Posted on: December 13, 2022, 02:21h.
Last updated on: December 13, 2022, 03:17h.
Former Wirecard CEO Markus Braun’s attorney said Monday it was an “absurd” notion that his client was part of a “gang” that concocted a massive fraud. It was alleged they conned investors in the now-insolvent fintech giant.
Braun is on trial in Munich with two other former Wirecard execs, Oliver Bellenhaus and Stephan von Erffa, for charges that include market manipulation and “gang-related fraud.”
Braun’s former company grew from being a payment processor for the online gambling and porn industries to the leading light in German fintech, with a market cap in 2018 of €22 billion ($25 billion.)
Then it imploded.
In June 2020, auditor Ernst & Young announced it could not confirm the existence of €1.9 billion (US$2 billion) in cash balances mentioned in Wirecards’ accounts. This money was supposed to be sitting in trustee accounts at two Philippine banks. But the banks denied having a relationship with Wirecard.
Days later, Wirecard admitted the money was “missing” and likely “never existed” in the first place. German prosecutors have called it a “massive criminal act” to artificially inflate the value of the company to defraud investors and lenders.
And they argue Braun, as CEO, knew about everything that went on in the company.
Never Sold Shares
Braun’s lawyer, Alfred Dierlamm, noted Monday his client had never sold his Wirecard shares, which suggested he had not attempted to profit personally from the inflated share value and was oblivious to any impending catastrophe.
Braun was Wirecard’s largest shareholder, and actually increased his holding prior to the company collapse.
Dierlamm also said Braun had taken the initiative to bring in outside auditors to investigate the company’s finances.
It’s an absolutely absurd and erroneous notion that a gang leader would act like this,” Dierlamm said, as translated by the Associated Press.
Dierlamm claimed prosecutors were under pressure to find a culprit after the disappearance of Wirecard COO and fugitive Jan Marsalek. As Wirecard came crashing down, Marsalek flew to Berlarus. He is believed to be hiding out in Moscow under the supervision of the GRU, Russia’s military intelligence, with which he has connections.
Money ‘Siphoned Off’
Dierlamm also pointed the finger at Bellenhaus, who has admitted responsibility and is the prosecution’s key witness. But Dierlamm said Bellenhaus was “not a credible witness” and accused him of being the main perpetrator of the fraud with Marsalek.
The company’s outsourced operations in Asia did indeed exist. But the money was siphoned off into shell companies without Braun’s knowledge by Bellenhaus and Marsalek, Dierlamm argued.
The lawyer also filed a motion to suspend the criminal trial, claiming prosecutors had failed to properly investigate the case and had dumped “endless documents” on the defense on a weekly basis, allowing insufficient time to study them all.
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