Wirecard denies fraud allegations; shares surge

German online payments firm Wirecard has denied reports of alleged fraud at its Singapore office, revealing that an internal probe had found no evidence of criminal misconduct.

Concerns had been raised by an employee in April 2018 over “potential compliance breaches”. They related to breaches of accounting procedures in the period 2015-2018 totalling revenues of €6.9m and costs of €4.1m “as well as an internal transfer of software intellectual property valued at €2.6m”.

In response, an internal investigation was launched and had found “no evidence to support the allegations and concluded that they were unfounded,” Wirecard said in a statement on Monday.

“Furthermore, there were indications that the allegations could be related to personal animosity between the employees involved.”

A separate investigation, launched last May on Wirecard’s behalf by Singaporean law firm Rajah & Tann, is ongoing.

But Wirecard said: “To date, neither Wirecard’s internal compliance department nor Rajah & Tann have made any conclusive findings of criminal misconduct on the part of any officer or employee of the company.”

The statement provided Wirecard’s under-pressure shares with a much-need fillip, sending them 18% higher in early trading.

Last week the stock tumbled after reports in the Financial Times – which Wirecard called “misleading” – that a senior executive in the Singapore office was suspected of using forged contracts on several suspicious transactions. The FT also said that Rajah & Tann had identified “potential civil and criminal violations”. Around €7bn was wiped off the company’s value.

Meanwhile, Bloomberg reported on Monday that Singapore police were “looking into the matter”.

Analysts at Kempen & Co said: “In our view, the nature of the allegations involved concern an individual’s actions and if proven true, could result in a fine which is either S$1m, or twice the amount of misappropriated funds.

“However, we await further clarity by the company and investigation by Singaporean authorities as it is too early to conclude the impact of such allegations.”