THELOGICALINDIAN - The collapse of a payments aggregation in what some are calling German Enron will abnormally appulse the crypto industry
The German payments aggregation Wirecard is branch to cloister to book for defalcation afterwards affable the books for over $2.1 billion. The close issues debit cards for Crypto.com and Wirex users, but Crypto.com’s CEO says chump funds are safe.
How Wirecard Collapsed
Last week, acclaimed banking accountant Ernst & Young (EY) refused to assurance off on Wirecard’s banking statements, claiming there was bereft affirmation for $2.1 billion on the firm’s antithesis sheet.
The company’s banal crashed; it’s aberrant that auditors acquisition a cogent alterity with a company’s accounts. A day later, the company’s CEO, Markus Braun, resigned. Braun had served as CEO for about 18 years.
The bearings bound deteriorated, and authorities smelled fraud. Braun was arrested on June 23, and Wirecard issued a account adage the missing $2.1 billion apparently never existed.
This artifice is annihilation new. It dates aback to October 2019 back the Financial Times wrote a hit allotment that the company’s sales and balance were fraudulently inflated. Two months later, adumbral affairs apropos Wirecard’s banknote balances were revealed by the Financial Times.
But the aboriginal actual affirmation of artifice came from KPMG, addition accounted auditor, that the close didn’t accommodate acceptable affirmation to altercation the claims fabricated by the Financial Times.
Wirecard abandoned this, countering that KPMG’s analysis didn’t ascertain any incriminating information. The jig is assuredly up, and Wirecard has filed for insolvency. Unfortunately, the furnishings of this could aperture into the cryptocurrency industry.
Crypto Card Provider
The European payments business is additionally the article abaft Crypto.com and Wirex’s debit cards. According to reports, a majority of these cards are issued by two subsidiaries of the Wirecard Group: Wirecard Singapore and Wirecard Solutions (based in the UK).
The fate of these two subsidiaries is still unknown, as the company’s defalcation advertisement states they are evaluating “whether defalcation applications accept to be filed for subsidiaries of Wirecard Group.”
Kris Marszalek, the CEO of Crypto.com, took to Twitter to bright the air.
User funds in the Crypto.com wallet are safe, but affairs may abort due to Wirecard’s demise. Marszalek has reminded, however, that afflicted Crypto.com users will be fabricated accomplished if charge be.
Disclosure: Crypto.com is a sponsor of Crypto Briefing.
