Wirecard: Scandal-hit agency recordsdata for insolvency

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Scandal-hit funds agency Wirecard has filed for insolvency, inflicting its shares to dive almost 80%.

It comes after the German agency final week disclosed a €1.9bn (£1.7bn) gap in its accounts.

Former boss Markus Braun has since been arrested and accused of inflating Wirecard’s funds to make them seem more healthy to traders and clients.

The agency’s collectors stand to lose billions of euros from the scandal.

The controversy erupted final week when auditors EY refused to log off on agency’s firm’s accounts, having been unable to find the lacking €1.9bn.

The Munich based mostly agency, which employs almost 6,000 workers in 26 nations, initially claimed the cash was held in accounts at two banks within the Philippines.

But on Monday Wirecard mentioned the cash merely could not exist.

Investigation widens

In an announcement on Thursday, the agency mentioned its new administration had determined to use for insolvency at a Munich courtroom “due to impending insolvency and over-indebtedness”.

The agency can be evaluating whether or not to file for insolvency proceedings for its subsidiaries.

Wirecard, which was launched as a start-up in 1999, joined Germany’s prestigious Dax 30 share index two years in the past at a valuation of €24bn.

But the corporate’s shares have crashed almost 100% within the final week, giving it a inventory market valuation of lower than €400m.

The Munich prosecutor’s workplace, which is investigating Mr Braun, mentioned it had now widened its investigation to take a look at others.

Former chief working officer Jan Marsalek is beneath suspicion and believed to be within the Philippines, based on the Reuters information company.

Meanwhile, Mr Braun has been freed on bail of €5m and stays a suspect.