Former Wirecard CEO Markus Braun Arrested
As the German payments company falls deeper into scandal following a €1.9 billion balance sheet hole, its former CEO has been arrested on suspicion of fraud.
Munich prosecutors confirmed on Tuesday that former Wirecard CEO Markus Braun has been arrested on suspicion of creating false transactions to artificially inflate sales and balance sheets, making the company appear more attractive to investors and customers.
Braun turned himself in on Monday evening after a warrant for his arrest was issued. Three other managers at Wirecard remain under investigation.
It emerged last week that EY auditors refused to sign off on Wirecard’s accounts for 2019, citing the absence of €1.9 billion that its balance sheet indicated was present. Allegations of fraud soon surfaced, and the company’s COO was suspended.
Once a star in the German financial sector, the fintech start-up is part of the Visa and Mastercard networks, currently employs over 6,000 people globally and was valued at €24 billion when it first joined the DAX 30. After news of the potential balance sheet fraud emerged last week, its value fell to less than €3 billion.
Braun resigned from the company on Friday following the discovery of the missing €1.9 billion, claiming that the firm had been “the victim in a substantial case of fraud”. He held the position of chief executive since 2002.
Wirecard’s share price rose by around 27% on Tuesday morning following news of Braun’s arrest.