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Former COO of insolvent German payments company Wirecard left for China after Philippines visit: report

Bloomberg

Former Wirecard COO Jan Marsalek arrived in Manila on June 23 and left for China from the central Philippine province of Cebu the next morning, CNN Philippines reported, citing Justice Secretary Menardo Guevarra.

Details of Marsalek's arrival and departure were on the Bureau of Immigration's database, although there were no signs of Marsalek in Cebu airport's CCTV, Guevarra was quoted as saying.

The former Wirecard COO was with his Filipina wife, which explains why he was allowed entry despite travel restrictions due to the pandemic, according to the report. Marsalek is planning to turn himself in at the Munich prosecutor at the start of next week, Sueddeutsche Zeitung reported. Germany has issued an arrest warrant for him, according to Handelsblatt.

The National Bureau of Investigation will summon a Filipino national named as a Wirecard trustee, Guevarra was also quoted as saying.

Wirecard filed for insolvency on Thursday, following the arrest of its CEO amid a massive accounting scandal that left the German payment-processing firm scrambling to find over US$2 billion dollars missing from its balance sheet.

Phantom billions plunge payments group Wirecard into chaos

Wirecard management cited over-indebtedness as the reason behind the decision to seek court protection in Munich, according to a statement. The company also said it is considering whether the insolvency proceedings should also be applied to its subsidiaries.

Wirecard Bank is not included in the proceedings, according to a person familiar with the matter, who asked not to be named, as the situation is private. German regulator BaFin is responsible for deciding whether a bank should file for insolvency, although there are also other measures it can take when a lender runs into trouble.

The company's rapid fall from grace comes after it admitted that 1.9 billion euros (US$2.1 billion) went missing from its balance sheet, and is a major setback for Germany's burgeoning tech scene and a debacle for investors. In less than a week, the company once hyped as the future of German finance had seen its shares and bonds collapse and its former CEO Markus Braun arrested in an accounting-fraud probe after almost two decades at the helm of the company.

The insolvency proceedings leave Wirecard's creditors facing lengthy negotiations with administrators over how much they will get back out of the money they are owed following the company's implosion. Banks who lent to Wirecard including Commerzbank, ABN Amro, LBBW and ING have been demanding more clarity from the company in return for the extension of almost US$2 billion in debt.

The crisis began when Wirecard failed to publish its yearly report on June 18, citing the missing cash. In the ensuing days, Wirecard's stock and bonds collapsed after two Asian banks that were alleged to be holding the funds denied any business relationship with the company. Braun resigned on June 19, and was arrested by Munich prosecutors a couple of days later. He has been since released on bail.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2020 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2020. South China Morning Post Publishers Ltd. All rights reserved.