EU Opens Preliminary Probe Into Wirecard Implosion - Dombrovskis

EU Opens Preliminary Probe Into Wirecard Implosion - Dombrovskis

The European Commission asked the European Securities and Markets Authority (ESMA) on Friday to look into the scandalous collapse of German payments firm Wirecard, Commission's Executive Vice President Valdis Dombrovskis said

MOSCOW (Pakistan Point News / Sputnik - 26th June, 2020) The European Commission asked the European Securities and Markets Authority (ESMA) on Friday to look into the scandalous collapse of German payments firm Wirecard, Commission's Executive Vice President Valdis Dombrovskis said.

"We have today asked ESMA to carry out a preliminary investigation into what went wrong at @wirecard. We have also asked them to set out the possible course of action. Listed companies must be supervised effectively by national competent authorities," he tweeted.

Wirecard, a blue-chip company listed in Germany's national DAX index, has been caught up in an accounting scandal after $2.1 billion were found to be missing from its balance sheet. The company filed for insolvency on Thursday.

The probe puts a spotlight on German financial regulator BaFin. Allegations of irregularities at Wirecard surfaced years ago but BaFin filed a criminal complaint last year against Financial Times journalists who reported about possible fraud.

ESMA is expected to reply by mid-July, according to the UK daily. Dombrovskis told the paper that the German financial authority might face a formal process over breach of union law. If that is proven, BaFin could be ordered to change its practices.