Markus Braun, the former CEO of digital payment company Wirecard AG, made his first public appearance before a German court last week. The German digital payment company that was ran by Braun, folded after being accused of fraud. This ultimately wiped out billions in shareholder value for Wirecard, and halted German efforts to rival Silicon Valley by making its technology juggernaut.
Beginning of Long Trial
The case, opened by the Munich Regional Court earlier this week accuses Braun and two other co-defendants. The courtroom was packed with over 40 journalists, as the German public is anxious to hear the future proceedings.
Although the German people have already spent years searching for answers, the trial is set to proceed well into 2024 and maybe even some of 2025. This has to do with the five judges overseeing the trial as well as almost 1000 binders worth of documents.
Wirecard Fraud
There is evidence dating back to 2020. At this time, CEO Markus Braun was trying everything he could to portray Wirecard as a pioneer in the digital payment industry. Braun also argued that the accusations of Wirecard being built on fraud were simply made up. He said these were only rumors started by people trying to short-sell the stock of the company, as well as a journalist looking for the next big story.
However, Braun’s fictitious claims did not hold up for long. Wirecard initially mentioned $2 billion that they previously reported was mysteriously missing. Shortly after this news broke, the entire company crumbled. On June 25, 2020, Wirecard filed for insolvency.
CEO Markus Braun
Markus Braun was arrested and in custody before his company filed for insolvency. Braun has been incarcerated for almost two years now and has stayed out of the public eye. The last time Braun was seen by the German public was two years ago. He was being questioned by a committee in Berlin regarding all of the accusations.
Latest Court Appearance
On Thursday of last week, Braun appeared before the court where prosecutors read through approximately 80 pages of charges. Prosecutors stated that Braun and his co-conspirators intentionally set up an elaborate system of fake accounts to trick investors and credit providers into thinking Wirecard was a healthy business.
Prosecutor Statement
The head prosecutor on this case is Matthias Buehring, and he said the following during the court proceedings: “The goal was to inflate the balance sheet and the sales to make the company look financially stronger and dress it up as more attractive for investors and clients, They wanted to conceal that the real business of Wirecard was loss-making and the loans sought were needed to prevent its collapse.”
Wrap Up
When it comes to the collapse of Wirecard, this is something that could have been prevented by the German governemnt if they noticed the red flags that were prominently displayed in the company for years. Having a trusted accountant or advisor on your side will help you detect any “red flags” whether you are just filing taxes or looking to invest.