Wirecard: “salami tactics” of the government in the finance committee

Wirecard: 'salami tactics' of the government in the finance committee

In the wirecard scandal, a committee of inquiry is drawing ever closer; in addition, the opposition is taking a closer look at the chancellor’s office.

The issue is why indications of money laundering at wirecard were missed or not dealt with at all, said lisa paus, grunen’s representative on the finance committee, to the deutsche presse-agentur: "we will take stock of the situation immediately after the special meeting on tuesday. So far, an investigative committee has become more likely with each passing day – but we like to be surprised by the federal government."Left-wing leader fabio de masi told dpa that a committee of inquiry was becoming increasingly urgent.

"The federal government is still acting according to salami tactics and not submitting crucial internal government documents," de masi stressed before a special session of the finance committee this monday. Paus criticized that so far the federal government has always squirmed around the crucial questions. "It is understandable that resentment is growing among the many investors and the public who have been damaged."

FDP chairman florian toncar said it was puzzling why the financial regulator bafin and the FIU, the federal government’s anti-money laundering unit, had not investigated wirecard much earlier and more sharply. "It is also unclear why the bavarian authorities are also completely in the dark," toncar told dpa. Wirecard has its headquarters in aschheim near munich. The FDP is also in favor of a committee of inquiry.

The now insolvent payment service provider wirecard had conceded air bookings of 1.9 billion euros in june. Munich public prosecutor’s office assumes that wirecard had been reporting fictitious profits since 2015 – and is investigating for commercial gang fraud. The damage to the lending banks and investors could add up to 3.2 billion euros, the company flew out of the L index dax. Key questions in the political review are when exactly the federal government knew about irregularities and whether it did too little about them.

SPD chancellor candidate olaf scholz again rejects criticism of bafin, which is under the supervision of his finance ministry. "Bafin immediately initiated the review of the group in february 2019 and instructed the accounting police responsible for it, the german accounting review board, to do so, just as it is legally required to do in such a case," he told the "rheinische post" (saturday). At the same time, he once again criticized the auditing companies, which fall under the responsibility of federal economics minister peter altmaier (CDU). "We must be able to assume that auditors, who employ many people with high daily salaries, sufficiently control companies like wirecard," scholz told the newspaper.

Green finance expert danyal bayaz, who is also a member of the finance committee, accused scholz of sharing responsibility. The finance minister is not expected to go through the balance sheets himself, bayaz told the "frankfurter allgemeine sonntagszeitung". Scholz, however, had to become politically active after information about wirecard landed with him.

Among others, representatives of the chancellor’s office, representatives of bavaria’s interior ministry and justice minister christine lambrecht (SPD) are to be heard this monday. Among other things, she is to be questioned about the planned reform of the audit and the criminal law on financial statements as a consequence of the wirecard scandal, as well as about possible contacts between the ministry and the auditing company EY. The company has been criticized for having audited and certified the annual financial statements of wirecard since 2009. Among others, the president of the federal financial supervisory authority (bafin), felix hufeld, is expected to attend tuesday’s meeting.

Left-wing leader paus stressed that it must also be clarified what the chancellor’s office knew about the case. Left-wing de masi sees open questions, above all, about a trip to china by chancellor angela merkel (CDU) in september 2019, during which she promoted the market entry of wirecard. Merkel had defended this on friday: "it is customary, not only in germany, to naturally address the concerns of companies when traveling abroad."At the time, the irregularities at wirecard were not yet known. At the same time, merkel stressed that "what happened there must of course be cleared up, that’s clear."

The left-wing leader said: "the line of defense is that merkel was working for a dax company and didn’t know about the irregularities at wirecard. But why is the communication with the ambassador not disclosed??"

Grunen finance expert bayaz also criticized the german stock exchange in the case for including wirecards in the leading dax index and called for a correction of the stock exchange rules. "The stock exchange must also examine the quality of the board of management and supervisory rates, and solid corporate governance is needed for the company to be promoted to the dax," he told the "F.A.S.".

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