Germany’s probe into the shocking collapse of payments firm Wire card reaches its climax on Friday, with Chancellor Angela Merkel appearing before the investigative parliamentary committee.
On Thursday, Merkel’s Finance Minister Olaf Scholz tried to shield the government from any blame, saying “the responsibility for this large-scale fraud does not lie with the German government’’.
Any suggestions that the government or regulatory authorities had protected Wire card were “absurd fairy tales,’’ he said.
Merkel had advocated for Wire card during a visit to China in September 2019, but had no knowledge at the time of any irregularities, a spokesperson said.
Wire card, which had been listed on Germany’s DAX index of leading companies, admitted in June 2020 that 1.9 billion euros (2.3 billion dollars) in assets likely did not exist.
This in turn prompted a plunge in the company’s shares, bankruptcy and the arrest of former executives.
More broadly, it leads to doubts about the effectiveness of financial oversight authorities in Europe’s biggest economy.
Questions also arose as to why EY, Wire card’s auditor, had not noticed the financial irregularities.