‘Day of pain’: Wirecard boss denies charges in massive fraud trial

MUNICH, Germany – Wirecard’s former boss on Monday, February 13, denied all wrongdoing over the collapse of the payments company as he took to the stand for the first time in Germany’s biggest post-war fraud trial, accusing other managers of scheming behind his back.

Dressed in his trademark black turtleneck and rimless spectacles, Markus Braun, 53, expressed his “deepest regret” over Wirecard’s demise but said he had no knowledge of any forgery or embezzlement and believed he was running a healthy business.

The Austrian-born former chief executive and two other ex-Wirecard managers Oliver Bellenhaus and Stephan von Erffa are on trial on charges including market manipulation and fraud and face up to 15 years each in prison if convicted.

Former chief operating officer Jan Marsalek is an international fugitive on Europe’s most wanted list whose whereabouts are unknown.

Braun has been in custody since the 2020 collapse of Wirecard, which shook Germany’s business establishment, putting politicians who backed it and regulators who took years to investigate allegations against the firm under intense scrutiny.

“I had no knowledge of counterfeiting or embezzlement,” Braun told the court in Munich, describing the discovery of a 1.9-billion-euro ($2 billion) hole in Wirecard’s balance sheet as a “day of pain” for shareholders and employees.

Prosecutors accuse the defendants of being in a gang that invented vast sums of phantom revenues through bogus transactions with partner companies to mislead creditors and investors.

Braun’s lawyers have previously alleged that Bellenhaus was the main perpetrator of fraud at the company, which began processing payments for pornography and online gambling and rose to be a blue chip DAX company worth $28 billion.

‘Nothing to hide’

Bellenhaus, who became a key witness after turning himself in to the authorities, has painted Braun as an “absolutist CEO” calling the shots at the heart of a vast swindle.

In his most detailed statements about Wirecard’s collapse since his arrest, Braun pushed back against that characterization, describing his leadership as collegiate.

Instead, Braun accused Marsalek of constructing a “myth” that Wirecard’s finances were healthy while he and Bellenhaus tried to obstruct Braun’s attempts to hire KPMG as an external auditor as allegations of wrongdoing at the firm mounted.

By bringing in KPMG, the aim was to clear up “once and for all” allegations about balance sheet manipulation, Braun said. “I told Marsalek we have nothing to hide.”

When 1.9 billion euros went missing from the balance sheet, “Marsalek was very clever and understood how to explain that it was a mistake,” Braun said, speaking in the same calm and concentrated voice with which he used to address investor meetings and press conferences.

Matters came to a head in February 2020, Braun said, when Marsalek came to his office and revealed he had shifted billions of euros from Singapore to accounts in the Philippines without the knowledge of Braun or the company’s chief financial officer.

“I didn’t scream. It’s not my style,” Braun said, adding, “I can remember asking him if he had lost his mind.”

Braun said he had resolved to fire Bellenhaus and clip Marsalek’s powers, though the company collapsed before he did so.

Describing Marsalek as intelligent but somewhat withdrawn, Braun said he was only later made aware of allegations in the media that Marsalek had ties to the security services and ran a shadow business operation from a Munich villa.

Braun also batted away suggestions that he had asked private security contractors to harass journalists who were investigating his company.

He contrasted Wirecard’s demise with accounts of his early years at the company, describing a struggling startup where he and other managers pulled all-nighters and worked with a sense of mission. “There was in reality no life outside the company,” he said. – Rappler.com