Behind Wirecard’s Collapse: Allegations of Lies, Spies and Missing Billions

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Behind Wirecard’s Collapse: Allegations of Lies, Spies and Missing Billions

Markus Braun built Wirecard to "conquer the world,“ but those aspirations attracted skeptics. Its accounting scandal has sent shock waves through Germany.

Markus Braun, the chief executive of Wirecard, was arrested on Monday in Munich.Credit...Michael Dalder/Reuters

June 26, 2020Updated 2:50 p.m. ET

In the elite corridors of corporate Germany, Markus Braun had become a legend.

A little-known entrepreneur until just a few years ago, Mr. Braun had forged an obscure Bavarian company called Wirecard into a German tech icon, winning a coveted spot on the benchmark DAX stock index. Wirecard provided the invisible financial plumbing that, with a wave of plastic over a card reader almost anywhere in the world, made transactions happen. Hedge funds and global investors scrambled to buy shares.

When critics raised red flags about the company's seemingly miraculous success, questioning murky accounts and income that could not be traced, Mr. Braun, a methodical executive from Austria who was the company's biggest shareholder, hit back repeatedly, and the stock price skyrocketed.

But on Thursday, Mr. Braun's empire came crashing down after Wirecard filed for insolvency proceedings, days after the financial technology company acknowledged that 1.9 billion euros ($2.1 billion) that it claimed to have on its balance sheets probably never existed. Its longtime