The former CEO of German payment service provider Wirecard has been arrested amid an accounting scandal that centres on a missing sum of 1.9 billion euro (£1.7 billion), prosecutors in Munich said.
Markus Braun resigned on Friday after the company disclosed that auditors could not find accounts containing the 1.9 billion euro, and postponed its annual report.
On Monday, Wirecard said its management board “assesses on the basis of further examination that there is a prevailing likelihood that the bank trust account balances in the amount of 1.9 billion euro do not exist”.
Hours later it announced the sacking of its chief operating officer, Jan Marsalek, who had been suspended from the management board last week.
German news agency dpa reported that Mr Marsalek had been in charge of overseeing daily operations including in south-east Asia, where the suspected fraud occurred.
Two Philippine banks that were said to hold the money in escrow accounts said that they had no dealings with Wirecard.
The Bank of the Philippine Islands said a document claiming the company was a client was “spurious”.
BDO Unibank said that a document claiming the existence of a Wirecard account was falsified and “carries forged signatures of bank officers”.
The country’s central bank governor said none of the missing money entered the Philippines’ financial system.
Wirecard AG was once regarded as a star of the growing financial technology sector, but its shares have fallen sharply after the company became the subject of multiple Financial Times reports about accounting irregularities in its Asian operations.
Wirecard disputed the reports, which first emerged in February 2019, and said it was the victim of speculators.