Wirecard scandal: EY faces €1.5 billion lawsuit
Audit firm EY is facing another lawsuit in connection with the collapse of German financial firm Wirecard. Wirecard’s insolvency administrator, Michael Jaffe, has filed a claim for damages of €1.5 billion (approximately CZK 37 billion) against EY. This information was published by Reuters on Friday. EY acted as Wirecard’s auditor for several years and verified its financial records.
EY is facing several lawsuits in the matter and has denied claims for damages, claiming that Wirecard’s collapse was the result of sophisticated fraud with a global impact. Wirecard announced its insolvency in June 2020 when it emerged that it was missing some €1.9 billion (£47 billion) that had been shown on its books. Journalists and investors have previously expressed doubts about Wirecard’s financial situation.
Last week, Wirecard’s investors filed a lawsuit against EY demanding more than EUR 700 million in damages. Klaus Nieding, legal counsel for the investors, said that EY could easily have discovered that the €1.9 billion in Wirecard’s accounts did not exist, which was later confirmed very quickly by another auditor.
Wirecard was founded in 1999 and specialised in payment processing and financial services. In Germany, it was considered a promising player in the growing financial services market, was seen as an example of domestic success and was hailed as a star in the German technology sector. The company’s crash in 2020 also had an impact on clients in the Czech Republic.
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