Philippine banks deny holding Wirecard's missing $2.1 billion

Two of the largest banks in the Philippines denied doing business with German payments giant Wirecard, after claims of supposedly holding the latter's $2.1 billion missing money.

BDO Unibank and Bank of the Philippine Islands said on Friday, June 19, that the documents presented to them by its auditors were falsified.

"The document claiming the existence of a Wirecard account with BDO is a falsified document and carries forged signatures of bank officers," BDO said in a statement.

BDO CEO Nestor Tan said that a "rogue" employee falsified the documents, according to a report by Bloomberg.

BPI said that the documents were "spurious."

"Their external auditor presented to us a document that claimed that they are a client. We have determined that the document is spurious," BPI said.

After the denials of the two banks, Wirecard CEO Markus Braun resigned from his post on Friday. He will be replaced by James Freis in the meantime.

Braun had previously claimed that the scandal-hit firm may also be a potential victim of fraud.

Wirecard is facing a potential cash crisis. In-house auditor Ernest & Young had refused to sign off its 2019 earnings for the 4th time on Thursday, June 18.

EY was unable to locate the escrow accounts claimed to hold the missing billions for risk management – supposedly a quarter of their consolidated balance sheet total.

If the German payment firm would not able to post their financials on Friday, loans of as much as 2 billion euros ($2.24 billion) would be called in.

Bangko Sentral Pilipinas said Friday that it has launched a probe.

"The Bangko Sentral ng Pilipinas is aware of reports about German payment company Wirecard and is already investigating the matter.

The Financial Times published a series of investigations into Wirecard's accounting practices, particularly on inflating revenue through forged and backdated contracts.

The embattled company's shares plunged by 80% in the last two days, to around 22 euros as of Friday 1 pm Central Eastern Europe time.

Founded in 1999, Wirecard was seen as a figurehead for "fintech" companies that are upending the traditional world of banking and payments before its downfall. – Rappler.com

$1 = 0.89 euros

Aika Rey

Aika Rey covers the Philippine Senate for Rappler. Before writing about politicians, she covered budget, labor, and transportation issues.

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