UK fintech firms forced to suspend services after Wirecard collapse
On Friday, the British FCA (Financial Conduct Authority) had
suspended activities of the scandal-hit German payments firm Wirecard AG’s UK
units, which in turn led to a havoc-scale chaos on the British firms which were
relying on the beleaguered German payment firm’s services.
In point of fact, latest move from the British FCA came
forth a day after the German payment processor, once the second-largest fintech
firm in Europe, Wirecard AG had filed for an insolvency in a Munich court
citing nearly €4 billion in debts that came up alongside its missing €2
billion, a search for which had hit a dead-end in the Philippines after the
Southeast Asian country’s Central Bank Governor said earlier this week that the
money had never entered into the country’s financial system, while the payments
firm’s decade-long auditor EY was quoted saying yesterday that Wirecard AG had
fabricated a number of escrow documents and sent them to relevant authorities
alongside securities exchange commission, raising possibilities of a number of
legal actions including market rigging and financial fraud.
Besides, as UK FCA decision to suspend all of Wirecard units
in Britain had forced a number of UK-based fintech companies to process
payments or to access their money, thousands of customers were reportedly
complaining in the social medias on whether they would be able to get their
money back.
Meanwhile, as a number of customers of British fintech firms
such as ANNA were unable to access their accounts following the latest move of
UK FCA, in a statement on Friday, the UK FCA was quoted saying that its
so-called safe-guarding rules would protect and return customers’ money, should
a firm collapse.
In factuality, owing nearly €4 billion to its creditors
following termination of its roughly €2 billion debts deals last week after
reveal of the missing money from Wirecard AG’s 2019 balance sheet, the German
payments firm, whose shares had pummelled nearly 99 per cent since the
disclosure of the fraud, had sent a wake-up call to the German financial
watchdogs, urging for an immediate overhaul to avert similar events.
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