- German Payment Processor, Wirecard, Collapses with £3bn worth of debt
- The news comes as Ernst and Young refused to sign off on its payment records from 2019.
From its Chief Executive being arrested on suspicion of market manipulation to the horrific admission to the regulatory body, Ernst and Young (EY), that £1.7bn of its case “probably did not exist.” The German payment processor and Fintech, Wirecard, has collapsed, leaving many holders of its associated Crypto Card in limbo.
Within Munich's court, the company stated that it would be filing, citing its “impending insolvency and over-indebtedness.” According to recent statements by both EY and Wirecard, this would lead to the 5,300 employees.
One of the interesting, yet disconcerting features of this collapse is that Ernst and Young, the corporate services and auditor, failed to press Wirecard for its financial history. An activity that took place over three years.
In addition to the collapse of Wirecard, its UK-based subsidiary, Wirecard Card Solutions, has been ordered to cease operations by the Financial Conduct Authority (FCA) the same day. Consequently, all cards issued by Wirecard have been deactivated, including those belonging to crypto services like Crypto.com, and TenX.
It proved to be a pretty embarrassing situation for both companies; however, tenuous links to Wirecard might be. For example, TenX and Crypto.com remained silent with the announcement by Wirecard of nearly £3bn in missing assets.
Both companies, however, have been outspoken is in their support of affected customers, however. Crypto.com's CEO, Kris Marszalek, has since announced that cardholders will be 100% reimbursed by the company within 48 hours.
TenX has since posted that customers will not see their assets affected by the recent collapse of Wirecard; reiterating that existing assets are safe, while also stating that it is currently working on getting their cards up and operational again:
“Please be reassured that all customer funds are safe and remain accessible as the TenX Wallet is unaffected…The TenX team is working to re-enable the affected services as soon as we can. We apologize for the disruption and will continue to provide updates to you whenever we have them.”
With the ongoing developments involving Wirecard, Crypto.com's Kris Marszalek has further added that it is also seeking alternative card providers to bring its card services up once again. This is according to a blog post the company provided recently.
“Separately, we're working on transferring the card program to a new provider, so that we can resume the issuing of cards in the UK and Europe and allow existing and new customers to benefit from our card program again.”
However, further requests for comment regarding the collapse or activities of Wirecard have not been met with comment.