An Post freezes 50,000 pre-paid cards in German Wirecard scandal

Listed director of Irish Wired unit faces questioning after collapse

An Post has frozen 50,000 pre-payment cards issued to customers over the past three years as the German Wirecard scandal spread to include Irish consumers.

The post office acted after the British Financial Conduct Authority, which regulates Wirecard Card Solutions Limited, ordered it to cease operating such cards.

Wirecard, a fintech company, said on Thursday that it was assessing whether certain subsidiaries of the business would have to file insolvency applications after a €1.9 billion hole was discovered in its accounts – amounting to a quarter of the company’s stated assets.

“All existing An Post Money Currency cards issued by Wirecard Card Solutions Limited have been suspended until further notice,” An Post said in a statement in Friday night after the British regulator’s announcement. “This means that they cannot currently be used by customers in Ireland or abroad.”


A spokeswoman for An Post could not say how much customers currently hold on the cards or how many are being actively used.

The An Post Money Currency Card is an An Post-branded prepaid Mastercard issued by Wirecard Card Solutions. Introduced in 2017, it allows customers to purchase and top up multiple currencies on a single card. Initially, the card offered just sterling and dollar options but this has since been expanded to include 16 different currencies.

An Post said it “greatly regrets this inconvenience to our customers” and was working to sort out what the impact would be for customers who hold money on the cards.

Industry sources said that, although there are 50,000 of the cards in circulation, they are generally used as a one-off and are rarely topped up with more funds for regular use.

The news came as former Wirecard chief operating officer Jan Marsalek, who is still listed as a director of the insolvent German payment company's Irish unit after being fired from his position earlier this week, plans to turn himself in for questioning to Munich authorities next week, according to reports.

Also on Friday, it emerged that EY, which audited Wirecard for a decade before its collapse, failed for more than three years to request supporting evidence for the company's claims that it had up to €1 billion in cash with a Singapore bank.

The once high-flying German fintech company Wirecard filed for insolvency on Thursday after admitting it had lost €1.9 billion from a largely fictional balance sheet. With its former chief executive Markus Braun facing a fraud investigation, and out of prison on €5 million bail, the company cited its unsustainable debt position as the reason for seeking court protection in Munich.

The company had seen its low-profile Dublin-based business, Wirecard Ireland UK, caught up an external investigation in recent months amid reports of accounting irregularities across a number of the group's international operations, including Singapore, Dubai and India.

Wirecard's board hired KPMG last October to investigate a series of allegations that had appeared in the Financial Times and other publications, alleging the company had reported higher revenues and profits based on fictitious customer sales.

One of the FT allegations was that a Wirecard partner company, Dubai-based Al Alam Solutions, a so-called third party acquirer which helps retailers accept credit card transactions, had routed sales in the names of suspect clients through subsidiaries of the German group in Dubai and Dublin. KPMG could neither verify nor disprove the claims, according to its report.

Mr Marsalek is listed as a director of Wirecard UK and Ireland. The company’s two other directors have not responded to efforts seeking comment.

Mr Marsalek is planning to turn himself in to the Munich prosecutor at the start of next week for questioning, German newspaper Sueddeutsche Zeitung has reported.

EY has come under fire after Wirecard filed for insolvency, revealing that €1.9 billion in held in bank accounts probably did “not exist”.

People with first-hand knowledge told the FT that the auditor between 2016 and 2018 did not check directly with Singapore’s OCBC Bank to confirm that the lender held large amounts of cash on behalf of Wirecard. Instead, EY relied on documents and screenshots provided by a third-party trustee and Wirecard itself.

The Big Four accounting firm had issued unqualified audits of Wirecard for a decade despite increasing questions over suspect accounting practices from journalists and short-sellers.

The German accounting watchdog FREP is probing Wirecard’s balance sheet, and Germany’s auditor oversight body APAS has begun looking into EY’s work. EY declined to comment on the regulatory investigation and details of its work. FREP and APAS declined to comment. – Additional reporting, The Financial Times, Bloomberg, Reuters

Joe Brennan

Joe Brennan

Joe Brennan is Markets Correspondent of The Irish Times