Angela Merkel and the business pages

Cantillon: Chancellor lobs responsibility for Wirecard fraud into finance minister’s lap

German chancellor Angela Merkel:  “It was right that I mentioned Wirecard on the state visit. At the time, it was about improving access to the Chinese market.” Photograph: Clemens Bilan/EPA

German chancellor Angela Merkel: “It was right that I mentioned Wirecard on the state visit. At the time, it was about improving access to the Chinese market.” Photograph: Clemens Bilan/EPA

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Chancellor Angela Merkel once revealed that, when reading a newspaper, she always turns first to the business pages.

On Friday, as final witness at the Bundestag inquiry into last year’s meltdown of Wirecard, all we learned is that she is not a regular reader of the Financial Times.

Despite years of regular reports by FT journalist Dan McCrum into the shady dealings of the Munich payments company, the German leader claimed she had no idea of problems at Wirecard before its collapse last June.

So oblivious was she that, on a trip to China in 2019, she was happy to lobby for the company that, back then was the lone star of Germany’s fintech sky.

“It was right that I mentioned Wirecard on the state visit,” Merkel said. “At the time, it was about improving access to the Chinese market.”

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She insisted that what was known since the summer of 2020 about Wirecard – that nearly €2 billion if its balance sheet was invented – was “not known in 2018/19”.

‘Serious irregularities’

Despite ample FT reports to the contrary, she said there was “no reason to think there were serious irregularities” at the company.

Five months before federal elections end her fourth and final time in office, the German leader gently lobbed responsibility for postwar Germany’s largest corporate fraud into her finance minister’s lap.

Dr Merkel said she relied on the finance ministry to keep her informed of matters involving companies, particularly those playing a role in foreign visits. Germany’s finance minister Olaf Scholz, a witness on Thursday, is also lead candidate of the Social Democratic Party (SPD) in the autumn election. Given this, he is anxious not to let Wirecard hamper his chances.

China trip

On Thursday, MPs from Merkel’s Christian Democratic Union (CDU) insisted that, as ultimate head of financial regulator BaFin, it was Scholz’s job to carry the can. Leaked email correspondence on Friday showed how his ministry’s dossier for the chancellor ahead of the China trip was highly selective, with few detailed, critical reports on Wirecard.

Merkel, who always likes to be informed in detail about all parts of her political day, insisted she was ignorant about Wirecard.

“There is no 100 per cent protection against criminal behaviour,” she said. With characteristic understatement, she added there was “room for improvement” at Germany’s financial regular, and that the Wirecard meltdown was a “major setback” to Germany’s reputation as a financial centre.

As the last and final witness to wash her hands of the affair, the collapse of Wirecard has cost investors their shirts – but should not prove a setback to any German political careers.

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