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Mammoth task Wirecard process: punishing the guilty is not enough

Mammoth task Wirecard process
Punishing the guilty is not enough

A comment by Uli Reitz

In the mammoth proceedings for what is probably the largest accounting falsification in German economic history, the perpetrators are to be held accountable. But that’s not enough. Consequences must also be drawn. To strengthen the equity culture in Germany again.

More fairy tale hours in Munich? No, not this time. The prosecutors have taken precautions. They’ve been investigating for years. The indictment is 474 pages long. The charges against Markus Braun, the former CEO of the Dax group Wirecard, which collapsed in 2020, and two co-defendants are tough: balance sheet falsification, market manipulation, particularly serious breaches of trust and gang fraud.

Braun is the face of the scandal for observers – despite the presumption of innocence. The allegations against him and two other defendants were collected, evaluated and formulated down to the last detail over the years. The indictment alone, the part of the indictment that has to be read out orally at the start of the trial, is almost 90 pages long. Around five hours were estimated for the reading.

The burden of proof resulting from 450 interrogations and around 40 searches must be overwhelming. There is no other explanation for the fact that Braun has been in custody for around two and a half years. It will have to be clarified what Braun and the co-defendants knew and when they knew it. Did Braun just lie from the start? And what role did his submerged deputy Jan Marsalek play? Was Braun, whom wily communications consultants tried to position as the revenant of Apple mastermind Steve Jobs, totally overrated? Or was he completely incompetent and stupidly ignored all the warnings?

The mammoth trial is about much more

The proceedings in the bombproof courtroom in the basement of the Munich-Stadelheim prison will be about identifying the guilty party – and convicting them. But that is not enough. The mammoth trial is about much more. When the proceedings come to an end at some point, perhaps in 2024, there must be clarity as to what happened and how. How it was possible that a handful of managers could fool a complete and elaborate security system in such a way that investors and professional investors lost billions of dollars.

How could it be that even the federal government didn’t notice anything? How have financial regulators, prosecutors and the media been duped for so long? And why do auditors actually call themselves auditors if abnormalities do not provoke any consequences? Didn’t they really notice anything? Were they bribed? Or were they simply mercilessly naïve, motivated by the hope of lucrative follow-up orders?

This clarity is important. In order to rehabilitate the German capital market and to strengthen the share culture in Germany, which is repeatedly demanded. And also to adapt the security systems in the future so that such brutal fraud does not happen again. In the end, consequences must be drawn. Lest such an unprecedented fraud against shareholders, lenders and employees happen again.

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