Shortly before bankruptcy: Bafin employees traded Wirecard shares

In the months before the Wirecard bankruptcy, employees of the financial supervisory authority Bafin increasingly traded in shares of the scandal group. That comes from a response from the Federal Ministry of Finance to the Greens – and not only that: Wirecard had another prominent advocate in addition to Guttenberg.

Employees of the Federal Financial Supervisory Authority (Bafin) traded in the months before the multi-billion Wirecard bankruptcy increasingly with papers from the payment provider. In the first half of 2020, 2.4 percent of all reported private financial transactions by Bafin employees were transactions with Wirecard shares or share derivatives, according to Reuters' answers from the Federal Ministry of Finance to a catalog of questions from the Greens. They are anything but satisfied with the answers given by the federal government. Green parliamentary group leader Anton Hofreiter considers a committee of inquiry to be "almost inevitable" in order to be able to clarify the background to the scandal, which has reached the highest political levels.

The proportion of Bafin employees who bought or sold Wirecard shares was only 1.2 percent in 2018 as a whole, and 1.7 percent in 2019. SPD finance minister Olaf Scholz and the financial supervisory authority responsible for BaFin are criticized for the Wirecard scandal. The increase in trade in Wirecard papers in the first half of 2020 (2.4 percent) was explained by BaFin with the higher fluctuations in the share price due to media coverage and the company's ad hoc reports, according to the answer from the Federal Ministry of Finance. The increased Wirecard share transactions by BaFin employees are "not unusual or not conspicuous" compared to other Dax values, where volatility has increased.

According to the Ministry of Finance, around 20 percent of Bafin employees reported private financial transactions in 2019 and the first half of 2020. They were all approved by the line managers. This confirmed that there was no knowledge of inside information for private financial transactions.

Share crashed from 200 to 1.43 euros

In the first half of 2020, 58 percent of the company's equity derivative transactions were acquisitions and 42 percent were disposals. The extent to which BaFin employees have bet on exchange rate losses by selling short cannot be determined. No information is available on this.

Wirecard had to file for bankruptcy at the end of June. The investigators accuse former CEO Markus Braun and other managers of having inflated the payment provider's total assets and sales through sham deals at least since the end of 2015. The main person responsible for the billion-dollar fraud is ex-sales director Jan Marsalek. The Austrian has gone into hiding since the scandal became known.

On the basis of the sham deals, banks and other investors provided the financial services provider with a total of 3.2 billion euros. The money is likely to be lost. Wirecard, which only rose to the Dax in September 2018, will be out of the German benchmark index in August. The share, which was once quoted at almost 200 euros, fell on Thursday by eleven percent to 1.43 euros.

The request from the Greens also brings another prominent advocate of the scandal group to light: When it comes to lobbying, Wirecard also relied on the contacts of the former CDU mayor of Hamburg, Ole von Beust. As can be seen from the answers given by the Federal Government to the Greens parliamentary group, von Beust turned to Chancellor Angela Merkel's economic advisor, Lars-Hendrik Röller, in March of this year.

Ex-politician von Beust also did lobby work

The former top politician acted accordingly in his capacity as a member of the von Beust and Coll. Consulting company. He wrote to Röller on behalf of Wirecard and asked "for more detailed information on the EU-China summit planned under the German EU Council Presidency in Leipzig (including a possible accompanying program for companies)".

According to the information provided by the German government, Röller replied a good week later that the preparatory work for the summit was with the President of the European Council, Charles Michel. So far, there are no concrete plans to involve companies. The EU-China summit has since been canceled due to the corona pandemic.

The Beust & Coll consultancy. confirmed the commitment to Wirecard the "Spiegel": "We worked for Wirecard AG from June 1, 2018 to July 13, 2020," said a spokesman for the magazine. "We ended the business relationship." On June 26th, Wirecard filed for bankruptcy against the backdrop of a billions in balance sheet fraud scandal.

Answers for riders "sobering"

The Greens are disappointed that their questionnaire no longer provides answers to the Wirecard scandal. The answers to a total of 89 questions brought "hardly any new knowledge", were "often succinct or subject to secrecy", criticized the Green finance politician Lisa Paus. "Nothing new was revealed" about the role of the Federal Chancellery and the secret services. A few weeks ago it became known that in addition to ex-defense minister Karl-Theodor zu Guttenberg, the former secret service coordinator Klaus-Dieter Fritsche had advertised the company in the Chancellery last year.

All that remained was the two further special meetings of the finance committee on August 31 and September 1, "in order to decisively advance the investigation". These should again be about the anti-money laundering authority of the customs, which recently came into the focus of criticism, said Paus. The Financial Intelligence Unit (FIU) has "become a symbol of chaos with authorities".

Green parliamentary group leader Hofreiter described the answers of the federal government to the "Rheinische Post" as "sobering". The federal government still does not seem to understand the full extent of this scandal, said Hofreiter. In his opinion, the establishment of a committee of inquiry would be "almost inevitable".