German MPs quiz Merkel, ministers over Wirecard scandal

BERLIN (AFP) – German lawmakers probing the collapse of payments firm Wirecard are this week grilling top ministers and even German Chancellor Angela Merkel as a Parliamentary inquiry into the massive fraud reaches a dramatic climax.

Finance Minister Olaf Scholz, who has described the Wirecard scandal as “unparalleled” in Germany, found himself in the hot seat yesterday, two days after Economy Minister Peter Altmaier appeared before the Parliamentary committee.

Lawmakers are investigating the political and regulatory failings that allowed the Wirecard cheating to go unnoticed for years, with critics saying early warning signs were ignored.

Once a rising star in the booming fintech sector, Wirecard filed for bankruptcy last year after admitting EUR1.9 billion was missing from its accounts.

The company’s former chief executive officer Markus Braun and several other top executives were arrested on fraud and money-laundering charges.

The focus on politicians’ roles in the drama comes at an awkward time for Merkel’s ruling conservatives and their Social Democratic (SPD) coalition partners, five months before a general election.

Once a rising star in the booming fintech sector, Wirecard filed for bankruptcy last year after admitting EUR1.9 billion was missing from its accounts. PHOTO: AFP

Outgoing chancellor Merkel will be quizzed over her role in the scandal today, after it emerged she promoted Wirecard on a trip to China in September 2019 when the firm was eyeing a foray into the Chinese market.

Her intervention has raised eyebrows because journalists were already voicing doubts about Wirecard’s books at the time.

Merkel should ask herself whether “promoting Wirecard was really appropriate or whether her office should not have looked into the warning signs earlier”, said MP from the pro-business FDP party Frank Schaeffler, who is on the committee.Also accused of being too slow to react is Merkel’s would-be successor Scholz from the centre-left SPD, whose Finance Ministry oversees banking regulator Bafin, which has come under fire for its lax oversight of Wirecard.

That, in turn, “raises the question of the political responsibility of Olaf Scholz and his state secretaries”, said conservative MP on the committee Matthias Hauer.

Some of those responsible have already lost their job, including former Bafin chief Felix Hufeld, who was dismissed in January.