The Wirecard scandal revisited, two years later
Wirecard was once a multi-billion-dollar financial services company that functioned like PayPal in Europe. Brought down by a spy novel-esque scandal peaking in 2020, the now-defunct German payments company is the subject of a new Netflix documentary, “SKANDAL! Bringing Down Wirecard.”
The film unravels the true story of an investigation by journalists at the Financial Times into the formerly DAX-listed company long accused of dodgy accounting practices. Their reporting ultimately led to the collapse of Wirecard–the company filed for insolvency in June 2020, owing creditors several billion dollars and disclosing another $1.9 billion missing entirely.
“Marketplace Morning Report” host David Brancaccio spoke to Dan McCrum, an investigative reporter at the Financial Times whose story is a major part of the documentary.
The following is an edited transcript of their conversation:
David Brancaccio: For those unfamiliar here in the U.S., what can we call Wirecard? Is it like PayPal but based in Europe or something?
Dan McCrum: That’s pretty much it. It was a big, successful technology company which has something to do with moving money around and credit card payments.
Brancaccio: So you and your team found evidence of shenanigans, corruption and fraud big time, give us a taste.
McCrum: Shenanigans is putting it lightly. I started to look into it. And I thought its numbers didn’t really add up, it looked a bit fraud-y, shall we say. And the strange thing was, the more I dug, the stranger and more bizarre the story gets. So I think I’m looking into a company. But then private detectives are following people around, hackers are trying to break into our email. And we start to realize Russian spies are maybe hanging out with the guys who were running the company.
Brancaccio: Now I want to understand this a little better, you start reporting on this. But you start spotting the signs that somebody, maybe the company, is spying on you?
McCrum: I start writing these stories saying, “I’m not sure about this company’s accounts.” Things start to heat up and we start to discover that there’s this team of 30 private detectives who are running around London trying to get photos of our sources, you know, talking to journalists colluding to try and bring down this big technology company. And it’s kind of like, I don’t know if you’re familiar with the Theranos story, but it’s a bit like that just on steroids.
Brancaccio: Yeah. And there are echoes of Enron, but I don’t think they had any of the Wall Street Journal guys followed who were working on that story. But you’re saying there was more, that it becomes an official investigation into your team and the paper–police are getting involved?
McCrum: Yes, it was this very large German company. And we start publishing stories saying there’s fraud happening inside here. And what the German government does is step in to protect the company. They banned speculation in the shares. And then they started investigating me and my colleagues for market manipulation. They are convinced we’ve been leaking our stories to speculators so they can use them to profit.
Brancaccio: And you’re not.
McCrum: No, I should say very clearly. No, we’re not. They’re rather embarrassed about that whole thing now.
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