Scandal-hit German payments giant Wirecard is currently facing a probe by the US Justice Department around whether it played a role in an alleged US$100mln fraud linked to an online cannabis firm.
According to a Wall Street Journal report, two individuals have been charged with fraud for allegedly working with payment processors to misdirect US banks and get them to approve card payments for cannabis products.
The FBI and the US Attorney’s office are reportedly investigating whether Wirecard acted in conspiracy with the firm as a foreign payment processor to help enable the illegal acts. Wirecard served as an intermediary for the digital business of the cannabis firm.
The WSJ also cited unnamed sources that said they were also looking into whether past and present Wirecard executives had also participated in the fraud.
Wirecard collapsed into insolvency in June after revealing what its auditor EY said were “clear indications” of “elaborate and sophisticated fraud…with the deliberate aim of deception”.
The unravelling began after the company admitted that around €1.9bn in cash was missing from its accounts which may have never existed in the first place.
Since then, the company’s former chief executive Markus Braun has been arrested on suspicion of false accounting and market manipulation, although the insolvency only affected the holding company and the operating business is still functioning.