German fintech company Wirecard was allegedly looted before its collapse in June, according to speculations from German prosecutors.
Even though the payments group denied claims of deception at the time, around $1 billion was moved to unclear partners, the Financial Times said in its news report on Friday.
The basis of the investigation are the loans granted to associate partners in Dubai, Singapore and the Philippines, which contradict the statements of former chief executive Markus Braun and other top ex-employees.
“According to people familiar with the probe and a document seen by the Financial Times, the embezzlement is suspected to have taken the form of unsecured loans, which Wirecard claimed were for advance payments to merchants processing card transactions through its partners in Asia,” the Times report reads.
Braun has rejected any act of alleged wrongdoing. Those arrested in the case last month, apart from Braun, were three former executives.
In June, Wirecard filed for insolvency after $2 billion went missing as The Block reported. At the time, the company was examining whether insolvency proceedings needed to be filed for its two subsidiaries: Wirecard Card Solutions and Wirecard Singapore. Both subsidiaries issue crypto Visa debit cards for corporations such as Crypto.com and TenX. The two companies told The Block at the time that their performance remained unaffected by the case.
The troubled German payments processor subsided in June under €3.5 billion of debt, which came to be known as one of Germany’s large-scale postwar accounting frauds.