EY fined and banned over audits of failed payments in Wirecard Scandal

Germany’s accounting watchdog fined Wirecard’s 2016-2018 auditor, named EY in the company’s yearly reports, 500,000 euros ($541,650.00) and barred it from taking on new audits for businesses of public concern for two years on Monday.

In an email, EY stated that it had been told by APAS that an inquiry into the firm had been finished, but that it had not been advised on the specifics of the decision.

APAS said in a statement that it had sanctioned Wirecard’s accounting firm and five individual inspectors, without naming EY. According to Wirecard’s yearly report, EY was the auditor for that time frame.

Wirecard declared bankruptcy in June 2020, owing debtors nearly $4 billion, after revealing a 1.9 billion euro hole in its accounts, which EY claimed was the product of a complex worldwide fraud.

The business, which was established in 1999, began by handling funds for gaming and pornographic websites before rising to become a fintech powerhouse and a member of Germany’s blue chip DAX index.

According to APAS, the inspector committed breaches of duty in association with the incident.

The prohibition prohibits the auditor from engaging in contracts for audits of specific businesses for two years. This includes all publicly traded businesses as well as the bulk of the financial industry, which includes banks and insurance companies.