CAD, MAS launch probe into Senjo, Citadelle following Wirecard review

Singapore

SINGAPORE's white-collar crime-buster and the Monetary Authority of Singapore (MAS) have launched a joint investigation into the Senjo Group of companies as well as Citadelle Corporate Services, following a review of developments relating to insolvent German payment processing company Wirecard.

The Commercial Affairs Department (CAD) and the MAS, in a joint statement on Friday, said that a review of the recent developments relating to Wirecard has given them reasons to suspect that offences may have been committed.

Citadelle Corporate Services and Senjo Group (including its units) are being investigated for suspected falsification of accounts as well as carrying on a trust business without a licence, said the statement.

Under the investigation, CAD and MAS had obtained documents and records from these companies, and had interviewed persons involved in them.

MAS said in the statement that it is aware of media reports alleging that Citadelle has handled money for Wirecard in a trustee capacity. The provision of trust services as a business in Singapore is an activity regulated under the Trust Companies Act, MAS added.

Citadelle is not licensed to provide such services in Singapore, and is not supervised by MAS. The regulator has placed Citadelle on the Investor Alert List on its website.

MAS and the Accounting and Corporate Regulatory Authority (Acra) are collaborating with CAD to scrutinise recent developments relating to Wirecard, after the payment processor collapsed last week and admitted that US$2.1 billion of its cash probably did not exist.

CAD has conducted a probe into Wirecard's Singapore operations since February last year.

Meanwhile, Bloomberg reported that Pine Labs - the Indian payments company backed by Temasek Holdings, PayPal and Mastercard - is considering a bid for Wirecard's businesses in South-east Asia and India, citing people familiar with the matter.

A potential bid is still at an exploratory stage, as there's no information available yet on the valuation and finances of Wirecard's Asian operations, said the people, who asked not to be identified as the information is confidential.

There's no certainty that Pine Labs will proceed with a formal bid, the people added.

The sale of Wirecard's businesses will be clouded by ongoing probes into its operations after the German payments firm was forced into insolvency by an accounting scandal.

However, several Wirecard's subsidiaries - including those in Asia - weren't part of the insolvency filing. The firm's administrators have said the assets are attracting interest from many global investors and a sale process involving investment banks is on the way.

Pine Labs is potentially interested in Wirecard's regional point-of-sale business, which handles merchants' payments transactions, one of the people said. That is Pine Labs' core business in India, and any acquisition of Wirecard assets would allow it to expand those operations further in South-east Asia, the person added.

Pine Labs chief executive officer Amrish Rau declined to comment in an emailed response to questions from Bloomberg News.

Singapore is home to Wirecard's Asia-Pacific headquarters and the company has been expanding aggressively in the region, which accounted for almost 45 per cent of the group's reported revenue in 2018, second only to Europe.

Pine Labs, founded by Lokvir Kapoor, processes US$30 billion of payments a year and serves some 140,000 merchants via 450,000 network points, according to the company's website.