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Singapore police looking into alleged irregularities at payments firm

Singapore

THE Singapore Police Force (SPF) is looking into reports by the Financial Times of alleged financial irregularities at German digital payments firm Wirecard.

Last week, the newspaper published two reports about alleged wrongdoing at Wirecard's Singapore office that sent shares in the member of the blue-chip DAX falling the most in more than a decade last Friday.

"The Police are looking into the matter," a spokesman for the SPF said in response to an e-mailed question from Reuters about the reports.

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Wirecard's 25 per cent plunge - the worst since July 2008 - capped a tumultuous three days that shaved about 7.2 billion euros (S$11.15 billion) off the company's market value, despite repeated denials of wrongdoing.

Last Friday, the Financial Times reported that an external law firm commissioned by Wirecard found evidence indicating "serious offences of forgery and/or of falsification of accounts".

Rajah & Tann lawyers identified potential civil and criminal violations in Singapore, Hong Kong, India, Malaysia and Germany, findings that formed the basis of a presentation to Wirecard's senior management on May 8 last year, the newspaper said, citing the law firm's report.

Wirecard denied the story, calling it "inaccurate, misleading and defamatory".

"It is untrue that Rajah & Tann Singapore has ever uncovered any findings of material misconduct of any Wirecard employee in matters of accounting practices," Wirecard said, adding that no presentation was made to senior management on the matter on May 8 last year.

Rajah & Tann is among Wirecard's legal advisers and regularly conducts "compliance and governance related advisory work," the payments company said.

Earlier last week, Wirecard denied claims made in another FT report that alleged executive fraud originating at the Singapore office, fuelling concerns about the fast-growing company's practices. The stock closed 13 per cent lower last Wednesday.

German financial regulator BaFin is looking into the allegations for signs of possible market manipulation.

On Friday, BaFin spokesman Anja Schuchardt said the regulator is at the beginning of its investigation and will take the new report into account.

Founded in 1999, Wirecard initially provided financial services to online gambling and adult websites, barely surviving the dot-com bust.

After a decade of growth, the company last year replaced Commerzbank in Germany's benchmark DAX index.

This is not the first time Wirecard has had to defend its reputation. Its shares plunged after past claims were published about accounting irregularities in 2008 and fraud allegations in 2016.

But analysts have stayed true to the company, with 79 per cent recommending investors buy the stock, according to data compiled by Bloomberg. REUTERS, BLOOMBERG