Jan Marsalek claims third-party business survived Wirecard’s collapse

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Former Wirecard executive-turned-fugitive Jan Marsalek claims to have survived the collapse of the Asian operating payments group at the center of one of Europe’s biggest accounting scandals, a German court has been told.

The claim was made in a letter sent by Marsalek’s lawyer to a court in Munich, where Wirecard’s leading Markus Braun and two other former senior executives, Oliver Bellenhaus and Stefan von Erfa, are on trial on charges of fraud, embezzlement and market and accounting manipulation.

The unsolicited letter received earlier this month is the first known contact with Marsalek since the 43-year-old fled the country before Wirecard collapsed in June 2020.

Wirecard, once a big hope of Germany’s tech sector, failed after admitting that €1.9 billion in cash did not exist. German prosecutors and Wirecard’s administrator said the company’s outsourced operations in Asia, or so-called third-party acquiring (TPA) operations, were a sham.

Nico Werning, one of Braun’s lawyers, revealed Marsalek’s claim in court on Wednesday, who are seeking to have the letter treated as formal evidence in Germany’s biggest fraud trial.

According to Werning, Marsalek claims that the TPA operations “ultimately proved to be more resilient and crisis-proof than those of the (Wirecard) Group”, adding that it was able to process payments independently to the point of collapse of the Munich-based company. and they remain in operation.

Wirecard’s former second-in-command also claimed that over time the TPA business separated from Wirecard and at one point was not dependent on the group at all – “not even in terms of sales, finance and technology”, Werning told the court.

Prior to its implosion, Wirecard said it had sent payment-processing customers to its outsourcing partners in Asia to handle business from countries where it did not have its own licenses. The outsourced operations allegedly received royalty fees that were paid into bank accounts in Asia, which were later found to either not exist or to have never held such a large amount.

Marsalek claimed that the TPA business was set up in a way that was typical of the payments industry and consisted of “a structured international network of firms”.

In a forensic investigation in the months prior to the Wirecard failure, KPMG was unable to verify that TPA operations existed. Wirecard’s administrators and Munich prosecutors concluded that they were fake and fabricated in order to inflate the company’s share price and help it fraudulently raise more than €3 billion from banks and bond investors.

After Wirecard’s demise, its administrator failed to uncover any trace of the TPA business. A major argument pointing to the fact that it was invented is that no TPA customers ever accessed Wirecard after its collapse. In his letter, Marsalek claimed that this happened because the TPA business ceased to exist.

Marsalek is one of the world’s most wanted white-collar criminal suspects and has been on the run for three years after flying to Belarus on a private jet, telling colleagues he was heading to Asia to retrieve missing cash. German law enforcement officers suspect that he is hiding in Moscow. He is one of six Austrian citizens on Interpol’s “Red Notice” list, which records the world’s most wanted criminal suspects.

Marsalek’s claims about the TPA business seem to echo testimony from Braun, who has said the operations were genuine but that the proceeds were siphoned off without his knowledge. According to Werning, Marsalek said in his letter to the court that the TPA business has been in existence for more than a decade, processing a “large transaction volume.”

The court will later decide how to deal with the Marslake document.