Merkel defends her promotion of scandal-hit Wirecard on China trip

By Theresa Muench and Andreas Hoenig, dpa

German Chancellor Angela Merkel on Friday defended her efforts to promote scandal-hit payments provider Wirecard during a China trip in 2019, saying there were no indications of “grave irregularities” at the time.

Speaking before an investigative parliamentary committee probing the shock collapse of Wirecard, Merkel denied giving any special treatment to the former German star company.

“The Wirecard AG did not receive any preferential treatment during the trip,” Merkel said.

Merkel said the goals of Wirecard at the time matched those of the government and that it was normal for the chancellor to promote the interests of German business during bilateral talks.

“Despite the press reports, at the time there was no reason to assume there were grave irregularities at Wirecard,” Merkel said.

Merkel confirmed that before her trip to China in September 2019 she had met with Karl-Theodor zu Guttenberg, a lobbyist for Wirecard who previously served as minister of defence and economics. But she said she could not recall if Wirecard was mentioned.

Wirecard, which had been listed on Germany’s DAX index of leading companies, admitted in June last year that 1.9 billion euros (2.3 billion dollars) in assets likely did not exist.

This in turn prompted a plunge in the company’s shares, bankruptcy and the arrest of former executives.

The prosecution believes that Wirecard had been cooking its books since at least 2015. Wirecard’s auditor EY however approved them year after year, prompting questions why the financial irregularities were never noticed.

More broadly, the revelations have cast doubts over the effectiveness of financial oversight authorities in Europe’s biggest economy.

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