WIRECARD investigative committee: KPMG partner Geschonnek heavily charges EY

Plaintiff representatives see tailwind for pending civil proceedings against EY

On the evening of November 26, 2020, KPMG partner Alexander Geschonnek testified before the investigative committee of the German Bundestag. Alexander Geschonnek headed the 40-strong KPMG team that prepared a special report on WIRECARD's balance sheets from November 2019 to April 2020, which identified serious errors. Geschonnek's statement severely incriminates WIRECARD, and thus also the then responsible auditors of EY.

According to Geschonnek, KPMG was massively impeded in the preparation of the special report. Especially for the trust accounts in Asia no evidence was presented. According to Geschonnek, this applies to the years 2016 to 2018, which were three fiscal years for which EY issued unqualified audit opinions to WIRECARD for the annual financial statements. According to Geschonnek, it was not reasonable to certify the existence of these escrow accounts when applying common auditing standards. Geschonnek literally said: "We have worked with methods that every auditor usually works with". And when applying these usual methods, no sufficient evidence could be found for the trust accounts, which were last shown in the WIRECARD balance sheet with 1.9 billion EURO.

Lawyer Dr. Wolfgang Schirp, Berlin, who together with Dr. Marc Liebscher represents a large number of WIRECARD shareholders against EY: "Alexander Geschonnek's statement places a heavy burden on EY. So far, EY has taken the position that it has itself been the victim of fraud. Allegedly, this fraud could not have been uncovered with the usual methods of an auditor. According to Geschonnek, this line of defense of EY will not be upheld. Now it is clear: If EY had followed the usual duties of an auditor, the fraud with the trust accounts would have been uncovered years ago and the investors would not have suffered any damage. Under no circumstances should the audit certificates for the 2016 to 2018 financial statements have been issued. This is a further circumstance that provides considerable tailwind for our claims for damages".

For further information please contact us:

Dr. Wolfgang Schirp, Schirp & Partner Rechtsanwälte mbB, Leipziger Platz 9, D - 10117 Berlin, Tel. 0049-30-3276170 and 0049-179-5320213, mail: schirp@schirp.com, URL: www.schirp.com

Dr. Marc Liebscher, Dr. Späth & Partner Rechtsanwälte mbB, Kurfürstendamm 102, D - 10711 Berlin, Tel.: 0049-30-88701617 and 0049-176-93150194, mail: marc.liebscher@gmx.net, URL: www.dr-spaeth.com

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