The multinational professional services firm based in England, Ernst & Young (EY) is in hot waters after it has been accused of a big fraud concerning their major account – Wirecard.
This was after it has failed to point a big stash amounting to $2.1 billion dollars in one of its books.
EY has received criminal charges from its Shareholders’ associations because of this malpractice.
According to reports, 3 employees (two are current and one was a former worker) were involved in the conspiracy fraud. The criminal liability was done when these people were not able to flag the authorities and the investors about the steep drop in their client’s share card.
In an official statement from EY, it mentioned that the fraud was highly crafted and it covers parties worldwide being deceived.
The accounting ruse, moreover, were very knit that even extensive audit would not be able to scrutinize.
This connivance was an intense scene of a revelation that happened earlier this June when law firm Wolfgang Schirp had submitted charges against EY for its failure to report improperly booked transaction in Wirecard’s last 2018,
On the other hand, the stocks of Wirecard, which is sold at €3.50 (roughly $4) has soared 105 until some employees admitted that there is malpractice and this has been purposedly not declared to deceive investors and EY of the cash balances and inflow.
Germany’s top rank stock index. Wirecard is still a constituent member of the DAX 30, albeit filing insolvency recently.
In addition, this revelation has shaken the industry including Wirecard’s client thru its subsidiaries Wirecard Solution, who is a provider of the crypto payment card for Crypto.com and TenX.
These two companies have expressed ending their partnership with Wirecard.
In the meantime, EY has told its senior partners and clients to be transparent about what happened so its other clientele were informed about the scandal which aimed to mislead their internal and external relations.