Wirecard Ex-C.E.O. Arrested on New Charges of Defrauding Banks


The former chief executive of Wirecard was arrested Wednesday on new charges after prosecutors in Munich said they had uncovered evidence that the insolvent payments company had used false accounting to defraud creditors of $3.7 billion.

The accusations significantly increase the scale of the financial wreckage left by Wirecard, and will add to the pressure on German regulators and outside auditors who failed to uncover irregularities despite warning signs going back more than a decade.

Markus Braun, the former chief executive, and two other former Wirecard executives were arrested early Wednesday after prosecutors “significantly widened” their investigation of the company, Anne Leiding, a spokeswoman for the Munich State’s Attorneys Office, told reporters.

Mr. Braun, who has contested the charges, had been free on bail since an earlier arrest on suspicion of accounting fraud and market manipulation in June, soon after Wirecard admitted that 1.9 billion euros, or $2.1 billion, that it claimed to have on its balance sheet probably never existed. He and two others, a former chief financial officer and a former head of accounting who were identified only by their initials, remained in custody after being brought before a judge on Wednesday, Ms. Leiding said.



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