The Wirecard trials in Germany continue unperturbed despite the confusion surrounding the espionage affair involving former Management Board member Jan Marsalek. Four years after Wirecard collapsed, former chief financial officer Alexander von Knoop and former chief product officer Susanne Steidl have been charged with breach of trust. The charges are part of the ongoing investigation into one of Europe’s largest accounting scandals.
Allegations and Charges
Prosecutors accuse von Alexander von Knoop and Susanne Steidl of failing to meet their legal obligations to Wirecard by approving over €100 million in potentially fraudulent loans to sham companies controlled by a business partner of Jan Marsalek, Wirecard’s fugitive chief operating officer. Some of these funds were allegedly funneled to Marsalek, who used them to repay a private loan from former chief executive Markus Braun.
The charges against von Knoop and Steidl are less severe than those faced by Braun and two other executives — former head of accounting Stephan von Erffa and Oliver Bellenhaus, the head of Wirecard in Dubai. These three have been charged with fraud, market manipulation, and accounting manipulation. However, if found guilty on all counts, von Knoop and Steidl could still face up to 15 years in prison.
Wirecard’s Collapse and Financial Woes
Wirecard collapsed in June 2020 after revealing that half its revenue and €1.9 billion in corporate cash did not exist. At its peak, the company had a market capitalization of €24 billion. When it collapsed, Wirecard had over €3 billion in debt. Among the questionable financial activities, Wirecard gave a €100 million loan to a Singapore-based company controlled by Marsalek’s business partner, James Henry O’Sullivan.
This loan consumed a significant portion of Wirecard’s remaining liquidity shortly before the company declared insolvency. O’Sullivan has since been charged in Singapore with Wirecard accounting fraud.
Prosecutors’ Statements and Legal Proceedings
Munich prosecutors have deemed the €100 million loan “unjustifiable” and allege that von Knoop and Steidl “obviously and grossly violated their duties to Wirecard,” resulting in financial damage amounting to “several hundred million euros.”
Braun and von Erffa have denied all allegations against them, while Bellenhaus has admitted the charges and become a chief witness for the prosecution. The trial of Braun, von Erffa, and Bellenhaus is expected to continue until at least mid-2025.
