Singapore police said Friday they raided the local offices of German payments processing firm Wirecard, following reports of fraud at the company that have sent its stock plummeting.
Stock in the star “fintech” firm, which sells software for cashless and contactless payments, sank more than eight percent in afternoon trading in Frankfurt after news of the raid broke.
It came a day after the Financial Times reported that two senior executives at Wirecard HQ knew of a so-called “round-tripping” scheme — in which cash was moved around between Asian subsidiaries to artificially pad the books — orchestrated in the group’s Singapore offices.
It was the third and most detailed report on the topic from the business daily since January 30.
The company told AFP on Friday that it had handed over documents to police in Singapore and intended to “continue to cooperate” with investigators.
It added that the firm was committed to “carry out its internal investigation and make the results public”.
“We repeat that the defamatory FT accusations against Wirecard employees are unfounded,” the company added.
Germany’s Bafin financial markets watchdog said last week it would launch a probe of its own into possible market manipulation after the FT reports.
Wirecard stunned the traditional German banking sector last year by displacing financial stalwart Commerzbank from the prestigious DAX index.
Hailed as a champion of the insurgent “fintech” (financial technology) scene, it then boasted a market valuation of more than 23 billion euros — outweighing even giant Deutsche Bank.
But since January 1, the stock has shed 22 percent of its value.