Wirecard was a “sloppily completed fraud” conceived by a gaggle led by an “absolutist chief govt” bent on creating the phantasm that the German funds firm was extra profitable than it was, a former govt has advised a Munich court docket.

In much-anticipated testimony, Oliver Bellenhaus, the previous head of a Wirecard subsidiary and the prosecution’s chief witness, described the Munich-based firm as a “rip-off proper from the beginning” that was doomed to fail.

The 49-year-old, who led a Dubai-based enterprise on the coronary heart of the fraud, apologised for his personal position within the multiyear deception. “There isn’t a excuse for what I’ve completed. Nonetheless, I wish to apologise.”

In a halting voice, Bellenhaus advised the 5 judges that “it doesn’t come naturally to me to take accountability,” and that his personal position began with “minor transgressions” after which through the years ended with “felony acts”.

Wirecard collapsed in 2020 in one among Europe’s largest accounting scandals after revealing that €1.9bn in money and half of its income didn’t exist. Bellenhaus is on trial in Munich alongside Wirecard’s former chief govt Markus Braun and Stephan von Erffa, who was the cost group’s head of accounting.

The trio are charged with fraud, embezzlement, and accounting and market manipulation. If discovered responsible, they may withstand 15 years in jail. Braun and von Erffa deny wrongdoing.

Bellenhaus has spent the previous two-and-a-half years in police custody after travelling from Dubai and voluntarily reporting himself to authorities.

After the Monetary Occasions obtained inner paperwork from a Wirecard whistleblower in early 2019, “we had been combating a rearguard battle,” he advised the court docket.

Studying from a written assertion working to greater than 200 pages, Bellenhaus admitted that over a number of years he fabricated paperwork meant to indicate that Wirecard made €1bn in annual income from its purported outsourced funds processing operations in Asia.

Bellenhaus advised the court docket that every quarter he was briefed by Von Erffa in regards to the quantities wanted to offset the hole between the group’s inner targets and the efficiency of Wirecard’s actual operations. The deception was motivated by Braun, who was “obsessed” with reporting additional development by the corporate, Bellenhaus mentioned.

Neither “cash nor social status” had been his personal motivation for taking part within the fraud, Bellenhaus mentioned, however that Wirecard “was my id” and over time “small lies turned greater and greater”.

In his detailed and typically rambling assertion, Bellenhaus described a gathering with Braun, Jan Marsalek, Wirecard’s former second-in-command, and Von Erffa within the chief govt’s workplace in October 2019, shortly after KPMG had begun a forensic investigation of Wirecard’s books.

Bellenhaus mentioned that he advised the assembly it could be unimaginable to face up to the audit as KPMG was insisting on entry to detailed info on the so-called third-party buying (TPA) companies that didn’t exist.

“Braun mentioned it can solely be a semi-forensic audit,” Bellenhaus advised the court docket, including that the previous Wirecard boss defined he was already involved with KPMG’s chief govt and would be certain the Massive 4 agency performed a light-touch investigation.

Bellenhaus advised the court docket how he created mock IT techniques for the sham Asian operations, detailing how he relied on servers that had been decommissioned by the funds group in addition to some purchased on Ebay. The previous govt additionally revealed he had been involved that an IT audit by EY in 2019 would expose the sham.

“Not one of the TPA companions possessed the required regulatory licences to conduct their enterprise, and so they additionally lacked required IT certificates,” Bellenhaus mentioned. He identified that KPMG additionally missed it throughout its forensic investigation.

The prosecution’s chief witness additionally sought to refute the argument made final week by Alfred Dierlamm, Braun’s lawyer, who mentioned that, whereas the outsourced operations in Asia did exist, the proceeds had been embezzled by Bellenhaus and Marsalek.

Bellenhaus disagreed, accusing Dierlamm and Braun of “intentionally inventing new black containers which can be unimaginable to be investigated in years to return.”

The funds referred to by Dierlamm had been unrelated to the TPA, mentioned Bellenhaus, who spent greater than an hour of his testimony dissecting a number of of them.

The TPAs had no contractual obligation to do enterprise with Wirecard so might have simply severed ties within the run-up to the group’s collapse, Bellenhaus advised the court docket. He additionally identified that regardless of, on paper, processing billions of euros a month in funds, no shoppers of the TPAs ever sought to contact Wirecard after its failure.

Dierlamm, who final week filed a movement to droop the trial, took intention at Bellenhaus.

He advised the court docket that new paperwork, lately shared by prosecutors with the defence, confirmed that from late 2019 Bellenhaus began to switch private wealth to his spouse — funds that had been most probably embezzled from Wirecard. Dierlamm accused Bellenhaus of failing to reveal the transactions to prosecutors early in his co-operation with them.

The presiding choose Markus Födisch mentioned on Monday that the court docket would want extra time to resolve on Dierlamm’s movement to dismiss the trial. Ought to the movement be rejected, Braun would in all probability give testimony “within the second half of January”.

Bellenhaus’s testimony is anticipated to renew on Wednesday.


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