| A total of around $2B has simply "disappeared" -- as in, no one yet has been able to figure out what happened to it. I keep imagining a Monty Python-esque skit: "Was it stolen? We don't know." "Was it spent? We don't know." "Was it lent? We don't know." "Was it transferred? We don't know." "Was it burned? We don't know." Coincidentally, or maybe not, the company's last fictitious balance sheet, which was published in November of last year, right before the scandal was revealed, reports approximately $2B in long-term debt.[a] So, as much as Wirecard was in the business of processing financial transactions ($124B last year!), it was also secretly performing a magic act of borrowing money and making it disappear into thin air. In a way, it's been an "impressive" performance. On a more serious note, I hope Wirecard's failure is not seen in hindsight as a "Creditanstalt moment."[b] -- [a] https://ir.wirecard.com/download/companies/wirecard/Presenta... [b] The failure of Creditanstalt, an Austrian bank, in 1931, marks the beginning of the Great Depression in Europe: https://www.bis.org/publ/work333.pdf |
I’ll hazard that we’re seeing only the firsts in a wave of [cooked up] companies imploding.
[0] https://www.wsj.com/articles/massive-forgery-helped-hide-3-b...