Wirecard operations cease in Singapore, MAS slaps down more charges
Singapore’s central bank, the Monetary Authority of Singapore (MAS), has ordered Wirecard SG to cease operations throughout the country.
It has instructed the German payment fintech’s subsidiary, whose parent slipped into insolvency in June, to return all customer funds within the next two weeks.
Since slipping into insolvency, Wirecard AG has seen its former CEO arrested twice, the owner of one of its business partners reported dead in the Philippines, and its former chief operating officer become the centre of an international manhunt.
The end of Wirecard SG
In June, following the collapse of its German parent, the MAS moved to safeguard Wirecard SG’s customer funds. This was because the Singaporean business was unable to continue providing payment processing services to a significant number of merchants.
The regulator has since been instructing Wirecard SG to deposit cash in banks in Singapore. It has also asked the Wirecard subsidiary to assist customers with switching to alternative providers.
Now, the regulator has put a time limit on the wind down.
“MAS has assessed that it is in the interest of the public for Wirecard SG to cease its payments services and promptly return all customers’ funds,” says the central bank in a statement this week.
Wirecard partner slapped with more charges
At the same time, MAS has slapped a further five charges on Singaporean R. Shanmugaratnam. He faces a total of 11 charges.
Shanmugaratnam is the director of Citadelle Corporate Service – a firm which reportedly handled money for Wirecard in a trustee capacity.
Citadelle is one of two companies the Singapore authorities are investigating. Despite acting in a trustee capacity for Wirecard, it is not licensed to provide such services in Singapore.
The company is also not supervised by the MAS. This is why the regulator has listed the firm on its ‘Investor Alert List’ on its website.
Shanmugaratnam allegedly faked letters in early 2017 which stated false balances held in his company’s accounts. The new charges come as more letters are uncovered.
Citadelle sent letters to Wirecard UK & Ireland, Wirecard AG and Cardsystems Middle East – Wirecard’s largest subsidiary which it liquidated in May. In these letters, it falsified account balances of tens of millions of euros.
Wirecard flash sale so far
Since its collapse, Wirecard AG has seen its subsidiaries either bought off, liquidated, or put through administration pending a sale.
Change Financial, a US fintech listed on the Australian Stock Exchange (ASX), is in the midst of raising capital to acquire Wirecard’s Australia and New Zealand business.
The payments and card issuing firm has signed a binding agreement to acquire all the assets of the business for AUD 7.8 million ($5.7 million).
Wirecard’s UK subsidiary – Wirecard Card Solutions (WCS) – sold to PayrNet, a subsidiary of London-based Banking-as-a-Service (BaaS) provider Railsbank.
PagSeguro Internet – a wholly-owned and fully-controlled subsidiary of PagSeguro Digital – signed a binding agreement to acquire 100% of Wirecard Brazil SA.
Neither PayrNet nor PagSeguro have revealed how much the sales cost them. But with Wirecard’s Australia and New Zealand business standing at a price tag of just $5.7 million, it’s likely these deals were similarly cheap.
In August, Wirecard AG terminated 730 of its employees, along with remaining board members.
These terminations, which account for more than half of its staff, affect its core business and its subsidiaries. About 570 employees, including 350 at Wirecard’s insolvent subsidiaries, remain in employment.