The Monetary Authority of Singapore (MAS) has told bankrupt Fintech Wirecard (WDI.DE) to halt payment services in Singapore and to return all customer funds by October 14, 2020.
MAS states that it has been monitoring Wirecard’s bankruptcy proceedings and the ability of the company to provide services in Singapore. When word of the insolvency came out, MAS required Wirecard to keep all customer funds in banks in Singapore and to help customers transfer to alternative services.
Wirecard SG has since informed MAS that it is unable to continue providing payment processing services to a significant number of merchants.
Wirecard has emerged as a poster child for fraud and hubris. Once a Fintech darling and a member of the German DAX, Wirecard imploded when it was revealed that the payments firm could not locate €1.9 billion. Soon, Wirecard’s CEO Markus Braun was arrested for allegations of fraud and the COO, Jan Marsalek, disappeared leaving only a trail of questions. The former executive remains missing to this day.
Shares in Wirecard have submarined going from a 52 week high of €148/share to around €0.78/share today representing a spectacular collapse in corporate value. Bankruptcy proceedings are ongoing.
MAS says it 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, providing “the greatest certainty to customers on their appropriate course of action, including seeking alternative service providers.” Wirecard’s services were not licensed in Singapore as it fell under a grace period of newly enacted law that took effect at the beginning of 2020.
MAS notes that other forms of e-payments such as NETS, PayNow, and SGQR continue to be available.