JPMorgan, UniCredit Gave Germany Wirecard Tips That Went Nowhere

(Bloomberg) -- UniCredit SpA, JPMorgan Chase & Co., and Commerzbank AG were among banks which flagged suspicious transactions related to collapsed payments firm Wirecard AG but received little attention from prosecutors before the demise of the firm last year, according to evidence given to a German parliamentary investigation.

Italian lender UniCredit warned German anti-money-laundering authorities in early 2019 of a questionable transaction involving former Wirecard executive Jan Marsalek. Officials there passed the information to relevant prosecutors in Munich but were quickly informed that the case wouldn’t be followed up, the head of the Financial Intelligence Unit, Christof Schulte, told lawmakers on Tuesday.

The parliamentary inquiry, which has heard testimony from around 100 witnesses including Chancellor Angela Merkel, is seeking to determine how the unprecedented fraud by a company listed on the benchmark DAX index could go undetected for years and why authorities failed to intervene. Wirecard collapsed in 2020 after executives admitted that 1.9 billion euros ($2.3 billion) it had reported as assets probably never existed.

Commerzbank AG also informed the FIU in 2019 of suspicious transactions in which third-party companies were acquired for inflated values, the inquiry heard. Those were however not passed to prosecutors before the collapse of Wirecard as they were deemed to be in the remit of officials in countries where the transactions occurred, Schulte said.

In May 2019, JPMorgan told the FIU about suspicious transactions in Asia involving Wirecard subsidiaries which the money laundering authority did pass to Munich prosecutors, Social Democrat lawmaker Jens Zimmermann said. However, the allegations are still part of an ongoing investigation, he said.

On Monday, opposition parties presented a 675-page final report on their findings in the Wirecard investigation, calling it the biggest accounting and financial scandal in Germany’s post-war history. They blamed a “siege mentality” among authorities for failing to uncover the malfeasance.

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