German MPs criticize Scholz and Merkel for Wirecard

German lawmakers have censured Finance Minister Olaf Scholz for the Wirecard scandal, saying he had political responsibility for the failure of financial supervision in Germany that the saga exposed.

The report by opposition lawmakers, which follows a months of parliamentary inquiry, also said that Chancellor Angela Merkel was “too naive” in terms of the technological society’s lobbying efforts, which fell into insolvency last June after admitting that 1.9 billion euros were missing from her accounts.

In addition to attacking the finance minister, the report blamed Wirecard EY’s auditor and the company’s supervisory board, saying they too had failed miserably in their oversight duty.

“The Wirecard scandal is much more than an accounting scandal,” the authors wrote. “It’s the biggest stock market and financial scandal in the world [Germany’s] post-war history ”.

They had been made possible, they said, thanks to a “collective failure of supervision,” a “German siege mentality toward non-Germans,” and “the desire for a digital champion that could enter the Chinese market.”

Scholz, who is the Social Democrats ’center-left candidate for chancellor in the September Bundestag election, declined to comment. In a statement, EY Germany said it had not received the report and could not comment on the content.

The 675-page document, drafted by the opposition Free Democrats (FDP), Greens and the hard-line left Die Linke, was published as dissenting opinion in the final report of the parliamentary inquiry, which is likely to be formed by the ruling party MPs – center-right CDU / CSU of Angela Merkel and SPD of Scholz.

While opposition lawmakers did not point to Merkel, they said she had been “shown to be too naive” in her dealings with one of Wirecard’s top lobbyists, a former defense minister. Karl-Theodor zu Guttenberg. He had convinced her to grow the company in conversations with Chinese officials during a 2019 trip to Beijing.

The report blamed on special guilt the Financial Intelligence Unit, Germany’s leading agency for the fight against money laundering and terrorist financing, and BaFin, the German financial watchdog. Both are controlled by the Minister of Finance.

“For every public allegation against Wirecard, BaFin has searched and found reasons to stand by,” the report said. He said the watchdog had “fully accepted the narrative” presented by Wirecard that the company was the “victim of an Anglo-Saxon conspiracy of short sellers and financial media”.

Deputies said BaFin’s reputation could be restored only because of a “cultural revolution”, adding that the “scale of observed shortcomings and shortcomings” had previously been “inconceivable”.

In particular, the report criticized the FIU and Rolf Bösinger, the secretary of state to the finance minister who was responsible for it.

MPs said the parliamentary inquiry was not properly informed about a highly detailed suspicious activity report that Commerzbank submitted to the FIU in February 2019. The report, and an explanation added by Commerzbank, detailed several dubious Wirecard transactions. . But the FIU only forwarded it to criminal prosecutors after the company’s collapse.

The inquiry learned only about the full extent of Commerzbank’s warning to the FIU after public broadcaster Bayerischer Rundfunk reported on the classified documents. MPs censured Bösinger for drafting key information in documents he submitted to the committee.

Deputies said Scholz and his deputy Jörg Kukies, who oversees the financial markets at the finance ministry, had the ultimate responsibility for “abuses of their subordinate authorities”.

Bösinger and Kukies declined to comment.

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