The scandals linked to the German financial technology firm “Wirecard” and its insolvency proceedings have rocked the German financial sector. With an estimated €1.9bn hole in its balance sheet, an amount which has been claimed to have never existed, the company has now filed for insolvency. The group has filed their insolvency claim at the Amtsgericht (District Court) in Munich. The nature of the collapse of Wirecard has left many people asking questions. It has also left many of Wirecard’s investors, creditors and other interested parties needing legal representation in order to secure their rights in the forthcoming insolvency proceedings.
At Schlun & Elseven Lawyers we are experienced legal professionals in the field of insolvency law. For those creditors and investors in need of specialized assistance in this matter with Wirecard, make sure to contact us as soon as possible. Once we have the information and facts of your case in order, we can proceed with providing the legal counsel and representation needed. Use the form below, our email address firstname.lastname@example.org or our contact number +49 221 93295960 to find out more about how we can help you.
Insolvency of Wirecard and Consequences for Creditors and Investors
The insolvency of Wirecard is of great significance. Wirecard is the first member of the German stock index (DAX) to file for insolvency in its more than 30 years. This Wirecard card is also one in which many serious insolvency criminal actions would appear to have taken place. Earlier this week, the former CEO of Wirecard, Markus Braun, was arrested on suspicion of falsifying the company’s accounts to make it more appealing for investors. Mr. Braun presented himself to the police before being released on bail of €5 million. The Munich prosecutor’s office has stated that they are looking into “all possible criminal offenses” in this case.
With the artifical boost that was given to the firm due to its apparent “creative accounting”, there are avenues open to creditors and investors who will be hit by this insolvency. With claims soon to start coming against Wirecard, it is crucial to get your claim in and to follow the appropriate procedures. Incorrect filing procedures can lead to issues further down the line when it comes to accessing the amounts owed. Our article on “Insolvency Proceedings Filing Claims in Germany” outlines the steps required in greater detail. Getting your claim in early will provide you with the greatest chance of receiving some return for the amounts invested. However, due to the size of this bankrupcy it is likely that getting the return will take a long time.
For investors and creditors this Wirecard insolvency scandal also raises questions concerning Germany’s financial authorities and their ability to regulate businesses of this size. If you believe that you may have a case concerning the financial authorities and their failure to regulate Wirecard sufficiently make sure to contact us directly to find out more about the options available to you.
Insolvency Procedure against Wirecard
Bankrupcy occurs in Germany when indiviuals or companies can’t pay their debts anymore and the relevant courts have examined the claim. As Wirecard has declared insolvency, the court will appoint a preliminary insolvency administrator to examine the case in greater detail. This preliminary insolvency administrator’s task is to secure the assets of the debtor and from there to prepare for the Insolvency Court’s decision whether to open final insolvency proceedings. His report will also inform the insolvency court of whether to continue with the insolvency proceedings.
Insolvency proceedings are lengthy affairs and once it has been decided to continue down this route it may take a long time to receive what you are owed. Predictions may be made by the insolvency administrator as to when returns will be made and the proportion which will be granted, but in the reality of a complex insolvency case is that such predictions are not certainties.
Claims of Creditors against Wirecard
As a creditor of Wirecard, it is vital that contact is made between you and the preliminary insolvency administrator. By contacting the administrator and outlining your case in the appropriate manner you place yourself in the best position to gain what you are owed by the debtor. Filing for an insolvency claim must take place at the insolvency administrator’s office. The presentation of the required documentation (contracts, invoices and proof of performance among others) will establish your claim amongst the other existing claims.
Deadlines are in place for when an insolvency claim can be made. Missing a deadline is not fatal to a case but it can lead to difficulties. Therefore, make sure to pay attention to the deadlines in place and start working with a legal professional as soon as possible to make sure that all paperwork and other requirements are filed in good time.
Once you have made contact with a lawyer in good time it is important to know how to act from there. Here are some tips we can provide on this matter:
- Accuracy: The claim you make must be specific. Your claim must be so clear as to ensure that it is not confused with any other claim made. Once again having the required paperwork and documents to demonstrate the specifics of your claim is vital.
- The law: What is the legal basis behind your factual claim. What is the relationship between your claim and Wirecard’s insolvency built upon? Working with our insolvency lawyers will ensure that you follow through on this step in the correct manner.
- Submission of documents: Submit two copies of your claim registration to the insolvency administrator.
Our legal team will advise you and ensure that your claim follows the correct requirements. It is your responsibility as a creditor to ensure that your claim is comprehensible and submitted in the appropriate manner.
Rights of Wirecard Investors
As well as the rights of creditors, the rights of investors are also protected in Germany. It is clear that many investors invested in Wirecard based on their supposed financial health. Of course, as that financial health would appear to have been built on falsified transactions, it is clear that these investors will also have cases to bring. Many investors have unfairly lost significant figures based on the alleged criminal actions of those within the company.
At Schlun & Elseven our lawyers will work with you in enforcing your claim for compensation. We will outline what legal rights you have and the options available to you in this matter. Contact us today to find out more!
Criminal liability of the Management
If this current situation is as claimed, then many people will seek to take criminal law action against Wirecard. Fraud claims under § 263 StGB can lead to heavy fines and lengthy prison sentences of up to 10 years. Filing a criminal case is an option which investors and creditors of Wirecard should consider, especially if the level of deceipt and falsified transactions is as is stated. German law allows for criminal actions to be taken against managing directors and other company directors when it comes to fraud and other illegal actions. Our page on “The Rights and Obligations of Managing Directors” outlines this in greater detail.
At Schlun & Elseven Attorneys, we will work with you to prepare your criminal law complaint. The scale of this case means that having legal counsel is necessary. We will use our knowledge of the fields of German criminal law and insolvency proceedings to ensure that your case is filed for in the appropriate manner. Contact us today to find out more!
Insolvency Lawyer in Germany
At Schlun & Elseven Lawyers we are experienced professionals in the field of German insolvency law. Our insolvency team led by Dr. Richard Nouvertné has been working with clients from all over the world in resolving their insolvency issues. We can be reached at our offices in Cologne, Düsseldorf and Aachen by using our contact details below this article. We have further conference room facilities in Berlin, Hamburg, Munich, Stuttgart and Frankfurt and we provide our services in English as well as German.
Contact us today if you need legal guidance on how to proceed in this matter. The fallout from the Wirecard scandal will be great and therefore it is crucial to respond to this matter in a timely fashion! Delaying your response may damage your ability to get compensated to the level you deserve. Contact Schlun & Elseven and our insolvency law team by using the contact form below. Our lawyers look forward to working with you.