Singapore has handed down prison sentences to two former senior Wirecard finance executives, the first criminal convictions related to the collapse of the once high-flying German payments group.
James Wardhana was sentenced to 21 months and Chai Ai Lim to 10 months by Singapore’s state court on Tuesday with immediate effect for conspiring to misappropriate funds. Both pleaded guilty after being charged in 2022 alongside two other people in connection with the case.
The rulings mark the first convictions for one of Europe’s biggest accounting frauds.
Wirecard, once worth €24 billion and hailed as one of Europe’s most successful tech start-ups, collapsed in June 2020 after disclosing that half of its €2 billion in annual revenue did not exist. The company’s implosion sent shock waves through Germany’s financial and political establishment, and its Singaporean unit stopped payment activities in 2020.
Wardhana, a 40-year-old Indonesian citizen and permanent resident of Singapore, was the international finance process manager of Wirecard Asia. Chai, a 44-year-old Singaporean citizen, was the head of finance at Wirecard Asia. Both admitted to conspiring with their superior to embezzle funds from Wirecard Asia’s bank account. The prosecution noted that the two were active participants in the conspiracy.
Their superior, Edo Kurniawan, is still at large, with a warrant for his arrest and an Interpol red notice issued against him. Wirecard “lost contact” with Mr Kurniawan, who led the group’s accounting in the Asia-Pacific region, 10 days after the Financial Times published its first report on suspected accounting irregularities at Wirecard and Kurniawan’s alleged central role in the affair.
Wirecard executives have been on trial in Munich since December last year. Three former senior managers of the disgraced German payments company, including chief executive Markus Braun, face charges of fraud, embezzlement and accounting and market manipulation in a trial that is expected to continue into at least 2024. He denies the charges.
Attention will next month swing back to Singapore when the trial of James Henry O’Sullivan is scheduled to begin. The Englishman is not being charged in Germany but is alleged to be central to the Wirecard fraud.
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Mr O’Sullivan faces charges of abetting the falsification of documents, including papers that helped persuade Wirecard’s auditors at EY that the company had extensive cash reserves until it was forced to announce that €1.9bn recorded in its accounts did not exist. If convicted, he faces up to a decade in prison.
Companies controlled by Mr O’Sullivan received hundreds of millions of euros from Wirecard in loans and payments for assets in transactions spanning several years, according to whistleblowers and documents seen by the Financial Times. He has never commented publicly on the events.
Jan Marsalek, Markus Braun’s protege and Wirecard’s former chief operating officer, remains at large, with some reports placing him in Moscow. – Copyright The Financial Times Limited 2023
