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How the biggest fraud in German history unravelled
- 0xDEF 4y agoGermany has its own share of big shady fraud and corruption cases. Deutsche Bank being raided for laundering Russian money was an annual happening before the 2022 Russian invasion of Ukraine.
- suction 4y ago[dead]
- WA 4y agoWe have a chancellor who has acute Alzheimer symptoms when it comes to CumEx. https://en.wikipedia.org/wiki/CumEx-Files https://en.wikipedia.org/wiki/CumEx-Files
- heipei 4y agoIf you're into that I suggest watching the SWR documentary around Big Manni / FlowTex.
- tagyro 4y agoStill waiting for an investigation into vivid.money, and their front, Solaris Bank. BaFin will get there ...eventually
- boeingUH60 4y agoRelated fact: German entrepreneur Christian Angermayer was paid €13 million for arranging SoftBank's investment in Wirecard [1]. He's well-known for hyping Bitcoin, Psychedelics, and SPACs [2]...the perfect financial woo-woo combo. 1- https://www.ft.com/content/3c561ccf-2e95-46f7-ac43-a8e04db21dfe https://www.ft.com/content/3c561ccf-2e95-46f7-ac43-a8e04db21... 2- https://www.bloomberg.com/news/articles/2021-04-23/billionaire-took-psychedelics-got-bitcoin-and-is-now-into-spacs https://www.bloomberg.com/news/articles/2021-04-23/billionai...
- mistrial9 4y agoyou say that like its a bad thing ?
- snapcaster 4y agoHow does paying short sellers to close their positions work? Doesn't that just encourage others to open them to collect the "bribe"? Maybe that's where the "turkish boxers" come into play
- amadeuspagel 4y agoWirecard wasn't trying to pay short sellers to close their position, but trying to pay FT journalists to stop reporting. The short sellers were just intermediaries.
- ikinsey 4y agohttps://archive.is/ztXde https://archive.is/ztXde
- monero-xmr 4y agoAlso the Netflix documentary is pretty good https://www.netflix.com/title/81404807 https://www.netflix.com/title/81404807
- amadeuspagel 4y ago> A German parliamentary inquiry held a hundred witness hearings and reviewed nearly four hundred thousand pages of documents, concluding that the behavior of Wirecard and its enablers was “the largest financial scandal in the history of the Federal Republic of Germany.” The report blamed “collective supervisory failure,” “the longing for a digital national champion,” and “the German mentality toward non-Germans”—specifically, Quadir and McCrum. “German supervisory authorities are not fit for the ‘Internet Age,’ ” the report concluded. It's not just “the longing for a digital national champion”, but also the idea that american startups are more successful because they are more ruthless, more willing to lie, to commit fraud, an idea which I also see on this forum.
- rcme 4y agoAmerican start ups are definitely more willing to ignore regulations in the name of growth, but not sure that’s fraud.
- carlmr 4y agoSelling self-driving technology with a next-year time horizon for 7 years seems quite fraudulent.
- boc 4y agoExcept it's hard NOT to see a self-driving car (including cars without anyone inside) if you walk around SF these days. Please don't conflate Musk and Tesla with the Waymos of the world.
- dghlsakjg 4y agoPlease don't conflate SF with the rest of the world. Incredibly rare to see self driving cars outside of the Bay Area. Up here in Canada I have my doubts about ANY self driving car achieving true autonomy in our conditions, and I live in the part that doesn't see much snow.
- WeylandYutani 4y ago
- cm2012 4y agoMatt Levine had an excellent analysis of this today
- AlbertCory 4y agoWhen I saw the title, I thought it must be about the Hitler diaries: https://www.independent.co.uk/news/uk/home-news/hitler-diaries-anniversary-sunday-times-extracts-hoax-fake-news-germany-a8337286.html https://www.independent.co.uk/news/uk/home-news/hitler-diari... I think you'd have to call that a bigger fraud.
- TedDoesntTalk 4y agoWhat an interesting read. I don’t know about the Hitler diaries.
- andix 4y agoIn comparison to Wirecard that was just a funny prank.
- r9295 4y agoVery interesting that they did the same thing India is doing with Adani. Defending them as "local champions", talks of suing the entity that exposed them and stopping shorting
- sudhirc 4y agoWho is defending Adani? Could you provide some citations please? News I tracked shows Adani is getting investigated by SEBI[0]. [0] https://www.business-standard.com/article/companies/adani-group-tries-to-calm-investors-as-sebi-confirms-investigation-123021301267_1.html https://www.business-standard.com/article/companies/adani-gr...
- r9295 4y agohttps://www.thehindu.com/news/national/why-do-lic-sbi-continue-to-invest-in-adani-group-opposition-asks/article66444535.ece https://www.thehindu.com/news/national/why-do-lic-sbi-contin... For example
- sudhirc 4y agoTerm defending seems to have lost its meaning. Since when investing became defending? Moreover anonymous Hindenberg,crazy George Soros are more credible than LIC and SBI!!
- Upvoter33 4y ago"Biggest Fraud in German History" -> would be careful with that bit of hyperbole ...
- sfe22 4y agoBiggest fraud spots are usually reserved for … … for … … governments
- mhb 4y agoWirecard Had a Wild Run by Matt Levine https://www.bloomberg.com/opinion/articles/2023-02-27/wirecard-had-a-wild-run https://www.bloomberg.com/opinion/articles/2023-02-27/wireca...
- paxys 4y agoI remember reading about the Wirecard scandal when it happened, and the key learning wasn't that it was some very complex financial scam that no one could have seen coming (quite the opposite in fact), but rather that the entire state machinery – politicians, regulators, intelligence agencies, banks – was complicit in the fraud because they wanted to take credit for a German company making its name among the silicon valley elites. A passage from the article: > On February 18, 2019, Germany’s financial regulator, known as BaFin, issued a ban on creating new short bets against Wirecard, citing the company’s “importance for the economy.” > The same day, prosecutors in Munich confirmed to a German newspaper that they had opened a criminal investigation. But they weren’t going after Wirecard—they were going after the F.T.
- andix 4y agoThey were probably not complicit in the fraud. They just looked the other way, because a scam in that scale was unthinkable for them. As far as I know there are no cases of bad faith or corruption known. They „just“ didn’t do their job carefully enough.
- whatshisface 4y agoIf that's the public attitude it's going to keep happening.
- andix 4y agoSure, but technically you need to know about the fraud, or at least that you are doing something wrong, to be complicit in it. I think they genuinely though they were doing the right thing.
- ChuckNorris89 4y ago>I think they genuinely though they were doing the right thing Your job as a government regulator/agency isn't "to believe", it's to be impartial, do your due diligence and apply the law indiscriminately. Selectively looking the other way is blatant corruption. Ask any accountant at any company. They double check everything. If you miss something and fuck up you can't just tell your boss "well, I didn't check it because I believed there couldn't be anything wrong here". It doesn't matter what you believe, your job is to check.
- LastNevadan 4y agoMatt Levine's blog at Bloomberg also discusses Wirecard https://www.bloomberg.com/opinion/articles/2023-02-27/wirecard-had-a-wild-run https://www.bloomberg.com/opinion/articles/2023-02-27/wireca...
- no1groyp 4y agoBiggest? Hear me out…
- WeylandYutani 4y ago[flagged]
- fsckboy 4y agoWirecard? I came here to read about diesel emissions! the fine totals are higher, but I guess that's multiple companies and punitive measures so maybe the negative externality of air quality is lower?
- eqvinox 4y ago> “In an ‘accident,’ he’d routed all of the company’s internet traffic through his own PC, rather than the dedicated hardware in the server room—a set-up ideal for snooping.” But Marsalek, a talented hacker, couldn’t be fired; […] Interesting. I had not heard this nugget before.
- cultureswitch 4y agoNot to be overly dramatic, but that's hardly the biggest fraud in German history.
- 9dev 4y agoIf you go by the numbers, it clearly is. Or what incident are you referring to?
- eternalban 4y agoThis story was as stinky as the subject. It even went out of its way to paint a bunch of obvious certified a-holes as heroes.
- Magi604 4y agoSo I had no idea what I would be reading when I started, but WOW what an amazing story. I could not stop. Halfway through I thought to myself this would make an amazing TV series as it seemingly has everything: finance, politics, spies, assassinations, backdrops of the UK, Germany, Libya, Singapore, Philippines, Russian mercenaries, private mansion gatherings, a cunning mastermind (Marsalek)...I'll just call it now and say that one day a production company will make a killer TV series out of this (a movie is too short to do it complete justice).
- andix 4y agoThere may have even been Russian involvement on a state level. Parts of Wirecard were maybe a Russian FSB operation. Jan Marsalek was from Vienna, which is still one of the most important FSB outposts in Europe. There are some threads connecting Marsalek and the Russians to the government and the administration in Austria, that may be connected. But it’s just speculation, no real evidence backing it up (yet).
- jvans 4y agoI have always thought the most troubling aspect of these frauds(Theranos/Madoff/Enron/Wirecard) is the fact that they are not sophisticated, are complete and total frauds, and yet they persist for years or decades. It makes me wonder how much companies get away with when they only do a little bit of fraud.
- magnuspaaske 4y agoOne thing that seems to connect some of these are how they play to being outsiders and for people who otherwise can't get in. The best place to set up a fintech company in Europe is obviously London and if you wanna start up in Munich there's a lot of car industry around to service. But for (fintech) fraud Munich is pretty good, partially because there's less employee overlap with legitimate business for you and the regulators are not really set up to catch you (the way they would be in London). The investors in Theranos were also largely people on the sidelines of VC and the Madoff investors were people who would have a hard time getting into legitimate hedge funds
- willyt 4y agoLondon is a pretty notorious money laundering hotspot. One of the tensions between the EU and the UK was that the EU wanted better scrutiny and regulation of British tax havens which the dirty money sector in London is not keen on.
- jvans 4y agoReally good point. I remember from Carreyrou's book how big name biotech VCs were notably absent from the list of Theranos investors. People who were capable of making good decisions did just that
- foobarian 4y agoIt struck me that both in this case and Theranos, they exploited the weakness in "sampling audits" where external parties are shown only a sample of the product on the faith that the rest of the inventory is the same. Like showing a few machines and switching around the serial numbers here, or in Theranos case showing one blood test machine but not the off-the-shelf tester actually performing the assays. It's actually pretty difficult for an auditor to do an exhaustive search - what would they do, ask to visit 3000 machines?
- angarg12 4y agoI worked for Wirecard in ~2017. Now that the company is no more I guess I'm free to talk about it. Wirecard is without a doubt the worst company I worked for. Nevermind the legacy ball of mud, the whole work environment was toxic. Blaming, finger pointing, sexist and racist remarks weren't rare. This is the only company where I've seen people screaming out of their lungs and slamming doors during meetings. Back in the day I used to think Wirecard was a living example that you don't need a good tech stack or working enviroment to be a successful company.... oh boy was I wrong.
- magnuspaaske 4y agoIn many ways a toxic work environment seems great when committing fraud. People don't develop the kind of bonds that it would take for them to otherwise expose the fraud together and you have a lot of opportunities for misdirection
- angarg12 4y agoI was part of the Cards and Accounts Management team, and I never witnessed anything that would make me think of fraud. Sure, I saw some weird things, but not "billions of euros fraud" weird. I honestly doubt that anyone but a very few selected people were privy to what was happening there. For the rest of us it was just a dysfunctional-trying-to-be-cool "startup".
- PicassoCTs 4y agoThe wish for a "national" digital champion besides SAP is the cause for this. German Politicians are desperate to have a google/amazon/meta of there own. Eastern europe (poland, slovakia, the baltics) get this done, but germans cultural self-image rejects abstract products. The gap between the wished for and the possible, is exploited by fraudsters and scammers like the wire card gang.
- neilv 4y ago> A young woman suggested that they go around the table and share their real aspirations, most of which required years of training or an advanced degree. “And when it came to me, without hesitation, I was, like, ‘I’d be a journalist,’ ” he said. “And the woman who had asked the question just looked at me as if I were a bit stupid and said, ‘Well, you know, you can just do that.’” That's how a lot of people became a software engineer. (Personally, I also wanted to be a lawyer, USSC justice, scientist, artist, business person, etc., but computer programming had much lower barriers to entry, including less class gatekeeping.)
- deleted 4y ago[deleted]
- TheAlchemist 4y agoWhile it’s very interesting, sadly, it doesn’t come close to biggest frauds in Germany. German top politicians pushing legislations and projects for Russian gas, then going to work directly for the Russian companies anyone ?
- LeonB 4y agoThe one about them being a master race had pretty big costs as well I’d say.
- 9dev 4y agoThat one wasn’t technically a fraud though, but a coup.
- spongebobism 4y agoIs that the right way to put it? The NSDAP's rise to power was the result of relatively free elections, and it's not like they were lying about their intentions.
- 0dayz 4y agoIn order to make the coup and retain the power you have to make the biggest fraud.
- LeonB 4y agoNo, the coup didn’t work. They went the semi-legit route and used the system.
- rdiddly 4y agoI guess we're not counting the fraud that was Nazism. snickersnicker
- Kalium 4y agoI worked for a national champion fintech, for a while. One of the things I noticed was how it received clearly preferential treatment from its home government. Eventually things went sideways and it lost 75% of its value in one day. Wirecard may have been the German case, but more than one country has fallen prey to this problem.
- ripvanwinkle 4y agohttps://archive.ph/qAbwz https://archive.ph/qAbwz
- bigbacaloa 4y agoThe best scams need a willing victim of low moral character.
- lawgimenez 4y agoOf course, Philippines is involved. We are still in Financial Action Task Force's gray list because of shit like this. Reminds me also of the Bangladesh Heist perpetuated by North Korea. Smh.
- JohnClark1337 4y ago[dead]