Latest update on 16 March 2016
Wirecard statement concerning the reports published by a dubious source containing untrue and slanderous allegations: The report is without any substance and we assume the report has been spread to negatively influence our share price. Legal action has been initiated.
Despite the reports distinct lack of credibility, Wirecard has spent significant time and effort reviewing the report and the allegations it makes and determined that the report is totally false. Below you will find answers in detail to a number of the points raised.
Wirecard has always supported strengthened regulation of the internet payment industry, with strict compliance to protect consumers, merchants and the industry from any form of misconduct. It was the first Payment Service Provider (PSP) to hold a full banking licence, as early as 2006. Being a regulated entity involves extensive regulatory oversight and enforces the application of strict compliance procedures to the company’s operations. Since Wirecard acquired its full banking licence, the European Union has introduced a regulatory framework that has required Wirecard’s competitors to apply for licences and to become subject to regulatory oversight. Wirecard’s German banking licence and the regulatory regime which that entails shows that Wirecard operates under one of the most extensive and strictest regulatory environments in Europe.
1. As one of the world’s leading online payment companies, Wirecard has excellent relations with all credit card organisations. It is an active licensee/member of such organisations through its regulated entities in the UK and Germany, and has been for more than a decade. Further to its role as an acquirer and issuer for various credit card organisations, Wirecard holds strategic partnerships with these card organisations and has acquired assets and subsidiaries from them.
2. Wirecard continuously discloses the nature of the transaction volumes processed by the company and the revenues related to each client industry segment in its audited annual reports. Online gambling transactions solely originate from regulated online gambling operators and volumes constitute about 7% of Wirecard’s total transaction volumes. They are aggregated under the ‘digital goods’ segment of Wirecard’s public reporting. Any claim that Wirecard obfuscates payment jurisdiction and associated merchant risk, to circumvent high risk categorization and authentication requirements within the credit card organisation networks, is wrong. Wirecard’s compliance and merchant account setup procedures are repeatedly audited by regulatory bodies as well as the credit card organisations themselves. The allocation of country and merchant category codes to individual merchant accounts is conducted fully in accordance with all regulatory, tax and credit card organisation rules.
3. Wirecard has never acquired Krores and does not have any business relationship with Krores.
4. Wirecard has no direct or indirect business dealings with Inatec GmbH.
5. Wire Card UK Limited (company number 05888415) was incorporated on behalf of Wirecard AG by an incorporation office on 27 July 2006. This was for the purpose of establishing a subsidiary for Wirecard in the UK but in the end other decisions were made. In its whole lifetime it was a dormant shell company which was never operational nor was at any time owned by Wirecard Group. It was dissolved on 17 August 2010. The initial registration address of Wire Card UK was defined by the incorporation service, it was never changed because the company never became operative, if it would have become operative in any way of course the address would have been changed to a Wirecard address. The fact that the address was a residential address is out of our area of responsibility and influence.
6. Bluetool Limited has never, directly or indirectly, been a part of Wirecard Group.
7. Bluemay Enterprises has never, directly or indirectly, been a part of Wirecard Group.
8. Mr Usman Fayaz was neither directly nor indirectly a shareholder of any of the companies at the time of the purchase of the payment business of GI Retail Group. Neither GI Technologies nor Hermes have ever been involved in any form of lottery or gaming business. GI Technologies is India’s leading domestic money remittance operator and regulated by the Reserve Bank of India (RBI). It is regularly audited by the regulator and applies rigorous KYC and compliance procedures to its remittance operations. The corporate fraud which is referred to is in respect of the company Popular Agro Farms Pvt Ltd, which has nothing at all to do with Wirecard or GI Retail.
9. Wirecard has never acquired Asia Pacific E-Serv Corporation (aspaconline). Wirecard Asia Pacific, Philippines was a newly established company in 2007 and was dissolved in 2012.
10. Wirecard has never hosted any content websites or any other merchant business model.
11. Wirecard never violated the Unlawful Internet Gambling Enforcement Act (UIGEA).
12. Click2Pay was positioned as a wallet predominantly for the European digital content markets. Click2Pay was set up in full compliance with credit card regulations and the UIGEA. Click2pay never reached a significant market position and transaction volume processed as well as profit contributions were rather insignificant in relation to Wirecards core products (e.g. under 4% EBIT contribution in 2008 going down to 0% from 2010 onwards)