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1/The reality of the Wirecard $WDI fraud is now unavoidably obvious for even the most blinkered of observers.
There are profound lessons that should emanate from the $WDI story
But first, let’s call out the winners and losers:
1/The reality of the Wirecard $WDI fraud is now unavoidably obvious for even the most blinkered of observers.
There are profound lessons that should emanate from the $WDI story
But first, let’s call out the winners and losers:
2/
Winners:
@FD Dan McCrum has literally been on this story for years, and became the subject of a criminal investigation in Germany as a result of exposing the truth of Wirecard. He’s an exemplar of investigative journalism.
Winners:
@FD Dan McCrum has literally been on this story for years, and became the subject of a criminal investigation in Germany as a result of exposing the truth of Wirecard. He’s an exemplar of investigative journalism.
3/
Winners con’t:
@FT For supporting @FD and standing by their reporting when the full weight of the German justice system was arrayed against him and the paper. Bravo.
Winners con’t:
@FT For supporting @FD and standing by their reporting when the full weight of the German justice system was arrayed against him and the paper. Bravo.
4/
Winners con’t:
@RodboydILM for being very early on this story and being right. Roddy is also an exemplar of investigative journalism and his org https://ffj-online.org/ is worthy of your support if you care about the truth in financial markets
Winners con’t:
@RodboydILM for being very early on this story and being right. Roddy is also an exemplar of investigative journalism and his org https://ffj-online.org/ is worthy of your support if you care about the truth in financial markets
5/
Winners con’t:
The shorts who persisted over a period of years, dug very deep, exposed the truth and for their efforts were criminally investigated, hacked by black hat security firms, and trolled by paid shills on Twitter
People involved on the short side include
Winners con’t:
The shorts who persisted over a period of years, dug very deep, exposed the truth and for their efforts were criminally investigated, hacked by black hat security firms, and trolled by paid shills on Twitter
People involved on the short side include
6/
Winners con’t:
The shorts that were active in exposing this fraud include
@AIMhonesty @alderlaneeggs @lordshipstrade @QCMfunds @WallStCynic
Apologies to those I have missed
Winners con’t:
The shorts that were active in exposing this fraud include
@AIMhonesty @alderlaneeggs @lordshipstrade @QCMfunds @WallStCynic
Apologies to those I have missed
7/
Losers
BaFin – their reputation as a financial regulator lies in tatters. The entire leadership of the organization should resign immediately. Merkel should launch a sweeping investigation.
Losers
BaFin – their reputation as a financial regulator lies in tatters. The entire leadership of the organization should resign immediately. Merkel should launch a sweeping investigation.
8/
Losers con’t:
Not only did BaFin fail to detect this massive, obvious fraud, it actively did $WDI ’s bidding by instigating a criminal investigation against $WD , the @FT (a first by a regulator AFAIK) and short sellers.
It also instituted a short selling ban to prop up $WDI
Losers con’t:
Not only did BaFin fail to detect this massive, obvious fraud, it actively did $WDI ’s bidding by instigating a criminal investigation against $WD , the @FT (a first by a regulator AFAIK) and short sellers.
It also instituted a short selling ban to prop up $WDI
9/
Losers con’t:
The Munich prosecutor’s office, who did BaFin’s & Braun’s bidding by actually pursuing the investigation of @FD & the shorts
Can anyone in this organization fog a mirror or accurately assess the wide array of damning facts presented against $WDI ? Bueller?
Losers con’t:
The Munich prosecutor’s office, who did BaFin’s & Braun’s bidding by actually pursuing the investigation of @FD & the shorts
Can anyone in this organization fog a mirror or accurately assess the wide array of damning facts presented against $WDI ? Bueller?
10/
Losers con’t:
DAX/Deutsche Borse - For putting this POS in the premier German equity index to start with, for keeping it there as the fraud was unearthed, and for not delisting it long ago.
Losers con’t:
DAX/Deutsche Borse - For putting this POS in the premier German equity index to start with, for keeping it there as the fraud was unearthed, and for not delisting it long ago.
11/
Losers con’t:
Taken as a whole, the ‘circling of the wagons’ by the German regulatory, business and media establishment around a long running and obvious fraud casts a large shadow on the integrity of the German economy.
Losers con’t:
Taken as a whole, the ‘circling of the wagons’ by the German regulatory, business and media establishment around a long running and obvious fraud casts a large shadow on the integrity of the German economy.
12/
Losers con’t
When the $WDI scandal is viewed in the context of many German banking frauds & the VW stock rigging by Porsche, investors can rightly ask whether German financial regulation is anything but a fig leaf. @muddywatersre phrase ‘Moscow on the Main’ is quite apt.
Losers con’t
When the $WDI scandal is viewed in the context of many German banking frauds & the VW stock rigging by Porsche, investors can rightly ask whether German financial regulation is anything but a fig leaf. @muddywatersre phrase ‘Moscow on the Main’ is quite apt.
13/
Losers con’t:
E&Y – One word: cash. If your audit can’t confirm the cash in the bank, you need to find another business. Full stop. E&Y is the auditor of record in two other major suspected frauds. Massive fines that pinch every partner are needed to send a message
Losers con’t:
E&Y – One word: cash. If your audit can’t confirm the cash in the bank, you need to find another business. Full stop. E&Y is the auditor of record in two other major suspected frauds. Massive fines that pinch every partner are needed to send a message
14/
Losers con’t:
The German press – With a few exceptions, the German press was happy to parrot the official line of $WDI and BaFin rather than taking the mounting evidence at face value. Imagine printing this on BaFin’s short ban without a hint of skepticism (Handelsblatt)
Losers con’t:
The German press – With a few exceptions, the German press was happy to parrot the official line of $WDI and BaFin rather than taking the mounting evidence at face value. Imagine printing this on BaFin’s short ban without a hint of skepticism (Handelsblatt)
15/
Losers con’t:
Black hat security firms – Recent years have seen a long line of financial basket cases (Theranos, Casino, AmTrust, etc) hire dodgy ‘private security’ firms often led by former government intelligence officers to hack and intimidate shorts and the media.
Losers con’t:
Black hat security firms – Recent years have seen a long line of financial basket cases (Theranos, Casino, AmTrust, etc) hire dodgy ‘private security’ firms often led by former government intelligence officers to hack and intimidate shorts and the media.
16/
Losers con’t:
$WDI played this game too. It is well past time for these ‘security’ firms to be exposed and regulated and for the lawyers (looking at you David Boies) and the corporations that hire them to be held accountable.
Losers con’t:
$WDI played this game too. It is well past time for these ‘security’ firms to be exposed and regulated and for the lawyers (looking at you David Boies) and the corporations that hire them to be held accountable.
17/
Losers con’t:
Online trolls – A recent tactic of financial frauds being exposed is to hire & deploy small armies of online trolls to harass, defame and dox media critics and short sellers. Almost certainly this involves stock manipulation as well. $WDI played this game too.
Losers con’t:
Online trolls – A recent tactic of financial frauds being exposed is to hire & deploy small armies of online trolls to harass, defame and dox media critics and short sellers. Almost certainly this involves stock manipulation as well. $WDI played this game too.
18/
Losers con’t:
Similar to the black hat security firms, this rock needs to be turned over to expose the parties who engage in this for a living and the almost certain violation of securities laws they are complicit in.
Losers con’t:
Similar to the black hat security firms, this rock needs to be turned over to expose the parties who engage in this for a living and the almost certain violation of securities laws they are complicit in.
19/
Losers con’t:
CNBC – It may be gratuitous to even bother calling out their wholly uncritical reporting, but they can’t even be bothered to run a legitimate clip on the exposure of the fraud Imagine having this as the sum total of your $WDI video clips for the last 2 ½ years
Losers con’t:
CNBC – It may be gratuitous to even bother calling out their wholly uncritical reporting, but they can’t even be bothered to run a legitimate clip on the exposure of the fraud Imagine having this as the sum total of your $WDI video clips for the last 2 ½ years
20/
In summary, the $WDI fraud has all the features of today’s highly evolved art of corporate financial fraud. Its scale, duration, and brazenness (faked cash!) highlight just how free a hand financial fraudsters enjoy to ply their trade.
In summary, the $WDI fraud has all the features of today’s highly evolved art of corporate financial fraud. Its scale, duration, and brazenness (faked cash!) highlight just how free a hand financial fraudsters enjoy to ply their trade.
21/
It also exposes just how deep the rot is in the realms of regulation, accounting, securities exchanges, and (with important exceptions) almost all of the financial and business media.
It also exposes just how deep the rot is in the realms of regulation, accounting, securities exchanges, and (with important exceptions) almost all of the financial and business media.
22/If there are any people in these areas that retain a conscience (debatable, but one can hope), this should be a come-to-Jesus moment to assess what purpose they serve
If you are still baffled about the rise of populism vs financial interests, this should be your wake-up call
If you are still baffled about the rise of populism vs financial interests, this should be your wake-up call
23/
I’m told that there are US prosecutors investigating $WDI . This is a career making opportunity for someone. They should pull on EVERY thread in the story, and follow them to their ultimate ends.
I’m told that there are US prosecutors investigating $WDI . This is a career making opportunity for someone. They should pull on EVERY thread in the story, and follow them to their ultimate ends.
24/
What will be learned will be revelatory, IMO, and could help reset the rules so that truth once again is a touchstone in financial markets, as opposed to the rampant fake narratives, bogus financials and see no evil oversight that pervades corporate disclosure today.
What will be learned will be revelatory, IMO, and could help reset the rules so that truth once again is a touchstone in financial markets, as opposed to the rampant fake narratives, bogus financials and see no evil oversight that pervades corporate disclosure today.
25/
A fraud this big and blatant can only persist for this long with the assistance, either active or passive, from a wide range of enablers. They all need to be named, shamed and suffer the consequences of their complicity for the good of the financial markets. /fin
A fraud this big and blatant can only persist for this long with the assistance, either active or passive, from a wide range of enablers. They all need to be named, shamed and suffer the consequences of their complicity for the good of the financial markets. /fin
26/
You can add Herbert Smith Freehills to the list of enablers.
Consider this list a work in progress. https://twitter.com/RodBoydILM/status/1273711279530815509
You can add Herbert Smith Freehills to the list of enablers.
Consider this list a work in progress. https://twitter.com/RodBoydILM/status/1273711279530815509
27/An excellent @WSJ follow up story
According to the story, $WDI was the only company in German history to be the subject of a short selling ban outside of a financial crisis.
Curious minds in German financial, regulatory & govt circles will ask why
Release the BaFin emails
According to the story, $WDI was the only company in German history to be the subject of a short selling ban outside of a financial crisis.
Curious minds in German financial, regulatory & govt circles will ask why
Release the BaFin emails
28/The @WSJ story also discussed the stalking and legal harassment of short sellers that @WDI deployed in an effort to conceal its fraud
29/The story also references hacking attempts against short sellers & journalists investigating $WDI that were recently documented by @citizenlab
They identified Dark Basin & BellTroX, a firm headed by an indicted hacker for hire, as the source of these attacks.
They identified Dark Basin & BellTroX, a firm headed by an indicted hacker for hire, as the source of these attacks.
30/ Link the the @citizenlab report on Dark Basin and BellTroX https://citizenlab.ca/2020/06/dark-basin-uncovering-a-massive-hack-for-hire-operation/
31/ To all my German friends, the question of the day is:
What's in your deposit guarantee fund?
Would it matter if it turned out that BaFin was protecting a fraud that threatened the solvency of this fund?
Release the BaFin / $WDI emails
What's in your deposit guarantee fund?
Would it matter if it turned out that BaFin was protecting a fraud that threatened the solvency of this fund?
Release the BaFin / $WDI emails
