• Ex-CEO Markus Braun and two former executives are on trial in Germany’s largest accounting scandal.
• The trial began Thursday.
• The digital payments firm failed after admitting $1.9 billion missing from its accounts did not exist.

Ex-CEO Markus Braun and two former executives are on trial in Germany’s largest accounting scandal.

The trial began Thursday, two and a half years after the digital payments firm failed after admitting $1.9 billion missing from its accounts did not exist.

Olaf Scholz, Germany’s then-finance minister, called the affair “unparalleled”

Jan Marsalek, Wirecard’s former COO with ties to foreign intelligence organizations, was absent from court.

Marsalek escaped Austria in 2020 by private jet. He’s reportedly hiding in Russia.

Wirecard CEO Braun, in detention since July 2020, is accused of commercial gang fraud, breach of trust, accounting fraud, and market manipulation.

The 53-year-old disputes the allegations and calls Marsalek the mastermind.

His co-defendants include ex-accounting chief Stephan von Erffa and ex-Dubai subsidiary head Oliver Bellenhaus.

Bellenhaus admits misconduct and will be a prosecution witness.

The three face long prison terms if convicted.

Prosecutors will read the 90-page indictment on the first day of the high-profile trial in Munich.

Complex case has 100 trial dates.

The prosecution claims Wirecard executives overstated the company’s profitability beginning in 2015 by fabricating revenue streams from partner transactions.

Third-party acquirer (TPA) companies in Dubai, the Philippines, and Singapore accounted for a large portion of Wirecard’s sales and profits.

The indictment states that “all the accused understood” that the TPA firms’ income “didn’t exist” and that the defendants fabricated paperwork to mask the deceit.

Prosecutors said the purpose was to make the company more attractive to investors and customers.

Wirecard was founded in 1999 to accept credit card payments for porn and gambling websites. It has now become a major participant in the burgeoning “fintech” sector.

It entered Germany’s blue-chip DAX index in 2018 and peaked at $25 billion, outvaluing Deutsche Bank.

Wirecard’s spectacular rise persisted despite rumors of impropriety.

In 2019, the Financial Times released blockbuster pieces outlining accounting problems.

Longtime auditor EY found a $2bn hole in the company’s books in June 2020.

Wirecard’s cash was supposed to be in trustee accounts at two Philippine banks.

The Philippines’ national bank stated the money never entered its system, and BDO and BPI denied a contact with Wirecard.

Wirecard’s share price plummeted and it filed for insolvency, leaving $3 billion in debt that creditors are unlikely to collect.

Wirecard’s collapse sent shockwaves through Germany and forced a revamp of Bafin, which was criticized for ignoring early signs.

Volker Bruehl, a professor at the Center for Financial Studies in Frankfurt, said many people “didn’t want to accept fraudsters were at work” at a German champion firm.

“The Wirecard affair hurt Germany’s financial reputation.”

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