Lawmakers in Germany have opened a parliamentary probe into the scandal-hit payments company Wirecard.
The litigators aim to push the German government to investigate more about Wirecard’s failure in order to prevent the biggest post-war corporate fraud in the country.
German lawmaker Fabio Masi said: “This was a fake company. We are not getting the answers we need.”
Masi played a major role in launching the inquiry, which allows the legislators to interrogate officials and ask for information.
The Green Party, Left party and pro-business Free Democrats (FDP) also joined forces to launch the probe.
The investigation is expected to intensify pressure on Chancellor Angela Merkel and her deputy Olaf Scholz, before the national elections in 2021.
The German government said that in September 2019, Merkel proposed Wirecard’s planned takeover of a Chinese company.
During her visit, a senior official in her office had pledged to further support Wirecard.
However, according to an official parliamentary response, Merkel was not aware about the irregularities at Wirecard.
The government had flagged over 1,000 suspicious transactions involving Wirecard since 2017. However, these transactions were found unrelated to the latest scandal.
Moreover, Merkel’s deputy Scholz – who heads the Germany’s finance ministry – also oversees the watchdog BaFin.
BaFin has been condemned for failing to investigate Wirecard, while for years the regulator had probed critics instead.
A spokesman said that the ministry will cooperate with the parliamentary enquiry, while also working on setting up toughened rules for auditors, supervision and accounting controls.
Additionally, the global anti-money laundering watchdog Financial Action Task Force is due to carry out a routine review of Germany’s record.
In June 2020, Wirecard filed an application to open insolvency proceedings with the Munich District Court, reeling from a billion-dollar balance sheet scandal.
Its auditors Ernest & Young (EY) said Wirecard owes €4bn ($4.5bn) to creditors after it admitted that €1.9bn ($2.1bn) had gone missing from its books.
The scandal led to the arrest of former Wirecard CEO Markus Braun and other executives on suspicion of running a criminal racket that defrauded the creditors.
However, they denied any wrongdoing, while former Wirecard COO Jan Marsalek is currently on the run.