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German finance company Wirecard files for insolvency amid accounting scandal

German financial technology company Wirecard is filing for insolvency after an accounting scandal that led to the arrest of its former chief executive earlier this week.

The payment systems provider said it would make the filing at a district court in Munich “due to impending insolvency and over-indebtedness”.

It added in a brief statement that it is evaluating whether insolvency applications also have to be filed for its subsidiaries.

Markus Braun resigned as CEO on Friday after the company said that auditors could not find accounts containing 1.9 billion euros (£1.69 billion).

On Monday, Wirecard said it had concluded that the money probably does not exist, and Braun turned himself in to prosecutors hours later.

Markus Braun is under investigation (Matthias Schrader/AP)
Markus Braun is under investigation (Matthias Schrader/AP)

Braun was arrested on suspicion of market manipulation and inflating financial numbers, and later freed on bail

Adding to the damage to Germany’s corporate reputation was the reaction

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