The former CEO Markus Braun of German payment service provider Wirecard who resigned on Friday has been arrested over an accounting scandal.
The focus of an investigation has been over missing sum of €1.9bn, Munich prosecutors have said.
EY refused to sign off the accounts due to the missing money as the auditors could not find the accounts containing €1.9bn and the annual report was postponed.
On Monday, Wirecard’s management board said, “assesses on the basis of further examination that there is a prevailing likelihood that the bank trust account balances in the amount of €1.9bn do not exist.”
Chief operating officer, Jan Marsalek was sacked hours later after the management board’s statement, as he was suspended from the board last week.
Marsalek was in charge of overseeing daily operations including South East Asia where the fraud is suspected to have occurred, according to German news agency dpa.
It was been alleged that two Philippine banks held the money in escrow accounts, but they claim they had no dealings with Wirecard. Furthermore, a document that claims Wirecard was a client was labelled “spurious.”
BDO Unibank said the document which claims the existence of a Wirecard account was falsified and “carries forged signatures of bank officers.”
The Philippines central bank governor said none of the missing €1.9bn had ever entered the Philippines’ financial system.