By Angharad Carrick for City A.M.
EY failed to carry out a standard audit procedure on Wirecard for more than three years that could have uncovered colossal fraud at the fintech, it is claimed.
The accounting firm, which has audited Wirecard for over a decade, has come under fire after the German fintech disclosed a €1.9bn black hole in its accounts.
It is now reported that EY failed to request crucial account information.
A report by the Financial Times claims that between 2016 and 2018 EY did not directly check with Singapore’s OCBC Bank to confirm the lender held huge amounts of cash on Wirecard’s behalf.
Instead, the auditor relied on documents and screenshots provided by Wirecard and a third-party trustee.
One person told the FT that Wirecard has no banking relationship with OCBC and that the firm’s former trustee does not have an escrow account with the bank.
Additionally, the lender did not receive any query from EY in relation to Wirecard between 2016 and 2018.
In a statement on Thursday, EY said “even the most robust audit procedures may not uncover this kind of fraud”.