
Former Wirecard CEO Markus Braun arrested - kleiba
https://www.dw.com/en/former-wirecard-ceo-markus-braun-arrested/a-53905720
======
geophile
I was just listening to a podcast last night, in which a financial analyst who
identified problems with Wirecard was harrassed for years, both online and
IRL. Interesting story:
[https://www.npr.org/transcripts/868001948](https://www.npr.org/transcripts/868001948)

~~~
tenpies
What's really interesting is seeing the _same_ people sound the _same_ alarms
about extremely popular companies that continue to trade _today_ , and yet our
regulators, auditors, and journalists all ignore them.

We really never learn. If I were a regulator I would be taking short seller
statements extremely seriously when it comes from one of the proven reliable
ones.

~~~
greenhatglack
Though I can't speak for regulators and auditors, you have to keep in mind
that 99% of journalists are just hired guns who's sights are specified ahead
of time.

Since no one with power had their sights on Wirecard, nothing happened - it's
not unexpected.

~~~
AndrewBissell
John Carreyrou managed to take down Theranos despite the fact that Elizabeth
Holmes appealed directly to the owner of his paper, who sat on her board.

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matsche
it baffles me that it had to come this far. There were warning signs all over
it.

The German BaFin messed up so badly that one must either fundamentally doubt
theircompetence or question their integrity.

~~~
MrBuddyCasino
At least BaFin boss Felix Hufeld admitted they messed up and that the whole
thing was the biggest debacle he ever witnessed.

This is rare, and I find it respectable. But yeah, how they missed that is
hard to comprehend.

~~~
mschuster91
> But yeah, how they missed that is hard to comprehend.

Look at the German DAX and what is in there. That is explanation enough. Heavy
industry, consumer goods, banks, insurances. The only IT company other than
Wirecard is SAP and it is not exactly known for innovation.

Everyone, especially politics, wanted Wirecard to succeed: the only actually
somewhat innovative IT company in the DAX. It's the same pattern with the car
industry scandals (not just Dieselgate but also the Porsche attempted
takeover) or with Bayer/Monsanto.

Germany doesn't have many "unicorns" so politics will protect them until way
too late, for the companies, for the share/stakeholders and the planet.

~~~
djpr
> Germany doesn't have many "unicorns" so politics will protect them until way
> too late, for the companies, for the share/stakeholders and the planet.

Interesting. Is there a strong feeling of innovation/unicorn envy among the
wider business culture in Germany? Is it a fear of being stale, comparisons to
Silicon Valley & Asian tech scene, or something else? I'm curious if you have
more insight on this?

~~~
mschuster91
> Is there a strong feeling of innovation/unicorn envy among the wider
> business culture in Germany?

Everyone wants to be like the SV hipsters, no one can because the higher-ups
are still mentally and literally stuck in fax times, there is almost no
venture capital (and the venture capital that _is_ here gets invested into
stuff like Rocket Internet whose "business model" is to copycat US ideas),
banks (across the EU) won't dish out dumb money because unlike the US we have
public funded pension systems and not capital-based ones and we have strict
loan regulations (Basel framework).

> Is it a fear of being stale

Culturally, us Germans are known for being extremely risk-averse, bankruptcies
are socially shamed. This of course clashes with the US way of life that from
the bottom to the top embodies "fail fast", and the youth yearns for change
but as explained above that's hard to do.

~~~
sushshshsh
May I also additionally ask how on Earth a 50k salary for a software engineer
is at all justified? After paying taxes and rent, it seems to me there is not
much money left over for saving or lifestyle spending?

It seems like an unfair situation

~~~
jlangenauer
Why is it unfair? No-one is forcing anyone to accept development work for 50k
per year, yet there are plenty of people happy to do it.

~~~
sushshshsh
Define plenty? It seems to me the other commenters have offered counter points
to you.

In the US, before taxes, an income of $130,000 to $170,000 is the norm in
bigger cities. I imagine based on my calculations that the difference between
Berlin's discretionary income for SWE and NY/SF/SEA/BOS is probably an extra
$50,000 post tax.

~~~
Tomte
And what do you think do houses cost in Germany, compared to "bigger cities"
in America?

I know plenty of people in that income range myself who do own houses (or
apartments in some cases) and wouldn't think of forgoing their summer vacation
in Menorca or Ibiza.

"The other commenters" is just one, and he's factually wrong. No matter how
much HNers love to pile on, 50k Euros is a respectable income in most parts of
Germany.

The idea that all software engineering is in Stuttgart, Munich or Berlin is
laughable. We have lots and lots of family companies of the so-called
"Mittelstand" strewn across the province (but West Germany primarily). Some of
those are hidden champions. In towns and regions few Americans will ever have
heard of.

~~~
sushshshsh
I've heard of plenty of American and also German towns and cities and even if
I was living for free in a caravan (which I've done for many months in my
life, much like Germans who go to music festivals will do in the summer), I
don't see how it is possible to make a substantial savings in life on a yearly
post tax income of $25,000.

After an entire decade of working, this will only result in a best case
scenario of $250,000 in savings, which, for my personal lifestyle is not going
to work. I think collective action for higher wages is proper here.

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xoxoy
The same people with large shorts in Wirecard like Chanos also have large
shorts in Tesla. Just saying.

~~~
adventured
Chanos, the guy sitting on a bearish call against Tesla in November. The stock
is up 200% since then. If Chanos were really betting to match his propaganda,
he'd never work again after being destroyed like that.

~~~
xoxoy
Wirecard has been at highs too. That’s the point.

If you have high conviction something is wrong then it doesn’t matter that it
works the wrong way in the meantime.

------
dang
Recent threads:

[https://news.ycombinator.com/item?id=23573386](https://news.ycombinator.com/item?id=23573386)

[https://news.ycombinator.com/item?id=23598824](https://news.ycombinator.com/item?id=23598824)

[https://news.ycombinator.com/item?id=23438323](https://news.ycombinator.com/item?id=23438323)

This, from a year ago, reads interestingly now:
[https://news.ycombinator.com/item?id=19737344](https://news.ycombinator.com/item?id=19737344)

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ubermonkey
I am coming way late to this story.

Is there a good backgrounder on this whole thing?

~~~
programbreeding
I'd recommend this HN post [0] which links to a good background story [1]. It
literally starts with "For those who just came back from a 15 year space
mission: Wirecard is a German company that..." haha.

[0]
[https://news.ycombinator.com/item?id=23598824](https://news.ycombinator.com/item?id=23598824)

[1] [https://valueandopportunity.com/2020/06/19/wirecard-the-
germ...](https://valueandopportunity.com/2020/06/19/wirecard-the-german-enron-
a-very-personal-history-2008-2020/)

~~~
TechBro8615
As an anecdotal datapoint, I've never heard of Wirecard until the past few
days. Although I'm American and not in finance.

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ww520
And yet the stock went up 18% this morning. It’s really baffling.

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weinzierl
Allegedly he will be released on 5 million Euro bail at 5 pm CET.

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Apofis
So did the steal the money like Nissan's ex-CEO or just spent over a decade
lying about the company's financials? The latter seems incredibly retarded; To
what end? It's a job.

~~~
eigenvalue
The latter. Basically the missing $2b of cash equals the sum total of all the
net income the company claimed to have earned over its entire history (which
was the basis for its $27b market cap at its peak). As for why, who knows,
they probably would have gone under during the financial crisis in 2008 and
lost their jobs if they hadn’t cooked the books. Then once you start doing
that you’re on a treadmill to keep it going, similar to the Madoff fraud. And
in the meantime, the CEO gets to be the big man of the German tech scene and
enjoy the perks of being a billionaire on paper. It must have been pretty
stressful though, that’s for sure! These kind of people have some way of
compartmentalizing things so they can function on a day to day basis.

~~~
TheOtherHobbes
In 2020, I'd be willing to short any company whose CEO sports a black
turtleneck.

