Ex-Wirecard boss Markus Braum and two other executives have been ordered to pay €140 million plus interest in damages to defunct payment Group’s administrator over violations of professional duties. The Board’s decision was “untenable and at odds with the duty of care of a prudent businessman”.

In the civil suit brought by  Wirecard Administrator, Michael Jaffe, Markus Braun, former CFO Alexander von Knoop, and former CPO Susanne Steidi have been found personally liable for losses from unsecured loans to allegedly fraudulent business partners in Asia. Wirecard collapsed into insolvency in 2020 after disclosing  that half its revenue and € 1.9 bn in cash did not exist.  Braun has been in custody for more than three years while  a criminal trial continues. Von Knoop and Steidi were charged with breach of trust last month but were not remanded in custody,

Management decisions at the heart of the civil trial in Munich underpin a small fraction of the alleged misconduct at Wirecard, once hailed as one of Germany’ s most successful fintechs, valued at more than €24bn.  The claim for damages were focused on potentially fraudulent loans to suspicious business partners in Asia, which on paper were generating huge chunk of Wirecard’s revenue and profits.

 In March 2020, just months before Wirecard’s collapse, they forked out €100mn in unsecured loans to a purported outsourcing partner in Singapore, and thereby using bulk of Wirecard’s remaining liquidity at the time. About €35mn of the cash was channelled back to Braun, who used  it to repay a personal loan that he had taken from Wirecard bank.

Before the insolvency, Braun’s shares in Wirecard  had a value of more than €1bn, and he owned luxury property in Austria, Germany and France. But his personal wealth has been ceased by prosecutors and this year, his former lawyer Alfred Dierlamn resigned  because Braun was unable to pay his legal fees after the funds of his directors and officers ‘ liability insurance ran out.

The Munich court ruled that Wirecard’s former deputy chair Stefan Klestil who was also sued by the administrator, was not required to pay damages.