EY files a criminal complaint for leakage of classified Wirecard report

EY has filed a criminal complaint against a German newspaper for publishing a classified parliamentary report on its work for the corrupt payment company Wirecard.

The criminal complaint was filed on Monday to Munich criminal prosecutors, the four big firms told the Financial Times. Prosecutors confirmed they had received the complaint but declined to comment further.

The highly critical report was written by Martin Wambach, partner in the auditing firm Rödl & Partner, on behalf of the parliamentary inquiry committee into the Wirecard scandal.

It highlighted serious shortcomings in EY’s audit work, finding that the company could not see indicators of fraud, did not fully implement professional guidelines and on key issues relied on verbal assurances from managers. The report cited more than 150 internal EY documents submitted to the committee but which were considered to be classified under German law.

A lawsuit by lawmakers who had asked the federal Supreme Court to allow the publication of an unedited version of the report was rejected in August. An appeal against this decision is still pending.

On November 11, the German financial newspaper Handelsblatt published the full 168-page document on its website. It claimed that the report, which was stamped “Deutscher Bundestag – Geheim”, was paid for by taxpayers and its content was of high public interest. Under German law, the “Secret” is the second highest level of secrecy. Individuals who hand over classified documents and are not authorized to do so can be punished with up to three years in prison.

In a statement Monday, the Big Four firm said: “From EY’s point of view, handing over the report [to Handelsblatt] constitutes a violation of the legal process, violates the authority of the Supreme Court and creates a fait accompli. ”

The company claimed that the rights of employees mentioned in the report and whose names were not edited by Handelsblatt were violated. In addition, the publication of the report unfairly revealed EY’s trade secrets, it states.

Following the two-part report, completed by Wambach in April and May this year, several newspapers, including the Financial Times, published stories about its contents and quoted specific parts. A person close to EY told FT that Handelsblatt’s publication of the entire document was “a completely different order of magnitude”.

EY said its criminal complaint was directed at the “unknown” individuals who leaked the document and were not directed at Handelsblatt journalists.

Kay Gottschalk, former chairman of the Wirecard Commission of Inquiry, which dissolved itself after publishing its report this summer, told FT he was “puzzled” by EY’s criminal case.

‘I can not imagine that members of the committee of inquiry have leaked the documents. We often saw that journalists had access to confidential documents even before they were handed over to the committee, says the MP for the right-wing party Alternative for Germany. Gottschalk also stressed that the protection of journalists’ sources was of the utmost importance.

“Handelsblatt stands by its publication of the Wambach report,” the newspaper’s editor Sebastian Matthes told FT, adding that it was the duty of journalists to hold political and financial power accountable, to identify shortcomings and create transparency. “This is what we did with the publication of the Wambach report,” Matthes said, adding that the millions of investors who lost money on Wirecard had “the right to learn how this scandal could happen”.

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