SAN FRANCISCO, June 19, 2020 /PRNewswire/ -- Hagens Berman, who on May 6, 2019 was appointed Lead Counsel in a pending securities class action against Wirecard and certain of its senior executives before Hon. Fernando M. Olguin, DelPoggetto v. Wirecard AG et al., 2:19-cv-00986-FMO-SK (C.D. Cal.), notifies investors in Wirecard (WCAGY; WRCDF; WDI), that it will be filing an amended complaint on Aug. 14, 2020, as directed by the court.
The amended complaint will expand the alleged fraudulent period to recover losses suffered by Wirecard investors due to recent events, including the Company's June 18, 2020 disclosure that Wirecard's auditor Ernst & Young refused to sign off on Wirecard's 2019 financial statements because it could not confirm the existence of 1.9 billion euros ($2.1 billion) in cash on Wirecard's balance sheet.
Hagens Berman urges Wirecard investors who have suffered losses and persons with knowledge of the alleged fraud or who could otherwise further assist with the investigation to contact the firm:
Wirecard (WCAGY; WRCDF; WDI) Securities Fraud Class Action:
The case concerns Defendants' deliberate use of improper accounting designed to inflate sales and profits. Throughout the Class Period, Defendants repeatedly affirmed the effectiveness of Wirecard's internal controls and processes for financial reporting. In truth, Defendants were fabricating financial results by reporting: (i) significant debts that "transactional parties" purportedly owed to Wirecard businesses when, in fact, these entities were phantom companies; and (ii) improperly recognizing receivables from an under-capitalized firm.
The truth emerged through a series of expose articles published by the Financial Times beginning on Jan. 30, 2019, revealing an elaborate accounting fraud orchestrated at the highest levels of WireCard.
On May 6, 2019, the Court appointed an individual Wirecard investor Lead Plaintiff for the Class and Hagens Berman as Lead Counsel.
On Feb. 14, 2020, Lead Plaintiff filed a first amended class action complaint.
Since this time, revelations about the full extent of the alleged accounting fraud continued and became worse. On June 18, 2020, Wirecard disclosed that its external auditor was unable to confirm the existence of $2.1 billion in cash balances on trust accounts, representing about 25% of the company's balance sheet. Moreover, Wirecard reportedly warned that a failure to provide certified annual and consolidated financial statements by June 19, 2020 would allow approximately 2 billion euro loans to be terminated. This news sent the price of Wirecard securities crashing over 60% lower.
The court has granted Lead Plaintiff leave to file an amended complaint on Aug. 14, 2020, which will expand the alleged fraudulent period to cover recent stock drops caused by the revelation of Wirecard's financial fraud, including the company's June 18 disclosure.
"Wirecard has long lied about its finances and almost fooled investors that information to the contrary was false. We are focusing our investigation on who knew what and when, including their accountants," said Hagens Berman partner Reed Kathrein.
For more information about the case visit: https://www.hbsslaw.com/cases/WRCDF
Whistleblowers: Persons with non-public information regarding Wirecard should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 510-725-3000 or email mailto:[email protected].
About Hagens Berman
Hagens Berman is a national investor-rights law firm headquartered in Seattle, Washington with 78 attorneys in 9 offices across the country. The firm represents investors, whistleblowers, workers and consumers in complex litigation. More about the firm and its successes can be found at www.hbsslaw.com. For the latest news visit our newsroom or follow us on Twitter at @classactionlaw.
Reed Kathrein, 510-725-3000
SOURCE Hagens Berman Sobol Shapiro LLP