ASX-Listed Fintech Giant to Buy Australian Wirecard Assets After Crypto Card Platform Collapse

Wednesday 16 September 2020, 7:00 AM AEST - 1 week ago

A US-based fintech enterprise listed on the ASX has announced a bid to buy Wirecard’s Australian and New Zealand businesses subsequent to the collapse of the international cryptocurrency debit card company in June this year.

Change Financial, a US-based fintech company, has announced that it recently entered into a binding agreement that will see it acquire all of the business assets of Wirecard in both Australia and New Zealand for a total cost of $7.8 million.

Wirecard, which promised worldwide crypto-powered debit cards, collapsed in June after revealing that €1.9 billion in company assets did not exist. The payments company, originally based in Germany, was operating as a major crypto debit card issuer, until financial strife revealed poor bookkeeping and fictional assets.

Controversy regarding Wirecard began on June 18, when Ernst & Young auditors reported that more than $2 billion that was supposed to be held by Wirecard in Philippines-based accounts did not exist. The CEO of Wirecard, Markus Braun, was subsequently arrested on August 23, with Wirecard filing for insolvency on June 25.

Ernst & Young global chairman Carmine Di Sibio released a statement via a letter distributed to senior executives this week, expressing regret that Wirecard’s fraud was not identified sooner.

“Many people believe that the fraud at Wirecard should have been detected earlier and we fully understand that. Even though we were successful in uncovering the fraud, we regret that it was not uncovered sooner.”

Change Cashes in on Wirecard Assets

Change Financial, however, is cashing in on the controversy surrounding the now-defunct card provider, purchasing all of Wirecard’s business assets in both Australia and New Zealand for less than $8 million. 

The strategic acquisition includes a blue chip client base that includes Australia’s Big 4 Banks, an estimated $15.4 million in revenue for the 2020 financial year, and partnerships with Visa, Amex, UnionPay, and Diners. 

Change has stated that it aims to upgrade and expand upon Wirecard’s existing platform in order to expand into the US market over the next 12 months.