SoftBank Saw Opportunity in Wirecard Before It Unraveled

Nearly half of Wirecard’s debt, raised months before its collapse, came as a result of SoftBank’s involvement

Payment-processing company Wirecard was the darling of Germany’s fintech industry until auditors uncovered a $2 billion hole in its accounting. WSJ explains what we know about the missing money, as investigators are still trying to understand what happened. Photo composite: George Downs

When influential tech investor SoftBank Group Corp. backed Wirecard AG last year, it gave a $1 billion jolt to the German fintech, and temporarily quieted questions about the legitimacy of its profits.

Wirecard’s rapid unraveling last month in an accounting scandal is bringing new scrutiny to the deal. SoftBank lent its name and reputation to the digital-payments company, but offloaded the financial risk to other investors. Mutual funds and pension funds that bought Wirecard bonds are sitting on massive losses.

...
To Read the Full Story

Continue reading your article with
a WSJ membership

View Membership Options