Germany’s coalition parties have agreed to a series of reforms on financial conduct, governance and auditing responsibilities in light of the continued fallout of the Wirecard AG multi-billion fraud scandal.
Reported by Reuters, new plans developed by Deutsche Boerse financial authority BaFin will enforce direct controls upon corporate governance boards with regards to monitoring and fulfilling their auditing duties.
In addition, German federal lawmakers are reported to want ‘tighter requirements’ on firms listed on the Deutsche Boerse index with regards to their membership criterias, leadership responsibilities and information made available to the public.
A summer of embarrassing news headlines, recounting Wirecard multi-billion auditing and false account scandals has led to corporate conduct being placed at the top of the Bundestag federal agenda.
On the direct orders of Chancellor Anglea Merkel, last July German Finance Minister Olaf Scholz presented a ’16-point plan’ to streamline system failures within German financial services’
Scholz recommendations had instructed BaFin to implement an overhaul Deutsche Boerse index rules
Reuters revealed that the new plans stated: “BaFin needs a right to audit all capital market-oriented companies including the right to information from third parties, the possibility to conduct forensic investigations as well as the right to inform the public at an earlier stage about its actions regarding balance sheet control.”
Furthermore, it has also been reported that the Wirecard calamity could lead to substantial alterations in the country’s taxing system, once again to avoid a similar situation unfolding.
Just last month, IDnow announced the signing of a new agreement with Wirecard Communication Services.
The deal saw the firm acquire Wirecard Communication Services and retain the Leipzig location preserving the majority of the 150 employees.
It came after the UK’s Financial Conduct Authority (FCA) implemented a host of restrictions on Wirecard AG, following the digital payment processing firm’s decision to file for insolvency in its home market of Germany.
The FCA detailed that Wirecard UK must cease any regulated market activities, with the financial services regulatory body emphasising that Wirecard is restricted from disposing of any assets and funds during its period of investigation.
The case has also lead to UK governance reviewing auditing processes, with tighter guidance likely coming in the near future.