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Thousands locked out of accounts as UK watchdog keeps Wirecard curbs

Stock MarketsJun 29, 2020 15:45
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2/2 © Reuters. FILE PHOTO: The headquarters of Wirecard AG is seen in Aschheim near Munich 2/2

By Huw Jones and Iain Withers

LONDON (Reuters) - Britain's Financial Conduct Authority said on Monday that Wirecard (DE:WDIG) was addressing its concerns but restrictions on the collapsed German payments company's services would remain in place for now.

Several British fintech firms have been forced to suspend services following the FCA's restrictions on Wirecard, leaving hundreds of thousands of accounts blocked.

"We cannot lift the restrictions without reassuring ourselves that the firm has been able to satisfy all our concerns, for example that all clients' money is safe. We hope to be able to issue an update soon," the FCA said in a statement.

Wirecard said on Saturday it would proceed with business activities after filing for insolvency and an administrator was appointed on Monday.

The FCA said its teams have been working with Wirecard and other international and UK authorities over the weekend.

A spokeswoman for Wirecard UK said it was working with the FCA to lift the suspension as quickly as possible.

Firms providing finance to poorer and vulnerable Britons who have difficulty accessing mainstream banking are among those hit, including Pockit and U Account, part of subprime lender Morses Club (L:MCLM).

The government said anyone worried about not being able to receive welfare payments should contact its helplines.

Wirecard's woes have forced some firms to accelerate existing projects to switch to other services, including card provider Curve which said on Monday its services were back online.

But industry forum Emerging Payments Association (EPA) warned it could take months for others to do the same and urged the FCA to lift its Wirecard freeze as soon as possible.

"We predict dozens of corporate failures, hundreds of job losses and significant reductions in tax payments, unless it is removed right away," EPA said in a letter to the FCA.

Martin Lewis, founder of consumer website moneysavingexpert.com, said there was a reasonable expectation that consumers affected would get access to their money again by Wednesday or Thursday.

Thousands locked out of accounts as UK watchdog keeps Wirecard curbs
 

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Comments (1)
Mon Sun
Mon Sun Jun 29, 2020 11:01
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EY told CNBC that there were clear indications that this was an elaborate and sophisticated fraud, involving multiple parties around the world in different institutions, with a deliberate aim of deception. He also indicated that even the most robust and extended audit procedures" couldn't uncover what it called a "collusive fraud." The UK is also under suspect like many other countries according sources.
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moto drives
moto drives Jun 29, 2020 11:01
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Mon Sun, so you gave the link to "EY told CNNC"...?
moto drives
moto drives Jun 29, 2020 11:01
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Mon Sun Mon Sun, so you gave the link to "EY told CNNC"...?
Mon Sun
Mon Sun Jun 29, 2020 11:01
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moto drives i have no idea about CNNC. This news is everywhere since Thursday. It’s no news and it is everywhere. EY waa intereviewed on CNBC and so obviously all medias should have this information. It’s been out since Thursday or so
Mon Sun
Mon Sun Jun 29, 2020 11:01
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In regards to the UK being the major suspect - it’s coming from other sources and not from EY
Mon Sun
Mon Sun Jun 29, 2020 11:01
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warecard also never held any customers money and so there couldn’t have any missing amount. wirecard is only a system that provides payment in which its operations are through the financial institutions and so there can’t be a missing amount with wirecard.
 
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