One of the stranger elements of the Wirecard scandal has been the involvement – or, apparently, lack of involvement – of the Philippines in handling much of the troubled payment processor’s disputed funds.
It’s tempting to think that this is damaging for the reputation of the Philippines and its financial services industry. And it might be. But it’s also possible it may prove the country’s systems to be more resilient than they have been given credit for.
A brief primer, for those who haven’t followed the intricacies of Wirecard’s alleged deceit, as unearthed by the FT’s investigations team: Wirecard, the Germany-based payments processor, claimed to have held €1.9 billion of funds through two Philippine banks, BDO Unibank and Bank of the Philippine Islands.
It now appears that the money never existed, and that Wirecard’s auditors, EY, were deceived by fraudulent documents.
Clearly, the Philippines still has questions to answer … but as a response to a fast-moving and damaging scandal, you have to say it has been both open and swift
The temptation here is to think of a certain emerging-market grubbiness in all this: that, if you wish to deceive auditors and give the illusion of having funds you don’t have, you turn to emerging Asia and set your scam there.
