Court’s Ruling Marks Significant Step in Investigating One of History’s Largest Financial Frauds
Singapore — The Wirecard scandal, one of the most significant financial frauds in recent history, unfolded when the fintech company filed for insolvency in 2020, with €1.9 billion (SGD 2.9 billion) mysteriously vanishing and its CEO being terminated and arrested.
The company’s Singapore office faced police raids in February 2019 following a series of whistleblower reports published by the Financial Times (FT), which raised serious allegations of accounting malpractice. Wirecard provided cashless payment solutions to notable Singapore clients such as EZ-Link, Electronic Road Pricing, ComfortDelGro, and Dash, while also serving major global clients like Apple, Google, and Samsung.
In a recent development, Mr. Suresh Divyanathan, a Dispute Resolution Partner at law firm Oon & Bazul, secured a unique ruling from the High Court, mandating Oversea-Chinese Banking Corporation Limited (OCBC) to disclose specific bank statements. These statements from Citadelle Corporate Services are intended for use in ongoing German legal proceedings connected to the Wirecard scandal.
According to Oon & Bazul’s statement, “Citadelle had previously informed Wirecard that they held millions of Euros across various accounts at OCBC on trust for Wirecard. To verify these claims, it was essential for Wirecard’s insolvency administrator to obtain the relevant bank statements.” The law firm also noted that R Shanmugaratnam, the director of Citadelle, faces charges for allegedly falsifying documents related to Wirecard entities. Consequently, the law firm sought the bank statements directly from OCBC, rather than from Citadelle itself.
Obtaining these statements was challenging due to Singapore’s stringent banking secrecy laws. Mr. Suresh and his team first had to petition the High Court for an order requiring OCBC to disclose Citadelle’s bank statements. Following this, another application was necessary to permit the use of these statements in legal actions in Germany aimed at declaring Wirecard’s prior financial statements as invalid.
Oon & Bazul emphasized that such disclosures are a rare occurrence due to Singapore’s well-established banking secrecy framework. “The applications to reveal bank records are typically difficult to achieve,” Mr. Suresh stated. The law firm pointed out that banks in Singapore are bound by Section 47 of the Banking Act to maintain the confidentiality of customer information, often refusing even to confirm if a person or entity holds an account with them.
However, Mr. Suresh contended that this ruling does not diminish Singapore’s reputation for banking secrecy. Instead, it illustrates that “in exceptional situations, banks can be compelled to disclose customer information to third parties when justice demands it.”
The law firm concluded that “Mr. Suresh and his team successfully convinced the Singapore High Court that, given the context of the Wirecard scandal, it was necessary and just for OCBC to disclose its customer’s bank statements to Oon & Bazul and allow their use in German Court proceedings.”
