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Four current and former EY auditors involved in inspecting the collapsed payments company Wirecard were the subject of closed investigations by Germany's audit body after they returned their professional licenses and quit their jobs earlier this month.
Apas is only permitted by German law to investigate and penalize potential misconduct of active accountants who are listed in the nation's public accountants register.
Four current and former employees of the country's chamber of public accountants, the WPK, quit this month as the watchdog's delayed decision over EY's contentious audit for the infamous German payments processor approaches.
According to sources with knowledge of the situation, the three EY audit partners who have been in charge of the Wirecard audit since 2016—Martin Dahmen, who is still employed by EY, and Andreas Budde and Andreas Loetscher, who have left the company—were among those who resigned. Loetscher took over as head of accounting at Deutsche Bank in 2018 as Budde retired, although she later left the company. The fourth person was a less experienced auditor who spent a lot of time working on the Wirecard mandate.
The four were among a group of 12 current and former EY employees who have been the subject of an Apas investigation since Wirecard went bankrupt in June 2020. For nearly a decade, EY gave the corporation a clean bill of health, but eventually the company had to admit that €1.9 billion in corporate cash and half of its claimed revenue were fakes.
The watchdog has the authority to suspend or permanently ban accountants and fine them up to €500,000 if it finds major wrongdoing.
According to Apas, the case against the four people who returned their licenses was concluded. It declined to divulge their identities but said that there were now only eight people under investigation as opposed to the previous 12 people.
The watchdog further stated that anyone subject to sanctions must be a member of the audit profession. "If the appointment as an auditor is waived for whatever reason, for legal reasons the professional oversight ends as well," Apas said in a statement, adding that "any ongoing investigation is automatically closed."
The WPK mentioned its publicly accessible database of licensed accountants in a statement, noting that four former members had left in early 2023.
EY declined to speak further but did state that "individual auditors have decided to renounce their licenses as auditors."
The decision made by Dahmen, according to his attorney, was "a personal decision" but was discussed with EY.
Mr. Dahmen said, "Mr. Dahmen wanted to draw a line under the matter and to look forward," noting that his client was still adamant that he carried out the audits to the best of his knowledge and belief and that Wirecard had duped the auditors.
Loetscher did not immediately respond to a request for comment, and a lawyer for Budde declined to make any statements.
By fLEXI tEAM