Wirecard’s Entanglement with Option888: Misstatements and Unanswered Questions

Introduction

In May 2019, Wirecard, a prominent German fintech company, issued a press release addressing allegations of its involvement with the binary options scheme Option888, operated by Uwe Lenhoff and his associated entities, including Altair Entertainment N.V. While the statement aimed to clarify Wirecard’s position, it contained several inaccuracies and omissions that have raised further concerns.​

Misleading Claims in Wirecard’s Statement

Wirecard asserted that Option888 possessed a government license to operate its business, stating:​

“Wirecard actively terminated the customer relationship with Option888, which had a state license to operate its business and was one of the few licensed binary option service providers that held bank accounts with Wirecard.”​

However, investigations reveal that neither Uwe Lenhoff nor his companies, such as Altair Entertainment N.V., Capital Force Ltd, Payific Ltd, or Celestial Trading Ltd, held any licenses from financial market supervisory authorities to offer financial instruments within the EU. Multiple regulatory bodies, including BaFin (Germany), FMA (Austria), CONSOB (Italy), and the FCA (UK), had issued warnings against these entities. This information should have been uncovered during Wirecard’s mandatory KYC and AML checks.​

Underreported Financial Transactions

Wirecard claimed that its annual sales from the Option888 relationship amounted to less than €40,000. Given the scale of Option888’s operations, it’s implausible that such a minimal amount accurately reflects the total funds processed. It’s likely that hundreds of thousands, if not millions, of euros flowed through Wirecard’s accounts on behalf of Option888.​

Termination Due to Suspicious Activities

Wirecard stated that it ended its relationship with Option888 in 2016 after detecting suspicious transaction patterns. While this action aligns with regulatory expectations, it remains unclear whether Wirecard reported these suspicious activities to the relevant authorities, as required by law.​

Acknowledgment of Involvement

By addressing its past dealings with Option888, Wirecard has implicitly acknowledged its role as a payment service provider for fraudulent binary options schemes. This admission brings to light the broader issue of financial institutions facilitating such scams, either knowingly or due to inadequate oversight.​

The GreyMountain Management Connection

Notably absent from Wirecard’s statement is any mention of its association with GreyMountain Management Ltd (GMM), an Irish-registered company linked to numerous binary options frauds. GMM, operated by the Cartu brothers, shared office space with Wirecard UK & Ireland in Dublin. This proximity suggests a deeper connection between the two entities, warranting further investigation.​

Key Entities Involved

Conclusion

Wirecard’s attempt to distance itself from the Option888 scandal raises more questions than it answers. The company’s misstatements and omissions highlight the need for greater transparency and accountability within the fintech industry, especially concerning partnerships with entities involved in fraudulent activities.​