Wirecard UK unlocks customers' cash after FCA freeze

Beleaguered Wirecard to proceed with business after insolvency

Beleaguered Wirecard to proceed with business after insolvency

The company said it has discussed measures with authorities in the United Kingdom after the Financial Conduct Authority froze the operations of Wirecard Card Solutions, Wirecard's United Kingdom operation. Wirecard also said it hoped its United Kingdom business, suspended by the Financial Conduct Authority on Friday, would continue trading after talks with the regulator.

Wirecard AG shares soared higher Monday after the company said Saturday that its business activities are continuing despite its having filed for insolvency in a court in Munich, Germany.

"We are maintaining pressure on the firm to resolve these issues which would allow it to operate under certain conditions", the FCA said.

Wirecard collapsed on Thursday owing creditors nearly US$4 billion after disclosing a hole in its books that its auditor EY said was the result of a sophisticated global fraud.

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The company's physical stores had been temporarily closed on March 17 due to the coronavirus outbreak. Shares were down 2% at market close on Friday at $196.39 per share.

"The FCA's consent means that Wirecard can now resume electronic money and payment services to its customers and customers can now, or very shortly, use their cards as usual", a statement said.

The UK subsidiary is still blocked from transferring its own assets and faces restrictions on where it can hold customer cash. The FCA said it would continue to monitor the firm closely.

Last Friday, the FCA told the company's United Kingdom unit to cease its activities and as a result customers' accounts were frozen. However, the move resulted in a worrying weekend for some United Kingdom customers who said they faced financial difficulty as a result of the FCA's crackdown. "We apologise for the inconvenience to our valued customers that the temporary suspension caused", the United Kingdom firm said.

The hundreds of thousands of users of British subsidiary Wirecard Card Solutions have lost access to their funds, with some taking to Twitter to express their dismay. It said in a statement that cardholders and client funds "remain safe and protected".

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