May 13, 2021

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EY Germany director to step down following Wirecard scandal

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The director of EY Germany, the longtime auditor of disgraced payment firm Wirecard, is expected to step down, people familiar with the matter say.

Hubert Barth, who has led EY in Germany since 2016, is expected to take on another role at the company, the people said, adding that his departure from the high-level position could be announced as early as Thursday.

The change has yet to be formally approved at board meetings in Germany on Thursday, the people said.

Barth’s expected move comes the day after EY announced a reorganization of its operations in Western Europe that will bring together companies with combined sales of $ 4.65 billion and 27,000 employees.

As a longtime Wirecard auditor, EY has come under intense pressure since the payments company collapsed into bankruptcy in one of Germany’s biggest accounting frauds. EY had previously issued unqualified audits for Wirecard for about a decade.

Munich prosecutors last year launched a criminal investigation into EY’s partners in charge of Wirecard audits after the German audit check deposit a criminal complaint, claiming to have found evidence that they could have violated their professional obligations.

EY has denied any wrongdoing. In December he retaliate against the audit watchdog, claiming that “in our opinion the legal right to be heard in this matter has not been sufficiently granted to us so far”.

Under Barth’s leadership, EY made significant inroads into German companies, gaining market share over rivals KPMG and PwC. However, several prestigious clients, including Commerzbank, the asset manager of Deutsche Bank DWS and the public lender KfW left EY in recent months.

Carmine Di Sibio, Global President and CEO of EY, in September Express “Regrets” that his company did not discover the fraud sooner. He said the Big Four accounting group will “raise the bar significantly” in its audit work.

EY declined to comment. Barth did not respond to FT’s requests for comment Thursday morning.



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