EY chairman Carmine Di Dibio has expressed ‘‘regret’’ in a letter to clients, which was seen by the Financial Times, over the Big Four accountancy group’s failure to uncover fraud at German fintech company Wirecard sooner.
Wirecard filed for insolvency back in June after it revealed that €1.9bn (£1.7bn) had gone missing from its accounts, after blaming “possibly fraudulent” transactions for the lost funds.
EY’s auditors in its German office did not request important information from a Singapore bank where Wirecard claimed to have the missing funds.
Investors are now preparing to sue Wirecard and EY after creditors were left owing €3.5bn (£3.1bn), with the latter also being investigated by the German authorities.
In his letter to clients, Di Dibio said: ‘‘Many people believe that the fraud at Wirecard should have been detected earlier and we fully understand that. Even though we were successful in uncovering the fraud, we regret that it was not uncovered sooner.
‘‘The collusive acts of fraud at Wirecard were implemented through a highly complex criminal network designed to deceive everyone — investors, banks, supervisory authorities, investigating lawyers and forensic auditors, as well as ourselves.’’
He added: ‘‘Whilst the primary responsibility for the prevention and detection of fraud is with the management and supervisory boards, audits should play more of a role in the future to detect material frauds.’’