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  "documentTitle": "Wirecard AG (WDI)",
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  "authorName": "Sir Chris Hohn",
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  "presentationDate": "2020-04-28 00:00:00",
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  "notes": "This is a page from a shareholder letter by TCI Fund Management regarding Wirecard.",
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      "text": "In our opinion, the necessary intervention is now to remove the CEO from all management duties.",
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      "text": "We are further advised that the supervisory board, as a corporate body as well as every single member of the supervisory board, has wide reaching legal obligations (fiduciary duties) to control and oversee the actions of the management board (Kontroll- und Überwachungsorgan). In circumstances such as these, where Wirecard's management did not provide KPMG with the necessary documentation to verify TPA revenues in the period of 2016 to 2018 and to verify cash balances amounting to €1 billion in “trustee accounts”, we are of the view that the supervisory board is legally obliged to intervene. In our opinion, the necessary intervention is now to remove the CEO from all management duties.",
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      "text": "Given this situation, why did you and the supervisory board not intervene when it became clear that the audit could not be properly completed?",
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      "text": "KPMG further explains that the supervisory board received regular updates on the progress of the investigation [p. 6 KPMG Report]. Hence, we assume that the supervisory board was well aware of the difficulties KPMG encountered in properly conducting the audit. Given the allegations raised against Wirecard and its executive team by various whistleblowers and newspapers, it could not be more obvious that there is a need to take measures to avoid the likely conflict of interest whereby management supervises an audit of their own actions.",
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      "text": "Wirecard operates a banking license in Europe and is strictly regulated as a payments service provider; in our view it has to abide by applicable Know Your Customer and anti-money laundering laws. This raises questions as to how it is possible to comply with these regulations if Wirecard either does not know or will not disclose who its customers are.",
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      "text": "Lengthy forensic investigation, then in our view this raises questions as to how investors, lenders and regulators can be confident that Wirecard's current and historic accounting is accurate.",
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      "text": "If the supervisory board does not remove the CEO, at the very least, they must directly take responsibility for the investigation and remove Wirecard's management from all involvement in this",
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      "text": "In our view, it is clearly now necessary for the supervisory board to take direct responsibility for this investigation immediately and to resolve the outstanding questions that the report has failed to answer. In fact, we are advised that the supervisory board has a legal duty of care (Sorgfaltspflicht) that requires it to intervene in these circumstances. In accordance with Section 84 (3) of the German Stock Corporation Act (Aktiengesetz), the supervisory board also may revoke the appointment of a member of the management board.",
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      "text": "KPMG further complained about a lack of cooperation from Wirecard's TPA partners to provide customer and transaction data [p. 13 KPMG Report]. Moreover, Wirecard did not provide KPMG with certain requested documents or only provided them with delay, and KPMG complained that arranged meetings with key executives of Wirecard were repeatedly cancelled and postponed [p. 10 KPMG Report].",
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