(Correction to the figure in the 5th paragraph, 1st sentence in the report of 09.12.2021: It should read 1.9 rpt 1.9)

MUNICH (dpa-AFX) - In the Wirecard scandal, frustrated investors can now hope for damages claims against the auditing firm EY after their immense share price losses. EY had audited the false balance sheets of the former DAX-listed company. In a preliminary ruling on Thursday, the Munich Higher Regional Court raised serious doubts about the court decisions of the first instance. The Munich Regional Court had dismissed claims against EY without taking further evidence. According to the Higher Regional Court, the Regional Court should have examined much more closely - as in the diesel scandal - whether EY acted in a deliberately immoral manner.

The preliminary indication does not mean that the Higher Regional Court considers EY's auditors to be jointly responsible in every case or that the success of the claims against the auditing firm is now guaranteed. However, the 8th Civil Senate of the OLG made it very clear that, in its opinion, the Regional Court had dealt with the case far too superficially.

In particular, the Senate criticized the Regional Court for lacking "its own expertise" to assess the allegations made against EY in an expert opinion by the auditing firm KPMG. According to the OLG, an expert opinion would have been appropriate.

In addition, the OLG accused the Regional Court of having ignored the report of the Wirecard Committee of Inquiry in the Bundestag, "contrary to duty of care" to the detriment of the plaintiff investors. The OLG recommended that the Regional Court open a test case. As an option, however, the OLG is also considering referring the proceedings back to the regional court in order to make up for the lack of extensive evidence to date.

In June 2020, Wirecard initially admitted to fictitious bookings amounting to 1.9 billion euros and filed for insolvency shortly afterwards. EY had previously audited and certified the company's balance sheets for years without discovering the suspected fraud. The Munich public prosecutor's office assumes that the Executive Board acted like a criminal gang and deliberately falsified the balance sheets for years in order to obtain bank loans and investor funds. Former CEO Markus Braun has been in custody for almost a year and a half.

For shareholders, the Wirecard bankruptcy meant immense losses in the double-digit billions. As a result, the Munich Regional Court has received hundreds of claims for damages against EY, which have so far been dismissed.

In several decisions, the Regional Court saw no causal link between the EY audit reports and the investors' losses, and no breach of duty on the part of the auditors. The OLG, however, has serious reservations about this view of things: According to the Senate's assessment, an earlier refusal of the audit opinion by EY would also have resulted in Wirecard AG filing for insolvency earlier. Based on this, "the general experience of life would then probably suggest that the investors would not have made the share purchases at issue if they had been aware of this", according to the OLG's statement./cho/DP/men