Economy

Wirecard: Cardholders' money locked as FCA freezes United Kingdom subsidiary

Wirecard: Cardholders' money locked as FCA freezes United Kingdom subsidiary”

The FCA said: "There are ongoing events in Germany concerning companies closely linked to Wirecard". Customer cash will be frozen.

"This is a massive issue for many customers who rely on the money placed in their U account for everyday essentials including the ability to pay rent and buy food", one customer told the BBC. "What the hell is going on???" tweeted a customer of business account provider ANNA.

They said that customers' money was still safe, but would not be accessible for a time.

A spokesperson for Curve said: "In April, Curve announced we would bring more processes in house such as card issuing and e-money and move away from a reliance on Wirecard". Furthermore, the financial services regulatory body underlined that Wirecard is restricted from disposing on any assets and funds during its period of investigation.

U Account customers' money is held by Barclays meaning the funds are ringfenced and not at risk, Morses said. We expect this to be completed within 48 hours.

Wirecard Card Solutions is a subsidiary of the German company Wirecard AG that on Thursday filed for insolvency. The company, once worth over €20bn (£18bn, $22bn), collapsed after admitting to a €1.9bn hole in its balance sheet.

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The news comes just days after Markus Braun, the ousted Chief Executive of th global payment processing firm, was arrested on charges of corruption, fraud and executive mismanagement.

"Despite the news from Germany, we had no warning that Wirecard in the United Kingdom was in any trouble", it said. "However, we can not lift the restrictions without reassuring ourselves that the firm has been able to satisfy all our concerns for example that all clients' money is safe".

Martin Lewis, founder of consumer website moneysavingexpert.com, said there is a reasonable expectation that the hundreds of thousands of consumers affected will get access to their money again by Wednesday or Thursday.

Customers of several British digital finance companies were unable to make payments or access their money on Friday after the collapse of German payments firm Wirecard caused disruption across borders.

Funds are not protected, as they are in banks, by the Financial Services Compensation Scheme, but the firm said customers' money was held safely in segregated accounts.



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