Holvi cards suspended because of the Wirecard scandal

Holvi, the digital banking platform for freelancers, has become the latest FinTech firm to be swept up in the Wirecard scandal.

The Financial Times have investigated and reported on irregularities in the German FinTech giant Wirecard for the last two years. However, things only started to move fast in the last two weeks after it auditor Ernest & Young refused to sign off on the company’s financial statement for 2019 after it discovered a €1.9bn ($2.1bn) hole in its balance.

Over the following fortnight, Wirecard admitted that the missing money, which represented roughly a quarter of its balance, probably never existed in the first place. Wirecard’s CEO Markus Braun stepped down from his role and was later arrested, accused of having inflated the company’s total assets and sales volumes. Braun was later released on a €5m ($5.66m) bail. Then, on Thursday June 25, Wirecard filed for insolvency. And that was when the troubles for UK FinTechs really started.

Early in the morning of Friday June 26, the FCA ordered Wirecard UK to freeze all of its assets and services. The regulator’s action affected the businesses depending on the German company’s services. Companies like Curve and ANNA Money have been forced to suspend its services because of the FCA’s freeze. The Finnish banking platform Holvi announced in January launched its services in the UK and has now also had to temporarily freeze its Business Mastercard because of the Wirecard scandal.

Holvi made the announcement on its website and said that it was “actively working on a solution to restore card usage as soon as possible.” The FinTech also stressed that it was in no way part of Wirecard’s alleged fraud, but that it had been dependent on the services provided by Wirecard Card Solutions (WDCS), the UK subsidiary that the FCA halted all regulated activities of.

Holvi also told customers that all “other functions of your Holvi account are still fully available.”

“You can still invoice, receive and transfer fund,” Holvi wrote. “Please be assured that all Holvi customer accounts and funds remain safe, secure and accessible at all times. This is because all Holvi customer funds are segregated and held in separate accounts in European banks in Finland, Sweden, Denmark, the UK and France. No customer funds are held by Wirecard AG. Your money and your Holvi account are safe.

“Your trust is our top priority. We’re actively working on a solution and will continue to update as soon as possible.”

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