Wirecard is probably one of the most famous European frauds of all time. It collapsed in 2020. We covered the stock as a Short for over six years, writing over 40 notes. Our journey started with deep dives into the changes in accounting at the Asian acquisitions (Singapore, Indonesia), through many, many accounting angles (cash conversion, gross debt), field work (trips to Romania, India and Germany) and corporate structure analysis (Maldives, India). This was a challenging Short because the share price went against us for many years, but the duration and quality of our work meant clients were able to avoid being invested, or capitalise on the collapse of the business. Wirecard is an excellent example of the challenges of short research because the company was very aggressive in their communications and actions against anyone who dared to question the story. In this case, we did not meet the management, other than attending group presentations, because we did not want to corrupt our independence in the research process.
