The Wirecard incident breaking in June last year was a story interesting for its intrigue as much as for its regulatory implications. The German payments processor battled allegations of fraud, forgery and opaque business links while allegations continue to circulate involving Wirecard employees hauling millions of euros of cash out if the group's Munich headquarters in shopping bags.
Unsurprisingly, the incident raised questions about the wider regulatory supervisory implications of the Wirecard case. These questions, and renewed scrutiny, of the regulation of fintech companies is unlikely to die down. New suspicions that a Lithuanian payments company was used to steal more than €100m from Wirecard weeks before it collapsed are likely to turn up the heat on regulators and fintech companies alike.
Wirecard's long shadow over the regulatory landscape is something that regulators, not least the Bank of Lithuania, will be cognizant of when designing their fintech strategies. The UK's Kalifa Review of Fintech envisaged fintech bridges. However, should we also be expecting fintech observation towers?