A group of British MPs has warned that the government must avoid the mistakes German regulators made when dealing with failed fintech giant Wirecard.
The All Party Group on Challenger Banks and Building Societies’ new report, “Wirecard: When fintech goes rogue” dives into how the UK can avoid a similar scandal.
The German financial watchdog, BaFin, has faced massive blowback for its persistent defence of Wirecard as it faced mounting allegations of financial accounting irregularities.
Group chair Karen Bradley MP links the collapse to the long awaited Kalifa Review of UK Fintech. Specifically, she welcomes the government’s support for Kalifa’s proposed Fintech “scale-box” which is designed to ensure keener oversight of newly-authorised institutions.
Says Bradley: “The APPG is strongly of the view that firms need proportionate regulation which matches their size, complexity and market exposure.
“Regulators need to be fleet of foot enough to anticipate the issues that arise as firms scale and must have the specialist knowledge to understand how these new types of institutions work.”