In 2021, when Commerzbank terminated the account of the porn company Manwin, Wirecard was on the spot. The German fintech did business with the porn industry for longer than ex-CEO Markus Braun portrayed it to the outside world. Wirecard grew to prominence with customers in the gambling and porn industries. Over the years, however, Braun tried to shed the smut image of the early years as best he could. German FinanceFWD recently published an interesting report.
The Wirecard Mission
Two years ago, the German magazine Der Spiegel asked Markus Braun in an interview whether porn and gambling had been his hobbyhorse. He replied, “Nice try.” In the early 2000s, he said, these were simply the first online payment offerings – with correspondingly large market shares. However, the erotic sector “no longer plays a role.”
As early as 2008, Braun emphasized to the FAZ that Wirecard’s revenues were primarily generated with consumer goods and that only ten percent of the company’s processing volume was accounted for by online dating. He did not even mention the porn industry. The DAX-listed Wirecard desperately tried to give itself a reputable image. The truth, however, is that Wirecard, until its bankruptcy in 2020, has always been a high-risk payment processor with porn and gambling clients. This was the company’s true mission and in its genes.
Pornhub, YouPorn and Mindgeek
Commerzbank terminated the relationship with the Luxembourg-based porn empire Manwin (later Mindgeek) because of the reputational risks. Manwin earned its money with scandal-ridden porn sites like PornHub or YouPorn; the head of the company was also involved in a tax scandal at the time.
At Wirecard, however, the German offshoot of the porn company was “welcomed with open arms.” According to the insider, Wirecard remained the house bank until at least 2015. The Wirecard account manager would have made many things possible for Manwin that other banks would have waved off for compliance reasons, FinanceFwd reports.
Wirecard was still processing payments for 4,000 porn and dating websites even in 2017 and generated such high margins in the process that experts suspected this could be money laundering.
The Wirecard Legacy
The early Wirecard managers who were also responsible for the fintech’s high-risk potential, Dietmar Knoechelmann and Ruediger Trautmann, founded today’s Payabl (formerly Powercash21 and Inatec) while they were active time as Wirecard executives. This Payabl, which is licensed in Cyprus as a payment processor, is likely to be the successor to the collapsed Wirecard in terms of its business model and high-risk customers. High-risk payment processing, done properly, may be unethical but can be a great business.
Share Information
If you have information about Wirecard, Payabl, or other high-risk processors, please let us know via our whistleblower system, Whistle42.
