It did not take long for Leo Perry to conclude that something deeply suspicious was going on at Wirecard. “What was really weird was how well documented it was,” said Perry, who co-runs Ennismore Fund Management. What he never expected, however, was that it would take six years for the rest of the world to cotton on, or that he could be spectacularly vindicated yet still barely profit from his work.
Without some final shorts after news broke of the cash hole, in spite of spotting the problems so early, Ennismore would have lost money from shorting Wirecard overall because of the high cost of paying fees for an extended period to borrow stock. In absolute terms, Perry said, the $500 million fund he co-manages made profits of around $10 million for its investors from the six years of work.
As Wirecard morphed from a stock market curiosity into a financial technology group more valuable than Deutsche Bank, time and again it sidestepped questions and smeared its critics. With the company now insolvent after allegations of a multibillion-euro fraud, the experience of Perry raises the question of how, and why, so many managed to rationalize what he considered to be obvious evidence of wrongdoing.