Posted 10 months ago | by Ben Armstrong
Crypto.com – Clients Should Be Immune to Risk after the Suspension of Wirecard by FCA
The UK's Financial Conduct Authority (FCA) ordered Wirecard to cease all operations earlier this month, and Crypto.com confirmed that any and all customer funds have been returned. This means that there is no risk to client funds.
According to a statement released on June 26 from the Financial Conduct Authority (FCA), Wirecard’s subsidiary responsible for issuing debit cards, Wirecard Card Solutions Ltd., is required to not dispose of any of its funds, stop conducting any of its regulated activity, and it must communicate on its website that it is no longer permitted to conduct any regulated activity.
The FCA explained that it began working with Wirecard after the news of the 1.9 billion Euros shortfall in the card-issuing subsidiary, to ensure that customer funds are protected. On Friday, the regulator ordered Wirecard Card Solutions to cease all regulated activities. “This now means customers money cannot be accessed,” the statement concludes.
Crypto.com Confirms Zero Risk from Wirecard Scandal
The suspension of the FCA on Friday affects all cards issued by Wirecard Card Solutions, including Crypto.com, TenX cards, and others.
“As of this moment the cards are working fine. As per our statement yesterday, in case of a disruption, we will rapidly proceed to credit the funds back to our users’ crypto-wallets. Given the announcement made by the FCA today, this is highly likely.”
According to a company blog post, Crypto.com disclosed that it has stopped operations for its EU and UK cards, which means customers in those regions will not be able to use their cards for the time being.
Also, Crypto.com confirmed that all funds on the debit cards will be refunded to customers on their crypto wallets in the next 48 hours. The company also added that it was in the process of transferring its card program to a new provider.
A Bad Situation
Currently, Wirecard admitted to lacking over 32% of its claimed assets, worth $2.1 billion. The CEO of the company, Markus Braun then resigned and was arrested by German authorities due to a long-running fraud to misrepresent the company’s earnings and assets.
On Thursday, the company filed for insolvency.
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