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Jupiter's Darwall hit as Wirecard tumbles on FT report

Shares in Alexander Darwall's top holding plunge 22% after Financial Times says law firm found evidence of forgery and false accounts.

Jupiter's Darwall hit as Wirecard tumbles on FT report

Top-performing European fund manager Alexander Darwall has been hit by a plunge in the shares of his top holding, German payments company Wirecard (WDIG.DE), after the Financial Times reported a law firm had found evidence of forgery and false accounts.

According to the newspaper, the law firm presented its findings to Wirecard senior management in May last year, having been commissioned to investigate the company's Singapore office.

The FT's publication of its report this afternoon, the second major Wirecard allegation from the newspaper this week, sent the shares 21% lower. 

On Wednesday the FT alleged a Wirecard executive had used forged and backdated contracts in a string of suspicious transactions. Shares in Wirecard have lost a third of their value over the last three days.

Wirecard has denied any wrongdoing, telling the FT it took all compliance and regulatory obligations extremely seriously and that it had 'strongent internal and external audits' with any concerns 'always thoroughly and appropriately investigated'.

The company labelled Wednesday's report 'false, inaccurate, misleading and defamatory'.

Wirecard is a 17% position in Darwall's Jupiter European Opportunities (JEO) investment trust, whose shares have fallen 3.3% today and are down 7% over the last three days.

The stock is also the top holding in his £5.1 billion Jupiter European fund, accounting for 8.7% of the portfolio, and is a 7.4% position in the Royal London European Growth Trust he runs with Cedric de Fonclare.

Citywire AAA-rated Carlos Moreno and Thomas Brown, the top performing European managers since the launch of their Miton European Opportunities fund at the end of 2015, are also investors.

Wirecard is meanwhile the top holding for Sarah Norris, who holds 2.8% of her Standard Life Investments European Ethical Equity fund in the shares.

The payments company has also attracted a number of short sellers betting against the stock. 

Bloomberg reported that hedge fund manager Crispin Odey had made $18 million (£13.8 million) from his short.

Barry Norris meanwhile has a short position on the shares accounting for 1.5% of his Argonaut Absolute Return fund. 

'Wirecard does not pass the smell test,' he said. 'It doesn't disclose how it makes money and what its competitive advantage is. Instead it just talks about the big picture in the industry and when they are asked for more granularity they either can't reveal it or refuse to reveal it.'

Another manager to have shorted the stock is David Crawford, who runs the City Financial Absolute Equity fund, with a short position disclosed in the fund's interim report covering the six months to the end of October.

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