Benefit Claimants Left With NO DWP Money - Wirecard Financial Crisis

Benefit Claimants Left With NO money after Wirecard Financial Crisis.

DWP benefits, State Pension and Tax Credits blocked and held by Financial Conduct Authority FCA -  This does not affect Post Office Card Accounts, only those who have benefits paid into PrePaid Debit Card accounts.

For years the Department for Work and Pensions (DWP) pressurised millions of benefit claimants and pensioners to dump the Post Office Card Account. Harassing them to nominate a bank, building society or credit union account  for payments to be deposited. The DWP must bear some of the responsibility after forcing claimants into the hands of these Financial Sharks who prey on the financially vulnerable. 

The UK license of Wirecard Card Solutions has been frozen by the regulator after its German parent company filed for insolvency. It means people are unable to access cash held with financial apps in the UK using Wirecard technology.

Shares in German payments company Wirecard have fallen more than 60% after the firm said its auditor had raised questions over cash balances worth £1.7bn. Auditors Ernst & Young had refused to sign off on Wirecard's accounts, saying it was unable to confirm the money existed. Ernst & Young, accused their client of "an elaborate and sophisticated fraud".

Wirecard has filed for court protection from creditors, Ernst & Young the accountants who signed off the firm's books for a decade are rejecting responsibility for their role in the debacle and preparing for the inevitable avalanche of lawsuits. 

Wirecard's former CEO Markus Braun was detained on suspicion of falsifying accounts before being released on bail. A saga that's evoked memories of the Enron accounting scandal in the United States.

Many benefit claimants and pensioners don't have bank accounts, many are unable to open an account. Many do have PrePaid debit cards which allow benefits to be paid direct into them and don't require a bank account. You can top these cards up at any store and spend online or use benefit payments like any other bank cards.

The Post Office Card account is ending in a bid to save government money. The contract with the Post Office will end in November 2021.

We the people are given a credit rating to ascertain our credit risk predicting our ability to pay back debt. The credit rating held by a credit rating agency is extremely harsh in keeping people in the gutter of poverty. Many reading this article will be asking who ascertains the credit risk, the credit worthiness, of companies like Wirecard to manipulate accounts and deceive investors and steal customers monies?

Work and Pensions secretary Thérèse Coffey said the cost of the contract provided “poor value for taxpayers”. Around 900,000 people use Post Office Card Account POCA to collect payments. However, DWP has been trying to encourage them to have benefits paid directly into their bank accounts instead.

Chairman of Respect For The Unemployed And Benefit Claimants said: 

"Yet again we are witnessing a financial crisis unfold - an unparalleled scandal. Wire-Card's collapse and many claimants left unable to open bank accounts expose the need for Post Office contract to be renegotiated. We need to protect vulnerable claimants, kids will be going hungry as a result of decisions being taken out of their control. An investigation must be held into the financial repercussions on UK cardholders -  FCA decision has put card accounts into Financial Lockdown"

For the last five years HMRC undertook a joint exercise with DWP harassing claimants to open bank accounts forcing claimants into the hands of Financial Sharks. Letters sent to tax credit and benefit recipients who had their benefits or pension paid into a Post Office Card Account (POCA) telling them to open a bank account. The letters have a black HM Government branded letterhead instead of either of the more usual HMRC or DWP letterheads that claimants may be more familiar with. The letter provides a DWP freephone telephone number that claimants can call for further information or advice.

With Bank closures, those wanting a bank account proved impossible for many. Campaigners are angry that letters sent to 900,000 pensioners and claimants failed to mention they can refuse to move – and keep their old account. The letters told the elderly to switch to a bank account for the continued receipt of their state pension. The Tory led Government since 2010 has been leading the Post Office into a ‘managed decline’. Government have stripped £65 million of fees from the Post Office, closing local branches in towns and villages across the country.

There is no legislative requirement to change from a Post Office Card Account POCA to a standard bank account. The reason for the exercise is to 'encourage' the use of a bank account, which provides the account holder with additional services such as debit card and direct debit facilities. That led the way for many to apply for PrePaid debit cards. The 'Financial LockDown' imposed by FCA will create severe hardship for benefit claimants and pensioners plus those stuck in low paid jobs who are unable to take a heavy financial hit! 

Pre-Paid Debit Cards - seen as providing 'vital support' for those in poverty. However cardholder funds are not protected, as they are in banks, by the Financial Services Compensation Scheme. Many benefit claimants and pensioners plus millions of Low Paid Workers of Wirecard's UK customers base are thrown into financial crisis. ANNA Money, a freelance business account provider, told users on Twitter to "urgently" withdraw their money. Another Northern Rock fiasco is brewing. Northern Rock at the time approached the government for support with its liquidity led within 24 hours to a public lack of confidence and concerns that savings were at risk, and the bank failed following a bank run as people rushed to withdraw their savings. It was the first British bank in 150 years to fail due to a bank run.

We are urgently recommending you withdraw your money from your ANNA account as soon as possible. This is due to the FCA placing requirements on our UK payment provider.

— ANNA Money (@ANNAMoneyUK) June 26, 2020

Pocket and ALL other pre paid card providers have FROZEN account holders monies. The Financial Lockdown was imposed by the Financial Conduct Authority FCA after Wirecard Card Solutions Limited £1.7bn Financial Crisis. The financial fallout has left millions penniless with NO money whatsoever for Food, Electric, Gas or to pay housing costs.

 

 The  Financial Services Authority  advises:
 
The account where I receive my benefit payments has been frozen, what do I do?
Please refer to the  Department of Work and Pensions (DWP)  for support.

Are my funds protected by FSCS?

No. The Financial Services Compensation Scheme (FSCS) only applies to certain types of activity which does not include issuing electronic money or payment service.  So Benefits will NOT be protected.

  The daylight robbery of the poor, pensioners and benefit claimants. continues  @wirecard - The  Financial Services Authority must release all funds held by UK card holders!

Many are asking .... Are we heading for another Global Financial Crash - capitalism in crisis?

The missing sum amounts to about a quarter of its total balance sheet. Wirecard joined Germany's blue-chip Dax 30 share index two years ago. At the time, it was valued at €24bn. Yesterday (Thursday) the group filed for insolvency after admitting the £1.7 billion missing from its accounts did not exist.

Investors around the world are warning that a “worldwide credit crunch” triggered by the coronavirus has the potential to “set in motion a wave of corporate bankruptcies that will make the global financial crisis...like nothing!

It’s impossible to say with any degree of certainty whether another crash is around the corner. However there’s certainly plenty of potential problems that could cause a fresh financial market meltdown. A second stock market crash could well be approaching - an indicator could well be Wirecard.....

 

'We are facing the biggest financial crash for 100 years'

That would represent the most severe hit to livelihoods since a 13 per cent slump in 1921, when Britain's exports collapsed and the post-First World War boom was ended by a fierce deflationary spiral.

 

The coronavirus pandemic has turn global economic growth "sharply negative" this year, the head of the International Monetary Fund (IMF) warned. Kristalina Georgieva said the world faced the worst economic crisis since the Great Depression of the 1930s.  She forecast that 2021 would only see a partial recovery. Lockdowns imposed by governments have forced many companies to close and lay off staff. Earlier this week, a UN study said 81% of the world's workforce of 3.3 billion people had had their place of work fully or partly closed because of the outbreak.

Kristalina Georgieva added: "In fact, we anticipate the worst economic fallout since the Great Depression. Her comments came as the US reported that the number of Americans seeking unemployment benefits had surged for the third week by 6.6 million, bringing the total over that period to more than 16 million Americans. The US Federal Reserve said it would unleash an additional $2.3tn in lending as restrictions on activity to help contain the coronavirus had forced many businesses to close and put about 95% of Americans on some form of lockdown.

In the UK we have NEARLY 9 million workers furloughed unable to work on the Coronavirus Job Retention Scheme. Recent figures from the government's independent economic forecaster, the Office for Budget Responsibility, show that the cost of the government's efforts to combat the coronavirus pandemic is expected to hit £123.2bn. The OBR expects annual borrowing to equal 15.2% of the UK economy, which would be the highest since the 22.1% seen at the end of World War Two.

Unemployment in Britain and the US look set to surpass the levels reached during the 1930s Great Depression within months as the coronavirus crisis crushes the global economy, a former Bank of England official has warned.

In a stark forecast as job losses mount around the world, David Blanchflower, professor of economics at Dartmouth College in the US and a member of the Bank’s interest rate-setting monetary policy committee during the 2008 financial crisis, said unemployment was rising at the fastest rate in living memory. Writing in Guardian the economist said recently that UK unemployment could rapidly rise to more than 6 million people, around 21% of the entire workforce, based on analysis of US job market figures that suggest unemployment across the Atlantic could reach 52.8 million, around 32% of the workforce.

“There has never been such a concentrated business collapse. The government has tried to respond but it has no idea of the scale of the problem it is going to have to deal with. We make some back-of-the-envelope calculations and they are scary,” he said.

Making the assessment alongside David Bell, an economist at the University of Stirling, the former Threadneedle Street policymaker said the collapse in activity amid Covid-19 and the accompanying rise in unemployment looked to be at least 10 times faster than in the recession triggered by the 2008 financial crisis. There will be NO 'Business As Usual' when this pandemic is over! 

As we navigate many unchartered territories we must embrace alternatives - A Socialist Plannned Economy would get Britain out of this economic, political and pandemic crisis.

Respect For the Unemployed & Benefit Claimants

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