Wirecard dives 75% as it files for insolvency following its $2 billion accounting scandal

• Wirecard's share price crashed on Thursday after the fintech filed an application to start insolvency proceedings.
• The company's former CEO Markus Braun was arrested this week on suspicion of market manipulation and false accounting practices.
• Wirecard's shares were suspended pending the announcement of insolvency proceedings, but almost as soon as trading began they dropped 75%.
• More than $2 billion went missing from the company's balance sheet according to auditors, with Wirecard later saying that the money may have never existed.

Wirecard's shares crashed in a brutal sell-off on Thursday as the German fintech filed for insolvency, days after its chief executive Markus Braun stepped down and was arrested on suspicion of market manipulation and false accounting practises.

Wirecard's shares are down 75% at 2.86 euros ($3.21) as of 7.00 a.m. ET, according to Markets Insider data.

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The massive drop in the company's stock came almost immediately after trading resumed following a pause prior to the announcement of insolvency proceedings.

The firm announced in a press release Thursday that it had filed an application to open insolvency proceedings in the Munich district court "due to impending insolvency and over-indebtedness."

The company's former CEO Markus Braun was arrested on Tuesday on charges of market manipulation and false accounting practises and released yesterday on a bail of 5 million euros ($5.61 million).

Thursday's developments makes Wirecard the first member of Germany's prestigious blue-chip DAX index to become insolvent.

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Wirecard's shares have been in ultra bearish territory ever since its auditor EY said it could not trace €1.9 billion (about $2 billion) on its balance sheet.

The firm had said its missing cash was being held in two banks in the Philippines, but later Philippines denied the claim .

The stock has lost about 90% since the company admitted 1.9 billion euros since Wirecard said the money likely never existed triggering an even bigger sell-off in the stock.

It is down around 98% since the start of 2020.