Vesttoo alleges ‘pervasive and systemic misconduct’ by former executives
Vesttoo alleges ‘pervasive and systemic misconduct’ by former executives | Insurance Business Asia
Insurance News
Vesttoo alleges ‘pervasive and systemic misconduct’ by former executives
Insurtech claims to have discovered ‘conspiracy’ following fraud investigation
Insurance News
By
David Saric
Insurtech Vesttoo, which has faced turbulence since it emerged that alleged fraudulent letters of credit (LOCs) had been used via its platform, has alleged that its CEO, other former executives and third parties engaged in “pervasive and systemic misconduct” and has claimed to have uncovered “conspiracy”.
The allegations came as Vesttoo filed its first interim bankruptcy report in the United States Bankruptcy Court for the District of Delaware.
In the report, it was alleged that former Vesttoo executives Yaniv Bertele (former CEO), Alon Lifshitz (former CFE), Udi Ginati (former senior director, capital markets) and Josh Rurka (former senior director, Asian markets) were “directly involved” in creating fake documents and forging identities.
Employees of China Construction Bank, as well as other banks and individuals associated with the Company’s largest investor, Yu Po Finance, were also alleged to have engaged in wrongdoings, according to a news update shared by Vesttoo.
While it was initially claimed that the source of fraud was external, the investigation found that that the individuals stated above knowingly directed, instigated and engaged in the fraudulent activities themselves.
Vesttoo fraud allegations – insurtech sets out next steps
The report highlighted the steps that Vesttoo has taken to ensure that appropriate institutional financial security controls are in place to resolve its contractual obligations on a commercial basis. It also described the development of a plan for reforming and conducting its business going-forward, named “Trade Forward.”
“While we obviously remain very troubled by the misconduct of those that the company and markets placed great trust in, we are pleased that the investigation has confirmed that this scheme was confined to a small subset of the Vesttoo leadership team,” said Ami Barlev, Vesttoo’s interim CEO.
“The company’s technology platform and its core value remain strong, and we intend to use it and our deeply experienced insurance professionals to emerge from this process as a trusted partner.”
Co-founders of Vesttoo speak up against “opportunistic parties” #insurancenews https://t.co/MdUACxZI2C
— Insurance Business America (@InsuranceBizUS) August 30, 2023
The pair have claimed that “opportunistic parties exploited the temporary crisis the company was facing to advance aggressive and unilateral actions aimed at taking control of the company,” according to reports.
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