Vesttoo’s top legal and financial executives leave the company amid alleged fraud scandal
Vesttoo’s top legal and financial executives leave the company amid alleged fraud scandal
The Chief Financial Officer, Chief Commercial Officer, Interim Chief Legal Officer, and Deputy Chief Legal Officer have all departed the startup embroiled in a fraudulent collateral crisis
The departure of senior executives at Vesttoo continues, with most of the company's top legal and financial management already having left the company following the revelations regarding the alleged fraud at the startup.
Among the executives to have left the company are Gaurav Wadhwa, Chief Financial Officer; Julia Henderson, Chief Commercial Officer; Lauren Smith, Interim Chief Legal Officer; and Daniel Goldfried, Deputy Chief Legal Officer.
Despite no longer working for the company, all the executives still appear on the Vesttoo website as part of the management team.
Following Calcalist’s revelations regarding the alleged fraud at the company, Vesttoo confirmed in a statement that “a few members of the leadership team have decided not to wait for the results of the audit and have decided to leave, and we respect their decision.”
The allegedly fake letters of credit (LOCs) provided by investors to insurers for reinsurance transactions on the Vesttoo platform are believed to total a sum of around $4 billion, Calcalist revealed on Wednesday. Most of the letters, allegedly forged, were from a leading Chinese bank, which appears to have been unaware of the situation. Vesttoo claims it cannot comment on the extent of the alleged fraud since the matter is still under investigation.
The fraud came to light when one of the LOCs was found to be fake, leading to a comprehensive review of all letters of credit issued by the company.
Vesttoo was founded in 2018 by Yaniv Bertele, Ben Zickel and Alon Lifshitz, each of whom owns about 24% of the company’s shares. The idea behind the company's insurance-linked securities (ILS) platform is to connect insurance companies with institutional investors in the capital market who are interested in acting as reinsurers, in exchange for payment for the risk they will assume.
The company told Calcalist in response: "The Vesttoo team discovered inconsistencies between an investor and a cedent in transactions that Vesttoo modeled the risk for. We take the integrity of our business very seriously and are conducting a comprehensive third party audit to ensure our due diligence processes continue to be robust."
