Austrian business magnate René Benko and one of his companies are currently the subject of investigation by Liechtenstein prosecutors over alleged insolvency fraud and money laundering. The probe, confirmed by prosecutor Gregor Hirn, involves preliminary inquiries into both a natural person and a legal entity, as well as against unknown perpetrators.
Benko’s legal representatives have responded to the situation. While a representative in Austria has not yet commented on the Liechtenstein investigation, Benko’s lawyer in Germany has strongly denied any wrongdoing, dismissing the reports as unfounded.
Casse against Rene Benko
This development marks the latest in a series of legal actions involving the insolvent Signa conglomerate and its founder. Prosecutors in Austria and Germany are already conducting investigations into various units of the company. Additionally, Middle Eastern wealth funds have initiated arbitration proceedings, seeking around €1 billion ($1.1 billion) in damages, including claims against Benko himself.
Signa, once a prominent retail and property empire, has faced significant challenges in recent times. Several Signa units have filed for insolvency, making it one of the most notable casualties of the real estate crisis in Europe. Among its €23 billion portfolio, Signa previously owned iconic properties such as the Chrysler Building and London’s Selfridges department store.
Real Estate Troubles
Many real estate companies have filed the bankruptcy in the last few months. These include companies like Evergrande, and Shimao to name a few.
The holding company of Signa, which comprises around 1,000 companies, filed for insolvency last month with a staggering debt of approximately €5 billion ($5.56 billion). Other divisions within Signa have followed suit, but Prime Selection stands out as Signa’s largest real estate division, boasting 54 properties valued at €19.3 billion and debts of €4.5 billion.
Notable holdings include the Park Hyatt in Vienna, the KaDeWe department store in Berlin, and the Elbtower in Hamburg (where construction has been halted)
INGBE Stiftung, a private trust established by Benko in Liechtenstein, has also been involved in late funding efforts within Signa’s luxury Prime unit, as reported by an insolvency administrator.
The investigation into Benko and Signa highlights the complex legal and financial challenges facing the conglomerate and its founder. The outcome of the probe could have significant implications for Signa’s future and the broader real estate industry in Europe.
