Vesttoo

The embattled ILS InsurTech said its investigation into fraudulent letters of credit used as collateral in the company’s transactions was in “advanced stages”.

The firm’s interim CEO Ami Barlev has argued that, with Vesttoo’s weekly expenses being $360,000, freezing assets above $1m would be “catastrophic for the company”.

The ILS transformer platform claims Vesttoo is in breach of shareholder agreements.

The incoming CEO said initial recommendations from investigators had been adopted in full.

White Rock’s petition to the New York Southern District Court stated that, "on information and belief, Vesttoo intends to remove all or substantially all funds from its US bank accounts”.

Porch books $48.2mn provision charge in relation to Vesttoo exposure

New CEO Ami Barlev – who has a background in tech, AI, comms and real estate – said he took the role at an “extremely difficult moment” for the InsurTech.

Prior-year legacy deals and higher reinsurance costs are just some of the issues that brokers, MGAs and other cedants are confronting in clearing up after the debacle over allegations regarding faked letters of credit.

As part of a restructuring, Vesttoo is liquidating its collateralised insurer in Bermuda, but continues to operate its branches in New York, London and other territories.

The firm has written to brokers and counterparties urging them to continue working with it to deliver solutions.

The company said it had completed ‘Know Your Customer’ checks on all parties, as the alleged fraudulent LOC crisis continues.

The company has already seen submissions from MGAs that are potentially looking for a new fronting partner.