Court dismisses Vesttoo’s NIS770m claim against founders
The Tel Aviv District Court has dismissed Vesttoo’s huge NIS768 million claim against the company’s founder Alon Lifshitz, and former senior executives. In dismissing the proceedings against the defendants, citing insufficient evidence to support the allegations, the verdict marks the end of a prolonged legal battle that has been closely watched by the business community.
In the motion submitted by it, the company claimed acts of forgery and fraud committed by its officers that resulted in the company’s collapse and a loss of approximately NIS 770 million.
Agmon with Tulchinsky successfully advised n the case, with attorneys Netanel Haim, Guy Azulay, Itay Hass, Hilla Peleg, Sapir Gabay and Omer Haritan securing a momentous verdict.
This ruling serves as a precedent, setting forth the principle that a trustee appointed by a company in foreign proceedings is not entitled to pursue legal action against third parties through a motion for instructions to the Israeli Insolvency Court.
Vesttoo was an Israeli fintech startup founded in 2018 by Yaniv Bertele, Ben Zickel and Alon Lifshitz. It was a platform designed to connect insurance companies with capital market investors acting as an alternative to traditional reinsurers. Investors would purchase what was known as an ‘insurance basket’ and would receive a payment for the risk they were taking on – and share the losses in the event of an insurance event.
Vesttoo developed a platform that would mediate between insurers and investors to ensure the transactions were properly conducted. Part of that process included ensuring that the investors had the appropriate collateral, usually in the form of letters of credit.
The fallout of the Vesttoo fraud could have wider implications on the re/insurance industry.
