The Committee of Unsecured Creditors in the Chapter 11 bankruptcy case of insurtech Vesttoo have filed a request with the court to allow them to conduct legal discovery on the main bank named in the letter of credit (LOC) reinsurance collateral fraud, China Construction Bank.Read the full article
News related to the use of collateral for and in insurance-linked securities (ILS), catastrophe bonds and collateralized reinsurance arrangements.
Collateral for insurance-linked securities (ILS) comes in numerous forms, but by far the most common is for ILS deals, especially so for all catastrophe bonds, to be fully-collateralized by cash, with that cash held in trust and invested into secure, liquid assets such as US government treasury money market funds. The use of letters-of-credit (LOCs) is also seen, but far less widely in ILS.
Artemis has learned that fronting specialist Clear Blue Insurance has filed a lawsuit against broking giant Aon, in relation to the reinsurance letter of credit (LOC) fraud perpetrated by insurtech Vesttoo.Read the full article
We’re told that the sum total of assets and so value that could be distributed in Vesttoo’s pending liquidation under the bankruptcy proceedings, is estimated to be below $25 million, which suggests creditors that lost significant value due to the reinsurance letter of credit (LOC) fraud are likely to be left unsatisfied, so may look […]Read the full article
The financial strength ratings of fronting specialist Clear Blue Insurance Insurance Group have been removed from negative watch by AM Best, but the rating agency notes that some uncertainty remains, due to the impacts and effects of the letter of credit (LOC) fraud instigated by employees of insurtech Vesttoo.Read the full article
Porch Group, the software driven financial services group with a homeowners insurance arm that was impacted after a letter of credit (LOC) backing a reinsurance deal it had entered into with insurtech Vesttoo was found to be fraudulent, is intending to pursue damages vigorously and not just against Vesttoo, it seems.Read the full article
Vesttoo, the insurtech at the centre of an international reinsurance letter of credit (LOC) fraud investigation, is set to remain in Chapter 11 bankruptcy, after the court denied a motion from the US Trustee to convert the case to Chapter 7 so a liquidation could be accelerated.Read the full article
Vesttoo is now insisting that there is value recoverable in some reinsurance transactions that were “bona fide”, while at the same time both Vesttoo as the debtor and the creditor committee in the Chapter 11 bankruptcy case, have objected to the US Trustees move to convert that case to a Chapter 7 focused on a […]Read the full article
As we reported over a week ago, Vesttoo, the insurtech at the centre of an international reinsurance letter of credit (LOC) fraud investigation, is trying to sell off assets of the firm, to realise value it believes is inherent in the business.Read the full article
Markel has reported that it recognised a $25 million credit loss against a fraudulent $50 million letter of credit (LOC) for reinsurance provided by insurtech Vesttoo, and suggested a chance that more could come with a second LOC also found fraudulent.Read the full article
In a sign that the Vesttoo saga could be sped through the courts in order to liquidate the insurtech and its assets, to protect value for stakeholders and creditors while avoiding further litigation between parties, a filing by the US Trustee calls for the Chapter 11 bankruptcy case to be converted to Chapter 7.Read the full article