René Benko, who founded property group Sigma, has been arrested at his villa in Innsbruck, Austrian prosecutors said on Thursday.
The company became Europe’s biggest casualty of the property meltdown, declaring bankruptcy as creditors tried to recover as much as they could.
What is the allegation against Benko?
“The prosecutor’s office in charge of economic crimes and corruption ordered the arrest of Cigna’s founder René Benko,” a statement from the prosecutor’s office said.
It said the arrest was made on suspicion of falsifying invoices and attempting to hide assets from creditors.
Banco’s Cigna Holding filed for bankruptcy in late 2023. Cigna’s German assets included the department store chain Galleria.
The Economic and Corruption Prosecutor’s Office announced that there was “strong suspicion” of multiple criminal offenses.
Benko was said to be the “actual ruler and beneficial owner” of a private foundation and that he had concealed it during his personal bankruptcy. In doing so he allegedly hid assets.
The complex corporate structure that Benco had established collapsed under the pressure of rising interest rates, energy prices, and construction costs.
According to the insolvency administrator, claims against Banco amount to approximately €2.4 billion ($2.5 billion).
The 47-year-old is also being investigated for alleged fraud in relation to state coronavirus pandemic funds, with a focus on aid funds for the luxurious Chateau Ann in the Austrian ski resort of Lake am Arlberg.
Benko was questioned by Austrian authorities in Innsbruck last month after an Italian court ordered an arrest warrant against him and several others. The media had linked it to a wider corruption investigation.
rc/nm (dpa, AFP, Reuters)