Austrian Mogul Rene Benko Charged With Fraud

If losing a $27 billion property empire wasn’t bad enough, Rene Benko is now in criminal crosshairs.

Austrian authorities charged the Signa Holding tycoon with insolvency fraud, Bloomberg reported. Benko has been in detention for six months, but these are believed to be the first criminal charges that will drag Benko into a courtroom.

Prosecutors allege Benko funneled assets away from creditors. He’s accused of making unwarranted pre-payments on a home rental contract and offering gifts while in financial distress in an effort to hide more than $750,000 from creditors.

Authorities have been investigating Benko for fraud, embezzlement, fraudulent insolvency — essentially Austria’s version of bankruptcy — and more. Benko denies wrongdoing.

Benko’s holding company filed for insolvency towards the end of 2023, plunging a property portfolio once valued as high as $30 billion into chaos. Signa’s major holdings have included stakes in large European department stores and the Chrysler Building in Manhattan, which Benko bought in partnership with Aby Rosen’s RFR Holding in 2019.

By the end of the same month of the insolvency filing, an Austrian court was pressing for the sale of Signa’s stake in the Chrysler Building. Despite the order, it’s unclear if Signa has unloaded its stake in the property, which has a famously complicated ownership structure.

Those with large exposure to Signa include Swiss bank Julius Baer, which had roughly $690 million lent to Signa at the time of the insolvency filing, and Austrian bank Raiffeisen Bank International, exposed to the tune of $830 million.

Dozens of creditors submitted claims for more than $1.2 billion in the immediate weeks after the insolvency.

Legal troubles are nothing new for Benko. In 2012, he received a tax fraud conviction after allegedly trying to bribe Italian officials. Two years ago, Benko was acquitted on bribery charges in his native Austria.

— Holden Walter-Warner