Vesttoo to significantly reduce its workforce following the discovery of fake collateral
According to Reuters, Vesttoo announced on Tuesday that it will be implementing significant workforce reductions, with about 75% of its staff being laid off. This decision comes after the discovery of a fraudulent letter of credit used as collateral in a transaction with an insurer.
The Israel-based company will also be closing several offices in Asia, including those in Tokyo, Hong Kong, and Seoul. However, it plans to maintain its presence in Tel Aviv, New York, London, Dubai, and Bermuda. Prior to the layoffs, Vesttoo had approximately 200 employees.
In an emailed statement to Reuters, Vesttoo explained that the company’s leadership aims to strengthen its foundation and regain industry confidence by refocusing on core services while simultaneously reducing overall costs, which includes parting ways with some employees.
Vesttoo had been in the process of raising around $200 million in a late stage funding round, which would have valued the firm at nearly $2 billion. However, the company has decided not to proceed with the fundraising at this time.