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Former Austrian billionaire Rene Benko is standing trial in Innsbruck this week in the first case related to the collapse of his real estate group, Signa. Prosecutors accuse him of trying to conceal around EUR 660,000 from creditors through unjustifiable rent payments and transfers to relatives. The investigation, which estimates total damages of about EUR 300 million, has been ongoing since Signa's downfall in 2023. Benko, who has been in custody since his arrest earlier this year, denies the charges. This case is one of several expected to follow as authorities examine Signa's finances.
The trial of Austrian businessman Rene Benko began this week in Innsbruck, marking the first criminal case connected to the collapse of his once-prominent property group, Signa. At its peak, Signa held ownership stakes in major assets such as New York's Chrysler Building and the British luxury department store chain Selfridges. The company grew rapidly across Austria, Germany, and Switzerland during years of low borrowing costs but collapsed in 2023 when inflation and rising interest rates sharply reduced property values and cash flow. Advertisement
Signa's bankruptcy is considered Austria's largest corporate failure and one of the biggest in Europe's recent real estate downturn. Its creditors include major financial institutions such as Deutsche Bank, Allianz, Julius Baer, and Raiffeisen Bank International, who have filed claims worth several billion euros.
Benko, aged 48, has been held in custody since his arrest in January this year. The ongoing trial is his first public appearance since then. Prosecutors accuse him of attempting to hide around EUR 660,000 from creditors through questionable financial transfers. They allege that about EUR 360,000 of the total was used to pay rent and related upfront expenses for a property in a way that was "economically and fundamentally unjustifiable." The remaining EUR 300,000, according to investigators, was transferred as gifts to relatives.
This case represents only a small fraction of the broader allegations surrounding Signa's collapse, but it carries serious consequences. If convicted, Benko could face up to ten years in prison. His lawyer has not issued any recent public statement, but Benko has previously denied all wrongdoing.
The charges are part of a larger investigation led by Austria's Central Prosecutors' Office for Economic Crimes and Corruption (WKStA), which estimates total damages linked to the group's failure at around EUR 300 million (USD 348 million). Prosecutors are also examining other possible offences, including concealment of assets, questionable fund transfers, and misuse of company resources.
Earlier reports indicated that Benko may have stored luxury watches, jewellery, and cash in a relative's home to keep them beyond creditors' reach. Prosecutors have also examined transactions involving COVID-related relief funds and potential preferential payments made shortly before Signa's insolvency filings.
Signa Holding, the main company at the centre of the scandal, faces creditor claims exceeding EUR 8.35 billion. Administrators have stated that about EUR 5.6 billion of these claims are disputed. Efforts are ongoing to resolve financial disputes and investigate whether certain payments made by Signa companies violated insolvency laws.
Authorities have confirmed that this trial is only the beginning of several proceedings expected in connection with Signa's collapse. A second case has already been filed against Benko involving separate allegations of financial misconduct, and more charges may follow as investigations progress.
The collapse of Signa marked a major turning point in Europe's real estate sector, revealing the vulnerabilities of firms that expanded heavily during years of cheap financing. The fallout has prompted regulators and creditors across the continent to review lending practices and corporate oversight within the property investment market.
Source Reuters
5th Jun, 2025
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