Israel-based insurtech to cuts 75% of Asia jobs

The company will be closing its offices in Tokyo, Hong Kong, and Seoul.

Vesttoo announced a significant workforce reduction, with approximately 75% of its staff in Asia being laid off, Reuters reported.

It will also be closing select offices. The decision comes as part of the company's efforts to recover from a scandal involving a fraudulent letter of credit used as collateral in a transaction with an insurer.

READ MORE: Fintech Vesttoo to slash jobs after fake collateral scandal

Currently, Vesttoo is conducting both internal and external analyses to investigate the events leading up to the discovery of the fraudulent letter of credit.

Vesttoo, based in Israel, utilises artificial intelligence technology to bridge the gap between the insurance industry and capital markets. 

As part of the restructuring, the company will be closing its offices in Tokyo, Hong Kong, and Seoul, while maintaining operations in Tel Aviv, New York, London, Dubai, and Bermuda. Prior to the layoff, Vesttoo had around 200 employees.

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Vesttoo, which is partly backed by Banco Santander's fintech venture capital arm Mouro Capital, was amidst a process of raising approximately $200m in a late-stage funding round.

This funding round would have valued the company at nearly $2b. However, Vesttoo has decided to halt the fundraising process in light of a scandal involving a fraudulent letter of credit used in several transactions.

In its previous funding round led by Mouro, Vesttoo had raised $80m at a valuation of $1 billion in October. The company had planned to use these funds to expand its global presence.