Insurance Startup Vesttoo Intends to Liquidate in Bankruptcy

Bankrupt Israeli insurance startup Vesttoo Ltd. — just weeks after saying some of its former executives were involved in alleged fraud — announced it will liquidate in Chapter 11 as part of an accord with creditors owed hundreds of millions of dollars.

Vesttoo lawyer Craig Martin said Wednesday during a Delaware bankruptcy court hearing that the company will work with its insurance creditors to formulate the liquidation plan. The announcement comes after Vesttoo accused former executives of helping to draft fraudulent documents that were used to support transactions on its platform.

Vesttoo Interim Chief Executive Officer Ami Barlev testified Wednesday ...