A Czech billionaire described as the largest commercial real estate landlord in Berlin was sued in the U.S. for allegedly defrauding a New York hedge fund and a Czech investment firm of more than $1 billion.
Kingstown Capital Management LP and Investhold Ltd. sued Radovan Vitek, a real-estate mogul with residences in the Czech Republic and Switzerland, in Manhattan federal court Wednesday. They claim they were ripped off by Vitek in a decade-long racketeering scheme.
The investors claim Vitek, 47, used a web of shell companies and "straw owners" to gain control of a Luxembourg-based real-estate development company in which Kingstown Capital held substantial interests, and then sold the most-valuable assets at "distressed prices" to entities he secretly controlled.
“Today’s lawsuit painstakingly lays out the existence of a massive, decade-long fraudulent scheme perpetrated by Vitek and his co-conspirators that made him a billionaire with one of the world’s biggest property empires," plaintiffs’ attorney Matthew L. Schwartz said in a statement.
Vitek’s company said it plans to issue a statement soon in response to the lawsuit.
The case is Kingstown Capital Management LP v. Vitek, 1:19-cv-03170, U.S. District Court for the Southern District of New York (Manhattan).
This article was provided by Bloomberg News.