Austrian prosecutors accuse property tycoon Benko of hiding luxury watches

VIENNA (Reuters) -Austrian prosecutors on Thursday accused the founder of the collapsed Signa property group, Rene Benko, of hiding watches and other valuables worth hundreds of thousands of euros in a safe so they could not be recovered to repay creditors.

The Central Prosecutors' Office for Economic Crimes and Corruption (WKStA) said in July it was bringing an insolvency-related fraud case against Benko while continuing its wide-ranging investigation into the former billionaire, who has been in custody since January.

It was now adding another insolvency-related fraud charge against him and a female co-defendant whom it did not name over 120,000 euros ($141,000) in cash and "almost" 250,000 euros' worth of cufflinks, watches and other valuables found in the safe, the WKStA said in a statement.

"The aforementioned assets were hidden in a safe at the home of relatives. The co-defendant is alleged to have assisted Rene Benko in committing the offence," the statement said, without specifying which relatives.

Benko's lawyer did not immediately respond to a request for comment. Benko has previously denied allegations made against him.

Benko became a self-made billionaire by rapidly expanding Signa in the era of ultra-low interest rates, but the group collapsed after the fallout from the COVID-19 pandemic and Russia's invasion of Ukraine forced interest rates higher.

The WKStA has said its investigation into more than a dozen people including Benko relating to Signa continues and that it estimates the total harm caused at roughly 300 million euros.

Benko and the other unidentified people are suspected of committing offences including Benko passing off shareholders' investments in a capital increase as his own, fraudulently claiming COVID-19 relief funding by wrongly stating a chalet was operating as a hotel, and misusing funds provided by a sovereign wealth fund as loans towards a property project in Munich.

($1 = 0.8524 euros)

(Reporting by Francois Murphy and Alexandra Schwarz-Goerlich, Editing by William Maclean)