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Munich state prosecutors are investigating money laundering charges at René Benko's bankrupt luxury real estate empire Signa Group.

A spokesman for the prosecutor confirmed to the Financial Times on Thursday that preliminary investigative procedures had been launched.

They said they had received several criminal complaints about Signa's activities “since late last year.” “The facts of the case are being reviewed in detail from a legal perspective, as well as other possible criminal offences.”

The spokesman added that the exact jurisdiction of prosecutors was still being clarified.

The investigation is looking into Signa's real estate development projects in Bavaria and how large sums of money were transferred in connection with the developments, a person familiar with the matter said. Signa's main holding companies are located in Austria. It is unclear whether any of this may be part of the Munich investigation.

News of the investigation was first reported by the Austrian news agency and Germany's Bild am Sonntag.

Creditors to a unit of Signa Group believe hundreds of millions of euros have been misappropriated since it collapsed into competing estates late last year, the Financial Times reported on Tuesday.

“We have not been informed of any ongoing investigation by the Munich prosecutor's office,” Benko's lawyer said, noting that authorities had not named his client in any potential proceedings against Signa or related entities.

He said the department intends to cooperate fully with authorities and will assist with any investigation once they are contacted.

At its peak, Signa owned a vast empire of luxury buildings and addresses across Europe and the Americas, including New York's Chrysler Building, London's Selfridges and Berlin's KaDeWe department stores.

Behind its flashy address display, however, is a highly leveraged network of more than 1,000 corporate entities run by Benko and a small, loyal team from the company's headquarters in the Alpine city of Innsbruck.

Signa's financial strength is weakened as U.S. and European interest rates rise in 2022 and 2023. Benko has spent much of the past 18 months trying to plug a growing financial hole in the business.

Benko is a paper billionaire in his early thirties whose meteoric rise in wealth has made him a celebrity in Central Europe, where politicians often grace his lavish parties. He declared personal bankruptcy last week.

However, it is unclear how much money is left in his opaque family trust funds, which are held in his mother's name in Austria and Liechtenstein.

JPMorgan analysts last year estimated Signa owed more than 13 billion euros, but the total was likely much higher given the array of different instruments and relationships Benko used to leverage the group. Creditors to the group's main holdings were told this week they could expect to collect a third or less of what they are owed in the next few years.

Julius Baer is one of the high-profile victims. The private bank's chief executive, Philipp Rickenbacher, was fired at the end of January after the bank wrote off all 606 million Swiss francs ($689 million) of non-performing loans to Signa.

Aggrieved investors have filed several civil and criminal lawsuits against Signa.

Last month, a large group of creditors complained to Austria's anti-fraud prosecutors, accusing the company of criminal conduct. Austrian prosecutors have not yet said whether they plan to open a case.