Securities regulators on Tuesday raided the offices of an Israeli loan firm on suspicion of defrauding clients, falsifying documents and stealing millions from clients.
Unet Credit, a non-banking finance company, had former finance minister Moshe Kahlon as a board member, who resigned last month when news of alleged criminal activity emerged. Kahlon is expected to be questioned as part of the investigation.
Over the past year, the company has been involved in a series of scandals related to repeated fund mismatches, which have attracted the attention of the authorities.
Four senior figures from the company were arrested on Tuesday — former CEO Yitzhak Ezer, head of the Nazareth branch Yitzhak Eviatar and controlling shareholders Shlomo Isaac and Shai Penso. The court released them under restrictive conditions, including a restraining order prohibiting them from leaving Israel for 180 days.
The Israel Securities Authority said the suspects committed fraud and hid their activities from the company and the public by “falsely registering company documents and forging documents.”
Authorities also charged that Ezer used his private account for transactions in the company’s shares, and that together with Isaac, he “paid into the account of a private company they control” using insider information.
Eran Shaham-Shavit, Shlomo Isaac’s lawyer, said his client was cooperating with investigators and “remains confident in the company and is confident that the company can return to a successful and profitable direction.”
Over the past year, Unet has lost millions of shekels in funds, including NIS 10.6 million ($3 million) in missing checks and a NIS 37.5 million ($10.8 million) loan to Zoabi Holding in Nazareth that it is unable to collect .
Unet also revealed on Tuesday that it had uncovered another inconsistency in its books, involving a transaction of up to NIS 50 million ($14.4 million) made to a private company that “was not approved in accordance with the law and was not reported to the public,” it said. daily Israel Hayom.
In May, robbers disguised as food deliverymen stole NIS 3.5 million ($1 million) from the company’s main branch in Holon. Former company executives suspected that they were being helped from the inside.
Finally, an internal audit last month revealed a NIS 7.7 million ($2.23 million) discrepancy in the company’s books.
Kahlon resigned two weeks after the audit, noting that “the company may have significant financial exposure, which is caused by events that occurred before I joined the company.”