Israel Police's national fraud unit has for over two years been conducting a criminal investigation of Gilad Sharon, son of former prime minister Ariel Sharon, on suspicion that he served as a conduit for transferring to his father $1.8 million from businessman Arie Genger.
Police suspect the money was transferred to Gilad Sharon in the guise of profits from a real-estate deal in Canada, details of which are contained in a lawsuit filed in Manhattan Supreme Court a week ago by Dalia Genger against her ex-husband, Arie, Gilad Sharon and their American lawyers.
Gilad Sharon allegedly received the money from the Canadian projects through two companies that he controlled: Sycamore Ranch Ltd. and Lerner Manor Trusteeships.
The fraud squad yesterday confirmed the existence of the investigation, but police sources said it is merely another link in a long chain of investigations into the financial dealings of the Sharon family.
Sources close to the police investigation said yesterday that Gilad Sharon had been questioned in the matter, but opted to remain silent as in all of his interrogations. Sharon and his associates declined to comment yesterday on the suspicions ascribed to them.
The lawsuit filed in New York alleges that documents pertaining to Arie Genger's real-estate company, which owned two projects in Montreal, were falsified in order to make it look like a company owned by Gilad Sharon had half the shares in the projects. Dalia Genger claims her ex-husband did this to reduce the scope of his assets in their divorce settlement, thereby denying her and their children monies to which they were entitled.
At the center of the lawsuit are several companies founded by Genger. One of these, AG Properties, purchased the two Montreal projects in 2001 and early 2002. Dalia Genger claims that the deal was paid for with $2 million from the funds of a family-owned company, TPR Investments, in which Arie Genger held 51 percent of the shares (as joint property with his then wife). The remaining shares were held by a limited partnership, whose main owners were the Genger children's trust funds.
The lawsuit alleges that after the Gengers initiated divorce proceedings, the paperwork for the real-estate company was altered, and the investment by the family firm was made to look like a loan. Thus, the family could recoup only the amount they had invested in the deal, plus interest, but not share in the profits.
In 2003, when the Montreal projects were poised to succeed, Arie Genger and his American lawyers allegedly forged documents in order to hide information concerning their ownership, and to withhold the anticipated profits from their real owners.
The allegedly forged documents showed that half of AG Properties' shares were sold for $25,000 to Lerner Manor Trusteeships, which the suit claims was controled by Gilad Sharon. Dalia Genger claims that in a 2003 affidavit during the divorce proceedings, her ex-husband identified "a company indirectly owned by Gilad Sharon" as the owner of half the real-estate company. Later, with the help of the American lawyers, the company papers were allegedly altered to match the affidavit.
Lerner Manor Trusteeships paid $25,000 for the shares through a bank transfer on March 27, 2003. The company was reportedly founded in September 2002, but the forged documents tried to make it appear as if it purchased half of the ownership of the Canadian projects months before it existed. As a result, the suit alleges, half the proceeds from the projects (minus the $25,000 investment) went to the trusteeships firm owned by Gilad Sharon.
In 2005 the projects were sold for a large profit, and $1.8 million were transfered to Gilad Sharon - 72 times the amount he had allegedly invested in the deal.
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