Bank Hapoalim CEO Zion Kenan was questioned under caution yesterday by the Israel Police national fraud unit in connection to a loan extended by the bank to former Hapoalim chairman Danny Dankner.
Kenan could be charged with being an accessory to the fraudulent acquisition of goods as well as breach of trust in a corporation. He was released under restrictions after a few hours.
In March of last year Dankner was questioned by police on suspicion of fraud, breach of trust in a corporation and violating banking regulations in connection to his conduct in the 2005-2009 period, while he was chairman of the Bank Hapoalim board of directors.
He was removed from the post in the wake of intervention by the Bank of Israel. Police have looked into various credit deals carried out at Hapoalim while Dankner was bank chairman.
One of the deals attracting great attention from police investigators is the acquisition by Hapoalim of Turkish bank Positif. Hapoalim paid $25 million in exchange for the relinquishment by the RP investment fund of an option to acquire a 7.5% stake in Positif shares. RP is a partner in Elran Investments, which is controlled by by the Dankner family.
The deal was completed shortly after the Dankners sold RP stocks in their subsidiary Atlas for 6.5 million Euros.
The option purchased by Hapoalim later turned out to be worthless, as it became clear before the deal went throught that Turkey's central bank would not have permitted the sale of the Turkish bank's shares.
Between 2005 and 2009 Kenan was a member of the bank's board, deputy CEO and in charge of the business section of the bank. In 2003 to 2005, Keinan headed the retail banking department. He began working at Hapoalim 32 years ago, and has risen through the ranks.
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