Subscribe to Print Edition | Thu., June 19, 2008 Sivan 16, 5768 | | Israel Time: 02:02 (EST+7) web haaretz.com   Back to Homepage Rosner's Domain Diplomacy Defense Jewish World Opinion National Print Edition Car Rental Books Peres Conference Business Real Estate Easy Start Travel Week's End Anglo File

Police expect Yona to implicate banks By Tomer Zarchin, Jonathan Lis and Amit Ben-Aroya A source in the State Prosecutor's Office yesterday rejected criticism of the plea bargain with the CEO of failed construction company Heftsiba, Boaz Yona, saying the deal was for the good of Yona's hundreds of alleged victims. However sources in the police were shocked by the plea bargain, worrying it could affect the ability to make charges stick against others possibly involved. Yona was to serve seven years in jail and provide NIS 4 million in compensation to home buyers. Critics of the deal with Yona, who was extradited from Italy yesterday and whose remand was extended yesterday for two weeks, say he got off lightly Advertisement The State Prosecutor's Office source said the deal was struck, among other reasons, to ensure cooperation between Yona and the special administrator of the Heftsiba group, attorney Yitzhak Molcho, and to quickly assist the home-buyers hurt by the company's collapse. The source said Yona will be cooperating with Molcho to pinpoint the whereabouts of his money and assets, and a criminal verdict against Yona will assist home-buyers in bringing suits against him in civil court. The senior official in the State Prosecutor's Office said they had wanted to sign the deal with Yona while he was still in Italy but his attorney, Yair Golan, had trouble meeting with Yona in the days before his extradition so they put off signing until Yona's return. Police sources close to the investigation said they were shocked by a plea bargain so close to Yona's return to Israel. They had waited many months to question Yona and the assurance that a plea bargain would be signed had shortened his stay in Italy. But the fact that the plea bargain had been signed before they had managed to question him and gauge whether they could make charges stick against other directors of Heftsiba and individuals abroad who might be involved, may turn out to be a mistake, sources said. Because of the plea bargain, the "carrot and the stick" would not be effective, police said, in getting Yona to give evidence against the heads of Heftsiba and representatives of various banks that might allegedly have taken part in the huge fraud. A police source also said they were "conducting the investigation against Yona and trying to complete it as if no plea bargain had been signed, because of the concern that he will retract his end of the bargain." Police said the questioning so far was "flowing" and that Yona was cooperating with investigators. Police also said Yona would probably begin testifying soon to provide sensitive information against various business people, gray-market dealers and bankers who allegedly helped him stave off Heftsiba's collapse in recent years. Yona's attorney Golan confirmed that his client intended to give investigators a full accounting of the events of recent years, including the names of bank officials and Heftsiba directors who, he said, had been involved in the collapse and in the disappearence of money paid to the company by innocent clients. Yona was brought before Tel Aviv Magistrate's Court Judge Edna Bekenstein yesterday and was seated in the docket together with three Border Police. Eight security guards kept their eyes on the crowded courtroom, filled with reporters, security guards, police and curious court personnel. Yona remained expressionless throughout the 20-minute proceeding. After Golan confirmed his client's agreement to the remand, Bekenstein asked Yona if he had anything to say. Yona began to respond but his lawyer silenced him. The source in the State Prosecutor's Office said the seven-year jail sentence agreed on in the deal with Yona is acceptable under these circumstances and "another year in jail won't help the home-buyers." According to the source in the State Prosecutor's Office, the fact that Yona had agreed to be sent to jail for seven years without seeing a shred of evidence against him and without a long trial is an achievement for the State Prosecutor's Office. Yona is reportedly required as part of the plea bargain to present a "full and truthful" accounting of the affair including the involvement of others inside and outside Heftsiba so that the investigation may be completed and legal proceedings instituted against these individuals. No specific names were mentioned, according to the source, so as not to lead Yona to think about saying "what will be well-received and what will not," the source said. The source said there were additional individuals who were "not small," against whom the State Prosecutor's Office would seek indictments after sufficient evidence was collected. The source said a quite a few individuals inside and outside of Heftsiba had already been questioned under caution. Under investors' noses Yona is suspected of having stolen NIS 118 million with the assistance of top Heftsiba executives from two publicly listed companies in the Heftsiba group, and of transfering the money to his privately-owned companies. The Heftsiba group consists of dozens of privately owned companies and three listed ones. One of the listed companies, Global, was properly managed; alleged irregularities have been uncovered in the other two companies, Hofim and Jerusalem Gold. In February 2006, Hofim issued NIS 138 million worth of bonds and began to build Heftsiba's largest project, 18 residential towers in the Hadera area with more than 1,100 apartments. Only one building has been completed and residents have moved in. Jerusalem Gold is mainly a holding company that also leases properties. Law enforcement officials said the money allegedly flowed from the listed companies to the private ones in breach either of the Companies Law or the Securities Law, in that no board of directors' meetings or general assemblies were held to approve the transfer of funds, among other steps required by law. The Hofim prospectus stated that the issue was for the development of the Hofim project, payment to the Hadera municipality, etc. Investigators therefore suspect Yona of defrauding investors, whose money was transferred from the company in which they believed they were investing to Yona's private companies. A person close to the investigation explained yesterday that Yona allegedly used a typical white-collar crime tactic: To prevent accountants from noticing the missing money, Yona, allegedly with the assistance of four senior Heftsiba executives, forged documents to show that the money had been returned to the listed companies just before publication of the financial reports. Immediately thereafter the money was transferred back to the private companies. A private company was established for each of Heftsiba's many building projects, and some of the money was allegedly transfered to each. "It will be difficult to follow all the money at this stage," a source said. Bookmark to del.icio.us   Fragile cease-fire Olmert: Gaza cease-fire is fragile, may be short lived. Unbalanced stance Italy FM: EU stance on Israel in past swayed by intolerance.

Read & React Olmert: Gaza cease-fire is fragile, may not last Responses: 318 ANALYSIS / Cease-fire deal means Hamas is calling the shots Responses: 88 Moshe Arens: Israel has nothing to fear from next U.S. administration Responses: 50 Olmert to French daily: Israel, Syria not far from direct talks Responses: 50 Editorial: Law to ban Arab MKs from visiting enemy states is an insulting PR ploy Responses: 66 More Headlines 22:05 Noam Shalit threatens to appeal Gaza truce in court 21:56 Olmert: Gaza cease-fire is fragile, may be short lived 23:29 Lebanon PM: There's no place for bilateral talks with Israel 22:48 Olmert to French daily: Israel, Syria not far from direct talks 23:49 Italy FM: EU stance on Israel in past swayed by intolerance of Jews 02:01 Eager yet untrusting, both sides of Gaza border await calm 21:38 World welcomes Gaza truce, urges sides to fulfill obligations 18:07 Families of missing soldiers briefed ahead of Hezbollah deal 21:13 Hezbollah supporters hurl stones at U.S. envoy's car in Lebanon 14:45 Shas MK: 300,000 Jews still in Ethiopia eligible for immigration 23:35 9 people killed in car accidents across Israel Wednesday 21:14 Latin America Jewish Congress honors Chilean President Previous Editions Select Day 18 jun 17 jun 16 jun 15 jun 13 jun 12 jun 11 jun 10 jun 09 jun 08 jun 06 jun 05 jun

Special Offers Advertisement Holyland Park Jerusalem Apartment Tower World Class Luxury In the heart of Tel-Aviv The Meier on Rothschild tower Jerusalem of Gold Luxury apartments in Jerusalem's finest location Your vacation starts here Israel Travel Center Guaranteed Lowest Rates Free Hebrew Private Lesson www.iStudyHebrew.com Pardes Institute Summer Sessions http://www.pardes.org.il/ Free the Palestinians from: Corrupt Kleptocracy, Tyrannical Theocracy, Abysmal Anarchy Fattal Hotel Chain Perfectly located hotels on best resorts of Israel. ISRAEL BONDS Build Israel Israel bonds - a multi-purpose way to celebrate Israel's 60th Eldan Rent a Car Israel's leading car rental company offers you a 20% discount on all online reservations Junkyard Junk a car - get free towing nationwide and a tax-deductible receipt

Home | TV | Print Edition | Diplomacy | Opinion | Arts & Leisure | Sports | Jewish World | Underground | Site rules |

Real Estate in Israel | Travel to Israel with Haaretz | Hotels Israel | Restaurants Israel | Tourist attractions Israel | Shops Israel

birthright Israel

Haaretz.com, the online edition of Haaretz Newspaper in Israel, offers real-time breaking news, opinions and analysis from Israel and the Middle East. Haaretz.com provides extensive and in-depth coverage of Israel, the Jewish World and the Middle East, including defense, diplomacy, the Arab-Israeli conflict, the peace process, Israeli politics, Jerusalem affairs, international relations, Iran, Iraq, Syria, Lebanon, the Palestinian Authority, the West Bank and the Gaza Strip, the Israeli business world and Jewish life in Israel and the Diaspora.

© Copyright  Haaretz. All rights reserved