New details that TheMarker has obtained on the police investigation into Avigdor Kelner and Kobi Ben-Gur indicate the nature of the real suspicions: trading based on insider information.
Kelner, 63, was arrested and released to house arrest for ten days on Thursday last week, on suspicions that he traded in shares based on insider information. He has been forbidden to contact SFK group workers or go to the office, and has had his passport confiscated.
The white-collar crimes and fraud divisions of the police told the court that evidence indicates Kelner abused inside information for personal gain, and committed securities fraud.
The businessman is suspected of giving Ben-Gur directives and information to which he had been privy as a high-ranking executive in the Shrem, Fudim, Kelner (TASE: SFK) group, and Ben-Gur traded in shares based on that inside information. Afterwards, Kelner and Ben-Gur shared their profits, police suspect.
Ben-Gur is one of the top suspects in the Tax Authority case, where businessmen are suspected of bribing top tax officials to obtain clout in appointments at the Tax Authority. The case caused tax commissioner Jacky Matza to quit under a cloud of suspicion; last week he joined a top Tel Aviv law firm as an adviser on tax issues.
The current investigation is an extension of the tax case.
Sources near the investigation say that the insider-infrastructure trading scam is suspected in the case of four SFK group shares: Polar Investments (TASE: PLR), Polar Communications (TASE: PLRC), Polar International Real Estate (TASE: PLIT), and Telit (which makes cellphones).
The insider information that police suspect Kelner and Ben-Gur of abusing touched on negotiations to sell the controlling interest in Polar Investments to American developer Ziel Feldman.
In the case of Polar International Real Estate, the information in question involved property acquisitions abroad, according to the suspicions.
Regarding Telit, the executives are suspected of misusing information about SFK selling the controlling interest to Telit's CEO, Oozy Cats (pictured on left).
Telit is the only one of the four companies not listed in Tel Aviv, but on London's AIM market.
At the end of last week, the police decided to involve the Israel Securities Authority in the investigation, on the grounds that abusing insider information is that watchdog's province.
TheMarker has also learned that as last week closed, police officers raided Kelner's office and home, and confiscated documents.
Kelner's media adviser commented that the investigation is at a preliminary stage, and that the big picture remains to be clarified and Kelner's side remains to be heard. "Kelner is cooperating with the authorities and is providing information to advance the investigation, since he believes the truth should come to light and that he acted legally. We recommend waiting until the investigation is over."
Kelner, Yair Fudim and Itschak Shrem are the controlling shareholders of the SFK group, which controls several publicly traded companies, including the above four. They also own major interests in Alony Hetz Properties & Investments (TASE: ALHE), Urdan Industries (TASE: URDN), Ytong Industries (TASE: YPYP), Orlite Industries (TASE: ORLI), Nir-Let, Leader Investments, and others.
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