Where is Boaz Yona, the controlling owner and CEO of real estate company Heftsiba?

According to ultra-Orthodox sources who have been following Yona for the past two weeks, he left Israel last Thursday on a flight to Russia, while his company is expected to ask a court to protect it from its creditors. A Yona family confidante, however, said he is still in Israel. But there is still no sign of his whereabouts.

In the meantime, various documents came out over the weekend showing that Heftsiba owes certain companies NIS 1.5 billion, and that there are about 4,000 families waiting for unfinished apartments. In addition, hundreds of families spent the Sabbath in their unfinished apartments after breaking in over the past three days to prevent Heftsiba's creditors from taking hold of the flats. Others are taking turns staying in the apartments because the builder's subcontractors have started welding building and apartment doors shut to keep the buyers out. But in some cases, the contractors have simply welded the doors shut with the owners inside.

Heftsiba was building many projects, and some of the purchasers have bank guarantees. While those without bank guarantees face further problems, it is still much too early to begin to guess what damages they will suffer, in addition to a long delay in receiving the apartments - if at all.

Purchasers are starting to organize to protect their rights, and one group already has 500 members.

Heftsiba was the biggest builder for the ultra-Orthodox, with about 1,600 apartments under construction for the sector. About 30 percent of the firm's activities were targeted for the ultra-Orthodox.

A short time after the problems became known, but before they reached the courts, a race over control of the buildings began between Heftsiba, a number of companies, subcontractors, banks and those who purchased apartments.

Heftsiba was represented in its request to freeze all actions against it by the law firm of Shlomo Nass. Nass is now overseas, and instead the company will request that accountant Haim Kamil of Nass' firm be named the group's trustee.

A banking source has strongly criticized Nass, saying that he has appeared in the media making wild promises to buyers, even before he has appeared in court or been appointed as receiver. Another source said that while Kamil has started talks with a few banks, the discussions are not serious because no plan has been presented yet. In this case bankers are not able to provide credit to complete the construction, the source said.

Real estate sources predict that dozens of small suppliers are likely to be in trouble after Heftsiba's collapse.

These include all types of building suppliers including those in aluminum, wood, cement, ceramics and flooring.

"These suppliers, like many other small construction firms [who worked for Heftsiba] have no guarantees. They researched the company, assumed that it was safe and made agreements. Now there is no one to pay them back. There are cases of small suppliers owed NIS 30,000, and that can hurt them severely," sources said.

It was hard to explain the trust placed in Heftsiba, despite the rumors of liquidity problems that have been circulating for years. The company was known for never paying on time, according to real estate sources, but in the end it usually paid. Sources say that such talk has been going on for almost nine years.

Others who seem to have been misled by Boaz Yona include the underwriters of its last three bond issues, Poalim IBI. Heftsiba's last offering was for NIS 23 million in February, and three months before that NIS 186 million.

There is no evidence that anything in the company's prospectuses was inaccurate, or that the underwriters have any responsibility; however, it is somewhat surprising that none of the due diligence conducted discovered any problems.

Poalim IBI said that it was surprised by the collapse and was unable to to reach Yona.

Finally, there are those who always ask during such failures, where were the accountants?

However, the financial reports of the Heftsiba group - Heftsiba Global, Heftsiba Jerusalem and Heftsiba Hofim - were signed by accounting firm Ernst & Young Israel Kost Forer Gabbay & Kasierer.

As opposed to the Harel Investment fraud where the financial reports never showed a problem, Heftsiba's financials were never brilliant. The 2006 reports of Heftsiba Hofim clearly pointed to an equity deficit and a negative cash flow. Both Hofim and Heftsiba Jerusalem lost money in the first quarter of 2007.