First arrest made in Heftsiba collapse

Ze'ev Tanenbaum, the chief financial officer (CFO) for the Heftsiba group, was arrested on Friday. This is the first arrest to be made following the collapse of the real estate developer two weeks ago, during which hundreds of buyers lost homes they had purchased.

Tanenbaum is suspected of aggravated fraud, conspiracy to defraud, forging company documents, theft, money laundering, securities violations, and violations of laws on housing sales.

His remand was extended through this Thursday by Judge Dorit Kovarsky of the Tel Aviv Magistrate's Court.

The police stated in the remand request that Tanenbaum, along with others, acted to defraud customers, banks and other institutions. During the hearing, the police said that based on Tanenbaum's statements, the fraud methods were clear and the sums involved were huge.

"The matter is particularly serious in the case of the CFO, who is supposed to serve as a guardian and protect buyers and investors," said the police. The judge was presented with numerous complaints filed against Heftsiba as well.

Tanenbaum's lawyer, Ofer Resu, said that his client did not personally take any money and that the person who should have been sitting in the defendant's chair was controlling owner Boaz Yona, not Tanenbaum.

In response, the police presented the judge with a report on their actions to apprehend Yona.

The accusations of illegal activities by Heftsiba came out in court at the beginning of the week, in requests by creditor banks and insurance companies for the appointment of a receiver and liens against the firm. However, the two banks most involved, Banks Hapoalim and Jerusalem, have not yet officially filed a complaint with the police.