Fraud legacy still dogs revamped Star Night
Start Night Technologies, makers of night-vision goggles, has still not recovered from the fraud of its former managers. In 2001 the company had a deficit of NIS 3.4 million and an operating loss of NIS 4.9 million, the financial report published yesterday indicates.
Star Night also reported a net annual profit of NIS 3.7 million, but this profit is attributed to a waiver by the banks (mainly Leumi) of a NIS 10.8 million debt.
However, a growth in sales is also visible - in the fourth quarter revenues totaled NIS 3.7 million, compared to NIS 3.2 million in the previous three quarters put together.
Star Night made headlines in June 1999 when its former managers, Mark Blatt and Yaakov Pogotinsky, were accused of defrauding the defense establishment. Star Night (then known by the Hebrew name "Or Layil") bought high quality American tubes ostensibly intended for IDF night vision equipment.
Instead they sold the tubes to China and used sub-standard tubes in the equipment made for the IDF. The price difference between each tube was $1,000, explaining the big profits the firm posted before the scam was revealed.
Star Night signed an agreement to pay the Defense Ministry NIS 3 million. With a new management team in place, the company has been trying to patch up its relationship with the defense agencies, and in January 2002 won a NIS 1 million order from the police.
Last week Star Night said the Defense Ministry will declare there is no reason to avoid doing business with the company.
Mordechai Solomon, who owns 40 percent of Star Night, is now both CEO and chairman of the board.