Supreme Court Rejects ex-Israel Police Chief’s Fraud Sentence Appeal

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Rafi Peled.Credit: Ofer Vaknin

The Supreme Court sent a strong message on white-collar crime Tuesday, as it rejected outright an appeal by a former Israeli Police commissioner and increased the sentence a lower court had given him following his conviction for financial crimes.

The justices were unanimous in their ruling against Rafi Peled’s appeal. Peled and three business partners had appealed against a ruling by financial court judge Chaled Kabub.

Peled had been convicted of fraud and breach of trust for his part in the affair, and was sentenced to six months of community service and a 100,000-shekel fine. In rejecting his appeal, the justices ruled that Peled’s fine would be increased to 200,000 shekels.

Another partner, Tal Jaegerman, had his sentence increased to six years in prison, up from four.

The other two defendants, David Heby and Arie Givony, were sentenced to 12 months and 24 months in prison, respectively, as well as 20,000-shekel fines. Their sentences remain unchanged.

The justices accepted the prosecutor’s argument that Kabub had been too lenient with Peled and Jaegerman.

“In the past, courts would be lenient with this type of crime, due to their ‘clean’ image compared to other crimes. Yet sometimes the destruction economic crimes levy on their victims is unmeasurably greater than that of ‘regular’ property crimes,” stated the justices. “Their damage can last for years and pull down those close to the victims.”

The four were convicted of fraud three years ago. The court ruling took up 500 pages, capping a seven-year trial that involved more than 6,000 pages of protocol.

The four business partners began what was initially a pretentious but entirely legal business in 2001. At the time, the group was hailed as a promising initiative and some of Israel’s biggest names were tossed about as their investors. The partners took out large personal loans from banks in order to buy publicly traded companies. But their business didn’t develop as they’d expected, and Heby and Givony, at Jaegerman’s instruction, began taking money from publicly-held companies in order to pay back their private loans.

Ultimately the business group collapsed, leaving behind debts totaling hundreds of millions of shekels. At that point, the Israel Securities Authority launched an investigation. Jaegerman, Heby and Givony were indicted for stealing more than 45 million shekels, while Peled was indicted for looking the other way.

After Peled retired from the police force, he had served as chairman of the Israel Electric Corporation.

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