- Twenty-four employees, past and present, of Bank Hapoalim's
Hayarkon Street branch in Tel Aviv were arrested yesterday in what officials
called the biggest money-laundering case in the history of the state, thought
to involve hundreds of millions of dollars in the past year.
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- The Petah Tikva Magistrate's Court yesterday remanded
for five days the branch's former manager, Motti Cohen, on suspicion of
involvement in massive illegal money-laundering schemes, which included
leading "oligarchs" from Russia who also had business interests
in Israel.
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- The head of customer relations in the branch, Yaakov
Sverdelik, and the head of the Commonwealth of Independent States desk,
Alik Leder, were also remanded for five days.
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- The court also remanded, for three days each, Dalia Kaiserman,
head of the branch's French desk, and David Abutbul, who was responsible
for French customers in the bank.
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- Investigators from the International Crimes Unit said
that hundreds of millions of dollars were illegally laundered through the
bank over the past year. Police sources said they have evidence that senior
officials in the bank knew about the laundering and chose not to report
it.
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- Police are now investigating whether senior executives
at the national level of the bank were aware of the money-laundering.
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- Yesterday, police froze 180 accounts held by 18 customers
at the branch, accounts that police suspect were used as conduits for the
flow of money from outside the country into those accounts and then, via
"back-to-back" standing orders, sending the money out of the
country. At least 45 customers will be summoned in coming days by the police
to answer questions about signs of laundering in their accounts. But all
the customers of the bank - about 200 businesspeople - will be questioned,
as police try to determine just how extensive the laundering was in the
branch.
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- Among those likely to be questioned are Maariv owner
Vladimir Gusinski, whose Tel Aviv offices were raided yesterday, and Israeli
ambassador to London Zvi Hefetz, who was Gusinski's point man in Israel.
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- The case was only made possible by the promulgation of
an anti-money laundering law that went into effect two years ago. Many
of the bank's employees, including the manager and other senior officials,
took part in the laundering on behalf of their customers, police said.
The branch, which only handles foreign customers, had effectively become
a money-laundering station for hundreds of businesses worldwide, said police
sources.
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- Despite the sensitivity of the investigation and the
extent of the suspected crimes, police emphasized that so far their probe
is focused entirely on the branch and does not extend to elsewhere in Bank
Hapoalim. Nonetheless, senior executives of the bank are expected to be
asked about their knowledge of the branch's activities, especially if,
as police now suspect, branch employees won bonuses for their work facilitating
the laundering and not reporting it to the authorities.
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- Police described several of the laundering methods they
say were used at the bank. In some cases, large sums of money would flow
into an account and immediately flow out, in smaller amounts, to shell
companies around the world, in an effort to hide the original source of
the funds.
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- A second way was to break up large sums of money into
smaller amounts deposited in separate accounts in the bank, thus enabling
businessmen to avoid the rule requiring the bank to report cash transfers
of more than NIS 1 million if it involves money from overseas or NIS 50,000
if it is money from inside Israel. A third method was for the businessman
to deposit a large sum, take a loan of the same amount from the bank and
then send the borrowed money overseas, with the loan covered by the sum
that remained in the account.
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- The police worked closely with the Bank of Israel's Supervisor
of Banks Yoav Lehman in preparing their case, but Hapoalim's senior management
was left in the dark, with the arrests yesterday morning sending shock
waves through the bank. The police informed the bank as it moved from a
secret, undercover operation to the open one, made public through the media.
Bank executives promised full cooperation with the investigation and with
the central bank. Hapoalim shares were down by 2.6 percent for the day.
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