The Tax and Economic Prosecutor's Office filed an indictment in the Tel Aviv District Court, the Economic Department, against six senior officials of the Shikun & Binui Group. In accordance with their confession, the court convicted five of the defendants on Monday and sentenced Moshe Lachmani, who served as chairman of Shikun & Binui, to a fine of NIS 1.5 million and suspended imprisonment.
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The Shikun & Binui affair concerns events that took place within the framework of the group's international activities after Amendment 99 of the Penal Code came into force in July 2008, which prohibits bribery of a foreign public official. According to the indictments filed, even before the amendment came into effect, some of the companies in the group and their various organs used to make payments to various entities in the countries in which they operated, some of which were improper. These unlawful payments and the profits resulting from them were included and embedded in the Group's accounting books.
The amended indictment in which Moshe Lachmani, who served as chairman of Shikun & Binui from mid-2012 to early 2019, admits that when he assumed the position of chairman of the board of directors in July 2012, it was brought to his attention that the payments had not been stopped, some of which were illegal. Although Lachmani ordered the promotion of a code of ethics and an enforcement program, he did not take measures to immediately ensure the cessation of these payments, which continued to generate profits for the company. Financial statements published to the public included illegal payments, along with annotations that included the statement that "payment of expenses in the above format does not constitute material exposure to the group companies."
Moshe Lachmani - Shikun & Binui, Photo: Sivan Faraj
District Court Judge Benny Sagi convicted Lachmani of failing to act in accordance with the obligations imposed on him under the Securities Law (Section 36). He allowed the publication of the reports even though he was aware that the Shikun & Binui reports include the aforementioned annotation and statement, which ignores possible implications for the companies' businesses. In light of the above, he was convicted of an offense under the Securities Law and sentenced to a fine of NIS 1.5 million and a suspended six-month prison sentence.
The indictment filed against Ofer Kotler, who served as CEO of Shikun & Binui and chairman of the subsidiaries SBI Infrastructure and SBI Switzerland, Roni Ploch, who served as CEO of the subsidiaries SBI Infrastructure and SBI Switzerland, Dan Shaham, who served as CEO of the Kenya branch of SBI Switzerland, Moshe Heflig, who served as CFO of SBI Switzerland, and Benjamin Arbit, who served as head of the East Africa region at SBI Switzerland, It appears that the defendants conspired with various organs of the companies in order not to stop the provision of payments by subsidiaries of SBI Switzerland and branches in the countries of activity, even though these payments were some of them illegal. The volume of payments reached considerable sums that gave companies significant economic benefit.
Shikun & Binui Ministries, photo: Archive photo: Yehoshua Yosef
In accordance with their confession, Judge Sagi today convicted Kotler of conspiracy to commit a crime under the Penal Law and for failing to act in accordance with the obligations imposed on him under the Securities Law (Section 36). He is accused of allowing the reports to be published even though he was aware that Shikun & Binui reports include annotations and statements that ignore possible implications for the companies' businesses. The parties petitioned to impose on Kotler a fine of NIS 3 million and a suspended prison sentence.
Roni Ploch is charged with conspiracy to commit a crime under the Penal Code and prohibition of operating in property originating in an offense (section 4 of the Prohibition of Money Laundering Law), after he acted to unlawfully integrate the payments into its expenses and legitimate income, in the accounting system and financial statements of SBI Switzerland, as it was before the amendment of the law. The parties petitioned to impose on Floch a 9-month prison sentence (which could be converted to community service), a fine of NIS 500,000 and a suspended sentence.
Shikun & Binui building in Air Port City, photo: Yehoshua Yosef
Dan Shaham is charged with conspiracy to commit a crime under the Penal Code, and aiding and abetting false registration in corporate documents. The parties petitioned to impose on Shaham a prison sentence of 5 months (convertible to community service), a fine of NIS 200,000 and a suspended sentence. Moshe Heflnig is charged with conspiracy to commit a crime under the Penal Code and the offense of a corporate executive. The parties petitioned for a 7-month prison sentence (which could be converted to community service), a fine of NIS 775,000 and a suspended sentence.
Benjamin Arbit (whose hearing was postponed to another date) was charged with conspiracy to commit a crime under the Penal Law and a corporate executive, and in accordance with the agreement, the parties will petition to impose a 6-month prison sentence (which can be converted to community service), a fine of NIS 450,000 and a suspended sentence.
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