Sources inform ''Globes'' that another case of fraud is suspected at Harel Insurance Investments and Financial Services Ltd. (TASE: HARL), this time in its non-life insurance business. A few week's ago, Harel's internal auditor obtained information that a garage in the north was involved in fraud. The subsequent investigation has so far estimated the fraud at NIS 187,000, and it is now investigating whether any company employees were involved. This money has been recovered.
Harel has notified the Ministry of Finance Capital Markets, Insurance and Savings Division on the case. This is the second case of fraud at the company this year, although it is on a minor scale compared with the embezzlement at Harel Investment House Ltd.
Harel found that the fraud, which began in late 2006, allegedly involved a garage, which received payments for fictitious invoices. The money came from the company's nostro funds and not from policyholders.
In April, Harel Investment House deputy CEO Guy Vaisman was discovered to have embezzled NIS 123 million. The amount wiped out the company's shareholders' equity, which Harel Insurance was forced to make up. Vaisman is now on trial.
Harel was not available for comment by web-posting.
Published by Globes [online], Israel business news - www.globes-online.com - on December 19, 2007
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