The Bank of Israel Banking Supervision Department intends to demand that Bank Leumi (TASE: LUMI) review the conduct of senior executives in the affair involving the granting of benefits to investment advisors. The most senior executive in question is head of the international and private banking division Zvi Itskovitch, a member of the board of management. The division was responsible at the time of the affair for the subsidiaries Psagot Ofek Investment House Ltd. and Leumi Pia Mutual Fund Management Co.
The Bank of Israel expects Bank Leumi president and CEO Galia Maor to formulate her position and decide whether the employees in question can continue in their posts. She will notify the Bank of Israel of her decisions on the matter.
Most of the individuals involved in the affair are no longer at Bank Leumi, including Psagot Ofek CEO Gabriella Ravid and her deputy, Dan Silbiger, and Leumi Pia general manager Michael Civier and his deputy Meir Mazuz.
Bank Leumi and the State Prosecutor reached a settlement in the investment advisors affair in January 2008. The bank was accused of giving bonuses and other incentives to its investment advisors for recommending the bank's own mutual funds to customers. Under the settlement, Bank Leumi pleaded guilty to a misdemeanor and paid a NIS 25 million fine.
Published by Globes [online], Israel business news - www.globes-online.com - on May 14, 2008
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