The management of Menorah Mivtachim Holdings Ltd. (TASE: MORA) apparently knew about the practice of granting improper loans to agents long before the practice was stopped, implies a report by Barlev Investigative Accounting. The Ministry of Finance appointed the firm, headed by Yehudah Barlev CPA, to investigate the affair.
Barlev also found that the failure at Menorah had been brought to the attention of its management by other insurance companies. The loans, which violated procedures, cost Menorah NIS 60 million.
It is not yet clear, however, whether Menorah's management personally approved the improper loans, or if it merely tarried in stopping the practice after learning of it and used to time in an effort to reduce exposure to the loans portfolio and get the money back.
Barlev is due to submit his report to the Ministry of Finance soon. Menorah has meanwhile been asked to respond it, but has not yet prepared its response. Barlev reportedly has no plans to submit recommendations and is simply reporting the facts and conclusions.
Menorah said that it has not yet seen Barlev's report, and could therefore not comment about it.
Published by Globes [online], Israel business news - www.globes-online.com - on November 19, 2009
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