Psagot Investment House Ltd. CEO Roy Vermus, chairman Arik Steinberg, and executive Shai Yaron were questioned yesterday under caution by the Israel Securities Authority in the investigation of Psagot.
The investigation began about a month ago, following questioning of former Psagot executives David Edery and Shay Ben-David, who were responsible for the investment house's nostro portfolio, which represent's the firm's own money.
The questioning of Vermus, Steinberg, and Yaron apparently revolves around their involvement in the alleged activities of Edery and Ben-David, who are suspected of manipulating bond prices to add billions of shekels in profits to the firm's portfolio.
The suspicion now is that Vermus and Steinberg had up to date reports about what was going on in the account, and may have even authorized some of the illegal activities. Vermus had previously denied any connection. The probe will continue for several weeks at least.
As far as is known, the Securities Authority investigators have evidence, including e-mail messages, that Edery and Ben-David reported to Vermus and Steinberg about the transactions they carried out. Sources inform "Globes" that Vermus, Steinberg, and Yaron claimed under questioning that they could not understand from the reports they received from Edery and Ben-David that anything was wrong.
Psagot responded that it has full confidence in the authorities, adding, "We repeat, as we said in the past, that there is no connection with customers' assets managed by Psagot."
Published by Globes [online], Israel business news - www.globes-online.com - on March 18, 2010
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