Menorah Mivtachim Holdings Ltd. (TASE: MORA) unit Menorah Mivtachim Finance is subject to a criminal investigation by the Israel Securities Authority focusing on deals in funds that were made in the interests of a third party rather than customers.
These deals were made using customers' accounts (in this instance mutual funds) while breaching the obligation of trustees that fund manager have towards holders of fund units, that are called rescue deals, and in most cases influence the price of the security.
It was announced two weeks ago that senior executives at Menorah Mivtachim Finance were being investigated over alleged criminal violations including CEO Ronen Avigdor.
Sources at the company claim that they have no idea why the investigation is being conducted and that Avigdor and the other executives being investigated are continuing business as usual.
Published by Globes [online], Israel business news - www.globes-online.com - on June 28, 2010
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