State Prosecutor Moshe Lador today decided to indict former Bank Hapoalim (TASE: POLI) chairman Dan Dankner on charges of bribery, aggravated fraud, fraud, breach of corporate trust, impairment of proper conduct of a banking corporation, and violations of the Prevention of Money Laundering Law (5760-2000). The indictment is subject to a hearing. Dankner was chairman of the bank in 2007-09.
Lador will decide about Bank Hapoalim CEO Zion Kenan later. Lador also decided to close the files against other suspects in the case, including former Bnak Hapoalim chairman Shlomo Nehama, Ronen Israel, and Rafael Barber. Lador thus accepted the recommendations of the Israel Police submitted in February.
The main charges against Dankner center around conflict of interests, beginning with Bank Hapoalim's acquisition of Turkey's BankPozitif. This was a deal that began to be put together in 2005 between Bank Hapoalim and RP Capital and the owners of BankPozitif. Dankner was a director of Bank Hapoalim at the time. Later, in July 2007, he was appointed chairman.
In early 2008, Dan Danker, as chairman, led Bank Hapoalim's decision to award RP Capital substantial compensation at a time when RP Capital was a business partner of Elran Investments Ltd. (TASE: ELIN), controlled by two of Dankner's cousins. Dan Dankner allegedly concealed his ties to RP Capital from Bank Hapoalim executives and directors.
In late 2008 and early 2009, Dankner allegedly led Bank Hapoalim's decision to solve liquidity problems at BankPozitif (a decision to distribute a dividend by BankPozitif, and a decision to increase Bank Hapoalim's holding in BankPozitif). At the same time, Dankner obtained a €5 million loan from DHB Bank (Nederland) NV, which is owned by BankPozitif's Turkish owners. Dankner allegedly concealed this loan, which he received in exchange for benefits obtained for BankPozitif's Turkish owners, from Bank Hapoalim executives and directors.
During the investigation, the police questioned Kenan under caution on suspicion of abetting fraud, fraudulent receiving, and breach of corporate trust with regard to a $3.4 million loan granted to Dankner in October 2008, approved by the committee for transactions by parties at interest and affiliated parties of Bank Hapoalim. The loan was allegedly approved improperly on the basis of a false presentation by Kenan to the loan committee.
Published by Globes [online], Israel business news - www.globes-online.com - on September 5, 2011
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