Former Psagot execs set to be indicted

The prosecutor is about to make its decision on which suspects are to be indicted, including former Psagot CEO Roy Vermus.

Sources inform ''Globes'' that the Taxation and Economics State Prosecutor's Office will file indictments in the Psagot Investment House Ltd. bonds manipulation case within two months, three years after the scandal was discovered. The sources added that the prosecutor has completed processing the material obtained during the hearings for the suspects, and that it is now waiting for a government expert's opinion, which is almost complete. On the basis of this opinion, the prosecutor will make its final decision on which suspects to be indicted, beginning with former Psagot CEO Roy Vermus, who was ousted from his post because of the case.

In February 2010, the capital market was stunned when Israel Securities Authority announced the arrest of two Psagot executives, David Edry and Shai Ben-David on suspicion of manipulating government and corporate bonds in Psagot's nostro securities account. The capital market's shock worsened when Vermus and Psagot Securities CEO Shay Yaron were subsequently named as suspects in the case. Other suspects are Aharon Navon, who worked at the time in Deutsche Bank Israel's trading room, and Saar Weintraub, a broker at Deutsche Bank Israel.

On January 17, the State Prosecutor summoned Vermus and the other suspects for a hearing, and announced that it intended to indict them. Vermus and Yaron were suspected of involvement in the bonds manipulation, and overseeing and approving the actions as they occurred.

The illegal profits from the activity are suspected of influencing the salaries and compensation paid to the main suspects, including Vermus.

In October 2010, State Prosecutor Moshe Lador accepted a request by Psagot's controlling shareholder, Apax Partners for a settlement, which included the closing of the case against the investment house for lack of public interest, subject to the replacement of Psagot's senior management, the drawing up of a strict code of corporate governance, and payment of a NIS 150 million fine.

Published by Globes [online], Israel business news - - on December 30, 2012

© Copyright of Globes Publisher Itonut (1983) Ltd. 2012

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