This morning, the Israel Police detained for questioning fifteen suspects in an affair involving collection of protection money by companies posing as legitimate building site security companies. The investigation found that the companies were collecting money by extortion and threats against victims and potential victims. In addition, the companies were found to have made false reports to state authorities, thereby committing fraud estimated to be in the millions of shekels.
The investigation is being conducted by Israel Police together with the Beersheva VAT Investigation Department of the Tax Authority, the Tel Aviv District Attorney's Office, the Ministry of the Economy, and the National Insurance Institute. It is suspected that representatives of the companies approach building contractors, offer security services for building sites, and if the contractor decides not to accept, his sites are broken into, equipment is damaged, and property is set on fire, alongside threats that leave the contractors with no choice other than to accept the security services offered. Those involved are also suspected of fraudulent receiving, failure to report revenue, false accounting, and money laundering.
This morning, following a covert investigation, police, VAT investigators, and investigators from the Ministry of the Economy and the National Insurance Institute carried out searches at the homes and offices of the suspects and seized documents and computers. Further arrests are expected in the case.
Published by Globes [online], Israel business news - www.globes-online.com - on December 22, 2015
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