Promedico, Under Investigation, Continues Remitting Funds Abroad Without Tax Payment

The company's officers explained to their investigators that they did so in light of their basic concept whereby no tax is owed in Israel on these commissions.

The controlling shareholders of the Promedico company continued withdrawing millions of dollars from the company in a manner constituting a prima facie violation of law, even after an overt investigation was inaugurated against them in 1993.

Information reaching Globes indicates that at the time the investigation was launched (in 1993), the tax amount allegedly concealed from the Income Tax Commission stood at $14 million. In the course of the investigation it became apparent that the company's present controlling shareholders - Binyamin Jesselsohn and Alexander Eisenberg - continued paying moneys out of Promedico, by way of commissions, without paying tax thereon.

The volume of the alleged tax concealment involving all the suspects, including Teva's general manager Eli Hurvitz, amounts, together with linkage and interest, to about twenty million dollars.

It was also reported that under questioning, and in conversation with legal counsel, Jesselsohn and Eisenberg alleged that they had continued taking funds out in the same manner, due to their basic concept whereby neither they nor the company were under any obligation to pay tax in Israel on moneys paid as commission. This plea was later rejected by the prosecuting attorney and the income tax investigators.

Counsel for the suspects refused to comment on the details of the case, since a hearing is presently in progress

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