Union Mutual Funds Management, owned by Union Bank; economist Hod Zoiberman, an assistant to the general manager and an analyst in the company; and former general manager Aminahum Resnick have been indicted in the Tel Aviv Magistrates Court on counts of fraudulently influencing price fluctuations of shares traded on the stock exchange by continuous trading.
As part of his job, Zoiberman was responsible for managing and implementing investments in the Igud Yeter mutual fund, which was managed in the company framework. Resnick personally managed investments in four of nine mutual funds managed in the framework of the company, and supervised management of the other mutual funds.
The indictment against Zoiberman alleges that in August-September 1998, he implemented trading transactions intended to lower the share price of Isracolor Laboratories. The aim was to create artificial trading in the share, which had not been traded at all for many days, thereby enabling Igud Yeter to sell its shares in the company.
The second charge, which names all the accused, states that in 1998 Zoiberman traded in TACT stocks, in order to stabilize the share price and prevent it from falling.
The motive for these actions was to preserve the yield of the Igud Yeter fund and preventing a possible fall in yield, due to sharp share fluctuations characterizing lightly traded shares included in the fund's holdings.
According to the prosecution, Zoiberman influenced the volatile trading of various shares over a trading period of 17 days.
Union Mutual Funds Management and Resnick are accused of assisting Zoiberman in fraudulently influencing share prices, by being aware of his actions and consenting to his method. Zoiberman, in this indictment, is accused of fraudulently influencing trading, while the company and Resnick are accused of abetting fraudulent influence.
In the third indictment against the company and Resnick, the prosecution claims that Resnick managed the investments of the Igud Bonds fund.
The prosecution alleges that the accused carried out artificial and countervailing transactions in the accounts of Igud Bonds, thereby creating an artificial trading turnover.
The case has been scheduled for hearing before a judge on February 28.
Published by Israel's Business Arena on January 25, 2000