Former Logotech CEO Tuvia Leibowitz has made allegations against Logotech’s parent company, Tel Aviv Stock Exchange-listed Tadbik.
“Tadbik wanted to obtain excessive tax breaks from the Israeli government by fraudulently exaggerating the quantities and value of materials exported by Tadbik to Logotech in the US. Tadbik and Logotech exploited tax breaks the State of Israel offers businesses… either by sending subquality goods and overstating their value, or by claiming they were Israeli exports, rather than goods purchased in countries such as Germany,” alleges Leibowitz. The allegations were raised in a statement by the defense to a New Jersey court in a lawsuit between Leibowitz and Logotech.
Court documents obtained by “Globes” show that Leibowitz claims that goods exported by Tadbik to Logotech in 1996-98 raised several questions. Tadbik delivered raw materials to Logotech without paying customs taxes, using questionable declarations. Industry sources estimate the value of the deliveries at hundreds of thousands of dollars.
Leibowitz alleges in his defense statement that he was fired from Logotech because he refused to cooperate in the “scheme”. Tadbik CEO Ilan Drory, who has a controlling interest in the company, testified that Leibowitz was fired because of financial irregularities in the company.
Tadbik financial reports show that the company received three grants approved by the Investment Promotion Center totaling NIS 6 million, contingent upon the company meeting export targets, among other conditions.
Drory declined to return “Globes” calls, and Leibowitz also declined to comment on the report.
Published by Israel's Business Arena on 25 March 2001