| The Economic Department of the Tel Aviv-Jaffa District Court | |
| Criminal Case 59453-07-19 Israel v. Motola et al
Before the Honorable Judge Michal Agmon-Gonen
|
|
|
The accuser: |
Israel By Attorneys Idan Schwartz and Adi Levy of the Tel Aviv District Attorney’s Office (Taxation and Economics) |
|
|
against
|
||
| Defendants: | 1. Avi Motola
2. Avihu Ivshitz 3. Galit Ben Meir Dori 4. Paul Mashiach 5. Vera Yoffe 7. Tomer Kobani 8. Avraham Yaakov Rauchruger 9.Gabriel Klein 10. Yaakov Grohar 11. Meira Ben Yosef 12.Africa Israel Industries Ltd. 13.Negev Ceramics Ltd. 14.Via Arcadia Home Design Ltd. 15.Super Ceramic Home Finishing Products By Attorney Sagi Blumenfeld
|
|
Sentence in the case of defendants 13-15
Once again, the question arises before me of the responsibility of corporations in criminal matters, questions relating to the punishment of corporations in general and economic offenses in particular, as well as the question of their rehabilitation. This is an affair known as the Africa-Israel affair, or the Negev Ceramics affair.
- Background
The indictment spreads a wide range of offenses of false reporting and records over the years 2011-2014. In order to make false representations about meeting the objectives of the Negev Ceramics Group (owned by Africa Israel Industries (in liquidation)). As a result, the financial statements of Africa Industries and Negev Ceramics, between the years 2011-2014, misrepresented the financial situation and results of the activities of the Negev Group, and its parent company, Africa Industries, in amounts of millions of shekels.
During the audit of the financial statements for 2014, the auditors noticed accounting irregularities related to the prior and double recognition of the revenues made by the Negev Company, in the amount of approximately NIS 12.8 million, and Africa Industries was forced to amend its financial statements accordingly.
On March 15, 2015, Africa Industries published its annual reports for 2014, including the consolidated reports for the year ended December 31, 2014. As a result of the discrepancies, Mr. Motola was dismissed from his position in the group a few days after the publication of the reports, on March 18, 2015. Following the dismissal of Mr. Motola, Mr. Gabriel Klein, who had served as CEO of Via Arcadia and Super Ceramics since 2013, and was a member of the management of the Negev Group, contacted the Chairman of the Board of Directors of Africa Industries and the Director of Nosef, and reported to them additional irregularities in the recording of revenues in the Negev Group, including the recording of double revenues in Via Arcadia in the amount of millions of shekels, which were not discovered in the company's auditors. Following the request, the company opened an investigation, which was later expanded, and the board of directors of Africa Industries appointed internal and external parties to examine the accounting irregularities in the group.