Securities Authority recommends indictment for IDB’s Dankner

Dankner and securities traders Itay Strum and Adi Sheleg allegedly worked to artificially inflate the share price.

September 9, 2013 23:44
1 minute read.
Nochi Dankner in court, June 9, 2013.

Nochi Dankner in court 370. (photo credit: Tal Shahar/Yediot/poll)

The Israel Securities Authority on Monday revealed that it recommended the Tel Aviv District Attorney indict IDB controlling shareholder Nochi Dankner, as well as securities traders Itay Strum and Adi Sheleg, for alleged share manipulation.

The investigation opened in November over events that took place during a February 2012 IDB share offering, when Dankner and the others allegedly worked to artificially inflate the share price.

In July, the ISA turned the case over to the Tel Aviv District Attorney at the State Attorney’s Office.

Following an examination of the evidence, the district attorney on Monday allowed the ISA to reveal publicly its belief that the evidence suggests the suspects committed corporate fraud and breach of trust and securities fraud.

Though the ISA believes there is enough evidence for an indictment, it is now up to the Tel Aviv District Attorney’s Office to decide whether it agrees.

In response to the report, Dankner’s office stated: “As is customary and accepted, we are awaiting the district attorney’s decision, and believe it will be decided that no flaw will be cast on Nochi Dankner’s behavior.”

The investigation alleges that IDB shares rose to unusual heights on days that Strum and Sheleg bought shares at inflated prices, allegedly at Dankner’s behest and with his funding.

The possibility of an indictment adds another worry to Dankner’s laundry list of troubles.

The tycoon has been dodging bullets to try to maintain control of his company, as disgruntled bondholders push forth in their efforts to oust him.

In accordance with court orders, he has sold Clal Insurance and posted nearly a halfbillion shekels to a trustee account as a down payment on an impending deal with Alexander Granovsky, a Jewish Ukranian investor.

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