Adv. Amit Kriegel, lawyer for global super-model Bar Refaeli and a former senior Israel Tax Authority official, was questioned under caution by the Tax Authority in the Bar Refaeli criminal investigation. Kriegel, a partner of former Tax Authority legal advisor Adv. Moshe Mizrahi in the Moshe Mizrachi, Noach, Kriegel law firm, is suspected of abetting Refaeli in tax evasion through illegal tax planning concerning her place of residence.
Two weeks ago, the gag order was removed on the Tax Authority's investigation of Refaeli on suspicion of tax evasion amounting to millions of shekels. Refaeli and her mother, Tzipi Refaeli, were arrested and released under restricting conditions.
The main suspicion against Refaeli concerns her reporting of her residence to the Tax Authority, a question of great bearing on the amount of tax she should have paid. According to the Income Tax Ordinance, an Israeli resident owes tax on their worldwide income, while a foreign resident (someone living overseas most of the time), owes tax only on income produced in Israel. The definition of residence in the Income Tax Ordinance is according to the number of days the resident is present in Israel and the location of the person's "center of life," based on various criteria.
As part of the covert investigation conducted by the intelligence section of the Tel Aviv investigative tax assessment office, evidence was collected indicating that Bar Refaeli and her mother had allegedly defrauded the tax assessment office by making false statements aimed at camouflaging Bar Refaeli's center of life. It was also suspected that Refaeli did not report her full income to the tax assessment office.
For example, it was fond that Refaeli lived in the YOO towers in Tel Aviv in a rented apartment, while the lease was signed in her brother's name, probably in order to avoid linking her to Israel. After the YOO towers lease expired, Refaeli moved to the W towers for three years under a lease in her mother's name, despite the fact that it was Bar Refaeli who lived in the building.
Under questioning, Refaeli confirmed that she lived in the apartment. Asked about this benefit, Refaeli's accountant answered that he had not known at all who paid the rent; had he known, he would have had to consider whether she owed taxes on her income.
The investigation also revealed that in 2009-2012, Refaeli had apartments at her disposal in Israel. When the tax assessment office asked her about this, the answer on her behalf was that she had not rented an apartment in Israel in recent years.
Kriegel was summoned for questioning under caution as part of Refaeli's investigation by the tax authorities. When a lawyer is questioned by the police and the Tax Authority about his relations with his client, the question always arises of what he is allowed and forbidden to say, in view oflawyer-client privilege.
One argument by an attorney in such a case might be that his advice to his client was based on information given to himby the client, and that what he reported to the authorities was true to the best of his knowledge. Kriegel emphatically denies the suspicions against him, andRefaeli is also only a suspect, andit is premature to determine whether she committed any offenses whatsoever. The Tax Authority said in response, "We do not comment on ongoing investigations."
Kriegel's lawyer, Adv. Roy Blecher of the Goldfarb Seligman law firm, said in response, "Adv. Kriegel has been representing Ms. Refaeli in discussions with the tax assessment office for several years, and does so in accordance with the high professional standards characteristic of his conduct. There has been no fault in his representation of Refaeli, and we are confident that the case against him will be dropped."
Published by Globes [online], Israel business news - www.globes-online.com - on January 6, 2016
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