The State Attorney's Economics Department has informed seven suspects in the Israeli credit card company ICC-Cal affair that it is considering indicting them on criminal charges for a series of offenses in three different affairs, subject to hearings that will be held, should they wish. The list of suspects includes ICC-Cal, its former CEO Boaz Chechik, and former vice president Steve Greenspan, who are suspected of bribery, fraud, and money laundering worth billions of shekels.
This affair was first reported a number of years ago in “Globes.” The Boaz Chechik investigation began following a complaint made by Israel Discount Bank (TASE: DSCT) to the police, after a series of articles by Moshe Lichtman were published in “Globes,” investigating deviations in the company’s risk management - primarily in online credit card processing for gambling, porn, and food supplement websites.
Following the reports, Visa and Mastercard investigated the ICC-Cal’s risk management, and fined the company: Visa issued a fine of €9 million, and Mastercard issued a fine of $3.6 million. In parallel, the Bank of Israel launched a discreet investigation of the policies and the ties between the Israeli credit card companies and online e-commerce payment clearing platforms.
The Bank of Israel investigation was held after the banks were given guidelines, including a warning regarding the entry of criminal organizations to the online payment clearing business. The Bank of Israel even personally approached the CEOs of the banks at the time: First International Bank CEO Smadar Barber-Tsadik, Bank Hapoalim CEO Zvi Ziv, Mizrahi-Tefahot CEO Eli Yones, Leumi CEO Galia Maor, and Discount Bank CEO Giora Offer - and demanded that they not honor online transactions that are suspected of being illegal.
At the end of the investigation, the Bank of Israel fined ICC-Cal NIS 6 million for this matter.
On this occasion, an Israeli Police investigation found that between 2007 and 2010, the suspects allegedly committed widespread fraud of Visa and MasterCard. The suspects cleared deals on gambling sites with false codes indicating that the sites engaged services that were not gambling. The suspects opened and closed pornographic sites and pharmaceutical drug sites in an attempt to conceal the scope of transactions with these sites while committing money laundering, bribery and fraud offenses worth billions of shekels.
Published by Globes [online], Israel business news - www.globes-online.com - on April 21, 2015
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