The Tel Aviv District Court today convicted Emblaze Ltd. (LSE: BLZ) founder and former chairman Eli Reifman of aggravated fraud, forgery, and use of forged documents. Judge David Rosen said that in two separate cases, Reifman fraudulently received $6.3 million in loans from two foreign investment companies on the basis of forged documents, which claimed that he owned Emblaze shares for collateral.
"It was proven to me that Reifman received millions of dollars from Winton Capital Holdings Ltd and Double U on the basis of false representation that he owned nine million Emblaze shares," said Judge Rosen.
In March 2009, an order of receivership was placed against Reifman, and the Supreme Court later dismissed his appeal to lift it. When Tel Aviv District Court Varda Alshech ordered Reifman to transfer his Emblaze shares to a special received Adv. Eitan Erez, Reifman refused, claiming that he no longer owned the shares, which had been transferred to a trustee. Alshech sent him to jail three times for contempt of court because of this refusal.
Reifman claimed that he was the beneficiary of an allocation of 39 million Emblaze shares, which were held in blind trust for him. Emblaze's current owners said that Reifman's legal troubles since 2006 meant that he had no right to any Emblaze shares, and that the trustees listed in the company's records did not hold the shares for Reifman, but for other beneficiaries.
Published by Globes [online], Israel business news - www.globes-online.com - on July 17, 2011
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