The Bank Hapoalim (LSE:BKHD; TASE:POLI) money laundering affair kept gathering steam today. The bank issued its first statement this morning after a gag order was lifted on announcements about the massive police investigation into suspected money laundering at the bank branch on HaYarkon Street in Tel Aviv. Later today, United Mizrahi Bank CEO Eliezer (Eli) Yones, who is also the former CEO of Bank Hapoalim, was called to make a witness statement at the Israel Police National Serious and International Crimes Unit in Petach Tikva.
The police have emphasized that Yones at present is only a witness not a suspect in the affair. Yones was CEO of Bank Hapoalim for one year. He resigned over differences of opinion between him and the controlling shareholders after 900 staff members were fired. Later today, three other customers of the HaYarkon branch will be questioned.
The Israel Police National Serious and International Crimes Unit yesterday arrested two additional persons suspected of money laundering at Bank Hapoalim. The two were the head of the France desk, whose remand was extended this evening, and a bank customer. Three other customers were also interrogated.
Following last night's search of Vladimir Gusinsky's Most group offices, the police intend to interrogate Adv. Zvi Hefetz, currently Israel's ambassador to Great Britain.
At the time the alleged money laundering took place, Hefetz was Gusinsky's representative in Israel, and to the board of directors of ''Ma'ariv''. The police allege that Hefetz has evidence that would prove Gusinsky took an active role in laundering tens of millions of dollars.
Yesterday, the branch manager's detention was extended for five days, while two other senior employees -- the head of customer relations, and the head of the CIS desk -- had their detention periods extended by four days. Other employees will remain under arrest for three and two more days.
180 accounts belonging to 18 customers, with $380 million in assets, were frozen.
Published by Globes [online], Israel business news - www.globes.co.il - on Monday, March 07, 2005