Three and a half years after the Better Place electric car venture collapsed, investigations have begun to find who was responsible for its collapse. Those being summoned for questioning include senior officials in the company and in Israel Corporation (TASE: ILCO), which invested in the venture. Sources inform "Globes" that Adv. Sigal Rozen Rechav, from the Raved Magriso Benkel & Co. law firm, and Adv. Shaul Kotler, the Better Place liquidators, last week summoned former Better Place executives for questioning. In the next stage of the inquiry to clarify responsibility for the enterprise's collapse, they plan to summon Better Place founder and former CEO Shai Agassi, as well as senior company and market personnel who took part in the enterprise, including businessman and Israel Corporation controlling shareholder Idan Ofer and former Israel Corporation chairman Amir Elstein.
Former Better Place CEO General (res.) Moshe Kaplinsky and former head of Better Place Australia Evan Thornley will be summoned later. Sources also inform "Globes" that the liquidators are considering summoning Israel Chemicals (TASE: ICL: NYSE: ICL) chairman and former Israel Corporation CEO Nir Gilad for questioning, but had not yet made a decision in the matter.
1,000 lawsuits
Almost 10 years have passed since the Better Place enterprise was launched, and it is three and a half years since it collapsed in a financial fiasco that saw tens of millions of shekels go down the drain, and the investigation into the failure is still ongoing. Because of the many claims filed in the case against various companies in the Better Place group (more than 1,000 lawsuits in the case are being heard), no full estimate of the debts left by Better Place has been submitted to the court. In recent months, the liquidators are due to file a report containing a list of the company's debts. Meanwhile, however, they have begun to conduct an inquiry to determine the circumstances of the collapse and those responsible for it.
In recent months, the liquidators have conducted a covert examination, using economic consultants, insurance advisers, and others, into the circumstances of the company debacle, and how to maximize the money entering the liquidation fund. A month ago, the liquidators asked the court for permission to conduct an open investigation, including the summoning for questioning of shareholders, officeholders, managers, employees, and other parties linked to any of the Better Place group's companies in Israel or overseas. The court granted the request, and summonses were sent in recent weeks to various parties who were involved in the company's business. A number of former Better Place medium-level managers and officeholders appeared in the liquidators' offices last week, including former Better Place CFO Alan Gelman.
Investigation budget approved
By law, the liquidators are obligated to examine the circumstances that led to the group's liquidation, among other things, whether the business was fraudulently managed, and whether the senior officeholders and executives in the company should be held personally liable for the company's debts. At this stage, the liquidators are concerned that improper actions were taken in the company, although they have not yet found any fraud, negligence, or other executive failure. They have therefore begun to exercise their authority to summon for questioning the parties involved in managing the company.
In a request that they submitted to summon officeholders and senior executives for questioning, the liquidators stated that as part of the covert examination they conducted in cooperation with the MNS auditing and economic investigation firm, many documents and information from the Better Place group's companies were checked: protocols, insurance policies, documents for proving debt, financial statements, agreements, etc. All of their activity in this context was described in detail in confidential requests submitted to the court in past months. The liquidators are making it clear that they have not yet formed an opinion about whether legal proceedings should be instituted against the officeholders and senior executives who were summoned, but a frontal investigation is needed for the purpose of determining the extent of their responsibility.
Up until now, the court has authorized the liquidators' employment of the MNS accounting firm and the Kaplansky law firm on an hourly basis up to a total of NIS 50,000 initially for each firm, and NIS 75,000 subsequently for each firm. At this stage, the liquidators are asking the court to authorize a further NIS 70,000 according to hourly work costs for the accountant firm in order to continue the investigative audit, and a further NIS 25,000 for the law firm for assistance in the frontal investigation scheduled to take place in the coming weeks.
By law, if the liquidators find that any of the shareholders or officeholders committed fraud, or bear responsibility for the company's collapse, that shareholder or officeholder can be charged for the company's debts - with the court's approval.
Published by Globes [online], Israel business news - www.globes-online.com - on December 15, 2015
© Copyright of Globes Publisher Itonut (1983) Ltd. 2015