Crime Family Accused In Billion Shekel Fraud
Cops arrest nearly two dozen crime family members, including Ronnie Baranes, pictured at right, who is described as a key figure in the scam.
Police arrest dozens in fake invoices scam
Crime family accused in billion-shekel fraud.
By Nurit Roth and Hila Raz • Ha’aretz
Over 20 suspects were arrested yesterday morning in a huge tax fraud scandal. The suspects allegedly took control of several failing companies by violent methods and then used the firms to collect tax refunds by means of about NIS 1 billion worth of fake invoices.
Police say the suspects used the businesses to obtain some NIS 160 million in fraudulent value-added tax refunds.
Among those arrested were known criminals allegedly linked to Shalom Domrani's organized crime ring, which operates in the south.
"This is just the beginning of the affair," a prosecution representative told the Tel Aviv Magistrate's Court yesterday. "There are plenty of other [people] involved to investigate."
All the suspects were brought for a remand hearing yesterday evening in front of Judge Yuval Gazit.
Police say the scam worked by having the suspects, or their straw men, approach a business in financial trouble and offer the owners a loan from one of their companies. Along with the loan, the business also received fake invoices for about two and a half times the amount of the loan. These were for supposed purchases of products, materials or work that were never supplied. Thus if, for instance, the loan was for NIS 1 million, the fake invoices would be for NIS 2.5 million.
The VAT refund due on NIS 2.5 million is NIS 400,000, so the business would receive this amount back from the Tax Authority. This also happened to be the amount of interest the suspects would charge on a NIS 1 million loan. The business owners were allegedly forced to give the suspects post-dated checks for the amount of the interest - or in other words, the amount of the VAT refunds.
In addition, the fake receipts enabled the businesses to lower their income tax payments, since they showed much higher expenses.
In cases where the owners could not pay back the loans at the rates the criminals demanded, the lenders took over the business and its bank accounts themselves, said the police. The criminals then wrote fictitious invoices from the business and emptied its bank accounts.
The charges against the suspects include money laundering, fraud, tax fraud, false reporting to the tax authorities, forgery, extortion, illegal loan sharking, conspiracy, fraudulent receiving and import and export violations.
Two of the main suspects, Ronnie Baranes and Aharon Azran, were remanded for six days yesterday, after the judge concluded that there were reasonable grounds both for suspecting the accused of the crimes and for fearing that they might seek to obstruct the investigation if left free. However, the six-day remand he ordered is less than the 15 days the prosecution sought.
The hearings for the other suspects were still continuing when TheMarker closed.
The investigation started a few months ago, after the investigative department of the Tel Aviv VAT office and the police fraud squad began seeing large number of fraudulent tax invoices. The police's financial crimes unit then opened an undercover investigation.
There's a Chabadnik in Tzefat, Meir Baranes, who very publicly believes the late Rebbe, Menachem Mendel Schneerson is alive, is the messiah, and is God. Baranes tried to kill the Chabad chief rabbi of Tzefat several years ago. I wonder if the Ronnie Baranes mentioned above and this Meir Baranes are related?
Calling out to AE Anderson -
Are you okay?
Last post I read of yours was from Christchurch NZ. Let us know you're alright or a bunch of us will have to start saying Tehillim for you!
Posted by: Abracadabra | February 22, 2011 at 06:50 AM
theese crime families bring shame on the jewish people they are despicable characters and to top it the guy wears a kippa what a nut
Posted by: jancsipista | February 22, 2011 at 08:19 AM
Calling out to AE Anderson -
Are you okay?
Yes AEA, please say something! Are you OK?
Apparently the Christchurch shul was destroyed (called there, the Canterbury Hebrew Congregation) but no one was hurt and the Rabbi (Chabad) was in Australia at the time. Unfortunately there are 65 confirned dead now and 100 missing with numerous buildings destroyed.
Posted by: David | February 22, 2011 at 01:55 PM
What was the purpose of the gratuitous slap at Chabad? The attack on the Chief Rabbi of Tzfat was motivated by his direct and adamant opposition to those who proclaim the Rebbe as a deity. The only relevant point is the alleged criminality and despicable behavior of some, regardless of their outward displays of Jewish observance and fealty to G-d. Scott leave it at this. Your jihad against chareidim in general and Lubavitch in particular just detracts from your message or worse attracts haters while distancing the truly concerned.
Posted by: Baruch | February 22, 2011 at 01:58 PM
Baranes is a very common Tunisian Jewish name. However, considering that Meir Baranes was a suspected Shabak operative, it would not surprise me that he has relatives in organized crime. That is just how the shabak works - we have stuff on you so do us a few favors. And in this case the favor was trying to murder a respected enemy of land-for-peace who otherwise had no problems with anyone else in this world.
Posted by: Bareanass | February 22, 2011 at 03:08 PM
Update: A friend spoke with AE Anderson about 6-7 hours ago. This friend reports that AEA stated that he and his family were, thank G-d, safe and unharmed.
Posted by: Baruch | February 22, 2011 at 03:13 PM
Update: A friend spoke with AE Anderson about 6-7 hours ago. This friend reports that AEA stated that he and his family were, thank G-d, safe and unharmed.
Posted by: Baruch | February 22, 2011 at 03:13 PM
Good!
Posted by: Shmarya | February 22, 2011 at 03:23 PM
A-Engler Anderson writes on facebook:
Happy to report we've survived today's earthquake in Christchurch. Significant damage to house. Wife, chihuahua OK. Electric power restored after 7 hours. M-T-K.
Posted by: AYid | February 22, 2011 at 05:07 PM
What was the purpose of the gratuitous slap at Chabad? The attack on the Chief Rabbi of Tzfat was motivated by his direct and adamant opposition to those who proclaim the Rebbe as a deity. The only relevant point is the alleged criminality and despicable behavior of some, regardless of their outward displays of Jewish observance and fealty to G-d. Scott leave it at this. Your jihad against chareidim in general and Lubavitch in particular just detracts from your message or worse attracts haters while distancing the truly concerned.
Posted by: Baruch | February 22, 2011 at 01:58 PM
Try re-reading what I wrote.
I pointed out there is man named Baranes who is a Chabadnik. and that man tried to kill the Chabad chief rabbi of Tzefat. And I asked if the two Baraneses are related.
How this becomes an attack on Chabad in your warped little mind is beyond me.
Posted by: Shmarya | February 22, 2011 at 05:17 PM
"I pointed out there was man named Baranes who is a Chabadnik. and that he tried to kill the Chabad chief rabbi of Tzefat. And I asked if the two Baraneses are related."
Posted by: Shmarya | February 22, 2011 at 05:17 PM
If I pointed out that there is a man named Julius Rosenberg who is Jewish and that man gave American atomic bomb secrets to the Soviet Union. And if I were to ask if the two are related...
How this could be construed as a gratuitous aspersion on Scott Rosenberg is not beyond anyone?
Posted by: Baruch | February 22, 2011 at 06:34 PM
Posted by: Baruch | February 22, 2011 at 06:34 PM
I see you have poor reading comprehension skills.
Try to process: what I wrote about Meir Baranes would be considered bad for Baranes but not necessarily for Chabad. He tried to kill the Chabad chief rabbi, for Godssake.
Posted by: Shmarya | February 22, 2011 at 06:42 PM
And, genius, process further:
Meir Baranes and Ronnie Baranes are both criminals and bad men, and I'm "comparing" (your incorrect term) one to the other.
In your sick example, you are comparing a mass murderer to a blogger you don't like.
If you believe both of the above examples are equivalent, you need serious help.
Posted by: Shmarya | February 22, 2011 at 07:03 PM
I'm wondering if Shmarya Rosenber is related to Chris Rosenberg - the mafiosi from Cannarsie, NY....
Posted by: sam | February 22, 2011 at 07:13 PM
No, but Shmarya is a grandson of an old-time gangster from St Paul, Minnesota. However, since that reprobate was his mother's father, his surname is not Rosenberg.
Considering what is published here, the first Rosenberg I think of when I think of Shmarya is Alfred.
Posted by: Al Rosenberg | February 22, 2011 at 07:17 PM