Israeli Beverage Company BLU Faces Major Fraud Indictments in Recycling Scam
BLU, a leading Israeli beverage company owned by Anan Shamsoom and his family, is on the verge of facing indictments in Israel's largest-ever beverage container recycling fraud case. The scandal, uncovered in late 2023 after a lengthy covert investigation, involves false reporting of bottle and can collection and recycling volumes, resulting in hundreds of millions of shekels lost to the state. Shamsoom and senior company officials, including CFO Anat Avid, are accused of orchestrating a broad criminal scheme involving tax evasion, VAT fraud, money laundering, and false documentation in cooperation with collection and recycling firms.
The fraudulent scheme inflated reported recycling volumes through fake delivery and weighing certificates and fictitious invoices, allowing BLU to collect deposit fees without incurring recycling costs. The total financial damage to the state is estimated at approximately 335 million shekels, with BLU alone responsible for around 110 million shekels in tax offenses and 100 million in money laundering. Two recycling companies, Li-On and Bac-Bok, and their owners are also implicated, accused of aiding BLU in the fraud with offenses totaling millions in VAT evasion and money laundering.
The investigation revealed that BLU reported collecting more containers than physically possible, including plastic waste falsely declared as recyclable beverage containers. Some shipments purportedly sent abroad for recycling were returned intact to Israel, further inflating reported volumes. The suspects were arrested in December 2023, with their detention extended before release under restrictions. Shamsoom's name was initially kept under gag order but was publicly revealed in January 2024.
Following his release, Shamsoom resumed business activities and negotiated a sale of BLU to Carmel Corp for an estimated 450 million shekels, though the deal was later canceled. The Ministry of Environmental Protection is considering fines of about 100 million shekels for BLU's false recycling reports from 2019 to 2022. Draft indictments describe a five-year scheme involving sham invoices and false reporting to avoid paying doubled deposit fines.
BLU and the accused deny criminal wrongdoing, claiming the case is an administrative matter and asserting that allegations and sums have been significantly reduced. Their lawyers express confidence that the prosecution will be dropped after hearings. The investigation continues, with authorities also scrutinizing other large beverage companies suspected of similar misconduct.
Summary: Israeli beverage company BLU and its owners face imminent indictments for a massive recycling fraud involving false reporting and tax evasion, causing state losses of hundreds of millions of shekels. The case, uncovered after a long investigation, also implicates recycling firms and continues to expand.
