Ex-Tax Authority Official, Businessman Dudi Appel Indicted in Multi-Million Shekel Fraud Scheme

Israel's State Prosecutor's Office has filed an indictment against attorney and CPA Shimon Cohen, a former senior official at the Israel Tax Authority, and businessman Dudi Appel, accusing them of tax offenses, forgery, violations of insolvency and economic rehabilitation laws, and money laundering. Also indicted are Orly Tal, another former Tax Authority employee who worked in Cohen's office, along with Zvi Shpitz, Haim Salter, and three companies controlled by Cohen.

Cohen, who previously served for 15 years in senior roles at the Tax Authority, including as head of the international taxation division and deputy director of major tax assessments, allegedly used fictitious trusts and false documents to help clients evade taxes totaling hundreds of millions of shekels. He is also accused of hiding tens of millions in personal income and assisting Appel, who was undergoing insolvency proceedings, to conceal income from a brokerage deal. Cohen allegedly engaged in money laundering activities amounting to approximately 50 million shekels.

Specifically, the indictment details how Cohen and Tal allegedly created a fake trust and forged documents to conceal foreign assets and income for their client Zvi Shpitz, presenting them as held by an offshore trust established years earlier. Haim Salter was allegedly paid $15,000 to pose as the trust's creator and sign a forged trust deed. Cohen is accused of falsely valuing these assets at $20 million when they were worth half that amount.

In another case, Cohen allegedly fabricated another trust, backdating its establishment to 1990, to fraudulently settle undeclared foreign assets and income for clients, thereby enabling them to benefit from significantly lower tax rates. He allegedly received $300,000 in cash for this service, which he did not report.

The indictment also charges Cohen and Appel with money laundering related to a 2018 brokerage deal for a foreign company, where Cohen received a commission of approximately 8.45 million euros. Appel, while under receivership, allegedly received millions of shekels from this commission through his family members via sham loan agreements, without reporting the funds to the authorities. Cohen is accused of further money laundering offenses through offshore companies, bank accounts, false accounting entries, and foreign investments.