Father, Daughter, Accountant Suspected of Tax Evasion on $3.3 Million

Israel's Tax Authority has launched an open investigation into a father, his daughter, and their accountant for allegedly failing to report approximately 3.3 million shekels (about $900,000 USD) in income. The suspects allegedly hid owner withdrawals within company financial reports, which should have been declared as personal income and on wealth declarations.

The investigation began after a routine audit by the tax assessor in Netanya raised suspicions of long-term tax evasion. The case was subsequently transferred to the tax assessor for investigations in the Central District.

According to the arrest request, the father, Riyad Masarweh, established a company in 2017 providing workplace safety training and inspections. Due to his personal insolvency proceedings, his wife was initially listed as the shareholder, with shares later transferred to their daughter, Samar Masarweh, and then back to the wife. The company announced its cessation of operations and closed its VAT account in 2025.

Investigators found that the company's financial statements consistently showed a growing balance of owner withdrawals. Tax authorities state that, according to law, this balance is taxable income for the shareholder and should have been reported in their personal tax filings. The daughter reportedly failed to declare this income on her 2022 wealth declaration.

The accountant, Fouad Jabr, prepared the company's financial statements throughout this period and was aware of the owner withdrawals. The investigation alleges he did not include this income in the personal tax returns he prepared and filed for the shareholders.

An explicit investigation commenced this week, involving searches and seizure of evidence. The suspects were questioned, and statements were taken from other involved parties. Following their interrogation, the three were brought before the Rishon LeZion Magistrate's Court, which released them under restrictive conditions. The investigation is ongoing.