Financial Firm Ordered to Repay NIS 100,000 for Practicing Law Illegally
A Tel Aviv Magistrate's Court has ordered Dani Livneh and his company, Obligor Financial Services, to return NIS 100,000 to a couple, Yuri and Renata Shuv, for illegally engaging in activities that crossed the line into the practice of law. The ruling came in response to a NIS 1 million lawsuit filed by the Shuovs against Livneh.
The Shuovs, immigrants from the former Soviet Union working as a truck driver and a shopkeeper, hired Livneh after accumulating NIS 190,000 in debt. They agreed to pay him NIS 82,000 if he arranged a loan for them. Obligor presented itself as a company providing professional services to thousands of clients, assisting individuals and businesses with various debts.
The couple secured a NIS 280,000 loan through Obligor, but after upfront interest and fees of NIS 40,000, they received NIS 240,000. They were obligated to repay the loan within a year, immediately settle their existing NIS 190,000 debt, and pay Livneh his NIS 82,000 fee. The Shuovs transferred NIS 230,000 to Obligor's bank account to settle their debts and pay part of the company's fee.
Obligor claimed to have paid NIS 165,000 to creditors, leaving NIS 65,000 for the Shuovs, while asserting the couple still owed the company NIS 88,000. In January 2024, the Shuovs sued for NIS 230,000. Obligor returned NIS 65,000, but the Shuovs increased their claim to NIS 1 million, alleging Obligor's mismanagement inflated their debts by NIS 600,000 and seeking NIS 400,000 for emotional distress. They claimed they were misled, their signatures forged, and only later discovered they had received legal services reserved for attorneys.
Judge Gad Mina ruled that while the Shuovs signed the agreements, the contract between Obligor and the Shuovs was void. This decision was based on a 2017 District Court ruling, agreed to by Livneh and Obligor, which found they had infringed upon the legal profession by drafting legal documents and representing clients in legal negotiations. The current agreement violated this ruling, as Livneh failed to disclose he was not a lawyer and that the services were not legal, which the judge deemed intentional deception. Livneh also charged for actual legal work, contradicting his claims in court and potentially harming clients. The judge emphasized that declaring the agreement illegal was essential for upholding the rule of law. However, the judge dismissed the claim for emotional distress damages due to unproven losses and noted the Shuovs' own decisions contributed to their situation. Livneh and Obligor were ordered to pay NIS 15,000 in legal costs.
