Court Approves Settlement Plan for Slys Investment Firm

The Tel Aviv District Court has fully approved a settlement plan for Slys, an investment firm that managed provident funds. The plan, proposed by the authorized trustee, accountant Efi Sandrov, aims to resolve the complex financial fallout from the company's collapse, which involved hundreds of millions of shekels in missing funds.

Sandrov was appointed trustee three years ago following severe deficiencies found by the Capital Markets Authority in Slys's operations, particularly concerning individually managed provident funds. The investigation revealed a significant risk to the savings of many members.

The settlement plan outlines a detailed process for addressing the rights of members in "White Funds" and "Red Funds," as well as suppliers and creditors. Some members are expected to receive a substantial portion of their funds relatively soon, while others will receive funds contingent on the outcomes of ongoing legal proceedings against third parties. The plan is designed to rectify the company's failures, minimize damages, and recover assets.

Specific provisions are made for different fund types. For "White Funds," which hold approximately 1,800 members with investments totaling about 1.8 billion shekels, the plan differentiates between funds with illiquid assets and those that are more easily liquidated. For members in limited "White Funds," liquidity and transfer requests are currently on hold due to asset illiquidity. For free "White Funds," priority for withdrawals will be given to older members, starting with those aged 60 and above, then 50, and finally 40.

For "Red Funds," members will be grouped by organizers, and their recovery will be based on their nominal investment amount minus any loans received. The plan also seeks tax relief from the Tax Authority for members transferring funds to other provident funds. The trustee is working to identify investments, loans, and organizer groups to determine each member's share. New savings and study funds will be established to safeguard recovered assets.

While the plan addresses member claims, non-member creditors will need to file separate claims. The settlement's funding sources include existing transitional accounts, collections from "Red Funds," management fees, claims against third parties, and a potential state loan. The distribution order prioritizes company management expenses and state loan repayments (funded by shareholders or claims against officers), followed by various levels of member reimbursements and compensation for claims.