Tel Aviv Real Estate Firm Sues Bank Over Fraudulent 3.8 Million Shekel Transfer
Migdale Top Real Estate has filed a lawsuit against Bank Leumi, requesting the court to compel the bank to disclose the identity of an account that received 3.8 million shekels transferred under fraudulent pretenses. The company alleges it was deceived by forged payment vouchers and a fake building permit, both falsely presented as issued by the Tel Aviv-Yafo Municipality.
The fraud was uncovered after Migdale Top Real Estate, which is developing an urban renewal project on La Guardia Street in Tel Aviv, paid municipal fees and development levies based on vouchers it believed were authentic. The company transferred the funds to a Bank Leumi account, but later discovered the vouchers and the permit bore counterfeit digital signatures of municipal officials, including the acting mayor, deputy mayor, local planning committee chairman, and deputy city engineer. The municipality confirmed the documents and account were fraudulent. The real permit required a payment of 9.5 million shekels.
When Migdale Top requested the bank to reveal the account holder’s identity, Bank Leumi refused citing banking confidentiality. The plaintiff argues that banking secrecy is relative and must yield to public interest in exposing fraud, stating, "The wrongdoer has no right to hide behind privacy laws." The fraud impacts not only the company but also landowners, buyers, contractors, and the lending bank.
Bank Leumi responded that the plaintiff was negligent for not verifying the account details before transferring funds and that the transfer was made from an account at another bank, not Bank Leumi. The bank dismissed the company’s attempt to shift responsibility onto it. Migdale Top’s attorney, Einhorn Or, said the case details are thoroughly presented in the lawsuit and will be clarified in court.
This case highlights the risks of sophisticated fraud involving forged municipal documents and the challenges of banking secrecy laws in fraud investigations.
