Pinbert Investors to Recover Half Their Funds in Slices Scandal Settlement
Another party involved in the Slices financial scandal has signed an agreement to return funds, allowing Pinbert investors to recover approximately half of their original investments. Victims of the Slices case must now decide whether to accept an immediate payout of about 51.5% of their invested capital or continue relying on the entities that collected their money but have yet to reimburse them.
Pinbert, which was among the firms that raised money from Slices investors for the so-called "red funds," and the company's special manager submitted a request to the Tel Aviv District Court to approve a principles agreement for fund restitution. The agreement offers investors two options: a rapid asset liquidation within 18 months returning roughly $27 million (about 51.5% of the $52 million remaining assets after prior repayments), or continued investment management in Georgia for five to six years aiming for higher returns. Choosing either option requires investors to waive future claims against the settlement parties.
Originally, Pinbert raised $67.14 million from Slices investors. The settlement amount was determined through a compromise based on asset valuations, disputes over their worth, and potential realization. The court filing reveals that investor funds were allocated to various projects, including $3.1 million in a real estate project on Kazbegi Street in Tbilisi, currently delayed due to disputes with local developers, and $8 million for land in Batumi. The funds also hold about $7 million in cash.
A significant asset is a loan extended to Eshkol Liyam, a company controlled by entrepreneur Liyam Israeli, another figure involved in the red funds. The loan, initially about 15 million shekels, has grown to approximately $6.7 million due to accrued interest. There is also a right to collect additional loans totaling $25.2 million, but these are excluded from the settlement due to uncertainty about their recoverability.
The settlement includes individuals Idan Neftaji, Ilit Motola, Gabriel Kokuashvili, and 24 funds that raised investor money. Neftaji and Motola are listed as partners and organizers of the foreign funds marketed by Pinbert, while Kokuashvili served as the agency chairman.
The Slices scandal emerged at the end of 2023 after the Capital Market Authority appointed Effi Sandrov as the special manager following severe financial management deficiencies. According to the authority, about 900 million shekels of investors’ money were funneled into private foreign funds, the "red funds," illegally and without clear means to trace or recover the money. Pinbert managed some of these funds.
Lawyers Eitan Erez and Mor Ben Shoshan represent the victims, while attorney Alon Ron represents the funds. Pinbert is the third party to sign a settlement with the special manager, following entrepreneur Liyam Israeli and Amnon Yakobi, who committed to returning funds. Israeli pledged $34 million but has returned only $1 million so far, with $2 million in collateral already liquidated. Yakobi agreed to repay about 8 million shekels.
