Kohan Properties Bond Plummets 19% Amid Financial Irregularities in Israeli Market

Just six weeks after the dramatic collapse of Simed, the foreign bond market in Tel Aviv, particularly companies registered in the British Virgin Islands (BVI), faces another major crisis. Kohan Properties, a U.S.-based company that raised approximately 412 million shekels in April through its Series A bonds from the Israeli public, reported severe financial irregularities and missing disclosures on Friday. This announcement came after an urgent inquiry by the Israel Securities Authority, causing the company’s bond price to plunge about 19% on the stock exchange.

The company’s internal investigation revealed troubling conduct by the controlling shareholder, CEO, and director Mike Kohan. It found that Kohan allegedly used around $9.6 million of the bond proceeds for personal debt repayment related to his private assets, without any disclosure in the bond prospectus. Additionally, a hidden $4.7 million loan from a Delaware-registered fund, represented by Uri Eisenberg, was repaid with $7 million from the public offering funds, yet this transaction was not reflected in the company’s Q1 2026 financial reports.

Kohan claims he fully returned the funds to the company’s treasury through a property deal in Chicago (South Dearborn). However, the board remains unconvinced and has taken drastic measures: it ordered a full audit of all past financial reports, immediately revoked Kohan’s exclusive signing rights, appointed compliance officer Eran Kanti as a mandatory signatory on all company bank accounts, and required Kohan to deposit millions of dollars in cash as collateral pending the investigation’s completion.

This development adds to the turmoil in the Israeli real estate bond market, highlighting ongoing governance and transparency challenges within BVI-registered companies listed in Israel.