Cohan Addresses Investors After $14 Million Misuse in US Bond Company
Three days after the financial scandal involving US bond company Cohan Properties (BVI) broke, controlling shareholder Mike Cohan addressed investors to explain the situation. He admitted to a human error involving the misuse of $9.6 million from bond issuance proceeds to cover personal debts and the concealment of a $4.7 million loan from another fund. These issues were not disclosed in the company’s prospectus or Q1 2026 reports, despite raising 412 million shekels on the Tel Aviv Stock Exchange in March. Following the disclosure, the bond price dropped over 20% last Friday but rebounded 16% during Cohan’s investor call.
Major institutional investors affected include investment house Mor with 146 million shekels, insurance company Phoenix with 47 million, and others such as Meitav and Clal. Cohan repeatedly apologized and promised such events would never recur, attributing the problems to organizational shortcomings rather than dishonesty. He explained that a non-BVI asset was repaid due to a cross-collateralization issue and that the concealed loan was repaid as well.
In response, the company’s board ordered a review of all past financial reports, revoked Cohan’s exclusive signing rights, and appointed compliance officer Eran Kanti as a mandatory co-signer on all bank accounts. Cohan claimed he initiated these measures himself and vowed to bring in new personnel to strengthen governance. He emphasized that the BVI assets remain sound, unaffected in cash flow or valuation, and invited investors to visit the US properties for full transparency going forward.
Addressing the trust deficit, Cohan pledged to work hard to regain investor confidence and ensure full compliance with reporting and payment obligations. He acknowledged the bondholders’ losses and committed to doing everything possible to secure the company’s success and prevent future failures.
