Israeli Court Upholds 5.5 Million Shekel Fine for Unlicensed Pension Withdrawal Company
The Haifa Magistrate's Court has upheld a civil fine of approximately 5.5 million shekels against Noya Priscilla Litvak and her company Y.P (Gabriel) Financial Solutions for conducting pension-related activities without a license. The court, presided over by Judge Majda Jubran Morkos, rejected the company's appeal after it withdrew and agreed to dismiss it. This ruling follows findings by the Capital Market Authority revealing that the company solicited clients to identify and withdraw pension funds, provident funds, training funds, and life insurance held by institutional bodies without the required advisory or marketing license.
The company charged clients excessive commissions of up to 20% of the withdrawn amount for these services. Early withdrawal before the legal retirement age also imposed a maximum tax penalty of 35%, resulting in clients losing nearly half their savings to fees and taxes, along with irreversible damage to future retirement benefits and insurance coverage for disability and death.
Litvak and her company argued procedural flaws and requested a reduction of the fine during the appeal. However, the Haifa District Attorney's Office, representing the Capital Market Authority, opposed any reduction due to the severity of violations and significant financial harm to savers. Ultimately, the company agreed to withdraw the appeal, and the Authority consented to a payment plan of 45 equal monthly installments starting October 10, 2026. The court warned that any payment delay over seven days would cancel the arrangement and accelerate the full debt with added interest and penalties.
This judgment is part of a broader crackdown by the Capital Market Authority against unauthorized inducement of early pension withdrawals. Recently, the Authority's commissioner, Amit Gal, issued a binding directive effective within three months, requiring institutional bodies to actively warn savers through personal conversations or detailed notices about the tax damages, loss of insurance coverage, and the option to withdraw funds directly without paying brokerage fees.
