Albar to Pay NIS 18 Million in Indirect Vehicle Import Case

Albar, the leasing and rental company, will pay a NIS 18 million fine for its role in the indirect vehicle import affair first exposed by Calcalist 11 years ago. According to Israel’s Tax and Economic Prosecution, the Tel Aviv District Court convicted the company, based on its plea agreement, of fraud and tax offenses. The investigation was conducted by the Customs and VAT Investigations Unit in Haifa of the Tax Authority and the Coastal District investigation unit of the Israel Police.

Under the plea deal, both sides asked the court to impose the NIS 18 million penalty, which is far lower than the amount the Tax Authority originally sought. The case is still regarded as one of the most complex scandals in the Israeli auto sector.

Albar began importing cars through indirect import in 2012. In this model, unlike direct import from a manufacturer, the importer buys vehicles from an overseas agent and brings them to Israel. Albar initially imported Honda and Toyota vehicles, but it had to present approvals from authorized U.S. agents. Those approvals were later found to be forged.

The prosecution said Albar, together with others involved, presented false documents and agreements to create a misleading impression that it met legal requirements, and on that basis received permits and licenses from the Transport Ministry. Prosecutors said the company imported 1,828 vehicles worth more than NIS 176 million, submitted fake purchase invoices to lower purchase tax, and used false origin certificates to make it appear the cars had been properly bought by the agent from the manufacturer. The prosecution also said the false import declarations covered about 1,600 vehicles and that fake accounting entries were made to conceal the real transaction costs and the source of funds.

Proceedings against the other defendants are still ongoing. The company’s chief executive at the time, Yinon Amit, left shortly after the affair became public in Calcalist. Amit later co-founded Automax, which until last year was Israel’s largest indirect vehicle importer, and then expanded into direct imports from Chinese automakers before collapsing last year.