Construction Company Owner Arrested for Alleged 26 Million Shekel Invoice Fraud in Israel

Shmulik Gazit, owner of the construction company Niti Development and Construction Ltd., was arrested and questioned on Tuesday on suspicion of falsifying invoices totaling approximately 26 million shekels. The alleged tax fraud involved a value-added tax (VAT) deduction of about 4 million shekels that was improperly claimed from the VAT authorities. Gazit, 46, a resident of Ramat Hasharon, was detained as part of an investigation by the Jerusalem Customs and VAT Investigations Department. Authorities suspect that between 2022 and 2025, Gazit recorded fictitious tax invoices in the company’s books. The Tax Authority accuses him of multiple VAT offenses, including fraud, deception, providing false information, and deducting input tax without proper documentation.

During the arrest and bail hearing, the Tax Authority noted that Gazit gave vague responses, claiming he could not recall many details and needed time to verify information. On Wednesday, Jerusalem Magistrate Judge Yasmin Katili ordered Gazit's release under restrictive conditions. These include a 20,000 shekel cash deposit, a personal surety of 200,000 shekels, a 180-day travel ban, and a prohibition on contacting other individuals involved in the investigation. Gazit did not attend the hearing.

The investigation remains ongoing as authorities continue to examine the extent of the alleged fraudulent activities and potential accomplices.