Mike Ben Ari, Who fled Israel in April 2021 after being suspected of defrauding investors in the amount of NIS 600,000, made contacts with senior businessmen in Montenegro and through them smuggled assets and money. This emerges from the periodic report submitted by the trustee, Adv. Lior Dagan, to the Tel Aviv District Court as part of the bankruptcy and liquidation proceedings.
The report states that Ben-Ari met Zlatan Khalilovich, who introduced him to Vaseline Piovich, a businessman who is considered close to the president of Montenegro, Milo Djokanovic, with whom Ben-Ari worked and had extensive ties with him. According to the report, Ben-Ari transferred more than 20 million euros, which came from the money from the Ponzi scheme.
The report reveals that already in 2018, the Securities Authority applied to Ben-Ari for information and documents. His lawyers replied that he maintained his right to remain silent and if granted immunity from incrimination he would be willing to pass on the required documents.
Ben-Ari realized that it was only a matter of time before they got on him and started smuggling assets and money. He continued to raise money and between the date of his application in 2018 and his arrest in April 2021, he raised about NIS 120 million. He found smuggling routes for money, and for two years smuggled his assets, transferred a house in the US in his brother’s name, money to his ex-wife Vered and built the center of his life in the Balkans. Across many countries and smuggled assets to the Serbian businessman.Today his friends in Serbia give him a place to hide and guard.
“The debtor’s escape from Israel created a very serious problem. The debtor’s escape allowed him to carry out numerous smuggling operations of money, assets and rights on a huge scale, to empty the safes he held abroad, to empty the bank accounts, and to smuggle the funds,” Adv. Dagan wrote to the court .
An entire industry of forged documents
Trustee Dagan describes that Piovich took an active part in raising investors’ money, hosting them in his hotels in Montenegro and persuading them to invest. Ben-Ari served as an investment manager at Unifram, the company owned by Piovich, and it is alleged that Ben-Ari is acting on his instructions before and after his arrest and the actions are subject to his approval. The stolen money transferred was used by Piovich for the successful construction of the companies he owned.
Dagan describes that Ben-Ari’s activities span five major countries – Israel, Montenegro, Serbia, Hungary and the United States, along with other countries. Ben-Ari managed the funds abroad through dozens of foreign bank accounts and corporations without any separation of funds, and managed industry Complete set of forged documents, including bank credentials. Ben Ari’s creditors stand at 1,300 and are scattered all over the globe – America, Europe, South Africa and other places.
Dagan met with Ben-Ari in Belgrade, the capital of Serbia, in August and September, with the aim of reaching an agreement with him to return the funds. Dagan sat with him for many hours, and one of the meetings was joined by investors’ lawyers, Eitan Erez and Mor Ben-Shoshan. Initially, a memorandum of understanding was formulated in principle with regard to a possible arrangement, but Ben-Ari repeated it and acted to thwart any seizure of assets.
“The debtor himself and through corporations under his control initiated and managed the largest and longest-running Ponzi scam ever committed in Israel,” Dagan wrote.
He describes that “this is an international insolvency case, unprecedented in its scope and complexity, exceptional and extraordinary in which he manages for his part a world-wide after his assets and the debtor’s money.”
Adv. Lior Dagan / Photo: Kadia Levy
Dagan had to deal with a highly branched, almost double-edged reporting system run by Ben-Ari, which required the study of a “language” that Ben-Ari used using “codes” and “numbers” to understand financial history.
Arrest and escape from Israel with a forged passport
In April 2021, the Investigations Department of the Securities Authority opened an investigation against Ben-Ari and a company EGFE he owns on suspicion of committing fraud, securities offenses and money laundering offenses.
This is the largest Ponzi scheme that has been in Israel, according to the suspicion, in terms of the duration of the activity (15 years), the amount of sums – NIS 600 million and the amount of investors affected – about a thousand.
Ben-Ari allegedly offered investors to invest in the Blue Bird Fund in the US with fixed, interest-free fixed interest rates. He presented them with fake documents proving their investment and the return they were entitled to. Return the funds.
At the beginning of May 2021, Ben-Ari fled the country despite the existence of a restraining order in his case, using the passport of an investor who became his friend and assisted him. An indictment has been filed against the investor for obstruction of justice. Following the violation of the conditions of release, the Securities Authority confiscated two million shekels that served as a guarantee to ensure that he met the conditions of his release.
The Securities Authority stated: “The Authority has exposed the acts of fraud and deception of Ben-Ari and seized assets in Israel and around the world amounting to tens of millions of NIS. By virtue of its role, the Authority works daily to protect the investing public, and reviews information on dozens of supervised and unsupervised ventures, in order to ensure that these operate in accordance with the law. An investigation and an arrest warrant are tools that the authority has the authority to use only after a sufficient evidentiary basis has been established for the commission of offenses. “Had it not been for the PA’s proactive and determined activity, Mike Ben-Ari would have continued to deceive innocent investors to this day.”
Attorney Shalom Goldblatt, representing Ben-Ari, said: “A response will be given to the court.”
*** Presumption of innocence: Mike Ben-Ari has not been convicted and is presumed innocent.