The Eldad Peri Affair is the ‘Heftziba’ of the Purchasing Groups and Non-bank Lenders
As Peri Real Estate entered a suspension of proceedings, new details have been revealed regarding its conduct in the purchasing groups category.
25.09.20 | Adi Cohen
As Peri Real Estate entered a suspension of proceedings, new details have been revealed regarding its conduct in the purchasing groups category. The request to appoint a trustee for the company started a snow ball effect of additional claims on the part of customers and other creditors, whereby funds disappeared, advances were stolen from customers for apartments that were already pledged to other parties, and warning notes that were deleted in favor of customers without them being notified of such. Subsequently, the reins were taken away from Peri and two trustees were appointed to investigate the company’s financial state. However, hundreds of the company’s customers were left with a deep concern for the fate of their money and their investment.
Adv. Assaf Englard, Head of Financing and Banking at our firm, who served as Bank Discount’s official receiver after the infamous affair erupted in 2007 – with the collapse of the Heftziba Real Estate Group that was controlled by Boaz Yonah and which left hundreds of apartment buyers abandoned and defeated – sees the similarity between the two affairs: “The Eldad Peri Affair is the Heftziba of the purchasing groups and the non-bank lenders,” he says. “The effects of the earth shattering Heftziba Affair were seen at real estate development companies and banks. Their subsequent distancing themselves from the category of purchasing groups was also apparent. Later, this was also expressed in legislation, with the amendment of the Sales Law and the imposing of administrative responsibility both on banks and insurance companies – which were required to ensure the securities that the customers were to receive. Currently, we have witnessed another earthquake, only this time, the players are the same non-bank lenders and private lenders to whom the regulation and legislation still does not apply.”
Assaf added: “The company created investment packages for private individuals, with nice returns, and for this company, there was quick money that enabled it to continue to roll it over on a daily basis,” he said. “There was a considerable amount of lenders who took advantage of this and benefited from the money, but when the percentages are compared with the securities – it is obvious that this involved a large risk and this money could also disappear.”