Former senior Securities Authority official: Bonus Biogroup apparently once again committed a securities scam in order to stay in the indices
As we revealed in BizPortal, Bonus Biogroup bombarded the stock market with announcements just before the indices were updated and thus managed to stay in the index at the expense of Generation Capital. An investor is now suing Bonus Biogroup for NIS 365 million: the running of Bonus Biogroup shares has cost millions of generation investors, as well as the index holders - a bonus share has lost 50% since
Nathaniel Ariel | 14/02/2022 08:13(15)
Tags: Updating the indices Running stocks Update of indices
As we revealed in BizPortal , a companyBonus Biogroup -6.63% Allegedly acted to influence its stay in the large indices of the local stock exchange, TA 90 and TA 125, at the expense ofGeneration Capital -1.37% That came out of the indices. how? Bonus sent a significantly higher-than-usual announcement rate to the stock exchange and apparently showed that there was significant activity in the company and maintained the price until the set date - January 13. But since staying in the indices, the stock has simply plunged, losing about 50% of its value.
Those hit are of course the holders of the big indices who lost a lot of money within a few days, the institutions that follow the indices that are committed to buying the stock, and also the investors of Generation Capital, who were left out.
The impact of the CEO and owner of Bonus Biogroup - 23% of the lock turnover
but what is interesting is the person who participated in the impact on the exchange rate gates on the determining day of the index update: The owner and CEO of Bonus Biogroup accounted for 23% of the lock trade A former senior member of the Securities Authority, Othniel Afek.
Following this, a lawsuit was filed in the Economic Department of the Haifa District Court against Bonus Biogroup, according to which the damage caused to the shareholders of Generation Capital lost about NIS 38.5 million as a result of its exit from the indices - following the stock regulation that allegedly performed Bonus Biogroup. Attached to the lawsuit was Afek's expert opinion, which states that "based on the existing data, it appears that Mr. Maretzky's conduct raises a reasonable suspicion of fraud in securities."
Afek, who worked for the Securities Authority from 2002-2019, first as a researcher and head of a research team and from 2009 to 2019 served in senior management positions as director of the Intelligence Unit and then director of the Intelligence and Technologies Department and a senior member of the senior authority. The determinant) the CEO and controlling shareholder of Bonus Biogroup, Shai Maretzky, purchased 166,000 shares "as a result of this acquisition, the company's share remained in the Tel Aviv 90/125 indices" and that "intra-market manipulation" was carried out.
Section 54 of the Securities Law 1968, stipulates that anyone who fraudulently influenced the price fluctuations of securities is liable to imprisonment for five years. Since the companies themselves are clear that there is more information than the general public, the goal is to neutralize the distortions and information gaps as much as possible - because these distortions can cause direct and immediate economic damage to the trading public and investors, and damage public confidence.
According to Afek, in the case of the Biogroup bonus, these are not legitimate transactions: "This is not a type of transaction but a manipulation, which distinguishes it from the fact that it is based on real trading, but what distinguishes it is a subjective aspect: the investor's wrong intention to profit The exchange rate.
"Maretzky's interest is clear - this is his only acquisition in the last 5 years,"
according to Afek, "on the face of it, Mr. Maretzky's interest in the company remaining in a clear index, both in his capacity as controlling shareholder and CEO, both in terms of company stock marketability In relation to the fundraising capabilities and the image of the company in the eyes of the public. "
The amount of money that Maretzky purchased is nil in terms of the amount of money that Maretzky holds, so Afik concludes that "this is a controlling shareholder who executes a negligible transaction that hardly raises or lowers his holdings, and lacks a significant economic aspect" and that this is a very unusual transaction: "The last few years (and even more) indicate that this is the only purchase that Mr. Maretzky made of a share on the stock exchange during these years (!), So it seems that this is indeed a very unusual purchase on the part of the controlling shareholder."
According to Afek, in order to remove the fear of using inside information, Maretzky could purchase these shares almost indefinitely at any other time of the year, and even that day at lower rates, which means a better price for him - but chose to act on the last day On updating the semi-annual indices, and did so at a higher and "very attractive rate that ensured a high chance of executing the order at this rate - 122 cents compared to 117 cents at the continuous trading stage."
Afek concludes that there is a suspicion that the manner in which the purchase order was streamed, and the timing of its inflow, served the said interest of Mr. Maretzky and a bonus company. Determining the price of trading in a lock. "
This is not the first time that Biograph Bonus has run the stock to affect its inclusion in the indices
according to Afek, this is not the first time that Biogroup Bonus has affected its inclusion in indices. "It seems that this is not a one-time event, even in January 2017, a few days before the launch of the 60 SME index by the Tel Aviv Stock Exchange, the controlling shareholders in the company, including Mr. Maretzky, converted over 500 million shares, a move that doubled the company's value and significantly contributed to the company's inclusion. In the index ".
Bonus itself admits that it is important for it to stay in the indices:
In a presentation to investors published by Biogroup Bonus earlier this month, on February 2, shortly after it remained in the indices, the company itself writes that " , And which is considered the most significant index, and is considered the benchmark for the Israeli economy "- that is, in fact a bonus Biogroup admits that it is important for it to stay in the big indices. And if so, its effect to remain in the indices is unlawful and seemingly illegitimate. The Securities Authority should intervene.
The company responded: "Bonus Biogroup operates in accordance with the law and in accordance with the provisions of the law. The company did not receive any request for approval of a class action in this matter. If the request is submitted to the company, it will submit its response to the court."
