14 suspects detained in Deri tax investigation
Investigators from the National Fraud Investigations Unit and the Tax Authority detain 14 suspects related to the investigation into Aryeh Deri and his family for tax fraud; Deri and his wife are to be questioned by police on Monday.
"I have cooperated fully and answered all of the interrogators' questions," Deri said after the pronlonged grilling. "Like I said, I have full faith in the law and enforcement systems and I ask the public to be patient and respect the investigation. With God's help, I will keep serving the public with all my strength."
Two of those detained for questioning included a director-general of a government ministry and a senior businessman. Police are investigating funds being siphoned from the ministry to the Deri family and associates.
The new developments are expected to surprise Deri and his wife, who are being investigated as part of a Tax Authority probe into money laundering and false reports about income and assets.
Following new findings from the investigation, the Deri couple may also be investigated for bribery.
The police's decision to keep the Deris at the station for hours was intended to surprise them, along with the other suspects interrogated. At the center of the couple's interrogation were at least two cases: "the NGO affair" and "the mediation affair."
At the center of the NGO Affair, is Yaffa Deri, who heads the educational organization Mifalot Simcha, as well as other non-profit organizations, such as the charity Yehuda Ya'ale. The police asked to examine the nature and legality of large sums of money that were transferred to these organizations, for suspicion of tax evasion.
The police also examined one case in which money was not ultimately transferred—a NIS 590,000 pension from the Ministry for the Development of the Negev and Galilee, headed by Aryeh Deri, was stopped at the last minute by the ministry's accountant. In addition, it was reported that billionaire businessman Mikhael Mirilashvili, one of the owners of Channel 20 and a close associate of Deri's Shas, who contributed to the funeral of Rabbi Ovadia Yosef, also donated large sums of money to the Deris' NGO, together with his son Yitzhak. One of the Deris' daughters, Shefi Sananes, is the NGO's CEO, and two other daughters—Simcha Avitan and Dasi Iluz—are employed there.
During the investigation, Tax Authority investigators and Lahav 433 officers checked bank account records of Deri and his family. Among other things, they found an unusually high amount of money transferred to Deri's account from a company headed by Moshe Lion, a friend of Deri who serves as a member of the Jerusalem city council. Lion was also summoned to be questioned.
In his interrogation, Lion admitted to transferring the money to Deri, claiming it was payment for mediation. According to him, Deri was owed the money after convincing a business man to invest in a Hedge Fund headed by Lion several years ago.
Lion said that, at the time, Deri was not a government official, meaning that the money that was transferred to him was not only legal, but required. "It was payment for mediation that anyone would have deserved for the work they did," said Lion.
This is not the first time Aryeh Deri has been implicated in financial "irregularities." However, this is the first time Yaffa Deri has been under the strain of police and Tax Authority investigators. At the request of the Justice Ministry, forensic accountants have begun checking the books of several non-profit organizations associated with her, finding suspicious transactions worth hundreds of thousands of shekels in the early 2000s.
Police issued a statement Monday morning confirming the detaining of the suspects as part of a joint operation between Lahav 433's National Fraud Investigations Unit and the Tax Authority.
"This is an investigation that began in April 2016 and was originally based on reasonable suspicion of tax offenses mainly in the area of property. Following a broadening of suspicions, more suspects were identified including public officials and the minister's wife."
One incident in particular that has drawn heavy scrutiny from police involves a real estate deal conducted by Deri in which assets were transferred by Deri himself to his brother Shlomo.
Another incident being investigated centers on the construction of a Deri family vacation home in the northern community of Kfar Hoshen. Deri claims his whole family contributed to the construction of the home, not just himself.
According to estimates, the value of the home is roughly NIS 4 million. It was built in 2013 following permits being granted to Deri's daughter and her husband. The Tax Authority suspects that Deri and his family financed construction of the home through undeclared assets.
In addition to real estate in the north, the investigation into Deri and his wife also includes the Givat Shaul neighborhood in Jerusalem.
According to suspicions, Deri had rights to land containing a building with five apartments. Tax Authority officials suspect that Deri illegally transferred the apartments to his brother Shlomo just before his return to politics.
Police and tax investigators have questioned Deri's brother, his daughter and several Jerusalem-area contractors in connection with the case.
In response to his questioning with police, a statement was issued on behalf of Deri saying, "The Interior Minister has said from the beginning that he is willing to fully cooperate and answer all questions. He trusts the law enforcement system to do its job responsibly and properly."
