Eyal Rosen Extradited to Israel as Gibuy Credit Scandal Unfolds
Key suspect Eyal Rosen has been extradited from Portugal to Israel over the massive financial collapse of non-bank credit firm Gibuy. Trustees warn that over 200 million shekels remain unrecovered four years after the scandal erupted.
More than four years after fleeing abroad following the collapse of the non-bank credit company Gibuy, key suspect Eyal Rosen has been extradited to Israel from Portugal. His return brings back into focus one of the largest financial scandals in the local market, which involved massive embezzlement and the disappearance of hundreds of millions of shekels.
Rosen is expected to be the first defendant to stand trial for his role in the affair, having been formally indicted last week on serious charges including the theft of 9 million shekels from company coffers, aggravated fraud, money laundering, and securities offenses. According to the indictment, Rosen exploited his central position at Gibuy and personal relationships with clients to siphon millions through fictitious credit activity operated out of the northern branch near Afula. His defense attorney stated that his client denies the allegations and trusts the court to separate background noise from objective truth.
Unrecoverable Debts and Systemic Failures
An investigation reveals that out of a credit portfolio valued at approximately 300 million shekels, court-appointed trustees have managed to recover nearly 90 million shekels. However, over 200 million shekels remain unrecovered, with experts warning that these funds are likely lost forever. The recovery efforts have been severely hampered by the profile of the debtors, a double-digit number of whom have been murdered, fled abroad, or declared bankruptcy.
Furthermore, the trustees' comprehensive report exposed systemic failures at Gibuy, detailing how the company operated without proper underwriting standards, effectively inviting risky borrowers with a "come and take it" approach. Instead of addressing defaults, management routinely rolled over bad checks to artificially mask delinquencies, leading to the ultimate collapse of the firm in 2022 after banks cut off credit lines.
Impact on Creditors and Ongoing Legal Battles
Banks, bondholders, and the company's former owners have borne the brunt of the fallout. While banks managed to recover over 100 million shekels before the freeze, Gibuy still owes tens of millions to financial institutions and nearly 140 million shekels to bondholders. Trustees have filed a massive 360-million-shekel lawsuit against various former officers, controllers, and auditors, with the parties currently engaged in court-ordered mediation proceedings.
