Israeli Contractor Sentenced to Prison for Multi-Million Shekel Tax Fraud

The Magistrate's Court in Ramle has sentenced Ismail Adjo to 22 months in prison and a fine of 90,000 NIS after he was convicted of VAT offenses involving the use of fictitious invoices totaling approximately 16.2 million NIS. According to the Tax Authority, the total scope of the VAT offenses in this case amounted to approximately 1.8 million NIS.

According to the amended indictment, in 2017, Adjo and his company, Migdalei Adjo Ltd., received 57 fictitious invoices totaling approximately 7 million NIS. Through these invoices, input tax was illegally deducted in the amount of approximately 519,000 NIS.

Furthermore, in his capacity as a registered dealer, Adjo received 67 additional fictitious invoices totaling approximately 9.2 million NIS, which he used to illegally deduct input tax amounting to approximately 834,000 NIS. The indictment states that these invoices were recorded in accounting books despite the fact that the underlying transactions never actually took place.

Adjo was also convicted of exploiting another individual who was intermittently residing in drug and alcohol rehabilitation facilities. According to the verdict, Adjo instructed this individual on how to interact with accountants, drove him to cash checks, forced him to sign documents, and ordered him to remain silent if questioned—all to advance a criminal scheme involving the deduction of fictitious invoices worth approximately 435,000 NIS.

The Tax Authority noted that the total outstanding debt of approximately 1.8 million NIS has not been repaid, not even partially. The case was managed by Adv. Or Hadaya, head of the Legal Unit of the Central District VAT, following an investigation by the Haifa VAT Investigations Department.