Two years ago, Brooklyn developer All Year Management contributed to a major panic in Tel Aviv’s bond market after disclosing that $3.7 million had been “accidentally” transferred to chairman and CEO Yoel Goldman’s personal accounts. The Israel Securities Authority has now imposed penalties on the company for violations committed at that time, Calcalist reported.
- Dig Deeper: All Year and Goldman also admitted to negligently including a misleading detail in the financial statements for the second and third quarters of 2018 , The Real Deal noted quoting Israeli media.
- The Agreement: All Year and the ISA have reached an administrative enforcement arrangement that will see the company pay a fine of 600,000 shekels (nearly $200,000), while Goldman could be fined another 250,000 shekels and be suspended from senior positions in ISA-supervised bodies for nine months if he commits certain violations in the next 18 months, TRD noted.
- Why it matters: In the wake of All Year’s recent disclosures, ratings agency Midrooog downgraded the company drastically, from Baa2 to C. The agency estimates that the recovery rate for All Year’s unsecured Series B and D bonds is no more than 35 percent, while the recovery rate for its secured Series C and E bonds ranges from 65 to 80 percent.
- Flashback: Credit Ardon Wiener of Chestnut Holdings for shorting All Year’s bonds. The savvy investor opened a short position after noticing some curious legal documents surrounding the company’s Rheingold Brewery project. In July, Israeli financial adviser Ori Eizenberg announced that he had opened a short position on bonds issued by Joel Wiener’s Pinnacle Group. [TASE+Calcalist+Bizportal+TRD]