Eighteen months in prison and NIS 275,000 in financial sanctions. That is the sentence prosecutors and defense lawyers jointly asked a Tel Aviv court to impose on Shay Lipman, a former senior analyst at the investment bank Value Base.
The Tel Aviv District Court convicted him on Sunday of insider trading, securities fraud, and fraud and breach of trust in a corporation. The convictions followed a plea agreement, and he admitted using his position to profit from trades in public real estate companies. Judge Dana Amir set sentencing for September 6.
What the indictment says
Lipman worked at Value Base as a real estate analyst from 2016 to 2021. He covered listed property companies, published reports on them and sometimes advised on or sat in on corporate deals. According to the amended indictment, that gave him early access to sensitive and at times confidential information about planned business moves.
Prosecutors laid out two kinds of conduct. In three instances he bought shares in the knowledge of nonpublic developments: Rani Zim Shopping Centers taking control of Midas, the fight for control of Gav-Yam, and the planned sale of a controlling stake in the Sarfati construction company. He bought before the news came out, and either sold after the price rose or stood to gain from it.
In 11 further cases he bought shares shortly before publishing favorable analyses of the same companies, intending to sell if his reports lifted the price. An analyst’s call from a recognized financial institution can move investor demand, the indictment noted. His reports did not say that he owned the shares or planned to sell them.
Parents’ account, NIS 225,000
He ran the trades through his parents’ bank account. That hid them from Value Base and broke the bank’s rules on employees’ personal trading. Prosecutors put his profit at roughly NIS 225,000 and said he acted repeatedly over several years, exploiting the trust placed in him.
Value Base itself argued that penalties for securities offenses, insider trading above all, have to be harsh enough to deter others and protect investor confidence in the market.
