Shay Lipman bought shares in a company, then wrote a glowing report on it. Prosecutors say he did that 11 times, and told no one he owned a stake.
On Sunday the Tel Aviv District Court convicted the former Value Base senior analyst of insider trading, securities fraud, and fraud and breach of trust in a corporation. Lipman admitted the charges as part of a plea deal.
The prosecution and defense have jointly asked for an 18-month prison term and financial sanctions of NIS 275,000. Judge Dana Amir set sentencing for September 6 and has not yet said whether she will accept that request.
Inside information
Lipman worked at the investment bank from 2016 to 2021. He analyzed listed real estate companies, published reports on them, and at times advised on or accompanied corporate deals. According to the amended indictment, the job gave him early sight of sensitive, sometimes confidential, information about planned business moves.
In three cases he traded on it. The indictment ties those trades to Rani Zim Shopping Centers’ acquisition of control in Midas, the fight for control of Gav-Yam, and the planned sale of a controlling stake in the Sarfati construction company. Prosecutors said he bought shares before the news came out, then sold after the price rose or stood to gain from it.
Buying before the buy rating
The second scheme was simpler. In 11 other cases, Lipman bought shares shortly before putting out favorable analyses of the same companies. A recommendation from a recognized financial institution can move investor demand and a share price. According to the indictment, he meant to sell if his own positive report pushed the price up.
His reports did not say he held the shares or planned to sell them.
He ran the trades through his parents’ bank account, which kept them hidden from Value Base and broke the bank’s rules on employees’ personal trading. Prosecutors put his profit at about NIS 225,000.
The amended indictment says he acted repeatedly over several years. Prosecutors said he systematically exploited his role and the trust Value Base placed in him. Value Base argued that sentences for securities offenses, insider trading in particular, have to be heavy enough to deter others and protect investor confidence in the capital market.
Sources
- Former analyst at Value Base faces insider trading, securities fraud convictions | The Jerusalem Post
- Senior Real Estate Analyst Shai Lipman Pleads Guilty to…
