Former exec accuses IDE of insurance fraud

Sep 22, 2015 admin Uncategorized

IDE allegedly made a fraudulent insurance claim at the Vassilikos desalination plant in Cyprus

IDE Technologies, the controlling shareholder in most of Israel’s desalination plants, defrauded its insurance company during the construction of a desalination plant in Cyprus, according to one of the company’s senior executives who was fired and is suing for compensation. The plaintiff, a senior civil engineer, was a construction manager and project supervisor for a desalination plant construction project in the Vassilikos region in southern Cyprus between 2011 and 2013. IDE won the tender in early 2010. The initial investment for the construction of the plant, which has a 15 million cubic meter annual capacity, was originally estimated at €46 million. In July, 2011, there was a massive explosion in the area, which destroyed the island’s largest power station, and caused the deaths of 12 rescue and security force members, including the commander of the Cypriot fleet. The claim in the amended complaint, filed by Adv. Oren Weinberg, states that the company’s subcontractors at the site were instructed to claim expenses for “routine” work as “repair” work, supposedly made to repair damage caused by the blast. According to the plaintiff, IDE succeeded in getting €3.2 million from the insurance company in this manner. In its defense, IDE has stated that the explosion damaged the facilities on the site, caused work to be put on hold for 3 months, and nearly caused the entire project to be scrapped. The project was eventually completed in 2013. IDE is owned in equal shares by Delek Group Ltd. (TASE: DLEKG) and Israel Corporation (TASE: ILCO). IDE owns half the concession to operate three of the four active desalination plants in Israel: in Ashkelon, Hadera, and the newly opened Soreq plant. IDE responded that the claims are unfounded.
Published by Globes [online], Israel business news – www.globes-online.com – on May 1, 2014
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