Bonus BioGroup Executives Face Indictment Threats Over Stock Manipulation
The Tel Aviv District Prosecutor's Office is weighing indictments against Bonus BioGroup, CEO Shai Meretzki, and Chairman Yosef Roych over alleged stock manipulation to secure index placement.
The Tel Aviv District Prosecutor's Office (Taxation and Economics) has notified the biomedical company Bonus BioGroup, its controlling shareholder and CEO Dr. Shai Meretzki, and Chairman Yosef Roych that it is considering filing indictments against them, pending a hearing. The letters, dispatched on October 29, detail suspicions of fraudulent manipulation of securities trading, aggravated larceny, and reporting violations intended to mislead a reasonable investor.
The investigation centers on allegations that company executives orchestrated artificial trading activity to secure Bonus BioGroup's retention in the Tel Aviv-90 and Tel Aviv-125 indices during the January 2022 index rebalancing. According to the Israel Securities Authority (ISA), the suspects executed trades worth millions of shekels lacking economic logic on critical dates that determined index composition.
A focal point of the investigation was the pivotal trading day in January 2022. Investigators allege that a purchase order for 166,000 shares at 122 agorot per share was injected into the market. This maneuver pushed Bonus BioGroup's market capitalization to approximately 1.408 billion shekels at the close, narrowly surpassing Generation Capital's 1.404 billion shekels, thereby keeping Bonus in the index at Generation Capital's expense.
Bonus BioGroup stated that it and its officers intend to review the investigative materials and present their arguments at the upcoming hearing. The company emphasized that, based on legal advice, it possesses robust defenses supported by external, objective evidence. Meanwhile, shareholder Gad Liebman has petitioned the court through legal counsel to obtain corporate documents ahead of filing a derivative lawsuit against Meretzki and Roych.
