Israeli Supreme Court Upholds Prison Sentence for Defiant Bankrupt Rafael Rubinț
The Israeli Supreme Court has upheld a prison sentence for bankrupt businessman Rafael Rubinț, who faces imprisonment over persistent failures to comply with court payment orders and financial disclosure requirements.
Supreme Court Justice Ruth Ronen has ruled that bankrupt Rafael Rubinț will serve a two-week prison sentence starting on the 28th of this month due to his repeated failure to comply with court orders. This marks at least the third time Rubinț has faced imprisonment over an 11-year legal process, following a prior prison term in the United States and the loss of the luxurious villa in Savyon where he once lived with his family. His total debt stands at 2.2 million shekels.
In previous legal proceedings, the 70-year-old dual Israeli-American citizen stated that from the beginning of the century until 2014, he engaged in real estate marketing in the United States, recruiting investors for the AG Homes partnership. He served a ten-month sentence in a federal prison for offenses related to his business operations and was also placed on probation. Rubinț previously testified that his base salary was $1,300 per month, supplemented by $5,000 for each investor he managed to recruit.
Between 2012 and 2017, Rubinț and his family resided in a sprawling villa in Savyon featuring a garden and a swimming pool, renting the property for $6,000 a month. The family was eventually evicted through enforcement proceedings and moved in with his wife's parents. In 2016, the couple purchased vehicles worth 250,000 shekels. In March 2015, a month before a receivership order was issued against his assets, Rubinț sold a plot of land for 600,000 shekels, claiming later that he had simply forgotten about the transaction and therefore failed to report it.
A History of Non-Compliance and Legal Battles
In November 2015, Judge Irit Weinberg-Netivot ordered Rubinț to pay 2,000 shekels per month toward his debts. By 2018, Rubinț offered to pay 900,000 shekels to settle his liabilities—funds he claimed he would raise from distant relatives—while simultaneously requesting a reduction in his monthly payments to a mere 100 shekels, a request that was promptly rejected. The bankruptcy trustee, advocate Gila Hachmon, subsequently requested an arrest warrant, which Weinberg-Netivot granted in July 2018. The judge noted at the time that Rubinț was failing to submit truthful reports, had accumulated a debt of 34,000 shekels in arrears, and showed no inclination to respect judicial decisions.
Subsequent enforcement measures followed over the years. In March 2022, the court ordered a 14-day prison sentence after Rubinț continued to withhold full monthly payments and neglected to submit mandatory financial reports. Although arrest warrants were renewed in September 2023 and July 2024—with the latter canceled after Rubinț made a late payment—trustee Hachmon renewed her request in January following another default. By May, his arrears had mounted to 35,000 shekels under a modified monthly payment plan of 2,500 shekels that he had previously agreed to.
In an August ruling, Judge Gilad Lubinsky-Ziv criticized Rubinț for attempting to condition his compliance on the acceptance of a creditors' settlement that the creditors had overwhelmingly rejected. "As is well known, bankruptcy proceedings are not a 'menu à la carte,'" Lubinsky-Ziv wrote. "The debtor is not entitled to take the law into his own hands and decide that he simply does not want to pay money." Concluding that Rubinț was intentionally withholding payments despite his financial capability, Lubinsky-Ziv ordered a ten-day sentence at Hadarim Prison.
Supreme Court Rejects Appeal
Justice Ruth Ronen firmly rejected Rubinț's appeal against the imprisonment order, emphasizing that despite the severity of the measure, there was no justification to interfere with the lower court's ruling. She pointed out that Rubinț persistently conditioned his payments on the approval of a settlement plan and failed to provide any substantiated evidence of a change in his financial circumstances to justify lowering his monthly obligation.
"The debtor has failed to fulfill his obligations for about a year and a half, and the arrest request was filed over a year ago," Ronen concluded. Given that Rubinț was granted numerous opportunities to explain his default and failed to do so, the Supreme Court upheld the prison sentence, confirming that incarceration remains the only viable mechanism to compel compliance in this protracted insolvency case.
