Thousands of foreign workers whose money was deposited in accounts held by the fintech company Global Remit, which has been declared insolvent, are required to file claims in the coming months in order to eventually recover their money. The foreign workers must submit the claims in Hebrew by December 30. Over the past few months, Kav LaOved has been helping workers file the claims, but as of today, only a few dozen of the thousands of foreign workers who may be eligible have sought assistance and filed claims.
In May of this year, the license of the Israeli fintech company, which specialized in currency exchange and overseas money transfers, primarily for foreign workers sending their salaries to their families as well as for business clients, was suspended. The Capital Market, Insurance and Savings Authority suspended the license following a police investigation on suspicion of violations of the Prohibition on Money Laundering Law.
In June, attorney Hagai Ullman was appointed trustee of the company. Since then, Kav LaOved has been working intensively to assist workers who reach out for help in filing their claims. The workers are required to submit the claims in Hebrew through an online portal and pay a NIS 35 filing fee. Kav LaOved has clarified that it does not represent the workers in the proceedings and is not responsible for how the company’s funds are distributed among its creditors, but only provides assistance in filing the claims themselves. The service costs NIS 350, including the filing fee, while the remainder of the proceedings will be conducted directly with the trustee or the court.
“The trustee has informed us that at this stage, it is impossible to know how long it will take to recover the money,” Kav LaOved told workers, emphasizing that it will likely take more than six months. They also stressed that there is no guarantee that 100% of the money will be returned. “The amount that will be returned will depend on the total value of the claims that are approved, the funds available in the trustee’s estate, and court approval.”
The trustee’s attorney, Yehuda Assraf, told Davar that these days, among the other actions being taken, the trustee is taking a series of steps aimed at recovering funds for the estate so they can be distributed to the company’s creditors. “The recovery of funds involves two main efforts: first, collecting debts from debtors; and second, recovering funds held by the police as part of the various investigations into the company (a total of approximately NIS 29 million) and returning them to the trustee’s estate, so that they can be distributed to those entitled to them as soon as possible.”
According to him, the Lod District Court is well aware of the unique complexity arising from the circumstances of the case. “On the one hand, this is money that was deposited for workers, while on the other, there are significant technical difficulties in identifying and attributing the seized funds to a specific customer, alongside substantive issues concerning, among other things, ownership of the funds and the relationship between the company and its customers—all against the backdrop of an active criminal investigation into the company on suspicion of various money-laundering offenses.”
“All Seized Funds Will Be Released”
As part of the proceedings before the court, it required the various state authorities to complete the necessary checks and determine which of the seized funds had been proven not to have originated from criminal activity, and could therefore be released to the trustee’s estate. According to Assraf, the investigating unit, with the assistance of representatives of the Forfeiture Unit at the Administrator General’s Office, is expected to present its position to the court shortly after the holiday.
“The trustee and his team are in continuous contact with representatives of the investigating unit in order to achieve the just outcome whereby all the seized funds will be released to the trustee’s estate.”
According to him, in accordance with the law, the court ordered the company’s creditors, particularly the foreign workers, to file claims as part of the insolvency proceedings.
“It is very important to the trustee that as many people with claims as possible file claims. Usually, in proceedings of this kind, it is sufficient to publish a notice in a newspaper. But in this case, because we are dealing with vulnerable populations, some of whom do not speak Hebrew, we proactively approached a number of organizations asking them to help us reach those customers for whom funds had been deposited with the company.”
Among other efforts, outreach was conducted through the Labor Ministry and employers’ organizations, and SMS messages in English were sent directly to the mobile phones of all of the company’s customers. According to Assraf, Kav LaOved agreed to cooperate with the trustee to assist workers in filing their claims, as filing a claim requires a sworn affidavit signed in the presence of an attorney.
“Shortly after the holiday, we also intend to approach representatives of various embassies and take additional steps to inform customers about the need to file a claim as a condition for receiving a dividend as part of these proceedings.”
So far, he said, approximately 120 claims totaling about NIS 15 million have been filed against the company, of which about 70 have been identified as claims by foreign workers. This is despite the company’s total estimated liabilities, as reported by the company to the court before the trustee was appointed, standing at approximately NIS 35 million, of which NIS 22 million is owed to foreign workers.
“The trustee has begun reviewing the claims with the intention of distributing funds to creditors, under conditions to be determined by the court, shortly after the deadline set for filing claims (December 30),” he said, adding that he is calling on additional customers to file claims.