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Film producer Yoram Globus faces Israeli tax probe

February 20, 2013|By Batsheva Sobelman

JERUSALEM -- Film producer Yoram Globus was arrested for suspected tax evasion and released on bail Tuesday evening, local media reported.

The Israel Tax Authority asked for Globus' arrest as part of its investigation of the veteran movie maker. According to a statement from the tax authority Wednesday, Globus withdrew more than $7.3 million from two of his companies in 2005 and failed to declare it as income.

Tax authorities calculated the interest on the resulting tax debt that has accumulated over the years at more than $4 million.  

Israeli radio reported that Globus closed one of the companies in question, based in Israel, after the withdrawal and that the other remained open.

Yoram Globus, formerly part of a powerful film duo with Menahem Golan that helped create such films as "Delta Force One," "Cobra" and "Superman IV" as well as many local cult movies, returned to Israel two decades ago after years in Hollywood. He remains a leading film distributor and cinema owner. 

A judge in Tel Aviv released Globus on $270,000 bail and an equal sum as guarantee from a third party. He is barred from leaving the country until the investigation ends.

Globus told reporters he knew interest was due but doesn't understand why he hadn't been billed. "Ask my accountant," he told them. 

Separately, Israeli authorities have recently been cracking down on tax evasion, a not uncommon practice. 

Legislation has been passed closing loopholes to increase tax collection, including tightening regulations concerning foreign bank accounts and business done abroad.

In addition to an enforcement crackdown, authorities have launched a public campaign stressing that tax evasion is not only illegal but also uncool and "a social crime." A video clip explaining the campaign shows a black-clad figure piggy-backing on citizens and picking their pockets (link in Hebrew) .

The tax authority's move to open a snitch line -- officially called the Justice Line -- for people to leave anonymous tips about tax violators has caused public controversy but officials say it works. In the first week alone, more than 3,000 people phoned in. 

Among the tax authority's recent catches are a few big fish, including a restaurant owner and contractor who withheld millions, but also one beautician who kept $300 in cash to herself.

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