Bankruptcy Looms for Former Israel Diamond Manufacturers Association President

Economy
12/01/2016 16:41

Former Israel Diamond Manufacturers Association President Uri Schwartz, one of Israel's most veteran and well-known diamond dealers, is on the way to bankruptcy, writes Israel business news online publication Globes. A receivership order for his assets was issued last week because of a NIS 8 million ($2 million) unpaid debt. Bank Leumi intends to foreclose Schwartz's home in the Sea and Sun project in Tel Aviv and to seize other assets, including an apartment on Ben Yehuda St. in Tel Aviv. In a meeting with senior bank officials, Schwartz's lawyer was quoted as saying, "Uri has given up." His debts are estimated at NIS 78.2 million ($20 million), before a debt arrangement. According to the bank, diamond dealer and Israel Diamond Institute chairman Moti Ganz guaranteed Schwartz's NIS 8 million debt to the bank, although Ganz is asserting that his guarantee is no longer valid.

Globes quotes and industry sourcing saying that while by no means a minor player, "Schwartz was not one of the biggest diamond dealers ... For the public, you could say that Schwartz was an important figure, prominent, and respected." Schwartz, 67, began his diamond dealing career 45 years ago in the Schwartz Diamonds company, which he inherited from his father in the 1970s. The company had 250 employees at its peak. The company's business began to decline in recent years, following the general crisis in the diamond sector. The global economic crisis had a negative impact on diamonds sales, and a credit crunch afflicted many diamond dealers as a result of declining sales. Schwartz's plea in response to the bank's petition stated that he had been forced to discontinue the company's activity after injecting $13.5 million into the company in owner's loans. Schwartz served three terms as president of the Diamond Manufacturers Association.