Chief Rabbi Amar Bans Debt Settlement Haircuts

Israeli Sephardic Chief Rabbi Rav Shlomo Amar yesterday issued an unprecedented halachic ruling against debt settlements involving sharp discounts – called haircuts – by the controlling shareholders and executives of financial institutions, reports Globes.

At a press conference with the Movement for Quality Government in Israel, Rav Amar said that controlling shareholders should bear the costs of heavy losses. The ruling also bans cross-ownership.

Rav  Amar’s ruling, according to Globes, states that executives and controlling shareholders of large companies should take responsibility for the financial losses caused to the public, and that controlling shareholders and money managers cannot evade this responsibility even if they were negligent and without bad faith. Rav Amar also banned investment in institutions owned by them, or in affiliated institutions; i.e. he banned cross ownership.

{Matzav.com Israel News Bureau}