Court strikes at largest banks — what now with customers' money
A high-profile dispute is brewing in the Israeli banking system: the Central District Court in Lod allowed a class-action lawsuit for alleged damages of more than 15 billion shekels against four of the country's five…
Assessment
A court decision to allow a class action suit against four of Israel's five largest banks for over 15 billion shekels raises the question of what happens to customer money during such a legal battle. The banks are accused of using idle current account funds as an interest free financing source from 2022 to 2025. Individual customers are not in immediate danger of losing deposits, but the outcome could force banks to compensate millions of account holders and change how they handle current account balances. Watch for the next hearings and any settlement moves by the banks.