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Israeli Business: Dishonesty is Expected

Thursday, March 23, 2017 7:18
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Israelis-on-the-phone-in-Tel-Aviv.jpg(left, the biggest crooks are the Israeli phone companies.)

While certainly unethical business practices exist
elsewhere in the world, it’s worse in Israel because
of its cultural acceptance, says Saul, an American

As Randall Terry said, “Fool me once, shame on you. Fool me twice, shame on me.” In Israel there is NO shame. Israelis do not comprehend the ramifications of their actions. Invariably they fall back on, “anti-Semitism,” as if the Holocaust gives them a free pass to do whatever they want.

from Nov 13, 2013
by Saul

We’ve heard the phrase, “all’s fair in love and war.” Well, in Israeli business, profit is all that matters.

This is the meaning of the common Hebrew phrase, “shitat matzliach,” literally, “when it comes to succeeding, anything goes.” 

Deception and misinformation are hallmarks of the Israeli business model whether conducted at home or abroad. Literally anything goes, as long as a profit can be had. Indeed, Israeli society is so used to this type of behavior that there appear to be no ramifications for getting caught trying to cheat a client or customer. If caught, the ‘seller’ just shrugs — “Everyone does it” — and the buyer, shrugs back with a smile, “Caught you!” Business proceeds.

Foreigners should be aware that to an Israeli you are a “frier,” which means a sucker.

Non-Israelis are simply easy targets for deceptive business practices because outside of Israel, in the more ‘civilized’ world, people take the Golden Rule for granted. “Do unto others as you would have them do unto you.” In other words, treat business partners and customers fairly.

But, in Israel the golden rule is different — it means, “Screw the other guy before he screws you.” This is “shitat matzliach” in it’s most base form. All Israelis know what the term “frier” means, and many liberally apply it to the less clever folks from abroad. Yes, in every country there are cheaters, but in Israel, it is an art and way of life.

israel cell phone.jpgEXAMPLES

This type of business practice fosters a culture of deception and mistrust.

The biggest culprits of this behavior are the cell phone companies. Israel’s pride — Israelis invented the cell phone — these are the most corrupt institutions in the country. It is common for the major cell phone providers to double charge, to extra charge, and to flat out change services of customers’ account without notice.

Making matters worse, they almost all insist on linking to a customer’s bank account. When the government froze my bank account due to child support, my cell provider refused to do business with me by cash. No direct bill pay, no account.

The result is that frequently thousands of shekels are stolen from bank accounts. The banks in Israel typically side with the company. It’s not like in America where a customer can dispute a charge with his bank and the bank will credit the money back, forcing the biller to prove the charges were owed.

It’s the opposite. The customer now has to sue in small claims court to get their money back. The companies know that most people won’t go through this hassle of court for smaller amounts of money (under 1000 shekels), and this is clearly part of their “shitat matzliach” strategy.

2323752730.jpg(left, Olga, a repair shop manager)


Shitat matzliach can be seen in just about every Israeli business. For example, the process of registering one’s car in Israel is a major racket. In the US we have the “smog check” racket. The Israelis take this to new heights. Every year drivers must have their automobile tested. The tests alone cost over 1000 shekels, and invariably the testing facilities will find problems with the cars that need to be fixed.

There are only so many testing facilities in the country, and all are equipped to do most of the “work” required. It’s like having an accountant figure out your taxes and keeping the tax money. 

Everyone is aware of the Israeli registration scam, but it’s written off to “shitat matzliach” (these agencies and the government are going to make profit somehow) and the citizenry inevitably falls back on the age old Israeli adage, “Ein ma-la-asot” (there’s nothing that can be done. This is Israel. A scam country.)

An acquaintance was recently scammed by El Al. They charged her $200 for a third bag and when the customer complained that the stated charge was $100, the company told her she misunderstood their policy. Threatened with small claims court over the difference, El Al said, “Bring it on.” It’s all shitat matzliach.

The companies in this country know most people will not sue for $100 dollars, thus they will push the envelope, cheat, break their own rules. Failing to do is like giving money away. These greedy companies suffer no ramifications for deceiving customers with incorrect rules and terms, or in flat out not respecting their rules and terms.

landlord-shabbat.jpgREAL ESTATE 

Not just private landlords but rental agencies will screw over the tenant every chance they get. Deposits are routinely withheld, the landlord or agency claiming damages were done when none were, or when the problem was legally the property owner’s.

A friend of mine recently had his apartment flood from a leak within the walls of his unit. The leak persisted for days while the rental agency claimed it was the tenant’s responsibility. It absolutely was not, but the agency, notorious for this type of behavior — in the name of “shitat matzliach” — was hoping the tenant, who has to live with the water and mold, would grow tired of waiting and deal with it himself.

The apartment is now full of mold, the leak still not fixed, and the rental agency is threatening to evict him, no doubt planning to use his security deposit to fix the leak. It is illegal, but common practice here.

Ordinary Israelis are not unlike ordinary people in other countries — they conform to social norms. Unfortunately, in Israel the norm is to expect to be cheated and to always be on the alert for scams. It is thus typical for ordinary Israelis to cheat first figuring the other is going to try it too. This becomes “circular logic” – a self-fulfilling prophecy if you will. Israelis inevitably conclude, “nothing can be done. This is Israel.”

As Randall Terry said, “Fool me once, shame on you. Fool me twice, shame on me.” In Israel there is NO shame, thus Israelis do not comprehend the  ramifications of their actions. Invariably they fall back on, “anti-Semitism,” as if the Holocaust gives them a free pass to do whatever they want.

As a Jew I find it embarrassing, and it is my hope that people around the world cease association of Zionism or Israel with Judaism. Not all Jews are deceptive in business practice, even if a majority of Israelis are.

Saul is a prisoner in Israel due to stringent child support laws.

New Immigrants sue Israeli landlord who rented apartment he didn’t own

First Comment from G:

Your article about the lack of business ethics from the majority of Israelis is a stark reality of their ‘take no prisoners’, ‘scorched earth policy’, ‘Win / Loose’ approach to almost everything in their lives.
I can not reveal my identity because of the fear for retaliation…..but I can provide many, many examples of the ‘anything goes’, ‘scam’ style business practices of Israeli business people.
I personally have worked for Israeli business executives in the Telecom industry and I can tell you they have no qualms about screwing customers with fraudulent billing practices….and because the amounts are so small for each customer, it is the perfect scam. 
Here is one of the most grievous and shocking examples I can provide:
A particular Israeli Telecom executive running a US based public company was informed that his company’s conference calling service was being compromised by stolen credit cards with conference calls being initiated from Afghanistan.  When this issue was brought to his attention with the likeliness that terrorists were using the conference calling services for anonymous communication purposes, he refused to spend one dime to remediate the problem because of the potential loss of incremental revenue and because of the ‘unnecessary costs’ required for that remediation.  This is in the face of potential plots against his own people!  Anything for profit…..even over your own people’s safety.
These kinds of examples run rampant with Israeli business people.  They act with a sense of entitlement and an expectation of Impunity because the laws in the US require ‘proof.’  It is, as you say, a ‘catch me if you can’ mentality.
These kinds of people have no regard for anything close to business ethics….and many of their middle east counter partners behave the same way….namely Lebanese business people.
It takes several generations of Westernization for an Israeli to understand the value of business ethics….but until then, they will cut in line, reach to the back of the fresh food case for what they think is the most fresh product and whine till the cows come home if they think for a second that someone got an advantage over their perceived entitled way of life.
It is shameful……but shame is a concept that only has an impact if the shameful behavior is recognized as such……so, “Ein ma-la-asot”  and “buyer beware.”

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