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Mizrahi Tefahot Bank to pay $195 million in U.S. tax evasion settlement

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Mizrahi Tefahot Bank
America   Mizrahi Tefahot Bank is Israel's third-largest bank

Mizrahi Tefahot Bank, Israel's third-largest bank, admitted to helping clients evade U.S. taxes and agreed to pay $195 million in a deal with the U.S. Justice Department.

The bank engaged in schemes to hide clients' funds so they could avoid paying income taxes between 2002 and 2012, the Justice Department said.

In a quarterly earnings report in August, the bank said it had set aside 425 million shekels ($117.75 million) during that quarter to cover a likely fine by U.S. authorities. The bank had previously set aside 161.9 million shekels ($44.86 million).

Earlier in August, the bank rejected a proposal from the Justice Department to pay a fine of $342 million to settle the tax evasion investigation, saying at the time that any "reasonable calculation" based on its employees' behavior would result in a significantly smaller fine.

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