Kerarthos built a credit builder that allowed people to create and redeem credit for goods and services.
He was fined by the Israeli government after it emerged that he had used the credit builder in a scam involving thousands of people.
The Israeli police said the builder had been selling a credit-card-type system for people to use to pay for things like groceries and restaurants.
A report on the matter by the Palestinian news agency WAFA said Kerarthis’ system allowed users to make money by issuing credit cards or using the system to buy goods and make purchases.
Kerarthi, who was born in Palestine, has said he wanted to give Palestinians credit for their efforts to build settlements in the West Bank and Gaza Strip.
The system, which was initially introduced in 2007, allowed people who were not Israelis to purchase goods from Palestinians.
The authorities, who have a long history of using the Israeli credit system, have said Kerarys business was legal.
Keraries lawyer said he is “deeply sorry” for the scandal.
Kerarna Karpinski, a spokeswoman for the Israeli Prime Minister’s Office, said the government “rejects all forms of discrimination.”
The Israeli government has said it will hold Kerarthys account and will pay back the funds.
Israel’s economy is heavily dependent on tourism, which has become a major source of revenue for the country.
Kerartas business had not been officially sanctioned by the government and he was not facing any sanctions, the Jerusalem Post reported.
He told the newspaper that he has been in talks with Israeli officials to resolve the matter.
Kerarts attorney said he has a “very good relationship” with Israeli authorities.
Kerarchys account was frozen last week after he failed to respond to a court order to pay $1.5 million to settle charges he was illegally using credit cards.
Kerasti told WAFA that he is now working on an appeal.
“The government will not pay, and I will appeal,” he said.
He has denied the allegations and said he would not seek a new court order.
“I will appeal and we will go to the highest court,” Kerarth said.
Kerarteras attorney said the system has been used for “illegal activities, theft and embezzlement.”
In addition to being convicted of fraud, Kerarth was found guilty of using credit card numbers to issue credit to people who had not obtained credit cards, the news agency reported.