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Corruption

Corruption in Israel is peculiar - the petty corruption of traffic cops is largely absent, but grand corruption at the commanding heights of the polity is ramapant. Israel ranked 28 out of 176 countries in Transparency Internationals 2016 Corruption Perceptions Index. Strangely, senior political figures are routinely implicated in corruption scandals on a scale that is in the same league as Brazil.

There are several NGOs that focus on public sector ethics. Transparency International has a local chapter in Israel. The law provides criminal penalties for official corruption, and the government generally sought to implement the law. Impunity was not a problem. Media routinely reported on corruption. The national police, the state comptroller, the attorney general, and the finance ministry accountant general were responsible for combating official corruption. Senior officials were subject to comprehensive financial disclosure laws.

The decision to indict took just one month in the the Dollar Account affair [Parashat Heshbon HaDolarim], a 1977 political scandal. Prime Minister Yitzhak Rabin was charged with a violation because his wife, Leah, had failed to close a US bank account in 1973 after Rabin was no longer serving as Israels Ambassador to the US. It is illegal for Israeli citizens to hold foreign bank accounts. Leah Rabin readily admitted this but allowed it to be said that the amount involved did not exceed $2,000. There were actually two accounts amounting to a total of $18,000 in 1973 and about $10,000 when the story broke. Rabin resigned in a surprise announcement, less than six weeks before the election, that left Israeal's already turbulent political scene in turmoil.

Under Israeli law public servants may not receive gifts from anyone other than relatives during their time in public service. Prime Minister Benjamin Netanyahu said 14 February 2018 that his coalition government was "stable," and dismissed a police recommendation he be indicted for corruption in two separate cases. "Neither me nor anyone else has plans for elections," Netanyahu said. "We're going to continue to work together for the good of Israeli citizens until the end of the term." The recommendation of criminal charges came after a months-long investigation into allegations that Netanyahu accepted expensive gifts from billionaires, including Israeli-born Hollywood producer Arnon Milchan, and Australian media magnate James Packer. An indictment would not require Netanyahu to immediately step down, but it would certainly cripple his ability to govern in what is already a shaky coalition government of hardliners and liberals.

Former Israeli Prime Minister Ehud Olmert, who served in 2006-2009, was found guilty in the retrial for in the cash envelopes affair. The ruling came on Monday by the Jerusalem District Court. In 2014 Olmert was sentenced to six years' imprisonment for accepting bribes linked to a real-estate deal. In May 2015 the Jerusalem District Court sentenced former prime minister Ehud Olmert to eight months in prison, following a conviction for fraud and breach of trust in the Talansky cash envelopes case. In December 2015 the Supreme Court ruled on Olmerts appeal of separate charges from 2014 in the Holyland affair, accepting his appeal of some charges but maintaining his sentence of 18 months in prison for bribery. Olmert began serving his sentence in February 2016. Olmert was released from prison 02 July 2017 after his term in a corruption case was reduced by a parole commission. Under the terms of his release, the 71-year-old ex-prime minister cannot give interviews to the media, must do volunteer work and appear twice a month before police.

Former prime minister Ariel Sharon, was questioned while in office in 2003 and 2004 over allegations of bribery and corruption involving him and his two sons. Israel's attorney-general said 15 June 2004 there was insufficient evidence to prosecute PM Ariel Sharon on corruption charges. He made his decision after a government legal team rejected the recommendations of the former chief state prosecutor, Edna Arbel, who recommended Sharon and his son Gilad, be charged with accepting bribes from Israeli property developer David Appel. The decision was seen by observers as a political boost for Sharon while he tried to build a new government coalition and implement his plan for disengagement from some Palestinian areas.

Prime Minister Ariel Sharon's son - Omri Sharon - pled guilty 15 November 2005 to charges of illegally raising funds for his father's election campaign in 1999 and 2000 and funneling the money through a false corporation. At the opening of his trial in Tel Aviv, the younger Sharon's lawyer said his client admitted to charges of falsifying documents, perjury and violating the party funding law. Under the charges, Omri Sharon - a Likud Party lawmaker and a key advisor to his father - could face up to five years in prison. Sharon's son Omri served time in prison. Omri Sharon was freed from Ma'asiyahu Prison in Ramle on 25 June 2008 after five months in jail. The Supreme Court accepted an appeal on his behalf and shortened the sentence to seven months, of which Sharon served two-thirds.

There were no reports of judicial corruption during 2009, but during the year the government investigated and prosecuted several senior political figures for alleged misconduct. On 24 June 2009, the Tel Aviv District Court sentenced former finance minister Abraham Hirchson to five years and five months in prison for stealing 1.8 million NIS (approximately $460,000) from the National Labor Federation. Hirchson was convicted by the Tel Aviv District Court of larceny, executive theft, fraud, breach of trust, illicitly obtaining funds, money laundering, and falsifying corporate documents. On September 24, while serving the sentence, Hirchson began an appeal process.

On 02 August 2009, police recommended to the attorney general that he indict Foreign Minister Avigdor Lieberman on bribery, money laundering, obstruction of justice, and other charges. There was no decision at year's end.

On 30 August 2009, Attorney General Menachem Mazuz indicted former prime minister Ehud Olmert along with his former chief of staff, Shula Zaken, on three charges involving breach of trust, falsifying corporate documents, and fraudulent conduct. Olmert was also charged with tax evasion, and Zaken was charged with illegal eavesdropping. At year's end, two other charges were dropped, while one investigation regarding Olmert's political appointments remained pending. Olmert and Zaken both pled not guilty to all charges. At year's end, the trial continued. An additional six persons were indicted on related charges, including former tax authority chief Jacky Matza, three tax authority officials and two businessmen.

On 01 September 2009, former minister Shlomo Benizri began serving a four-year prison term after his conviction in 2008 on charges of bribery, fraud, and breach of trust for crimes committed between 1996 and 2001, when he was minister of health and minister of social affairs. The court initially fined Benizri 80,000 NIS ($20,000) and sentenced him to 18 months in prison, but the government appealed and the High Court of Justice increased the fine to 250,000 NIS (approximately $66,000) and increased his sentence to four years.

At the end of 2009, former president Moshe Katsav's trial continued for obstruction of justice, rape, and sexual assault (see section 6, women). In 2011, disgraced ex-president Moshe Katsav began a seven-year jail sentence after being convicted on two counts of rape and other sexual offences.

At the end of 2009, the trial of Knesset member Tzachi Hanegbi continued. Hanegbi was on trial for fraud, breach of trust, election bribery, and politically motivated civil service appointments of members of the Likud party headquarters and their relatives while he was environmental protection minister. Hanegbi was indicted, together with his former director general, Shmuel Hershkovitz. Hanegbi was later cleared of fraud, breach of trust and political bribery charges from his time as minister for environmental protection (but he was fined for lying to investigators).

Courts concluded the trials of members of the Knesset (MKs) Yaakov Edri and former MK Yitzhak Ziv due to lack of evidence. Investigations of MKs Ruhama Avraham, Roni Bar On, and Haim Katz ended in 2008 without criminal charges or civil penalties.

On 06 November 2013, the Jerusalem Magistrates Court acquitted Foreign Minister Avigdor Liberman, who was charged with breach of trust and fraud for allegedly ordering then Deputy Foreign Minister Danny Ayalon to advance the appointment of diplomat Zeev Ben Aryeh as ambassador to Latvia. Liberman resigned his post as foreign minister a day after the attorney general announced the indictment but was reappointed on November 13. Attorney General Yehuda Weinstein announced on December 18 that he would not appeal Libermans acquittal. Authorities were investigating at least nine city mayors for corruption at the end of 2013.

Following a 2012 report by the NGO Transparency International that criticized the government for allegedly taking no steps to file cases for bribery of foreign officials and not opening any investigations, the Ministry of Defense directed its Defense Export Controls Directorate to take an exporters engagement in foreign bribery into consideration in licensing and registration decisions. The law requires major defense exporters to adopt and implement corporate anticorruption compliance programs as a precondition for receiving marketing and export licenses.

In April 2015 authorities convicted Rabbi Yeshayahu Pinto of bribing senior police officers in connection with an investigation of alleged fraud by a charitable organization he headed. As part of a plea bargain in which Pinto gave evidence against the head of the National Crime Unit, Police Commander Menashe Arbiv, he received a reduced sentence of one year in jail, which he began serving in February, and a fine of one million shekels ($265,000). The investigation of Arbiv continued in 2016.

In May 2015 the government filed indictments against lawyer Ronel Fisher, retired police superintendent Eran Malka, former Tel Aviv district attorney Ruth Blum-David, and several business figures. Authorities variously charged the accused with taking and giving bribes, fraud and breach of trust, fraudulent receipt of assets in aggravated circumstances, money laundering, or obstruction of justice, each according to his or her role in the corruption affair. Authorities alleged retired police superintendent Eran Malka, a senior police officer in the Lahav 433 National Fraud Unit, was a key figure in the rings obstruction of justice. In September 2015 authorities sentenced Malka to eight years in prison. The cases of Blum-David and Fisher continued as of November 2016.

In December 2015 a Tel Aviv court indicted former Knesset member and minister for industry, trade, and labor, Benjamin Ben-Eliezer, on charges of bribery, fraud, breach of trust, money laundering, and tax evasion. Ben-Eliezer died on August 28, before the case concluded.

The government continued to investigate and prosecute top political figures in 2016. On 18 September 2016, police arrested more than 20 Balad party officials, including senior party members. The charges included concealment of millions of shekels in contributions from Israel and abroad. Balad MKs rejected the accusations as political persecution. The investigation continued as of November 1. In September 2016 police arrested and placed under house arrest Netanya mayor Miriam Feirberg-Ikar on grounds of failing to disclose a financial interest relating to a luxury housing project. The investigation continued as of November 10.

The State Prosecutors Office announced in September 2016 that it would summon former tourism minister Stas Misezhnikov for hearings before indicting him and 15 other members of the Yisrael Beitenu party on charges of corruption. A police investigation into the National Transport Infrastructure Company, formerly known as the National Roads Authority, began in late 2015 and continued as of September 2016. Haaretz reported that police recommended charging more than 40 suspects and 11 companies with corruption, including at least one former MK.

Benjamin Netanyahu and his wife, Sara, have weathered several scandals over the years, including investigations into the misuse of state funds and an audit of the family's spending on everything from laundry to ice cream. They have denied any wrongdoing.

Netanyahu had admitted to receiving money from jailed French tycoon Arnaud Mimran in the past. The prime minister's office said he received some $40,000 (38,000 euros) in contributions from Mimran in 2001. However, that was while Netanyahu was out of public office. The money was said to be part of funding for public activities, such as promoting Israel abroad. Mimran was sentenced to eight years in prison in July 2017 for a scam involving taxes on carbon emissions permits amounting to some 283 million euros.

Netanyahu found himself tied up in a separate investigation over a $2 billion deal to buy German submarines, which has led to the arrests of seven public officials and private business people. Although the prime minister wasn't implicated in the case, David Shimron, his personal lawyer and second cousin is representing the local agent of German manufacturer, ThyssenKrupp, and was believed to have helped push the deal.

In July 2017, Attorney General Avichai Mandelblit ordered a preliminary investigation into Netanyahu, although he refused to give any details concerning the nature of the inquiry. Israeli police disclosed 03 August 2017 that Netanyahu was suspected of fraud, breach of trust and bribes in a pair of cases.

File 1,000 related to illegal gifts received by Netanyahu and his family from business associates, including Australian billionaire James Packer and Hollywood producer Arnon Milchan. Benjamin Netanyahu and his wife, Sara, are said to have received more than $100,000 worth of cigars and liquor from Hollywood producer Arnon Milchan, who reportedly asked Netanyahu to press the US Secretary of State in a visa matter. Australian billionaire James Packer has reportedly lavished Yair Netanyahu, the eldest son of Israeli Prime Minister Benjamin Netanyahu, with gifts that included extended stays at luxury hotels in Tel Aviv, New York and Aspen, Colorado, as well as the use of his private jet and dozens of tickets for concerts by Packers former fiancee, Mariah Carey. Police were trying to determine whether these constitute bribes, since Packer was reportedly seeking Israeli residency status for tax purposes.

File 2,000 concerned alleged attempts by the prime minister to strike a deal with the publisher of the Yediot Ahronot newspaper group, offering legislation that would weaken the publisher's competitors in exchange for favorable coverage. This case related to conversations he held with an Israeli newspaper publisher about limiting competition in the news sector in exchange for more positive coverage.

Harrow, Netanyahu's former chief-of-staff, agreed to testify in the two cases against his former boss. Israeli media reported Harrow reached a deal with the prosecutors on 04 August 2017.

Case 3000 involves kickbacks stemming from Israels decision to order additional submarines from Germany, as well as the decision to give a German shipyard a no-bid contract to build new missile ships for Israel.

Case 4000 concerns various allegations of wrongdoing by the chairman and controlling stockholder of Bezeq, Israels largest telecommunications firm. The director general of the Ministry of Communication was questioned and detained for a short period over this case.



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