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Corruption Investigation Nets Members Of Netanyahu's Inner Circle

Sep 15, 2017

Allegations of corruption are circling Israeli Prime Minister Benjamin Netanyahu, his family and inner circle. While Netanyahu has not been indicted yet, many of his close friends, colleagues and family have been ensnared in the investigations.

Below are brief outlines of the four cases:

•   Case 1000 : Netanyahu, his wife Sara, and their son have been accused of unethically receiving lavish gifts from two people, Hollywood producer Aaron Milchan, and Australian billionaire James Packer. The gifts most notably include a regular supply of Cuban cigars, champagne, expensive jewelry, and various flights and hotel rooms. Netanyahu and his wife allegedly accepted the gifts from Milchan in exchange for extending the movie producer’s permanent residency status and to help him acquire an Israeli television station.

•   Case 2000 : Allegations claim that Netanyahu attempted to persuade major Israeli newspaper Yedioth Ahronoth to report more positively on him. A recording allegedly from Netanyahu’s chief-of-staff, who has agreed to serve as state’s witness, purportedly show Netanyahu asking Yedioth Ahronoth’s publisher for more favorable coverage. In exchange, Netanyahu allegedly offers that he would request a rival newspaper to not publish a Friday edition, which is a similar to a Sunday edition in the United States. An indictment could come as early as October.

•   Case 3000 : Allegations have been leveled against three of Netanyahu’s most trusted confidants, but not the prime minister himself, regarding a submarine deal between Israel and the German shipbuilder company ThyssenKrupp. Netanyahu’s friend and ThyssenKrupp’s representative in Israel, Michael Ganor, is accused of bribery potentially worth more than $1 billion USD. Netanyahu’s cousin and personal lawyer defended Ganor, and is himself now under criminal investigation. Ganor has since turned state’s witness, and will serve 1 year in prison, and be fined $2.8 million USD, according to Haaretz.

•   Case 4000: A special state comptroller report suggests the relationship between Israel’s communications ministry and the massive Israeli telecom company Bezeq was problematic and unethical. Netanyahu allegedly fired the former director of the ministry due to his efforts to change broadband policies that would have hurt Bezeq. Nethanyahu-appointed a new communications ministry director director, Sholmo Filber, has been accused of providing Bezeq with various reports and documents that could benefit Bezeq.

Dr. Gershon Lewental, visiting professor of Israel Studies in the departments of History and International Studies at the University of Oklahoma, spoke to KGOU’s World Views about the allegations. Lewental says Cases 1000 and 4000 probably will not result in indictments against the prime minister, and Case 2000 most likely is not serious enough to topple Netanyahu. Case 3000, on the other hand, is “the most serious corruption case ever in Israel’s history,” Lewantal said.

“Netanyahu has made it clear he’s not stepping down, even if he’s indicted. He’s going to sit and fight until the very end,” Lewantal said.

Interview Highlights

On Case 3000:

But then there's also Case 3000 which is the most serious corruption case ever in Israeli history. And this involves a sale of a purchase of submarines from Germany from the German company ThyssenKrupp. And here Netanyahu seems to be up to his eyeballs, even though the police are still emphasizing that he himself is not the target of the investigation. Perhaps we should put in parentheses “yet.”

Here he his his buddy his best friend, his confidant, his cousin and his personal lawyer, David Shimron, is under active investigation right now for having made an effort to push the Israeli government to purchase more submarines and to purchase from ThyssenKrupp without there being a proper tender. Now here there is also a state's witness who is Mickey Ganor, who was the representative of ThyssenKrupp in Israel. And this has brought in, maybe I'll use a sea metaphor since we're talking about the sea here, but they've they've tossed that net and they've brought in a whole sea a very very large fish from the Israeli military industry, in particular we're talking about the former chief of the Israeli Navy, the rear admiral Eli Marom, who is also seemed to have been caught up in this, a former minister and several other very important figures. We also have the question of whether Yitzhak Molcho, who is Netanyahu's personal envoy, he sends him whenever he wants to get some sort of negotiations done behind the scenes, he is the partner, the law partner of David Shimron, Netanyahu's cousin and confidant. And it seems to be a little too impossible that he didn't know about what was going on either. And so we have a lot of questions that I think at some point Netanyahu's name will become officially attached to this case.

On the strength of Israel’s democratic institutions:

I think Israel's democratic mechanisms are very strong so I don't think we're going to see any sort of collapse or any sort of domestic instability that will take place. I think you know former Prime Minister Ehud Olmert was sent to prison right. He resigned and then he was sent to prison for corruption as well. And nothing changed in terms of the political scene. I mean in terms of the stability the political scene. But what I would note is that at that point in 2007 Abu Mazen the head of the Palestinian Authority and Olmert had come to a series of agreements and basically Abu Mazen decided, "I'm not going to continue with him until we know what happens as a result of these investigations." And it potentially basically forestalled the peace agreement that could have happened. One always wonders. The same thing. I'm not saying Netanyahu was engaged in peace agreement but it does mean that any sort of potential negotiations that could happen could be put on hold because the Palestinians will say let's wait and see what's going to happen to Netanyahu because we're not going to start talking to someone who might not be here in a couple of months.

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FULL TRANSCRIPT

Suzette Grillot: Gershon Lewenthal, welcome to World Views.

Gershon Lewental: Thank you.

Grillot: I think Welcome back. I think we've had you on the show before I said thank you for being here again, and at this time we're going to talk about Israeli politics considering the Prime Minister, Benjamin Netanyahu, is undergoing, is being investigated facing potentially some several charges, bribery, fraud, break of trust. His wife is also being investigated I think recently indicted. So this is a concerning situation for domestic politics in Israel because this man has dominated Israeli politics for eight years. He's the longest serving prime minister since Israel's first prime minister, David Ben-Gurion. So can you, can you lay that give us the lay of the land here? Can you set the stage for us in terms of what exactly is going on? And then we could talk about maybe what some of the implications are.

Lewental: Sure. I mean he's been prime minister not just in the last two consecutive periods since 2009, but he was also Prime Minister in the 90s. So altogether it's at lot a lot of time that he's been prime minister, and he was investigated already in his first term in office back in the 90s, which is quite remarkable that one would think that he's learned his lessons but apparently he hasn't. So right now if I count correctly there are four major cases that somehow involve him, and another one that involves his wife. And that's besides a number of different cases that have been looked into and closed or ones that perhaps still haven't developed into major cases that, you know, they include things like mistreatment of the workers of the prime minister's residence, the care for his wife's late father, employing an electrician every weekend even on Yom Kippur, which is the equivalent of like Christmas, a day when everything is closed. Why would you bring an electrician to your house that often? And it happens to be an electrician who works for his political party. Buying furniture that matched the furniture at the private residence, and then switching out the furniture with the official residence. And my very favorite was bottle deposit returns. That they would buy small bottles that have a bottle deposit to gather them all together then return them, and keep the deposit for themselves. I mean we're talking about small amounts of change. You know, $3000 maybe a year. This is not you know, we're not talking big numbers in the in terms of these kind of things. But the other cases that are being investigated right now are a little bit more serious. So his wife has just been indicted for having received gifts of perhaps around a hundred and forty thousand, or one hundred and twenty thousand dollars, from friends and from well, the wealthy friends case. But then this is also a hundred and twenty thousand dollars that she's received as in unethical ways of billing the state basically for meals that they are receiving. And they of course want to have very fancy meals from big name chefs. And so they're trying to find ways to basically gouge the state, false billing, things like that.

Lewental: But then each case of his is one we call them the thousand cases. We have the case 1000, which is his friends, basically that he's received money from. In particular two very wealthy friends of his, millionaires, Arnon Milchan, who's a famous Hollywood producer, produced Pretty Woman and a number of other Hollywood films. And and a guy named James Packer, a very rich Australian businessman. And they have given them all sorts of gifts. And the most famous of which I've been a regular supply of Cuban cigars, and pink champagne, apparently for the wife. And, as well as other things including jewelry, that they are basically forced into providing jewelry for Mrs. Netanyahu, Sara Netanyahu, that basically she would send him an SMS to Milchan, and say I would like you know this jewelry that I saw at the store and he brought her, and this is an actual case it was an actual incident that was reported, because he's confessed to a number of these now. "I brought her this bracelet and then she complained that she also wanted the matching necklace." I mean it, you know, it's almost obscene the demands for these kind of objects, that seems to typify both of the members of the family.

Grillot: On the level of other types of corruption you see around the world I mean how do you compare this. I mean I guess Benjamin Netanyahu has been has been accused of trading favors for favorable coverage in the press. I mean that's a little more serious perhaps in terms of the kind of tradeoffs that you're making. But, is this really anything more than kind of just spoiled people really engaging in kind of petty corruption? Yes. I mean does the spillover really into governance more broadly in the country?

Lewental: We're not talking about Imelda Marcos here right. I mean there's no millions and millions of shoes that are hiding somewhere in the prime minister's residence. We're talking about really a small level of entitlement perhaps. I mean it's maybe a level of stinginess that has kind of rushed over into a little bit of bribery that we see. I don't think it's that serious, and I don't think that any of what I've talked about till now would be anything enough to really topple him as a prime minister, and certainly it's not enough to blacken his name amongst his supporters. Case 2000, though, is more talking about favorable coverage. There's a newspaper in Israel that was started eight, eight or nine years ago that it's called Israel Hayon, Israel Today. it's funded by Sheldon Adelson, a well-known Israeli American Jewish casino magnate who donates of course to Republican causes, but also to conservative causes in Israel, and he's basically funded this free newspaper that is distributed every day in Israel on the streets, to people that became overnight the best selling newspaper in Israel because it doesn't cost anything to get the newspaper. And the competing newspaper, Yedioth Ahronoth, which dominated the scene for 50 years, has been suffering. And so supposedly we have recordings that were taped by Netanyahu's own chief-of-staff, that basically reveal a quid pro quo, that Netanyahu was saying to the publisher of Yedioth Ahronth, the rival newspaper, I'm not going to allow Israel Hayon to publish a Friday edition, which is the equivalent of the Sunday edition here in the States, a bigger edition that costs more, if you give me more favorable coverage in your newspaper. This sounds like much more than just unethical you know gifts that are being given, this is actually we're talking about intervention to the press, and we add to this the fact that Netanyahu has dominated the communications ministry, either as the Communications Minister, which he holds in addition to his position as prime minister, or like right now where he dominates it through someone who is the minister of communications but he's essentially someone who's beholden unto him.

Lewental: And so here's an issue that we're talking a little bit more serious grounds. Ari Harow, his-chief-of staff, has turned state's witness. He's providing lots of information that relate to both case 1000 and case 2000. This is probably the reason that we see this indictment looming for Netanyahu in the future perhaps as early as October. He could be facing an indictment for both case 1000 and 2000. Now both of these cases are ones that he's being investigated personally. But then there's also case 3000, which is the most serious corruption case ever in Israeli history. And this involves a sale of a purchase of submarines from Germany, from the German company ThyssenKrupp, and here Netanyahu seems to be up to his eyeballs, even though the police are still emphasizing that he himself is not the target of the investigation. Perhaps we should put in parentheses, yet. Here his best friend, his confidant, his cousin and his personal lawyer David Shimron, is under active investigation right now for having made an effort to push the Israeli government to purchase more submarines, and to purchase from ThyssenKrupp without there being a proper tender. Now here there is also a state's witness who is Mickey Ganour, who was the representative of ThyssenKrupp in Israel. And this has brought in, maybe I'll use a sea metaphor since we're talking about the sea here, but they've they've tossed that net and they've brought in a whole sea a very very large fish from the Israeli military industry. In particular we're talking about the former chief of the Israeli Navy, the rear admiral Eli Marom, who is also seemed to have been caught up in this, a former minister, and several other very important figures. We also have the question of whether Yitzhak Molcho who is Netanyahu's personal envoy, he sends him whenever he wants to get some sort of negotiations done behind the scenes, he is the partner, the law partner of David Shimron, Netanyahu's cousin and confidant. And it seems to be a little too impossible that he didn't know about what was going on either. And so we have a lot of questions that I think at some point Netanyahu's name will become officially attached to this case. And this is in my opinion perhaps the most serious case that we have, even though, you know, all of these are, or have serious implications.

Lewental: And just finally to note that Case 4000, this is about the Bezeq telecom company, which is you know holds a monopoly on telecom it's kind of like AT&T ,during you know when it was when it was Ma Bell. There is there is some sort of competition within the Israeli telecom industry but not to the same degree as there is in the States, and here Netanyahu through his control of the communications ministry ... Again we can't see that he himself, but his proxy Shlomo Filbert, who was the director general of the communications ministry appointed just two days after Netanyahu formed his last government in 2015, when he fired the former communications director general who was going to open up new competition into the market. This guy Filbert, has apparently been passing documents confidential information to Bezeq to help them. Not only that, but Netanyahu never made a public declaration of his friendship with Shaul Elovitch, who is the controlling stakeholder of Bezeq, or his friendship with Arnon Milchan, who is one of the partial stake owner in Channel 10, one of Israel's two commercial networks. So we're talking about great friendship with all of these telecom moguls that are never being reported and then favors that are being done for the major telecom company. All of these together, I mean, any one of these individuals maybe except for the 3000 one we could say or possibly not such a serious situation. But all of these together, they've given Netanyahu a lot of fear that he may actually be facing personal indictments himself.

Grillot: Well things have clearly accumulated over the years and as you mentioned even before he served this past eight years. But you also mentioned his supporters probably not as concerned about this, but what is the general public response to what's going on here? Are we just. Is it being characterized as kind of just a domestic political ploy to try to you know associate Netanyahu with things? Whatever they can to try to get him out? Are there others that are kind of clamoring to follow Netanyahu? Because it looks to me, like there's not even real any real clarity on like who the next leader might be, that there's no you know kind of an up and coming person or people, that would be perhaps pushing this in order to topple Netanyahu and take over.

Lewental: Everything that you've said is true. I mean first of all we have his supporters that are unfazed by all of this. He has gone on sort of a Trump-esque rally, a series of rallies in the past month. In August he gave two rallies at the start of the month the end of the month, for supporters in which he denounced all of this fake news and the efforts of the left to topple him, and the left in the media, excuse me, the left and the media to topple him, which is clearly he's taking a page out of Trump's handbook. This has basically played to his audience. They believe in him like they've never believed him any more. His fellow ministers, and members of his party, many of them have just lined up like ducks, to basically support him and say, 'Of course we are with you and this is basically a witch hunt from the media.' As far as the rest of the population, There we see there's a lot of questions that are being raised. People have grown a lot of tired of Netanyahu. And as someone told me who is a longtime supporter of the Likud, Netanyahu's party, said to me you know, it doesn't matter if we like Netanyahu himself, every now and then a broom gets old and you need to change the broom right. You can't stick with the same old broom forever because it will collect dust. And here's a case that I think many people even from the right, are looking at him and saying, you know, maybe it's time for you to step down. On the other hand on the left, they love this right. That basically he's sitting here and holding on to the strings and no one from the left is able to challenge him. If we can topple him from the right, then maybe we'll be competing against someone less charismatic. Now in the right people are scrambling to try to compete with him, but without seeming like they're competing with him, because that could play badly against their audience. So a number of senior ministers are trying, the head of another one of these right wing parties is trying to position himself in this way. And, we should also note the head of the centrist party, Yair Lapid, who is really trying to aim for right wing voters is also trying to position himself as the best replacement for Netanyahu. I don't think any of these people can predict anything, because we don't know what's going to happen. And Netanyahu has made it clear he's not stepping down even if he's indicted. He's going to sit it out, and fight it to the very end and I don't think we should not trust him on this. I think he doesn't intend to give up his seat very easily.

Lewental: As far as you know the the the ordinary people you have a series of protests that have been taking place. I mean granted, most of them the activists seem to be from the left but they're protesting outside the home of Avichai Mendelblit, who is the basically the state attorney who is supposed to oversee these investigations. They're protesting him because they think he's dragging his feet on these investigations. And we shouldn't be surprised because he's a close personal friend of Netanyahu family. But despite all of that, he did issue this indictment against Sara Netanyahu, and it does look like he's going to allow these indictments to go against Netanyahu. So, these protests may start to peter out, but they have been gathering upwards of 1,000 people every week outside of his home. So, that does show that there is a great deal of unrest and upset about this.

Grillot: Well on that note and just as we finish very quickly, I mean I have to ask because having recently spent some time in Israel, it seems, like it's interestingly the most stable country in the region. I mean it's incredibly stable right now, despite the few things that happened here or there. But what are the implications for this in terms of some domestic political turmoil and the potential loss of a very strong leader like Netanyahu whether you like him or not? You know, there is there is a relatively stable situation in Israel. How would any shift affect that kind of stability in the country very quickly?

Lewental: Well I think Israel's democratic mechanisms are very strong, so I don't think we're going to see any sort of collapse, or any sort of domestic instability that will take place. I think you know, former Prime Minister Ehud Olmert, was sent to prison right. He resigned and then he was sent to prison for corruption as well. And nothing changed in terms of the stability the political scene. But what I would note is that at that point in 2007, Abu Mazen the head of the Palestinian Authority, and Olmert had come to a series of agreements and basically Abu Mazen decided, "I'm not going to continue with him until we know what happens as a result of these investigations." And it potentially, basically forestalled the peace agreement that could have happened, one always wonders. The same thing. I'm not saying Netanyahu was engaged in peace agreements, but it does mean that any sort of potential negotiations that could happen could be put on hold, because the Palestinians will say let's wait and see what's going to happen to Netanyahu because we're not going to start talking to someone who might not be here in a couple of months.

Grillot: Excellent point. Alright, well thank you so much Gershon for being here.

Lewenthal: My pleasure.

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