Israel Resource Review 25th March, 2006


(Translation) How Ehud Olmert Became A Millionaire2
Aryeh Avneri
Investigative Journalist, NFC.CO.IL

By Israeli standards, Acting Prime Minister Ehud Olmert is considered to be a millionaire, even though he never publicly reported the extent of his financial and real estate assets.

He will probably take care to do so from now on, in ongoing reporting to the State Comptroller, to draw away from himself the flames of public criticism that burn around him.

The law requires government ministers who hold assets and bank accounts abroad to include them in their reports; their declarations have the standing of a deposition under oath.

After Olmert's election in the 1970s, he declared, with pathos that could have an effect on simple citizens who did not know him well: "I was elected to the Knesset to fill a certain position, and to act, inter alia, to correct the current corruptions in Israeli society. I come to reveal serious phenomena and to arouse public opinion for proper treatment, to motivate the executive authority, and adapt priorities to the real needs of the society."

Dripping with honey, really. In actuality, however, Olmert has acted throughout all his years of parliamentary activity to make money. A lot of money, and quickly. Without being accountable to anyone. From time to time he throws a bone to his voting public. During the period in which Members of Knesset could act as lawyers, several lawyer-Members of Knesset were not squeamish about taking advantage of their parliamentary activity to do more for themselves and their families than for the public that sent them to the Knesset.

Olmert led the pack. He gained a reputation as a lawyer acting as an intermediary, with connections to all government officials, with the ability to get things done, and with the singular expertise to find shortcuts to almost all the government ministries and the various state authorities. Likud MK Michael Eitan relates: "Olmert did not participate in many sessions of the Knesset and its committees. He spent most of his time in legal activity on behalf of his clients. He told me straight out that he wants to make money for himself, and it transpires that he does this very nicely. Today Olmert is a serious millionaire." Already in that period people identified Olmert as having unbridled behavioral traits, that were expressed in his way of life, his frequent trips abroad, and his obsessive connecting himself to the very wealthy both in Israel and abroad - without his ever being bothered by the question of whether his new friends had a criminal past, and how they amassed their wealth.

One of the outstanding examples of this was his relationship with the questionable American millionaire Mark Rich, who fled from the US to Switzerland to escape the American tax authorities, who wanted to put him on trial for serious crimes. Olmert asked President Bill Clinton to arrange a "pardon" that would enable Rich to return to the US.

One deal followed another, Olmert's circle of international multimillionaires gradually expanded to other countries, as well, and included the wealthy from Europe also. Olmert was the lawyer of, among others, the Russian multimillionaire Shabtai Kalmanovich who lived in Israel and became close to several central political figures, and who was later charged with espionage against Israel. In any event, Olmert was one of the first politicians to identify the oligarchs who arrived in Israel over the course of time, without troubling himself to check their moral standing.

It is not coincidental that the billionaire Arkadi Gaidamak is only one of his friends among the oligarchs; nor is it by chance that Olmert persuaded him to buy the Jerusalem Beitar soccer team. We will return to this topic in the continuation of the series. At the beginning of his career that combined being a lawyer and an MK, Olmert discovered a sophisticated method of acquiring clients among businessmen in Israel and foreign investors who inquired about buying into various projects in Israel.

At the time, when I was an investigative reporter for Yedioth Ahronoth, I uncovered the method when I happened to receive an instructive document that was written on the stationery of "Olmert, Advocate," alongside which were the additional words: "Member of Knesset." We need not emphasize the significance of the double title as a "sales gimmick."

In the letter, that was addressed to potential investors in Israel and abroad, Olmert proposed that they invest in the establishment of a new private medical center in Jerusalem (Medical Center). It would not be difficult to guess why the lawyer-Knesset Member Olmert was busy in the medical ralm. Eliezer Shustak, one of the heads of his party at the time, was Health Minister. The door to his office was open to Olmert when the latter came in the service of his clients and gleaned information about current projects (when Olmert himself was Health Minister, he was involved in another affair that we will discuss at length in another chapter of this series).

I had contacted Olmert then to receive his response, in order to examine the question of his use of his political standing on his office stationary for his private dealings. Olmert said to me: "This was a mistake by a secretary." I told him that I intended to publish this response, and he said to me: "It's not worthwhile for you to start with me, I can harm your standing in the newspaper."

Olmert tried to prevent the publication, as he did over the course of years about many other items in the media. After he was not successful in this, he found a foolproof way to punish the newspaper: exclusive political materials were leaked to Maariv, the competing newspaper. Ever since then Olmert has been waiting to catch me. I continued to take an interest in his open and concealed activity, but I estimated that my victory was short-lived. The higher that Olmert ascended politically, becoming, among other positions, a member of the Knesset Defense and Foreign Affairs Committee, a member of the Secret Services Subcommittee, and very close to Prime Minister Yitzchak Shamir, with a large quantity of scoops at his disposal, the media's dependence upon him grew, and it was clear that, sooner or later, I would lose the battle against the interests of the newspaper.

Olmert did not succeed in having me removed from the newspaper, but I felt that my professional freedom of activity was restricted. Nor was I surprised when one day Tami Mozes-Borowitz, a shareholder in the newspaper, asked me: "What do you have against Olmert, maybe just leave him alone." After the Knesset decided to forbid its members from concurrently practicing law, Olmert lowered his profile, and he no longer appeared in the Knesset accompanied by his clients. Formally, he resigned from the law office in which he was a partner, but there were signs that the legal bug had not left Olmert. In the Hakhsharat Hayishuv (Palestine Land Development Corporation) sale that is detailed below, in which the corporation was purchased by the businessman Yaakov Nimrodi, Olmert took his fee when he was already a government minister. This deal clearly shows how Olmert took advantage of his public positions to become rich by being an intermediary for the sale of a public corporation - Hakhsharat Hayishuv, that was jointly owned by the Jewish Agency and Bank Leumi.

Hakhsharat Hayishuv is a corporation rich in properties, residential and commercial buildings, plots of land, hotels, and holdings throughout Israel. in order to attain control of this attractive corporation, it was necessary to purchase a bloc of founder's shares that was held by the Jewish Agency's Companies Authority and Bank Leumi's holdings in the corporation. Nimrodi relates: "I was asked to participate in the tender for purchasing control of the corporation, together with two partners. But I preferred to go to the tender alone.

After I arrived in Israel, Olmert contacted me and told me that he could take care of the transaction. I gave him power of attorney to act in my name. At the last minute we submitted the tender to Bank Leumi, and we won." The purchase of the shares held by Bank Leumi was not sufficient to attain control of the corporation, for which the shares held by the Jewish Agency would have to be bought. A number of trenchant questions arose concerning this purchase. Olmert received $250,000 from Nimrodi for obtaining the Jewish Agency's shares.

After the acquisition, Olmert arranged for Nimrodi to meet the Israeli international businessman Yossi Brender, who purchased a portion of the Hakhsharat Hayishuv shares for a certain period of time and entered as a partner. During the course of the transaction, Olmert traveled for the who-knows-how-many time on behalf of Israel Bonds, on a speaking and fund-raising tour. As always, Olmert took advantage of the trip to search for investors and deals. Olmert, who was still a Knesset member, demanded that Nimrodi give him additional hundreds of thousands of dollars as his fee for being the go-between with Brender. Nimrodi refused. In the end, they agreed that the Chairman of the board of Discount Bank at the time, Yossi Ciechanover, would be a mediator, and he allocated to Olmert an additional $200,000 (incidentally, the Discount Bank, like other public and financial bodies, had in the past purchased paintings by the wife, Aliza Olmert, and this was not deemed questionable).

The rest of the go-between money to Olmert was paid in 1989, when Olmert was already serving as Health Minister. The payment was made through Adv. Uriel Messer; we will return to him below.

One of the classic stories is the joint exercise that Olmert pulled off together with the former Knesset member Avraham Shapira, when the latter served as Chairman of the Knesset Finance Committee, in order to approve government aid in the amount of six million shekalim to the Jerusalem contractor Matityahu Lifshitz, who was among Olmert's close friends.

Although Lifshitz's construction company did not appear in the list of construction companies in distress who were eligible for aid, this didn't stop Olmert from pulling off a joint exercise with public money together with Shapira. Olmert "happened" to be present at a session of the committee, and warmly recommended granting the aid to Lifshitz. Shapira helped, knowing that Olmert would reward him. You help me, and I'll help you.

When Olmert was later asked what he was doing in the committee session, he replied: "By chance I happened to pass by there."

It was later learned that Olmert purchased an expensive house from Lifshitz on Khaf-Tet Benovember Street, which he sold in January 2004 for $2,700,000 to the billionaire Daniel Abrams, by means of the attorney Yaakov Neeman (this controversial transaction is currently being examined by the State Comptroller). Olmert claimed that the top floor of the house in which special effort was invested is not his, and is occupied by the daughter of Adv. Yaakov Neeman, whose ties with Olmert were always very close. Neeman repaid him on another occasion when he put his office in the capital at the disposal of Olmert's campaign headquarters, and even more so when he testified on Olmert's behalf in the Likud tax receipts trial. The price that Olmert paid Lifshitz for the renovated house has not been revealed to the present, and it is unclear whether the special price constitutes an additional bonus on top of the fee that Olmert collected for mobilizing state funds for his contractor. The amount that Olmert received from the NIS 6,000,000 remains a professional confidence between the lawyer and his client, and it almost certainly was not disclosed to the members of the Finance Committee who voted to allot state funds to Lifshitz. It has been claimed that Olmert did not perform any service without recompense. Olmert claims that he did not receive any discount.

The contractor Lifshitz responded at the time, in response to my question: "I cannot tell you the exact sum that Olmert paid me, but he received a very fine discount from me." Olmert told me at the time that he had not received any discount from Lifshitz.

It's not hard for me to decide which of the two to believe.

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The Olmert/Cremieux affair:
Yoav Yitzhak
Bureau Chief and Investigative Journalist,

According to an advance permit that was given, in writing, the [Jerusalem] municipality consented to the dismantling and reassembling of the building, and even to increase the built-up area around Olmert's home.

In this manner they succeeded in gaining an advantage and a profit of hundreds of thousands of dollars.

Alumot MG Engineering Corporation Ltd and Acting Prime Minister Ehud Olmert used insider information that they had obtained when they conducted the transaction at 8 Cremiux [St.] in Jerusalem, in addition to using connections to advance building permits in the municipality's institutions.

This comes into especially sharp focus now, in light of Alumot's position, as it was presented to Nfc, the response by Olmert, and information that was brought to our attention, as will be detailed below. As we reported here, Olmert received a bribe from Alumot in the amount of hundreds of thousands of dollars, and his name and standing were used to receive the building permits, both from the Preservation Commission, and from the Local Planning Committee.

The Final obstacle they face now is the Appeals Committee (that is connected with the District Planning Committee). Olmert and Alumot totally denied the claims against them, and in the course of their attempt to ward off the claims of bribery and to downplay the severity of the suspicion that use was made of Olmert's name, they revealed the following:

Olmert argued that even before they signed the contract between them (October 2004), Alumot had received permission in principle, according to which the municipality would allow the demolition and rebuilding of the structure, that is a preserved building;

Alumot claims in a letter to Nfc from March 5, 2006, copies of which were also given to the State Comptroller and to the Attorney General: "Even before the signing of the contract with the Olmerts, and unconnected to their purchase of the apartment - for in light of the comprehensive professional opinions submitted to it, it was convinced that the building could be preserved by its dismantling and reassembly, in accordance with the strict conditions established for this." [Alumot gave Nfc its version in a letter in which it demands an apology and financial compensation in the amount of a million dollars, claiming that my publication on the matter constitutes libel. Its demand is totally rejected.]

It was learned that this critical information - if it was indeed given to Alumot, and from it to Olmert - was not given to the tenants/owners of the building, and before that was not given to other entrepreneurs who were in contact with the municipality and examined the possibilities of receiving a permit to demolish and rebuild the structure. Deborah Ganani-Elad, from whom Alumot purchased about a third of the building that is to be preserved, told us in response: "I knew nothing. They didn't tell me anything. My lawyer, as well, did not know." Ganani sold her portion (161 sq. m., and building rights) for $1,100,000, and if the municipality's position had been known to her, she could have received a higher sum.

This means that Olmert and Alumot used insider information that they received from senior official individuals within the municipality in order to purchase the parts of the property from the various residents, and thereby make very high profits in the amount of hundreds of thousands of dollars. This is especially serious, since the Jerusalem Municipality had previously refused to allow others to make any change at the site, had forbidden residents to make any actual changes and/or additions, and had even given Alumot the permission, and in writing, even though this was not within its authority [changing the status of a building to be preserved, that in fact pertains to changing the Urban Building Plan, is under the sole authority of the District Planning Commission].

It was learned that the Director of the City Planning Branch, the architect Osnat Post, who was the deputy of Uri Shitrit, who was recently added by Olmert to the Kadima list for the 17th Knesset, directly dealt with granting the permit to Alumot, with the support of Shitrit.

It almost goes without saying that the Jerusalem Municipality, that gave this important information to Alumot, and from it to Olmert, had not previously done the minimum required by the law: to inform the public, by mandatory advertisements in the media, of the change in its position and the permit that it was willing to grant to anyone who would request to make changes at Cremieux 8, namely: dismantling and rebuilding, while utilizing the building rights given in the area. It is indisputable that if this had been announced in public, as the law requires, many more entrepreneurs would have contended for the purchase of the rights to the property, and the residents who had waited and who had been "stuck" for decades would have been able to receive a higher price for the property that they possessed.

The importance of the prior information is attested by the following fact: the contractor and Olmert took determined action to purchase the property. In this transaction Olmert purchased one third of the building (which is of three stories). Olmert paid the contractor, in advance, the entire sum set for the apartment that he purchased: $1,200,000. This sum was used, among other things, to finance the additional purchases, that enabled the entrepreneur and the purchaser (Olmert) to make huge immediate profits in the amount of hundreds of thousands of dollars, and within a very short period of time.

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Olmert Took Advantage of His Position to Advance His Friend's Business Deals
Yoav Yitzhak
Bureau Chief and Investigative Journalist,

Alexander Tessler bought a fountain pen worth $1,750 for Olmert - before that Olmert had acted on his behalf to advance his business deals in the Princess Hotel and took advantage of his position - Olmert: "This never happened"

Acting Prime Minister Ehud Olmert acted to advance the personal business deals of his personal friend the businessman Alexander Tessler, with a conflict of interest. The two have a close personal relationship. About half a year ago Tessler even bought an expensive birthday present for Olmert - a fountain pen. Max Smori, Tessler's senior representative, stated that the pen cost $1,750 in Israel. Olmert is known in Israel as a fountain pen collector, and therefore it was this gift that was purchased. The law forbids government ministers to accept gifts, with the exception of modest presents without any appreciable monetary value. At the time that he received the gift, Olmert filled a wide range of positions, including Finance Minister, Minister of Industry, Trade, and Tourism, and Chairman of the Board of Directors of the Israel Lands Authority - in all of which a government minister could aid a businessmen whom he wishes to advance, as Olmert indeed desired. Smori confirmed for Nfc that Tessler had given an expensive gift to Olmert. He mentioned that this had taken place about six months ago, and was a birthday present. He stated that Tessler, who lives in Germany, called Israel and sent an agent to buy a present for Olmert. "When Tessler buys a present, he buys an expensive one. You cannot bring a small gift." In response to Nfc's questions, Smori replied that the purchase of the present was meant to strengthen the ties with Olmert. "Obviously, you want good relations with him, But this does not say that this is corruption." Together with this, Smori said that, in his estimate, the gift cost less, perhaps NIS 4000-5000. It was learned that, despite the personal ties between the two, and despite the obligation incumbent upon any public figure in general, and especially upon a government minister, to refrain from any activity that hints of a conflict of interests, Olmert did not abstain from acting to advance Tessler's business affairs in Israel. Thus, for example, even before Tessler presented Olmert with that pen, he requested his assistance in resolving a serious problem that had arisen regarding the golf courses of the Princess Hotel in Eilat. "He requested a meeting, which was held together with the Regional Office Director, Fanny Sesporta," Smori related/revealed, while adding that nothing came out of this, and as proof: the Israel Lands Authority demands the lands back. Olmert stated in response: "This never happened."

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Olmert Aides an Entrepreneur in Reducing Assessments
Yoav Yitzhak
Bureau Chief and Investigative Journalist,

The intervention was done in the middle of a police investigation - the police have information about the involvement of Olmert and Yehezkel - they aided the entrepreneur, so that he paid NIS 1.5 million, instead of tens of millions of NIS

Acting Prime Minister Ehud Olmert and his aide, Oved Yehezkel, took advantage of their positions and aided in decreasing the assessment that had been set for a private entrepreneur, Ezra Aloni, in violation of regulations and against the public interest, so Nfc has learned. The assessment was issued by the Israel Lands Administration, that is headed by Olmert, for the construction activity of the A. S. P. Y. Corporation Ltd, headed by Aloni, by means of the Modi'in District Regional Council, for whom the contractor was working, and who guaranteed to the Lands Administration the payment of monies (royalties for use of the land and/or a license to use the land) that the contractor/entrepreneur was supposed to pay. The bottom line: the original assessment was reduced from tens of millions of NIS to only NIS 1,500,000, and that for only 92 dunams (about 23 acres) of land. Olmert and Yehezkel authorized this, despite opposition by senior officials in the Israel Lands Administration. These actions were conducted during the middle of a criminal investigation against the entrepreneur on this issue. This thereby prevented the collection of the realistic payment from the contractor's company, that actually holds some 428 dunams (107 acres), and that should have paid more than NIS 100,000,000. The matter is now in the hands of the Israel Police Economic Crime Unit, that is investigating the affair of the garbage dump at the Bareket site. Despite this, and despite the information possessed by the investigators, and the progress made in the investigation, Olmert and Yehezkel were not even summoned to give testimony in the affair.

At this stage, the command level of the Unit has not yet decided if and when Olmert will be questioned, despite the investigation raising a suspicion against the two, as will be detailed later on. Furthermore, Nfc has learned that certain activities that were to be done by the police have been put on hold at this stage - "until after the elections." Attorney General Manny Mazuz, who is the official authorized to approve the investigation of a government minister, has still not been updated on this matter. The Economic Crime Unit issued this response: "The Unit did not investigate the suspected involvement of Acting Prime Minister Ehud Olmert in anything pertaining to the investigation of the Bareket garbage dump. The Economic Crime Unit is a police unit in the Investigations and Intelligence Division, the management of whose investigations are governed by professional considerations. No pressure is, or was, exerted on the Unit to delay the investigation." This is the official response of the police, and specifically because of it, we are going public with this affair here. Nfc has learned that the investigative team possesses a great deal of information and documents on the subject, as well as testimonies, that would normally require the investigation of Olmert and Yehezkel, but the heads of the Unit have decided, at least at this stage, to refrain from investigating the two. It should be noted that in the legal proceedings before the High Court of Justice, the A. S. P. Y. Corporation Ltd, as well as the Modi'in District Regional Council, denied all the accusations against them. Ezra Aloni and the A. S. P. Y. Corporation stated in response that the report is filled with incorrect facts, distortion of the truth, half-truths, and even total lies. Their full response will be cited in our investigation (link). The Director of the Israel Lands Administration, Yaakov Efrati, said in response that pressure had not been exerted on him by Olmert or Yehezkel. His full response will be cited in our investigation (link).

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The State Comptroller is about to reveal a special report:: Olmert and His Close Associates' Jobs
Yoav Yitzhak
Bureau Chief and Investigative Journalist,

The complaint was filed in September 2004 by the Workers' Committee in the Ministry of Industry, Trade, and Tourism - The suspicion: Olmert and Director-General Dinur made forbidden political appointments and made use of personal connections - The Comptroller confirms: he will shortly issue a special report - Olmert and Dinur deny the claims.

The State Comptroller, retired Justice Micha Lindenstrauss, is about to publish within a few weeks, in the format of a special report, his findings concerning a lengthy series of appointments made by Olmert and his people in the Ministry of Industry and Trade, for invalid political considerations or as a result of personal connections. The report also relates to the actions of the Director-General of the Ministry, Raanan Dinur, and of Shulah Zaken, as the executors of those appointments that were made in an invalid manner. After the publication of the report Attorney General Manny Mazuz will have to examine whether a criminal investigation should be opened. The invalid appointments include: the appointment of attorney Lilach Nehemiah, the spouse at the time of Abraham Hirschson (Olmert's loyalist) to the post of Deputy Director-General of the Small Business Authority. The State Comptroller confirmed in response that a special Comptroller's report concerning appointments in the Ministry of Industry, Trade, and Tourism will soon be issued. The Comptroller's office could not say whether the report will be published before the elections, as is required by the people's right to know before the elections, or only afterwards. Workers in the Ministry of Industry, Trade, and Tourism argue, especially in light of the Knesset elections, that the Comptroller must explain why this report is still unpublished. The examination was conducted by Dafnah Degani-Agmon and Menahem Gutreich, both senior employees in the State Comptroller's Office. It was initiated in the wake of a complaint filed by the Workers' Committee in the Ministry of Industry and Trade, in light of Olmert and his people bringing in individuals from outside the Ministry, for inappropriate reasons, and even improperly intervening in tenders, instead of advancing dedicated workers from within the Ministry of Industry and Trade.

Goldberg Gave the Order Nfc has learned that the examination began in 2004, by order of the previous Comptroller, the retired Justice Eliezer Goldberg, after having concluded that, on the face of it, irregular appointments were conducted. The work of the examination actually was concluded several months ago. The current Comptroller, Lindenstrauss, was planning to publish the report against Olmert and his people as part of the annual report (the first half) which is scheduled for publication in May 2006. The draft of the report had already been given to the Prime Minister's office, for comments and/or responses. Due, however, to the gravity of the actions that came to light, and after additional revelations about Olmert's illegal actions in a string of affairs that we uncovered here, the Comptroller decided on the early publication, as a special report, of the chapter dealing with the appointments made by Olmert and his people. It was learned that the main items had already been submitted to Olmert for his response. Members of Olmert's office fear that the report might lead to a criminal investigation, as happened with the government minister Tzahi Hanegbi and MK Yisrael Katz.

The Workers' Committee: From the "Junta" Workshop The examination began in the wake of a complaint filed by the Ministry of Industry, Trade, and Tourism Workers' Committee, signed by Suzi Levi, Chairperson of the National Worker's Committee in the Ministry of Industry, Trade, and Tourism. It should be noted that not all the details of the complaint were proven in the examination. We will be able to learn and print the details of the Comptroller's findings only upon publication of the full report. The following is the complaint letter:

Re: Rejecting candidates in internal tenders in the Ministry of Industry, Trade, and Tourism

Hanegbi is not alone!!!

Both the Minister Ehud Olmert and the Director-General of his Ministry, Mr. Raanan Dinur, who carries out his orders, have friends who have to be taken care of. In the past two years we have witnessed increasing contempt for the dedicated and skilled workers of the Ministry, and the preference of those outside the Ministry who are close [to Olmert and Dinur], mainly for senior posts. We recently warned the Ministry management, the Civil Service Commissioner, and the Movement for Quality Government in Israel of this. Nonetheless, candidates were rejected in internal tenders, with the goal of going to external tenders and search committees, to choose those close [to Olmert and Dinur], but no one took action. The following are those who "were taken care of" (partial list).

- The Kaminka family: friends who advise Dinur in the Jerusalem Municipality in the organizational realm. As far as we know, this was not done in the Municipality. When Mr. Dinur came to the Ministry of Industry, Trade, and Tourism, they came together with him. Were their actions checked? And the monies that they received, and continue to receive, to the tune of hundreds of thousands of NIS?

- Mr. Aharon Domb: who is designated by the Director-General for the position of Director of the Investments Center, despite his lacking the relevant education. Domb's "activity" can be seen in the investigative report of Yedioth Ahronoth, but no one took action.

- Ms. Dorit Novak: a friend of Mr. Raanan Dinur from the time they were in the army, was brought from nowheres and was appointed, without a tender, to the position of Director of the Authority for Advancing Employment, but no one took action.

- Mr. Amiram Bukspan: a political crony; he was appointed Chairman of the Small Business Authority, without a tender, but no one took action.

- Mr. Shmuel Rosman: a political crony; he was appointed Chairman of the Small Business Authority, but no one took action.

- Adv. Lilach Nehemiah: a political crony; she was appointed Deputy Director-General of the Small Business Authority, without a tender, but no one took action.

- Mr. Shimi Shimon: a political crony, he was appointed Vice Director-General of the Employment Service, without a tender, but no one took action.

- The position of Assistant Director-General, Planning and Economics: the person filling the position is going abroad on an official task; the position is designated for an employee of the Ministry, which the Ministry administration does not deny. This preference hampers equal and fair opportunity for the other workers who regards themselves as suitable for the position, but no one took action.

- Mr. Amir Barkan: advisor to the Director-General; he was a candidate for Director of the Investments Center, but Mr. Domb's "accomplishments" were preferred.

- As compensation, the position of Director of the Financing Administration was designated for him. In order to clear the way for him, all ten internal candidates were rejected yesterday by the Tender Committee, in which the Director-General participated. Most had an academic Master's degree, are graduates of the attache course and other courses, and all have rich practical experience.

- The position of Director of the Development Areas Administration is in the search committee: we wonder who among the "special cronies" will receive this position, after the rejection of some 15 candidates in the internal tender, from among the most worthy and best in the Ministry, but no one took action. The legality of this process must be examined. Additionally, the appointments and contractual arrangements with external advisors, including a number of former Director-Generals, also must be examined. A recent examination revealed that the annual cost of these advisors is about NIS 50,000,000, when professional and suitable manpower is to be found within our Ministry. All of the above is from the workshop of our "junta," and the way is open for more.

The response of the Ministry of Industry, Trade, and Tourism that was given to the State Comptroller: On September 5, 2004, a few days after the complaint was submitted, the Director-General of the Ministry of Industry, Trade, and Tourism, Raanan Dinur, gave over his response (the response of Minister Olmert). Here it is, verbatim:

Re: Rejecting candidates in internal tenders in the Ministry of Industry, Trade, and Tourism

I received a copy of the Workers' Committee letter to you (and to the Movement for Quality Government), and I wish to relate to what is claimed in it, and to add factual information. I emphasize that there is no factual basis to what is claimed by the Workers' Committee. Of all the tenders for senior positions (a total of 37) that were issued from the beginning of MK Olmert's term in office as Minister of Industry, Trade, and Tourism, good and qualified individuals were chosen for these positions, most of them from among Ministry workers (33), and a minority from other government ministries (4). For your convenience, attached is a detailed list of appointments in the Ministry of Industry, Trade, and Tourism, including those mentioned in this letter, divided into categories as follows:

1. candidates chosen in internal tenders.

2. appointments from within other government ministries.

3. external advisors.

4. appointments in units connected to the Ministry. 5. search committees and internal tenders in the process. The Ministry of Industry, Trade, and Tourism management totally rejects the claims raised in the Workers' Committee letter, and its contents and style. The Workers' Committee undoubtedly viewed the "Hanegbi affair" as a opportunity to raise claims concerning appointments, even if those claims bear no relation to the facts.

MK Polishook: To Publish the Report in the Next Few Days Chairperson of the Knesset State Control Committee and Coordinator of the Headquarters of the Battle against Corruption of Hetz (the Secular Faction) MK Meli Polishook, in response to Nfc's scoop: "I ask of the State Comptroller to make a maximal effort to publish the full report in the next few days, even before the election. The Israeli public must know just for whom it is voting."

[My comment (Y. Y.): The State Comptroller examined the complaint, as well as the response. The best examiners in the State Comptroller's Office conducted a comprehensive examination that took more than a year. In light of the gravity of the findings, the Comptroller recently decided to issue a special report. Even if some of the claims of the Ministry of Industry, Trade, and Tourism Workers' Committee are proven to be unfounded, the fact that the Comptroller saw fit to issue a special report attests to the severity of the new affair revealed here.]

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