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A Russian-Israeli business tycoon, one of the types dubbed oligarch, wanted to buy a government company undergoing privatization. Governmental, intelligence and police authorities looked into his candidacy. They decided to disqualify him.

Wonder of wonders, a few hours after the decision was made, even before the man had been officially rejected, the oligarch withdrew his candidacy. Some of the people who had looked into the matter wonder if it was coincidence, or if a contacts in government, police or intelligence had leaked.

The State of Israel has always been forbearing to money-laundering. It did pass a law banning it and even set up at authority to fight it, which it has been doing diligently. But the general sentiment has not changed and it refuses to shun money from dubious sources.

The ones creating the sentiment are Israel's leaders. Knesset member Shimon Peres, one of the most important parliamentarians in the history of Israel, has not refused an NIS 35,000 donation from Vladimir Gusinsky, though Gusinsky has been suspected of money-laundering. Gusinsky's lawyer and associate, attorney Zvi Hefetz, is the incumbent ambassador to England, though he too has been questioned on suspicions of involvement in money-laundering (failure to report millions in transfers). Hefetz has never been convicted of anything and he is innocent unless proven otherwise. But is it really right for a person suspected of involvement in money-laundering to hold the lofty title of ambassador, our envoy to one of the most important countries in the world to boot?

Even acting prime minister Ehud Olmert takes pride in his relationship with Arkady Gaidamak, another Russian tycoon suspected of money-laundering.

Given how warmly politicians embrace people suspected of laundering cash, it's little surprise that once every few years an Israeli bank is suspected of colluding in money-laundering. A few years ago it was Bank Leumi Switzerland and latent Bank Discount of New York. With an embrace like that, little wonder the Jewish Agency does not dream of rejecting Gaidamak's $50 million donation.

It is a double message: just two weeks ago the cabinet approved a strategy to strengthen enforcement of anti-money laundering regulations. At the same time the people suspected of crime are openly sitting in the salons of the biggest political names. No wonder enforcement in Israel is having grave trouble.

Yet everybody knows that money-laundering is breath of life to organized crime. Drug dealers earning millions from their illegal occupation cannot drive a Mercedes and live in a castle without an explanation for their wealth. The gains of crime are worthless unless they can enable them to live openly in opulence and the way they can achieve that is by laundering the money. Meaning, the means is the end: laundering enables criminals to reap the fruits of their evil.

In the advanced world, money-laundering is treated as one of the worst crimes there is, and it is fought with according vigor. People are required to divulge the source of their money and if they cannot reasonably do so, their property is seized. The concept is that a person should not have a problem explaining how he lives and if he does, he has reason. In Israel, anybody can openly declare "I'm a multimillionaire and it's none of your business why."

Elsewhere, the landlord of a flat rented out and used for prostitution may lose the apartment, on the grounds of abetting the crime. Israel has a law like that but we can assume that if was enforced, every landlord in the land ignoring the bars on the windows and mysteriously high number of girls populating the apartment would take note. It certainly would help reduce trafficking in women. But nobody has ever exercised that clause in the law, nor seriously tried to stop the traffic in women, and the result is glaring. Israel has become a superpower in that.

Things could be otherwise, but the leaders must serve as examples. They should not drape their moral mantle over the shoulders of people suspected of laundering money. But they do.