A special prosecutor in Guatemala early this month sought to issue arrest warrants against Uri Zoller, Uzi Kislevitz-Shapira of Guatemala and Shimon Yelnick of Panama, and this put the involvement of Israeli arms dealers in dubious or illegal deals back on the international agenda. Once again there are questions about the Defense Ministry's supervision of dealers.
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These Israelis are, of course, not the only ones operating in the world's arms markets. The great temptation of making fast profits on arms deals attracts many mediators, straw men, middlemen and traders around the globe. Most of them are honest businessmen. A minority are swindlers.
Israeli arms dealers, though they come from a small country, are conspicuous in their relatively large numbers and in the many countries that they reach. Their uniqueness lies in the fact that most of them are equipped with permits from Sibat, the Foreign Defense Assistance and Defense Export Organization of Israel's Defense Ministry. These permits are issued only for trade in Israeli arms, but they are used as "authorizations" and marketing promotion.
Israel's arms industries have a reputation worldwide, and arms dealers can use the permits to give the impression of operating on behalf of the State of Israel or at least with Israel's knowledge and approval. That is what happened in the case of Zoller, Kislevitz-Shapira and Yelnick, who claim they acted in good faith, unaware of the illegality of the deal in which they were involved.
The deal entailed the sale of thousands of Kalashnikov assault rifles and ammunition worth $5 million, from Nicaragua to the Panama police, but instead of the munitions reaching their destination, they found their way to the armed militias of drug dealers in Columbia.
The Israeli government had no connection to the deal, except that the three suspects are Israeli citizens who live abroad. Zoller and Kislevitz-Shapira, however, are also authorized agents for Israel Military Industries (IMI), and say they have handled dozens of arms deals between Israeli security industries and countries in South and Central America.
In the meantime, a Guatemalan judge has rejected the prosecutor's petition and refused to issue arrest warrants for the three, but the damage to Israel and its image has already been done. Beyond the ethical issue of whether it is fitting to sell equipment that causes death and aids wars, arms dealers, particularly those who have committed crimes or are at the center of a conflict, give Israel a bad name.
Bribery scandals
A case that did worse damage to Israel's image and harmed relations with the United Nations was that of Lieutenant Colonel (Res.) Shimon Naor-Hershkovitz, a former manpower officer in the navy who, after his discharge from the Israel Defense Forces, became an arms dealer for several Israeli companies. He was arrested in Rumania in August 1999 on suspicion of selling Rumanian arms, using forged documents (end-user certificates, indicating that the arms were intended for Togo) to the guerrilla forces of Dr. Jonas Savimbi, thus violating the sanctions of the United Nations Security Council against arms sales to Angola.
Naor-Hershkovitz was released following guarantees provided by Israel and returned here, in part thanks to the intervention of then deputy defense minister Ephraim Sneh.
In November 2001, a UN investigative committee that was examining the case requested information from Israel regarding Israeli-registered companies owned by Naor-Hershkovitz and his partners.
The Defense Ministry did not bother to assist the UN even though the ministry has a powerful tool at its disposal - the department of the Supervisor of Security at the Defense Ministry (known by its Hebrew acronym, Malmab), which can easily provide such information.
Another example of this pattern of behavior on the part of the Defense Ministry is the case of Moshe Rothschild and Roni Lerner, who received permits from the ministry to sell Israeli arms in South America. Rothschild's and Lerner's names cropped up in reports in the local media over the past year in connection with the bribery case of Vladimiro Montesinos, former head of Peruvian intelligence, who is currently on trial in Lima.
In this case, too, when their involvement and their assistance to the corrupt regime leaders were revealed, the Israeli Defense Ministry did not bother to contact them or clarify why they had become involved. In general, the Defense Ministry takes little interest in the entanglements of arms dealers and agents with permits, and even automatically renews most of their permits each year.
These cases and others attest to the ministry's generally sympathetic approach to arms dealers, whom senior ministry officials prefer to call "arms promoters."
"They promote arms sales," says Major-General (res.) Yossi Ben Hanan, head of Sibat, "and even if there is something indelicate about this, it does not make them arms dealers."
Ever since Ben Hanan became head of Sibat six years ago, he has been aggressively promoting Israeli arms sales and security exports. "Since taking office I have revolutionized this field," he says proudly. "Security exports totaled $1.7 billion dollars back then, and each year I have set a new target and met it."
Indeed, over the past six years contracts for security exports have totaled $14 billion, just over $2 billion per year. In 2002 alone, signed contracts totaled some $4 billion.
Such tremendous sales have made Israel one of the world's largest arms exporters, next to the United States, Britain and France. Sibat has a network of nine emissaries stationed in Washington, Madrid, Bogota, Delhi, Canberra, Seoul, Brussels, Ankara and Berlin (where the emissary is responsible for security exports to the whole of Eastern Europe).
In addition, Israel's military attaches actively serve as arms promoters and marketers for the ministry and Israel's security industries.
Ben Hanan has even managed to recruit other branches of the ministry into promoting and marketing Israeli weapons systems. Two particularly successful branches are the weapons and export infrastructure development administration, headed by Shmuel Keren and Yehiel Horev, who also heads Malmab, and the foreign relations department, headed until recently by Kuti Mor (sources in the security industries fear that Mor's replacement, Major General Amos Gilad, who currently heads the department for coordinating government activities in the territories, will be less attentive to their needs than his predecessor).
Separation stymied
The aspiration to sell as many arms as possible naturally hampers the ability of Sibat and Malmab to closely supervise and reduce the damage caused and likely to be caused in the future. The state comptroller mentioned this point in his report of December 2001, when he recommended that Sibat be denied the right to supervise exports and that the granting of permits be transferred to another department. The comptroller saw a contradiction in the fact that Sibat, which is responsible for the security export process, was also actively participating in it - granting export permits and even marketing and advertising weapons systems. The comptroller recommended separating "the export licensing process from the control and supervision."
Ben Hanan stridently opposed such a move, and it was not implemented. The service to the customer - the weapons exporter - requires his control and involvement in all stages of the process, says Ben Hanan.
"The comptroller's recommendation," said Ben Hanan in a special interview with Haaretz, "was not serious. The representative of the comptroller who composed that chapter of the report did not even take the trouble to speak with me."
Ben Hanan insists that Sibat and the Defense Ministry "have the best supervision and enforcement mechanisms in the state." Among other things, Ben Hanan mentions the supervisor of exports division, headed by Ehud Ben Aharon, which operates out of the office of the ministry's director-general and the Foreign Contacts Coordination Committee, which is composed of representatives from a few of the ministry's departments and branches of the IDF, who voice their opinions as to whether to permit the export of specific weapons systems.
How does Ben Hanan explain the latest scandals?
He feels that the all-over exports speak for themselves. "If throughout six years and thousands of export deals worth tremendous sums, only two slip-ups were found to have involved money-hungry men who decided to violate the rules of the game and sell to forbidden clients, one can conclude that the supervision is successful," says Ben Hanan.
The two slip-ups to which he is referring are those that happened in deals in which Israelis were seemingly involved. One is the export of an American helicopter engine, sold by S.R.S. of Kfar Sava to an Argentinean military division of the peace force in Cyprus without asking the approval of the Defense Ministry. Following a complaint from the Pentagon, Malmab opened an investigation that ended with the filing of charges and court proceedings are continuing at present. The defendant claims that no permit was required, because the engine was civilian, and not military.
In the second case, which is still under police investigation, Avichai Weinstein of Netanya, the owner of PIAD, was arrested on suspicion of selling materiel to Iran. Customs officials in Germany discovered that caterpillar and armored personnel carrier treads Weinstein claimed had been sold to sources in Malaysia and Thailand had been loaded onto a ship bound for Iran.
"I maintain a policy of not renewing the permits of anyone who is in violation of the law," says Ben Hanan, and indeed, Naor-Hershkovitz's permit was not renewed.
The "original sin" is the ease with which a weapons export permit can be obtained. The process entails simply filing an application, and the only criterion required is the absence of a criminal record. Even someone who does not meet that criterion, however, can apply to an appeals board, and there has already been one case in which a man with a criminal past has applied for and received a permit to negotiate arms sales.
The main problem is with some of the Israelis who live abroad and trade in arms, notes Ben Hanan. He says he has tried to make expatriate Israeli arms dealers obtain permits from the Defense Ministry, but it turns out that this is impossible from a legal point of view. Even a modest attempt to involve the Foreign Ministry in the supervision of and control of activities, to order the revocation of Defense Ministry permits from anyone who has abused it and thus damaged the state, has met with difficulties.
The Defense Ministry apparently fears any law, amendment or public debate that is liable to harm or restrict security exports, which in the eyes of many ministry officials are practically of paramount importance
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