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Last update - 22:38 07/09/2008
Police sift through web of corruption to amass evidence against Olmert
By Jonathan Lis, Haaretz Correspondent
Tags: Shula Zaken, Morris Talansky 

Bribery, breach of trust, fraud, money laundering-related crimes - these are among the charges that appear in the police recommendation issued on Sunday to indict Prime Minister Ehud Olmert. The announcement is the culmination of a months-long investigation against the premier over his involvement in the "cash envelopes" and "Rishon Tours" affairs. How did these investigations, which led to Sunday's dramatic announcement, begin? What pieces of evidence were gathered?

Morris Talansky's name first appeared on the police radar after investigators pored over documents printed from the hard drives of computers in the Ministry of Industry, Trade, and Labor, which Olmert headed as minister during the Sharon administration. At the time, police were investigating Olmert's involvement in alleged instances of patronage and cronyism in the ministry's Investments Center.

In examining the documents, police discovered an improper financial relationship that Olmert maintained with Talansky, an American businessman and fundraiser. A close business associate of Olmert, attorney Uri Messer, and his confidante and former chief of staff, Shula Zaken, were also linked to the case. As evidence, investigators have relied on diaries kept in the ministry during Olmert's stewardship.
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This past April, the attorney general gave the go-ahead for an investigation into what would become known as "the Talansky affair", or "the cash envelopes affair". The evidence gathered during the probe subsequently led to an additional investigation against the premier in what was dubbed "the Rishon Tours affair".

Olmert, who was questioned by investigators six times in connection with both cases, denied the charges against him, though he was not able to refute the allegations. Police also took statements from a number of the principles involved in the matter, some of whom were questioned under caution.

Police confiscated incriminating documents after conducting searches of Messer's offices, government ministries, the Rishon Tours travel agency, aviation companies, communications firms, banks, the Knesset, the Jerusalem municipality, and other locations. A delegation of officers also amassed evidence in the United States.

During the investigation, Talansky, who has yet to return to Israel from the U.S., submitted a pre-trial deposition that has yet to be completed. Police officials took this into account in their final summation of the evidence gathered thus far.

According to evidence gathered by investigators, Talansky transferred significant sums of money through various channel to Olmert on numerous occasions since 1997. Some of the money was given illegally and in cash payments. Olmert received the money during various phases of his political career, during which he served as a member of Knesset, a government minister, mayor of Jerusalem, and acting prime minister.

During the period of time spanning their relationship, investigators also became aware of Olmert's efforts to promote Talansky's business interests, using his numerous public positions as a platform. The probe revealed that Messer stashed away large amounts of cash totaling hundreds of thousands of dollars in reserve for Olmert. Initially, the money was kept in a safe in Messer's office as per a special request from Olmert and Zaken. The cash was later moved to a safe at a Bank Leumi branch.

Police discovered that Zaken handed Messer the cash for safe keeping. From time to time, Messer was asked to transfer certain sums of money to either Zaken or Olmert. On a number of occasions, Messer converted the dollars to shekels and subsequently handed the money to either Zaken or Olmert.

In the Rishon Tours investigation, police say Olmert charged excessive sums of money from charities and non-profit organizations, using the extra cash to fund personal trips abroad for himself and his family between 2002 and 2006. Through his aides and employees of the Rishon Tours travel agency, Olmert would present fictitious invoices to the organizations, who would then pay the fee listed on the document.

Among the organizations that police say were defrauded were Friends of the Israel Defense Forces, Yad Vashem, Akim, and Aleh. Olmert amassed tens of thousands of dollars in excess funds, which were kept for him at the Rishon Tours travel agency. Police investigators say they can prove that Olmert was directly involved in issuing directives to his underlings and that the double-billing was done with his knowledge
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