Senior Kadima officials estimate that Finance Minister Abraham Hirchson will not remain in office for much longer due to the suspicions of embezzlement against him in the current police investigation. Hirchson, however, is permitted by law to stay in office until he is indicted.

Police are investigating whether Hirchson used NIS 5.65 million embezzled from Nili, a non-profit organization associated with the Histadrut national labor federation, to finance political activity in the Likud Party, of which Hirchson was a member before joining Kadima. Police believe the money had been transferred to Hirchson in person in envelopes by couriers.

Hirchson, a close ally of Prime Minister Ehud Olmert, was questioned under caution for seven hours Tuesday by the police financial crimes unit, who suspect Hirchson of fraudulent gain under aggravating circumstances, theft by a director, fraud, breach of trust and forging documents. Police intend to summon the finance minister for additional questioning. Hirchson's son Ofer and former Nili director general Yitzhak Rosso have also been questioned under caution.

	Advertisement

The investigation into Hirchson had little impact on the treasury, where work centered yesterday on the 2005 report by the finance ministry wages director. A senior official at the treasury told Haaretz the investigation "did not affect the treasury in the least bit." The official said that "all the workers are going about their jobs as usual, and we are carrying on as before until we are instructed otherwise. After the questioning is over, the minister will come back to the office and carry on as usual."

The official was proved right when Hirchson returned to his chambers after the prolonged questioning to deal with the general strike expected today. He held a press conference on the subject in which he refused to answer questions regarding the investigation against him.

"I gave my answers to the police. I am now running the treasury, and will go on doing so," Hirchson said.

Hirchson is considered one of the closest and most loyal supporters of Prime Minister Olmert within Kadima. His implication is therefore a personal blow to Olmert as well as a political one. It is estimated that Olmert will back Hirchson as he did in the case of former Justice Minister Haim Ramon, who had to resign after he was indicted last year
for performing an indecent act.

Olmert and his associates have refused to comment on Hirchson's possible replacement, but Kadima officials have begun naming possible successors. Among them is Minister of Internal Affairs Ronnie Bar-On, who is also considered one of Olmert's closest allies. Housing Minister Meir Sheetrit has also been mentioned as a candidate, along with Haim Ramon, who can be nominated only if his conviction is overturned.

In relation to the suspicions against Hirchson, police believe that Ovadia Cohen, who served as Nili chairman from 2000 to 2003 and is currently the deputy mayor of Ramat Gan, knew of Hirchson's alleged embezzlement and may even have been involved, but failed to tell police about it during questioning.

Cohen himself has confessed to embezzling roughly NIS 5.5 million, saying he gave the money to his brother to help him pay off debts. Cohen's brother has also been arrested in connection with the affair.

The police and state attorney were looking into the possibility of making Ovadia Cohen a state witness against Hirchson, but no such deal has been signed. Police say Cohen was not made a state witness because they had gathered enough evidence against Hirchson to support the allegations.