Police have opened an investigation into reports that a group of Kiryat Malakhi residents have been urging homeowners not to rent or sell apartments to Ethiopian Jews, Attorney General Yehuda Weinstein announced yesterday.

He said the probe was opened a few days ago, immediately after media reports on the issue first appeared, because if true, such behavior could constitute incitement to racism.

"It's a fundamental axiom that a democratic society cannot tolerate displays of demeaning behavior, hatred or hostility stemming from the color of a person's skin or his being of a certain [ethnic] origin," Weinstein wrote to Culture Minister Limor Livnat, who had asked him to look into the criminal aspects of the matter.

But community activists said that the problem was not confined to Kiryat Malakhi; similar racism can be found throughout the country.

The Knesset Immigration Committee also discussed the issue yesterday, and Kiryat Malakhi Mayor Motti Malka infuriated town residents - many of whom watched the session via the live broadcast on the Knesset Channel - by saying he hadn't been aware of discrimination against Ethiopians until he saw the media reports earlier this week. At that point, he said, he ordered a criminal investigation.

Residents charged that Malka was actually well aware of the discrimination, but preferred to ignore it. That claim was bolstered by Chief Superintendent Ofer Messing of the Southern District Police, who told the Immigration Committee that police had been aware of racism in the city long before it hit the headlines, having received many complaints from residents. He said the police were investigating the complaints.

One resident, Avi Yalu, said that at a meeting three months ago on the city's building plans, community representatives told Malka that Ethiopians were being barred from new apartments, and that he had to do something. But nothing happened.

Avi Tenza, one of the organizers of Tuesday's antiracism demonstration in the city, agreed.

"We tried to speak with the mayor long before the demonstration, so he wouldn't say 'I didn't know,'" Tenza said. "We came to his office to speak with him, 50 residents. Half of us had tried to buy an apartment and had not been allowed, so we got up, one after the other, and told him, 'It has happened to me, too.'"

Both men said the problem was that one contractor has a virtual monopoly on selling the new apartments, and he's a friend of Malka's.

The contractor, Yaakov Vaknin, declined to comment on his relationship with Malka, but insisted he sells "to anyone who's willing to pay."

Tenza says otherwise. When he tried to buy an apartment five months ago, he said, the agent initially refused to even quote him a price, telling him he couldn't afford it. Then, when Tenza insisted, he said it cost NIS 980,000.

"Only when I found out from neighbors who had already bought an apartment and weren't Ethiopian that they had paid NIS 740,000 for the same unit did I understand that he simply didn't want to sell to me," Tenza said.

Tenza then went back to the agent, who offered him something more "suited to his means" - a "rotting apartment in an old building that's unfit for anyone to live in." When Tenza insisted he wanted the new apartment, the agent said he "wasn't suitable for that building."

Nor is the problem confined to housing, Tenza said: The nursery school his 3-year-old son attends, where he is one of only two Ethiopian children, "tried in various ways to get me to remove him."

Malka also told the committee that 20 percent of Kiryat Malakhi residents are Ethiopian, but while the city works "night and day" to integrate them, "the government isn't doing a thing to absorb them as equals."

Meanwhile, in his first public statement on the matter, Prime Minister Benjamin Netanyahu said he had ordered his adviser on Ethiopian immigrants "to work to end" displays of racism against them. Such racism "has no place in Israeli society," he said. "The ingathering of the exiles, from Ethiopia and the rest of the world, is an inseparable part of Israel's essence."

Netanyahu added that he greatly admired these immigrants, who overcame "obstacles and difficulties" to come here and are now "integrating into Israeli society."