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During her tenure as foreign minister, Tzipi Livni advised the Palestinian Authority to reject then-prime minister Ehud Olmert's proposals for a peace agreement, former U.S. ambassador to Israel Martin Indyk said on Thursday.

"The prime minister was about to have an indictment filed against him and the foreign minister herself specifically told both the Americans and the Palestinians: Don't you dare sign the agreement," Indyk said, during a panel discussion at President Shimon Peres' Presidential Conference in Jerusalem.

He made the comment the panel's facilitator, Channel 2 reporter Udi Segal, asked whether the Palestinians had missed an opportunity in rejecting Olmert's peace offers.

Livni on Thursday denied Indyk's appraisal, telling Army Radio she had not been involved in the discussions between Olmert and Palestinian President Mahmoud Abbas.

"I wasn't party to the Olmert-Abbas contacts, and only once the proposal was released did I publicly say that it was unacceptable to me," said Livni. "There was no need to speak behind Olmert's back.

The opposition leader added that she had objected to the clauses in the proposal which would see thousands of Palestinian refugees returned to Israel, as well as a transfer of Jerusalem to international control."

Indyk, who served as ambassador in 1995-1997 and in 2000-2001, was not an official in the Bush administration at the time of Livni's alleged warning.