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Businessman Gregory Lerner, who served nearly five years in prison for defrauding Russian banks of tens of millions of dollars, was convicted Sunday of fraud, money laundering, and forgery in a "sting" operation that was to have netted him more than $1 million.

Lerner, 54, of Ashkelon, was found guilty under a plea bargain in the Tel Aviv District Court.

He was accused of manipulating two businessmen into investing in imaginary petrol ventures. Lerner accrued more than $1 million in the sting.

The offenses occurred in 2003-2004, just after Lerner was released from prison in an earlier fraud case. In the initial case, he served four and a half years for defrauding Russian banks of $50 million, as well as forgery, and bribery.

According to the indictment, Lerner, who was the owner of several local and foreign companies, produced a contract between his company "Israel Pacific Petroleum Ltd." and the Swiss "Petrobel" firm, which deals with Russian oil products.

Using this document, Lerner raised just over $1 million from businessmen Simeon Svelikin and Oscar Katzenelson, with no intention of investing these funds.

The plea bargain stipulates that Lerner compensate the investors, but no amount has yet been specified.