Ehud Olmert
Former Prime Minister Ehud Olmert. Photo by Michal Fattal
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Attorneys for former Prime Minister Ehud Olmert announced on Sunday that their client has repaid a loan he obtained 18 years ago from a friend, U.S. businessman Joe Almaliah. The announcement followed remarks by State Prosecutor Moshe Lador in an interview in Friday's Haaretz Magazine.

In the interview, Lador termed the story of that loan "extraordinarily scandalous" and said, "I've never heard of loans like that." Lador said that Olmert had never repaid the loan.

Olmert spokesman Amir Dan declined to comment on Lador's remarks. But yesterday Olmert attorneys Eli Zohar and Navot Tel-Zur told Lador and Haaretz in a letter that the state prosecutor's comments "seriously damage Olmert's reputation" because the loan was repaid in full (both the principal and the interest ) in July last year. They said the discharge of the debt was reported to the state comptroller and the court.

Zohar and Tel-Zur demanded an apology on Olmert's behalf and a payment to an agreed-on "public cause." Olmert was never questioned by the police about the loan, which was not included in any of the corruption indictments against him.

The loan affair was disclosed in Haaretz Magazine in July 2008.

In late 1992, Almaliah gave $75,000 to Olmert, then a Knesset member and Jerusalem mayoral candidate. Almaliah's reputation in Israel was tarnished in the early 1990s after he received hefty bonuses from foundering public companies in which he was a major shareholder.

He and Olmert were friends; Olmert was named to the board of one of Almaliah's companies, while the art-loving businessman once boasted of owning 15 paintings by Aliza Olmert, the former premier's wife.

In March 2003, then-State Comptroller Eliezer Goldberg asked Olmert to submit the wealth-declaration statement required of all cabinet members. Olmert, who had recently been appointed acting prime minister and minister of trade and industry, told Goldberg that he had received the loan from Almaliah a decade earlier but did not say when it was due.

Goldberg asked Olmert to supply details about the debt and about Almaliah's occupation and his relationship with Olmert.

In 2004, after a long correspondence, Olmert provided the information to Goldberg and stressed that Almaliah had never requested payment of the loan. At Goldberg's insistence, Olmert eventually signed a contract with Almaliah undertaking to repay the loan in January 2009.

According to an indictment issued against Olmert by the Jerusalem District Court, the former prime minister concealed from the state comptroller the receipt of an additional $100,000 from Almaliah that he deposited into his personal bank account, "with the intention of deceiving the comptroller and concealing from him the true nature of his relationship with Almaliah."

Officials in the state prosecutor's office said yesterday they were not aware of Olmert's repayment of either of the two loans from Almaliah.