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The Petah Tikva District Court on Friday rejected an appeal submitted by former Jerusalem mayor Uri Lupolianski, requesting to abort his five-day remand for alleged involvement in the Holyland case.

The court upheld Lupolianski's detention on the grounds that the former mayor could try to disrupt the police investigation once out of custody.

The Rishon Letzion Magistrate's Court on Thursday lifted its gag order on the identity of the 'senior official' suspected of taking bribes in the Holyland case, revealing the suspect to be none other than former prime minister Ehud Olmert, who served as mayor of Jerusalem from 1993-2003 and is already standing trial in three unrelated corruption cases.

In the new case, Olmert is suspected of taking at least NIS 3.5 million in bribes in exchange for furthering development of the Holyland luxury housing project in Jerusalem.

He will soon be questioned by the police in this case, which is being termed the biggest corruption scandal in the state's history. Police say the suspicions against him are grave and well-founded.

Olmert is suspected of having taken bribes both as mayor of Jerusalem and as industry, trade and labor minister, a post he held from 2003-2006. As industry minister, he presided over both the Israel Lands Administration and the Small Business Administration.

Police suspect that Olmert used his position as mayor in the 1990s to get municipal officials, both elected and appointed, to approve the Holyland project in the format requested by the entrepreneur, businessman Hillel Charney. Among other things, Olmert allegedly helped to secure the project's approval by the local planning and building committee and to remove various other bureaucratic obstacles.

Charney allegedly continued bribing Olmert after the latter moved from the mayor's office to the Industry Ministry. In exchange, police suspect, Olmert, in his role as head of the ILA, got senior ILA officials to remove hindrances from the path of another Charney real estate project - the Tzuk Manara project in the Galilee Panhandle.

In addition to Charney, Olmert is also suspected of taking indirect bribes from another businessman, Avigdor Kelner, who is currently under arrest. In exchange, Olmert allegedly used his role as head of the ILA to help Kelner advance plans to build a residential housing project near the former Hiriya dump in central Israel.

Attorney Uri Messer, a close friend of Olmert's, allegedly served as the main conduit for the bribes, with Olmert's former bureau chief, Shula Zaken, serving as a secondary conduit.

Police suspect that some of the bribe money Olmert allegedly received from Charney came in the form of financing for his legal expenses in an earlier case, involving the use of fake invoices in the Likud's 1988 election campaign. Olmert, who later switched to the Kadima party, was Likud's treasurer at the time, but was ultimately acquitted in that case.

The Holyland bribes were allegedly paid in the form of checks made out to "self" and endorsed by the payer, which enabled them to then be deposited in any bank without leaving a money trail. Police suspect that the checks were usually given to Messer, ostensibly for "legal services," and that most of the money was then transferred to Olmert, with Messer retaining a small portion for himself.

A source who has seen some of the evidence in the case said it appears to be solid and will requiring convincing explanations from Olmert. In contrast to the case of the cash-filled envelopes Olmert is currently on trial for (allegedly receiving the envelopes from American Jewish businessman Morris Talansky) this one is not based on one witness' potentially unreliable memory, but on "real material, on documents and documentation," the source said.

The source added: "Material of the kind the police and prosecution may not have managed to obtain in the Talansky case are present in abundance in this case."