Haaretz investigation: NIS 2m deposited in Hirchson's account during Nili fraud

Between 2000 and 2003, the same timeframe as the embezzlement at the Nili non-profit association, over NIS 500,000 (in cash) and NIS 1.6 million (in checks and transfers) were deposited in Finance Minister Abraham Hirchson's Bank Yahav account. The bank also allowed Hirchson to exceed his credit limit by hundreds of thousands of shekels. Then state comptroller Eliezer Goldberg shelved a report on the matter in deference to "the right to privacy."

About a week ago, Hirchson was questioned under caution for about seven hours at the Israel Police's Economic Crime Unit on suspicion of involvement in embezzling funds from the Nili non-profit association. The suspected offenses: fraudulent acquisition under aggravated circumstances, violation of public trust, theft by a director and fraudulent registration of documents. Hirchson is suspected of receiving, from various individuals, money that originated in the Nili association and other associations connected to the Leumit Health Maintenance Organization, and it is suspected that some of the monies were deposited in cash in his different bank accounts.

Hirchson's Bank Yahav account was opened in 1999. According to the account records obtained by the State Comptroller's Office, between January 1999 and December 2002 a total of NIS 585,755 in cash and NIS 1,634,740 in checks and bank transfers was deposited into the account. Still, the account was a bottomless pit. The average balance in that period was NIS -69,755. The largest overdraft was in August 2002: NIS -291,663 without sufficient securities or guarantees. As early as 1999, the bank's internal auditor noted that Hirchson's debit balance exceeded that of other bank customers.

The amounts deposited into the account were not consistent and there was no apparent rhyme or reason to the way they were deposited. For example, in January 2002, cash deposits of NIS 71,340 were made and in April a total of NIS 65,170 was deposited. Cash deposits were NIS 77,970 in October and "only" NIS 19,970 in November. During this period, the deposits in checks and bank transfers ranged from zero to NIS 130,000 each month. The account records clearly indicate that the account was not used for the direct deposit of Hirchson's salary nor any other regular payment.

Goldberg received Hirchson's bank records in the context of an investigation by the State Comptroller's Office in 2003 of suspected irregularities at Bank Yahav, the state-owned bank used by civil servants. When Hirchson covered the overdraft and the bank promised that the problems would be fixed, Goldberg shelved the chapter he wrote about it, citing the "right to privacy."

Bank Yahav Chairman Michael Zoller is a close friend of Hirchson, and once succeeded him as chairman of the Leumit Health Maintenance Organization. A document obtained by Haaretz that was submitted to the bank management states: "The handling [of Hirchson's account - G.W.] by various bank personnel was most irregular." Zoller was also questioned under caution last week.