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The "gifts affair" in which President Moshe Katsav is accused of using some NIS 30,000 in state funds to pay for personal gifts to family members, was revealed to the public only on Sunday, when police made their recommendations to the attorney general.

Police said they have accumulated sufficient evidence for Katsav to be charged with fraud and breach of trust.

Police said Katsav dipped into an office fund for gifts at official events to purchase about 60 silver goblets, worth an estimated NIS 500 each, for family members over the last few years.

Sources close to the case said the gifts affair was considered a relatively minor issue, but indicates that the president acted improperly. They said Katsav argued that he did not know such use of state funds was inappropriate.

"This is a strange affair that arose during the investigation and we couldn't ignore it," one of the sources said.