The Austrian bank BAWAG (Bank fur Arbeit und Wirtschaft), through which large sums of money were transferred to the Sharon family, has business interests in Israel and the Middle East. Among other things, it is a part-owner, together with Austrian businessman Martin Schlaff, of the Jericho casino. And the Israel Police are now considering the possibility that the bank itself was behind some or all of the money transfers to Prime Minister Ariel Sharon's family in 2002.
Schlaff's business interests in Israel are well-known, and it is no secret that police are looking into his ties with the Sharon family and whether he had any connection with the transfers of money from Austria to the Sharons. But the fact that BAWAG is also heavily invested in projects that Prime Minister Ariel Sharon has the power to help or hurt emerged only recently.
BAWAG owns at least 10 percent, and perhaps more, of the Oasis Casino in Jericho. Thus the bank, like Schlaff, is eagerly awaiting the moment when Sharon will give a green light for the casino to reopen. Before the intifada shut it down, the casino earned hundreds of millions of dollars for its owners. The owners have a franchise to run the casino until 2028, with all income being tax-free for the first 10 years. Furthermore, during the period of their franchise, they are the only people entitled to operate casinos in the Palestinian Authority.
All of the mysterious money transfers to the Sharon family have passed through BAWAG. In January 2002, a British businessman living in South Africa, Cyril Kern, opened an account there, from which $1.5 million was sent to Sharon's son, Gilad, ostensibly as a loan. In November 2002, after Gilad Sharon learned that the police were following the money trail, he received two additional money transfers from BAWAG, also totaling about $1.5 million. Using this money, the younger Sharon repaid a loan from Israel Discount Bank for which the Cyril Kern loan had served as collateral, and then repaid the Kern loan to the account in BAWAG.
Why were all these transfers via BAWAG? One possibility is that whatever business interests were behind the Kern loan were also behind the November transfers - and thus essentially helped Gilad Sharon repay a loan that they themselves had given him. Another possibility is that the bank itself is connected in some way to these transfers.
Schlaff, in addition to his interest in the Jericho casino, is also heavily invested (along with other Austrian partners) in a floating casino off Eilat, called the Cancun. The ship is currently anchored outside of Israel's territorial waters and is not operative, and Attorney General Elyakim Rubinstein has announced that he opposes allowing it to open for business.
Additionally, Schlaff has been trying for years to set up a casino in Israel. Over the last year, the Prime Minister's Office has invested a great deal of staff work in a proposal to legalize gambling in Israel.
Since Sharon was elected, Schlaff has visited him at his ranch several times.
BAWAG, which has many join ventures with Schlaff - for instance, the two joined with two other Austrian businessmen last year to purchase a Bulgarian cellular telephone company - was at one time represented in Israel by Shimon Sheves, who served as director-general of the Prime Minister's Office under Yitzhak Rabin. Sheves looked out for the bank's interests while the casino was being built; he now represents other business interests in Austria. Sheves is a close friend of Prime Minister Sharon's bureau chief, Dov Weisglass; the latter represented Sheves during a lengthy criminal trial, which ended in his acquittal. Weisglass's law office also represented Sharon over the years in various cases and it represents Schlaff's interests in Israel, and until he became Sharon's bureau chief, Weisglass handled Schlaff's business personally.
On the eve of the 2000 elections Weisglass and Sharon's son Omri met with Mohammed Rashid, who is both Palestinian Authority Chairman Yasser Arafat's financial advisor and Schlaff's partner in the Jericho casino. All three deny that the casino was discussed at that meeting.
All in all, the web of connections between Austria and Israel has been giving the police headaches, and police continue to believe that permission to depose witnesses in Austria is essential to unraveling the mystery.
BAWAG's response to this report could not be obtained last night.
Michael Nikbakhsh of Profil contributed to this report.