Inside Intel / Friends in High Places

Businessman Aaron Frankel continues to draw fire, this time for his dealings in Croatia. Frankel is Croatia's honorary consul in Jerusalem, and his name has been linked to the purchase of 47 dunams in the historic holiday city of Dubrovnik on the Adriatic coast. The Croatian weekly Globus had reported that the city's new mayor, Andro Vlahusic, asked the country's attorney general to look into the circumstances of that deal.

Frankel is married to Maja Brinar, a former Croatian deputy minister of commerce. The two, with the help of the former Croatian minister of commerce, Davor Stern, met with Dubrovnik's then-mayor, Dubravka Suica. Last May 5, the municipality signed an agreement with a company Frankel owns for the sale of a plot of land for 360 thousand euros. The weekly says it was an "outrageously" low price and asserts it was a "dubious deal." The plot is adjacent to an area of a projected golf course and luxury tourism site. Frankel bought the adjacent area from a local businessman two years ago.

The deal was made just before municipal elections. Unfortunately for Frankel, Suica lost the elections, and Andro Vlahusic replaced her. The new mayor began examining past contracts and discovered Frankel's. "The former mayor," he told the weekly, "was a stepmother to the city and a true mother to some chosen investors, never mind where they come from." Suica denied any wrongdoing and noted that Vlahusic himself had met Frankel and his wife shortly before the elections. She wondered why they met and what they discussed.

Years ago Frankel owned a failed halva plant in Bnei Brak, and his name popped up in the press in Israel such as the reports on his wedding at a deluxe hotel in Monte Carlo to the Croatian deputy minister in 2004. Major Labor Party figures were invited guests, including Shimon Peres, Haim Ramon, Benjamin Ben-Eliezer, Dalia Itzik and other friends. Frankel chartered a plane to fly them to the wedding and put them up in a hotel.

Then Frankel's name emerged in connection with the mega deal involving Israel, Russia and China for the sale of Phalcon early-warning aircraft. Frankel, who befriended the then director general of Israel Aerospace Industries, Moshe Keret, was the aeronautical industry's agent in Azerbaijan and Russia. Through his mediation, a Russian Ilyushin plane was flown to Israel, and IAI installed sensitive intelligence equipment. The plane was destined for the People's Republic of China, but the deal fell through because of pressure from the United States. Instead, IAI signed a similar, but much bigger deal, to sell early-warning equipped planes to India.

Frankel's close ties with IAI yielded tens of millions of dollars. Several years ago the State Controller's Office published a report about the Ilyushin deal with Russia and found numerous irregularities and suspicion of criminal activity. Subsequently the Israel Police launched an investigation that focused on Keret, but it produced nothing, and the file was closed.

Frankel's spokesman said in response that the property in Dubrovnik was purchased legally in accordance with a tender and the winning bid was higher than the assessment that an independent legal source gave the Dubrovnik municipality - this was the finding of the Croatian authorities when they checked into the deal - but "to our regret we were caught in a struggle between the incoming and outgoing mayors and this, despite the fact that we acted without blemish."

The successor

Hezbollah has appointed Mustafa Badr al-Din as head of its external operations, reports the journal Intelligence Online in its new issue. Until now al-Din commanded the movement's military arm and was an adviser to Secretary General Hassan Nasrallah.

Badr al-Din is the brother-in-law of the late Imad Mughniyah, who was killed in Damascus a year and a half ago, and it's not surprising he was named the organization's supreme military commander. His appointment follows three stinging failures for Hezbollah's external operations. First, there was the attempt to detonate bomb-laden cars near Israel's embassy in Baku, Azerbaijan. Two Hezbollah activists were arrested, and their ties to Iran's Revolutionary Guards were exposed. The second failure was in Egypt, where a network of Hezbollah operatives was exposed, and the third was in Colombia, where three Lebanese drug dealers are standing trial for paying a commission (12 percent of their profits) to Hezbollah.

According to the Intelligence Online report, Abdul Hadi Hammade, who until now commanded Hezbollah's secret Position 71, a special forces unit that engages in counter-intelligence and internal security, was appointed al-Din's assistant. That unit reportedly helped to uncover the alleged spy rings arrested in Lebanon over the last few months.

And, finally, a question to Defense Minister Ehud Barak: Doesn't the defense minister think that the recent events in Iran require he change his decision and now keep the tiny unit in his office that monitors developments in Iran? Recently Barak decided to close that unit headed by Uri Lubrani.