Police Recommend Bribery Charges Against Former PM Ehud Olmert in Holyland Affair

Olmert suspected of having received hundreds of thousands of shekels in exchange for his political influence as Jerusalem Mayor and Industry and Trade Minister.

Police announced yesterday that they will recommend indicting former prime minister Ehud Olmert on charges of accepting a bribe, fraud and breach of trust in the so-called Holyland affair.

Investigators said they also have evidence against numerous other officials involved in the case.

holyland - Tal Cohen - Aug 24 2010
Tal Cohen

Olmert allegedly received kickbacks totaling hundreds of thousands of shekels from real estate developers who sought to curry favor with him during his terms as mayor of Jerusalem and industry and trade minister.

Police suspect that Olmert transferred the money he received from the developers to his brother, Yossi Olmert, who currently resides in the United States. The Olmert brothers allegedly received the money via a middleman who has turned state's evidence, whose name is under a gag order.

Investigators also suspect that Olmert received numerous gifts from the witness, including cigars and pens.

In exchange for the bribe, Olmert allegedly used his influence as Jerusalem mayor, and later as industry and trade minister - a portfolio that includes control of the Israel Lands Administration - to advance the developers' construction projects.

Police suspect that officials in the Jerusalem municipality worked to changed zoning laws, significantly expand building permits to enable more apartments to be built, slash betterment taxes levied on the contractors, strike down any objections to the Holyland project raised by residents and expedite the project's approval by the planning and building committee.

Police also recommended that Olmert's former bureau chief, Shula Zaken, be indicted for taking a bribe. Zaken is thought to have received hundreds of thousands of shekels from the state's witness, which she allegedly deposited in bank accounts belonging to her relatives. She allegedly received gifts as well, including an expensive bag, jewelry and furniture.

In addition, investigators recommended charging several other officials who allegedly took bribes from the developers of numerous real estate projects, including the Holyland complex, Jerusalem's Gazelle Valley project, the Manara Cliff tourism project (which was never built ), the Ayalon Park project and properties owned by Israel Salt Industries.

Police say that businessman Hillel Charney, one of the owners of the Holyland and Manara Cliff projects, paid bribes through both the state witness and Meir Rabin, the brother-in-law of former ILA director Yaakov Efrati, another official whom police recommended indicting. The money was intended to curry influence with officials in both the Jerusalem municipality and the ILA.

Avigdor Kelner, a businessman and shareholder in the company that built the Holyland project, and Danny Dankner, the former chairman of both Bank Hapoalim and Israel Salt, are also suspected of paying bribes to further their business interests.

Among those suspected of receiving bribes are Olmert's successor as Jerusalem mayor, Uri Lupolianski; Uri Sheetrit, who served as Jerusalem's city architect from 2001 to 2006; former Jerusalem deputy mayor Eli Simchayof; and Yehoshua Polak, another former deputy mayor who also served as the chairman of the city's planning and building committee.

Efrati, the former ILA director, is suspected of fraud and breach of trust, while Dankner is suspected of paying Efrati's brother-in-law, Rabin, over NIS 1 million to promote Israel Salt's business interests with the ILA.

Police said they did not have sufficient evidence to support charges against either Olmert's friend and former lawyer, Uri Messer, or the head of the regional planning and building committee, Mati Hota.

Amir Dan, Olmert's spokesman, slammed the police yesterday for the "scandalous" decision to bar publication of the key witness' identity.

"Olmert stated in the clearest possible terms that he has never taken a bribe, either directly or indirectly," Dan said. "It's not surprising that after months in which the police generated tendentious headlines, they lack the courage" to reveal the witness' name.

Eli Zohar, the former premier's attorney, told Israel Radio that he accepts the police recommendation, but expressed hope that the State Prosecutor's Office would not "be led astray" by the police.

"All of Olmert's criminal cases began as bribery cases," Zohar said. "Most of them were closed; three of them turned out to be fraud and breach of trust cases. The bottom line is that I'm waiting like everybody else to see where the State Prosecutor's Office will go with this and how this affair will end."