Olmert's Company Pocketed $1.25 Million From U.S. Tycoon's Peace Foundation

Former prime minister was generously compensated by his friend, billionaire Daniel Abraham, for addressing American audiences.

Uri Blau
Uri Blau
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Former Israeli Prime Minister Ehud Olmert (2nd R) waits to hear his verdict at the Tel Aviv District Court in this March 31, 2014 file photo.
Former Israeli Prime Minister Ehud Olmert (2nd R) waits to hear his verdict at the Tel Aviv District Court in this March 31, 2014 file photo.Credit: Reuters
Uri Blau
Uri Blau

A consulting firm owned by former Prime Minister Ehud Olmert received $1.25 million from a peace institute established and funded by Olmert’s friend, American billionaire S. Daniel Abraham. The data on the transfer of the money – $700,000 in 2012 and $550,000 in 2013 – appears in forms submitted by the S. Daniel Abraham Center for Middle East Peace, in Washington D.C. These amounts constitute a significant percentage of the organization’s entire budget, which was $2.8 million and $2.2 million in each of those years, respectively.

According to U.S. tax laws, Abraham is entitled to a deduction on money he donates to the institute. This means that American taxpayers subsidized the payment to Olmert’s firm. The story broke on the investigative site ProPublica.

The Abraham Center did not disclose the purposes to which the money was put, but in answer to a query on the matter, the center responded that it had “engaged Olmert to promote its mission of resolving the Arab-Israeli conflict by speaking before influential audiences at distinguished institutions throughout the United States.”

It is not known how many lectures Olmert gave for the center, but in its response, the center mentioned 10 organizations before which the former prime minister had appeared, including Columbia and Stanford universities, the Washington Institute for Near East Policy and the McCain Institute for International Leadership. The fee for speaking to each of the 10 institutions would come to $125,000 per lecture.

Amir Dan, Olmert’s spokesman, said in response: “Mr. Olmert is a citizen and an owner of a consulting firm. He files reports on the company’s business to the authorities.’’

Abraham, 90, is the founder of the Slim Fast diet empire, whose fortune has been valued by Forbes at $2 billion. Abraham and Olmert were considered close associates for more than 20 years. When Olmert was running for mayor of Jerusalem in 1993, Abraham contributed nearly 200,000 shekels (about $54,000) to Olmert’s campaign. Abraham’s name popped up over the years in various investigations into Olmert’s dealings.

In 2004, a company owned by Abraham and registered in the Virgin Islands purchased Olmert’s house on Kaf Tet B’November Street in Jerusalem. Because Olmert continued to live in the house, the state comptroller at the time, Micha Lindenstrauss, released a report on the matter on the eve of the 2006 election.

In 2005, when Olmert was finance minister in Ariel Sharon’s government, he was suspected of tailoring a tender to privatize Bank Leumi to benefit his associates, among them Abraham. The case was eventually closed by then-State Prosecutor Moshe Lador. In 2008 Abraham was questioned by police on suspicion of having transferred money to Olmert, a charge Abraham denied.

In April of this year, during Olmert’s investigation on suspicion of obstruction of justice and attempting to influence the testimony of his former bureau chief, Shula Zaken, it was revealed that Abraham had given $50,000 to cover Zaken’s legal fees. Under questioning by police, as reported by Gidi Weitz last Friday, Olmert confirmed that he knew about this, but he said he had not initiated the payment.

The firm to which Abraham contributed millions of shekels, Ehud Olmert Consulting Services, was established in 2009, shortly after he left his post as prime minister. An investigative report published in Haaretz last year noted that since its establishment, the firm’s income stands at approximately 25 million shekels, from Israeli companies and additional, unknown sources.

In April 2013, Olmert traveled to the United States to speak at a synagogue in Palm Beach, Florida, which had been founded by Abraham. When asked by a local paper about Olmert’s legal situation, Abraham replied “That’s all behind him,” adding, “we never lost touch.”

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