Comptroller ’Softened' Final Report on Netanyahu’s Expenses

Harsh criticism of senior officials in PM’s office and comparisons with other countries were omitted from 'softened' report into PM's over-spending.

Gidi Weitz
Gidi Weitz
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The Netanyahus in December. The prime minister says certain forces in the press are using the story over Sara's recycling to defeat him and his party.
The Netanyahus in December. The prime minister says certain forces in the press are using the story over Sara's recycling to defeat him and his party.Credit: Emil Salman
Gidi Weitz
Gidi Weitz

The State Comptroller’s Office significantly softened its recent report on spending at Prime Minister Benjamin Netanyahu’s residences, omitting harsh criticism of senior officials in the Prime Minister’s Office for having pressured the office’s legal and financial gatekeepers as well as comparisons to spending by Netanyahu’s American and British counterparts, Haaretz has learned.

The report, released on February 17, revealed a pattern of over-spending at the prime minister’s residences.

The comparisons to spending at the White House and 10 Downing Street did not flatter Netanyahu, according to a person familiar with the draft report.

Some of the material omitted from the final report related to what prosecutors consider to be the most serious incident in the document: The hiring of the Netanyahu family’s longtime electrician, Avi Fahima.

The final report noted that a panel headed by the legal advisor to the Prime Minister’s Office, Shlomit Barnea Farago, had explicitly forbidden hiring Fahima. Ezra Saidoff, the ministry’s deputy director-general, said Fahima was needed to do urgent repairs at the Netanyahu’s private home in Caesarea on weekends and holidays, though in the past, maintenance of the prime minister’s residences was handled exclusively by ministry employees. But the panel said an outside contractor could be hired only if he had no connection to Netanyahu.

Nevertheless, the job was ultimately given to a firm that essentially subcontracted the work to Fahima. Within a very short time, Fahima had earned considerable sums of money doing urgent repairs whose nature was never clearly specified. The work was ordered by Netanyahu’s wife Sara and her staff.

The raw material that was omitted from the report related to attempts by senior officials at the Prime Minister’s Office to interfere with the work of ministry gatekeepers.

In May 2010, eight months after the payments to Fahima were made, Barnea Farago and Yossi Strauss, then the ministry’s accountant, met with the ministry’s then-director general, Eyal Gabbai, to discuss the problematic contract with the electrician and the suspicions it raised. Barnea Farago’s notes on the meeting quote her as saying, “There were rumors that the Netanyahu family’s electrician did work at the house, and now they’re seeking a way to pay him.”

According to her notes, which are now in the Justice Ministry’s possession, she and Strauss also explained to Gabbai that there was no way of supervising work commissioned directly by Sara Netanyahu and her staff or of knowing whether it was truly necessary.

But instead of backing his gatekeepers, Barnea Farago’s notes say, Gabbai responded that he didn’t understand why they had barred Saidoff from hiring Fahima to begin with, nor did he understand why they were paying attention to rumors. “I don’t want to make Saidoff feel he’s not okay,” the notes quote Gabbai as saying.

The next day, the two met with Gabbai again and agreed that Fahima should no longer be employed. But the day after that, Gabbai summoned Barnea Farago to another meeting on the subject along with Natan Eshel, then Netanyahu’s bureau chief. At that meeting, Eshel also asked why hiring Fahima was a problem.

“The holding of this meeting caused me great discomfort,” Barnea Farago wrote in her notes A decision had ostensibly already been made, “so there was reason to suspect the goal of the meeting was to influence or warn.” This was especially true, she added, because of her sense that during the previous meeting, Gabbai “had accused us of extraneous considerations and excessive zeal.”

A source involved in investigating the excessive spending at the prime minister’s residences told Haaretz that the comptroller’s draft report had harshly criticized Gabbai and Eshel — criticism that was omitted from the final report.

“It said explicitly that the gatekeepers hadn’t received backing from the management of the Prime Minister’s Office and that they had been turned from critics of irregularities into objects of criticism themselves,” the source said. The draft report “criticized the person then running the country’s most important ministry for attempting to influence [his staff’s] professional judgment and said the legal advisor and accountant had acted as expected of gatekeepers.”

The final report also omitted the facts that Fahima was paid three times as much as the sum initially approved for urgent work, and that Saidoff had signed off on the higher sum before the work even began.

A source familiar with the issue said the comptroller, Joseph Shapira, decided to omit the criticism of how the gatekeepers were treated after meeting with Gabbai and hearing his side of the story. “Gabbai argued that these weren’t official minutes of the meetings, but notes by the legal advisor,” whose account he disputed, the source said.

Another source said Barnea Farago had personally asked Shapira not to reveal either her role in ending the payments or the “heavy pressure” she came under to continue them, so as to preserve good working relations with other ministry officials. But she never retracted what she wrote in her notes, and in conversations with colleagues, she said the notes actually understated the situation, the source said.

Some staffers in the comptroller’s office opposed softening the report, one source said, but compromised “so that the report wouldn’t be stuck in a drawer for many more months, as the comptroller wanted. And we knew police would ultimately investigate all the information.”

Shapira’s office said initial drafts are frequently altered in response to answers provided by those criticized in the draft and are also frequently shortened during the editing process. The comments about pressure on the gatekeepers were removed after hearing Gabbai’s response and receiving “clarifications” from Barnea Farago.

The Fahima affair is currently being investigated by the police, it added, “so we can’t add details on this matter.”

As for the comparison to the White House, it was ultimately omitted because “there’s no real basis for comparison” in terms of either salaries or the scope of activity, the office said.

Gabbai declined to comment, but an associate said that after Barnea Farago met with him, Fahima’s employment was terminated immediately. “Gabbai never intervened in the gatekeepers’ work,” the associate added.

Barnea Farago declined to comment. Eshel said, “I gave my response to the comptroller – that this never happened – and as a result, it didn’t enter the report.”

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