From Bureau Chief to Suspect

The first clue that Shula Zaken was involved in something untoward emerged during former justice minister Haim Ramon's trial in 2006, when it turned out that for some unknown reason, the police had been listening in on phone calls made by Zaken, then-prime minister Ehud Olmert's all-powerful bureau chief.

Since then, she has only gotten deeper into trouble. She is now on trial in the Jerusalem District Court alongside Olmert, charged both with eavesdropping on her boss' phone calls and with various offenses in connection with Olmert's alleged double billing for overseas flights and receipt of cash-filled envelopes from Morris Talansky. She is also on trial in the Jerusalem Magistrate's Court for alleged involvement in improper appointments in the Tax Authority.

And yesterday, upon her return to Israel from a vacation in the United States, she was arrested as a suspect in the Holyland bribery affair as well.

A recent police raid on Zaken's home was not the first. In 2007, when police were investigating the Tax Authority case, detectives seized various documents from her home - including, as Haaretz reported at the time, a purse filled with honorary passes to casinos worldwide.

The indictment filed in the District Court deals with three main issues. In the double billing case, Zaken is charged with helping Olmert defraud both the state and various public organizations for years. She allegedly ran a system by which Olmert obtained double and triple funding for his trips abroad. The surplus money was kept in a special account at the Rishon Tours travel agency, and he and his family allegedly used it for private trips abroad.

"The defendant took advantage of [Olmert's] senior position and status and her own to create a systematic method of illicit income," the indictment says. "By so doing, she defrauded the organizations and the state."

She is charged with aggravated fraud, falsifying documents and breach of trust in this case.

In the Talansky case, Zaken is accused of managing Olmert's secret cashbox, where the money Talansky used to give the former prime minister was kept. The cashbox was located in his friend Uri Messer's law office. Zaken is charged with fraud and breach of trust in this case.

She is also charged with eavesdropping on Olmert's phone calls and transcribing them without his knowledge.

In the Tax Authority case, Zaken is charged with using her influence to get Jacky Matza named head of the Tax Authority. She also allegedly worked to bring about other appointments in the authority that indirectly helped her brother, Yoram Karashi, and other cronies. She is charged with fraud and breach of trust.

Zaken, 53, has lived and worked in Olmert's shadow since she was 17, when she was hired as a secretary in Olmert and Messer's law firm. Since then, she has accompanied Olmert with loyalty throughout his political career - from junior Knesset member through mayor of Jerusalem to the Prime Minister's Office - as his personal secretary and bureau chief.

Olmert and Zaken have shared the defendants' bench at the Jerusalem District Court in recent months. They hardly talk to each other during the hearings, but their close relationship is evident. A few weeks ago, when Olmert's eyes almost closed during the tedious debates, Zaken made sure he got a cup of coffee.