French Fraudster Behind 'Sting of Century' Claims He Gave Netanyahu $200k in 2009

On Monday, news broke that the police are investigating a 'new case' involving Netanyahu, which apparently revolves around money he received from foreign businessmen after returning to the Prime Minister’s Office in 2009.

Arnaud Mimran and Prime Minister Benjamin Netanyahu.
Bertrand Guay, AFP/Reuters

PARIS – The transcript of Arnaud Mimran’s first interrogation in the case known as “the sting of the century” contradicts Prime Minister Benjamin Netanyahu’s claim that the only money he ever received from Mimran was a one-time donation of $40,000 in 2001.

A joint investigation by Haaretz and the French website Mediapart has found that Mimran, the chief suspect in the massive fraud case, mentioned Netanyahu in his answer to a question about the key witness, Jeremy Jacques Grinholz, who is hiding in Israel under the name Eithan Liron. According to the transcript, whose contents are being published here for the first time, Mimran replied that he didn’t know exactly what role Grinholz had played in the scam. He then added:

“I met him for the first time in Israel in early 2009. I used to go there a lot back then, because that was during the campaign, and I’m close to Netanyahu, to whom I donated $200,000.”

In other words, in his response, Mimran directly linked his donation to the 2009 election.

A representative of Netanyahu’s responded, “It’s all nonsense. We stand forcefully behind the clear facts: Arnaud Mimran’s only donation, totaling $40,000, was given in 2001 to the public-benefit corporation, as permitted by law, at a time when Mr. Netanyahu was a private citizen.” Netanyahu set up the corporation in question to finance his public activities, primarily public diplomacy efforts on Israel’s behalf.

© Mediapart, all rights reserved. Published in Haaretz by special permission.

“The repeated attacks over the Mimran issue, which are meant to obscure the prime minister’s great achievements on behalf of the State of Israel, won’t be of any use,” the statement continued. “Not the previous attack, at the height of his historic visit to Russia, and not the current attack, at the height of his historic visit to Africa.”

A check of Mimran’s flights to and from Israel confirms his claim: According to lists provided to the investigators by the Israel Airports Authority and its counterpart at Le Bourget Airport in Paris, Mimran flew to Israel in his private plane on the morning of February 2, returned to France on the afternoon of February 5, flew back to Israel on the morning of February 10 and returned to France on the evening of February 12. The election took place February 10.

Moreover, Mimran drew a distinction between this donation and his prior acquaintance with Netanyahu. “I’ve known Netanyahu since 2000, because I used to lend him my apartment on Avenue Victor Hugo in Paris,” he said.

These statements were made during Mimran’s first interrogation after being arrested, an encounter to which jurists attach great importance. He was arrested at 7:15 A.M. on January 20, 2015 and brought for his first investigation at 1:50 P.M. that day.

His younger brother, Benjamin Mimran, was summoned for questioning on February 3 and asked if he played any role in fraud. When he denied all involvement, he was asked why, if so, he had traveled to Israel with his brother and defendant No. 2, Mardoche Mouly.

Regarding most of these trips, Benjamin Mimran said he didn’t remember why he had gone. But about the trip on February 10, 2009, he responded, “I don’t remember, unless that was the time of Netanyahu’s election.”

Subsequently, during his trial, Arnaud Mimran raised the issue of his donations to Netanyahu of his own accord. “I funded Netanyahu to the tune of a million euros,” he said.

This testimony doesn’t contradict his statement to the police about a $200,000 donation, because his “funding” of Netanyahu included many outlays over the years besides cash donations. Inter alia, he paid for Netanyahu’s ski vacation at the Courchevel resort in the French Alps, as well as vacations in Monaco and the French Riviera, and he also let Netanyahu use his Paris apartment free of charge.

On Monday, Channel 2 television reported that the police are investigating a “new case” involving Netanyahu, which apparently revolves around the money he received from foreign businessmen after returning to the Prime Minister’s Office in 2009. The question of whether this new case is related, either directly or indirectly, to the Mimran affair may be given a new twist in light of the source of the payments Mimran made to the bank accounts of his Israeli cronies: According to the findings of the Haaretz-Mediapart investigation, most of Mimran’s financial transfers to his Israeli partners, as listed in the indictment, and to other Israeli friends, were made from two American bank accounts.

The first account, which was used to make many payments to people in Israel out of the proceeds of the alleged fraud, is Mimran’s personal account at Safra National Bank of New York. For instance, on February 23, 2010 – during the height of the fraud that, according to the indictment, earned its perpetrators a net profit of 283 million euros ($311.3 million) – Mimran authorized a wire transfer of 180,000 euros from this account to an account at Bank Leumi that belongs to a Jerusalem notary’s office called Benichou-Bernstein.

 Benjamin Netanyahu with Arnaud Mimran. Monte Carlo, Monaco. 2003
Mediapart, all rights reserved. Published in Haaretz by special permission

The transfer appears with the notation “advance on purchase of the property,” and Mimran told his interrogators that he doesn’t remember for whom this property was earmarked. Attorney Benichou of Benichou-Bernstein declined to respond to Haaretz-Mediapart’s questions.

Less than a month later, while he was visiting Israel, Mimran transferred one million euros, in two installments, from his Safra Bank account to an account belonging to one David Cohen at an Israel Discount Bank branch in Eilat. Mimran told his interrogators that Cohen is a real estate agent, and that he gave him the money to buy a property for someone he doesn’t remember. Haaretz-Mediapart located two real estate agents named David Cohen; both denied any connection to either Mimran or the wire transfer.

Another foreign businessman also became embroiled in the investigation into Mimran’s mysterious payments in Israel. Investigators discovered that Mimran frequently used the American bank account of a family friend, a Jewish rancher from Argentina named Leandro Liberman. According to Mimran’s statement, Liberman allowed him to use his American bank account to circumvent regulatory restrictions in the United States.

Among other purposes, Mimran used Liberman’s account to transfer 400,000 euros to a company named Isra-Mart to “purchase a diamond as a gift.” Mimran told his interrogators that he “doesn’t remember” either whom the payment was meant for, or who the diamond that was purchased with the payment was meant for. The payment was arranged via a fax sent from the Business Center of the David InterContinental Hotel in Tel Aviv.

French law enforcement agencies have begun confiscating assets from Mimran and the other defendants in the “sting of the century” case, and to this end, they have asked Israel to identify all the bank accounts and real estate assets into which, according to the indictment, the proceeds of the fraud flowed.

One of the more prominent assets the French have seized is a residential building on Avenue Victor Hugo in Paris, which isn’t registered in Mimran’s name even though, according to the investigation, he is its real owner. This is the building in which Netanyahu stayed at Mimran’s invitation.

The French authorities also put a lien on Mimran’s bank accounts in France, including a stock trading account at HSBC containing assets worth 7 million euros – all of which, according to the indictment, was stolen from the French government.

In addition, the French authorities also seeking to map the financial transfers to Israel by other defendants in the case, including Israeli real estate broker Eddie Abittan. During his interrogation, Abittan said he received 2 million euros from Mimran as a loan, which he subsequently repaid. But Mimran told his interrogators that he doesn’t know Abittan, and that he transferred the 2 million euros to his Israeli bank account at the request of Samy Souied, the chief conspirator, who was murdered in Paris in 2014.

The French Justice Ministry has also requested information about the bank accounts of a foreign currency exchange firm called Albercom, through which at least 40 million euros obtained via the fraud was sent. Albercom initially cooperated with the French investigation, but its owner, Alexander Bernshtein, later decided to exercise his right to remain silent.

Bernshtein’s attorney, Ron Dror, said in response to Haaretz-Mediapart’s questions that his client had cooperated with the investigation up to a point, and that he himself had flown to Paris to answer questions. But to the best of his understanding, Dror said, “My clients have not committed any crime under Israeli law, which is the relevant law.”

After delving into the defendants’ financial transfers to Israel, French investigators had trouble understanding why the Israel Money Laundering and Terror Financing Prohibition Authority had failed to report these movements to its counterparts overseas, in line with international conventions against money laundering. A spokesman for the authority told Haaretz-Mediapart, “The authority is an intelligence agency. Therefore, the authority neither confirms nor denies the existence of investigations it is conducting, and by law, it isn’t authorized to divulge any information from its database, to the extent that such information exists.”

Another company in the French authorities’ sights is a phantom company called MK Holdings, which Mouly apparently established together with defendant No. 4, a Polish-Israeli named Jaroslaw Klapucki. According to their statements to the police, they set up the real estate company in Israel with an initial investment of 100,000 euros. But it later closed without having conducted any business activity.

Haaretz-Mediapart located three companies with this name, but none of them have any connection to the defendants. Attorney Elie Myara, who is described in the defendants’ statements as the person they asked to set up the company for them and then to close it down, told Haaretz that he “remembers some issue with a company like that,” but that he wasn’t asked by Mouly to register the company and certainly wasn’t asked to close it. He added that he doesn’t consider himself to be Mouly’s attorney.

Meanwhile, French authorities are continuing to confiscate the defendants’ French assets. Among other assets, they have seized a Parisian apartment owned by the Souied family and many cars belonging to Mimran and Mouly. The French court is slated to issue its verdict in the fraud case Thursday.