Israeli Court Extends Custody of Telecom Giant CEO in Government Corruption Probe

Stella Handler and a Bezeq board member were arrested as part of the widening probe into the firm's ties to government officials

Bezeq CEO Stella Handler appears in court, February 21, 2018.
Ofer Vaknin

An Israeli court issued an order to extend the detention of Stella Handler, the CEO of the telecom giant Bezeq, by another six days on Wednesday as part of the widening investigation of corruption and improper government influence at the company.

The probe, dubbed Case 4000, began as an Israel Securities Authority investigation. It includes alleged misconduct by the former director general of the Communications Ministry, Shlomo Filber, who reached an agreement with the police on Tuesday to turn state’s evidence in exchange for a lighter sentence.

A member of the Bezeq board, Amikam Shorer, is also to be kept in custody for another six days.

Handler, who is suspected of bribery and other allegations, was arrested on Sunday along with Shorer. At Wednesday’s hearing at the Tel Aviv Magistrate’s Court, counsel for the securities agency said Handler had been questioned every day since her arrest, but additional questioning was still required, which made it necessary for Handler to stay in jail rather than being released to home arrest.

Handler’s lawyer, Natan Simchony, said the only communications that she had with Filber related to government regulatory issues. “She didn’t commit any crime and that’s her position,” he said. Simchony also denied that Handler had obstructed an investigation of Bezeq, the country’s largest communications company, last summer.

The judge at the hearing said since a gag order had been lifted, it could be publicized that the case presents reasonably established suspicions of serious corruption, “and beyond,” implicating a large number of people and involving bribery, fraud, breach of trust and securities violations. “These offenses were committed, it is suspected, by senior officeholders in government and at Bezeq,” the judge said.

The latest developments in Case 4000 became public with the arrests of Handler and Shorer on Sunday. Both initially ordered held for four days. The controlling shareholder of Bezeq, Shaul Elovitch, was also arrested on Sunday, along with his wife, Iris, son Or, and Nir Hefetz, a media specialist and close associate of Prime Minister Benjamin Netanyahu’s. Filber was also arrested.

What initially began as a securities investigation now involves suspicions that Netanyahu, in his role as communications minister from 2014 to 2017 (while he was also prime minister), intervened with regulators to help the Bezeq group, and that in exchange Elovitch, a longtime friend of Netanyahu’s, allegedly ordered Bezeq’s Walla news site to provide favorable coverage of the prime minister and his wife, Sara. In addition, there are suspicions that Sara Netanyahu may have been involved in influencing the website’s coverage.