Two Elected Officials Arrested for Corruption in the Galilee

The investigation fingered nearly 20 suspects, including the mayor of the Haifa suburb of Kiryat Ata

Shmuel Siso, former mayor of Kiryat Yam, current Tel Mond council head, poses for cameras, February 22, 2008
דורון גולן/ג'יני

Shmuel Siso, the current head of the Tel Mond council and former mayor of the Haifa suburb of Kiryat Yam, was arrested on Monday on suspicion of corruption, along with Ya’akov Peretz, the mayor of another Haifa suburb, Kiryat Ata.

Siso and Peretz are suspected of taking bribes, tax offenses, procuring items by fraud and breach of trust. The Rishon Letzion Magistrate’s Court issued orders extending both men’s incarceration by four days.

The police placed eight others under arrest and detained nine on suspicion of corruption, following an investigation by the police economic crimes unit known as Lahav 433. Among the arrests were a former mayor, an assistant to a government minister and a contractor involved in infrastructure development who was previously arrested in another case on a similar suspicions.

Kiryat Ata Mayor Peretz is a close associate of several Likud ministers and is considered a major player in the party. Other party operatives are among the suspects as well. The police announced, however, that there is no suspicion of involvement by government ministers in the affair.

One of the suspects is a former executive with the government-owned transportation infrastructure company Netivei Ayalon. She is suspected of altering bidding specifications for the paving of a road in exchange for a promotion within the company.

The investigation is focusing in part in the alleged fixing of bids for the paving of roads in the Krayot, a northern suburb of Haifa, as well as urban renewal projects in the Sharon region, where Tel Mond is. Sharon Nahari and Rany Schwartz, lawyers representing two of the suspects, said their clients deny the suspicions against them.

The police said the case raises suspicions of bribery, procuring items through fraud, money laundering and other crimes. Most of the offenses were allegedly carried out at government corporations engaged in construction and infrastructure projects, mostly in the north of the country. The police are also looking into suspicions that public servants fixed municipal bids to benefit contractors in exchange for payment “or out of other illicit motives.” The police said the suspects appear to have engaged in corruption “with the involvement of influential people in government corporations and government institutions.”

The police raided the homes and offices of two suspects, confiscating equipment and documents. They also searched the Environmental Protection Ministry and removed documents from Netivei Ayalon offices.

The investigation is said to have found that “interested parties committed offenses to influence decision makers at government corporations and advance their interests.”

This is not the first time that Siso, one of the main suspects in the inquiry, has been embroiled in a corruption case in the public sector. He was detained for investigation in 2010 by the fraud squad on suspicion of fraud and breach of trust relating allegations of bid-fixing for a shopping mall run by a company owned by Adi and Rani Zim, brothers who were also partners in the Kimat Hinam supermarket chain. The construction was allegedly carried out in violation of municipal building plans, and the police recommended filing criminal charges against Siso in the case, but the state prosecutor closed the case for lack of evidence in 2011.

Siso, 68, grew up in Kiryat Yam and was its mayor from 1989 to 1997. He has headed the Tel Mond local council since 2017. His lawyer, Adi Carmeli, told TheMarker: “My client denies any connection to any criminal activity. He is council chairman and has served in many public roles with distinction.”

“There is a reason Kiryat Yam is the weakest of the Krayot towns,” said a former resident of the city. “It’s a place with a beach and amazing potential, but during the Siso era, we didn’t see any economic or cultural initiatives.” And the official added: “The feeling is that it’s a city of fixers. Siso gives the impression of being a respectable man who speaks nicely, but he didn’t really manage to lift the city up.”