Members of the Balad party are suspected of receiving hundreds of thousands of shekels from sources overseas and in Israel and misrepresenting them as legal, local campaign contributions. The state comptroller said Balad received 710,000 shekels in 348 separate cash contributions that were never properly accounted for, and which may have violated party campaign funding laws. Balad has denied any wrongdoing.
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The police announced on Tuesday that they found enough evidence to indict three Arab lawmakers and other senior officials of the Balad party on corruption charges. The three Knesset members under suspicion are Haneen Zoabi, Jamal Zahalka and Joumah Azbarga of Balad, a faction of the Joint List, which is Israel’s third largest party in Knesset.
The charges recommended by the police include fraud, money laundering, forgery, breach of trust, falsifying records and documents, ethics violations and other crimes involving millions of shekels. They also suggested indicting former Balad MK Basel Ghattas, now serving a two-year prison sentence for smuggling cellphones and documents to terrorists in prison, on the same charges. The case has been passed on to the State Prosecutor’s Office for a final decision.
Many donors who signed declarations concerning their contributions denied giving the money, the police say. Others said their contribution was much less than what the declarations state. Yet other declarations were signed by minors of relatives of party activists, who also denied donating the money.
Among those suspected of involvement in the false declarations are party lawyers and other activists. Some business owners, such as printers who provided campaign materials, are also suspected of illegal campaign contributions.
The party is also suspected of paying large sums to rent properties, ostensibly to be used as campaign headquarters during the last election campaign, which it did not need and which served as a conduit for illegally moving the money.
At least 150 suspects have been questioned in the affair. The investigation began about two and a half years ago, based on a report from the State Comptroller’s Office on party financing. The police’s Lahav 433 national fraud squad conducted the investigation along with the economic crimes department of the State Prosecutor’s Office.
In a statement released at the conclusion of the investigation, the police said that the focus of the investigation was two reports submitted by the State Comptroller’s Office. “One concerned contributions to Balad for the 2013 municipal election campaign and the other was a report on party expenditures in the 2015 Knesset election, which was released in October 2016. The state comptroller passed on his findings to the attorney general, saying he found suspicions of criminal offenses. The attorney general then authorized the opening of a criminal investigation into the allegations.
“With the conclusion of the investigation, the unit in charge believes it has found sufficient evidence against party officials,” the statement said.
The police said it looked into the suspicion that members of Balad had raised cash donations without submitting the required declarations signed by the donors, as required by law when dealing with cash contributions. When the State Comptroller’s Office asked about the money, the forms were filled in retroactively. The party reported that it received a total of 2.5 million shekels (around $700,000) in campaign contributions for the 2013 local election campaign.
The report about the 2015 election accused the Joint List of improperly accounting for its campaign funds. Balad allegedly spent 1.4 million shekels on renting campaign headquarters, but this was a “misrepresentation,” said the state comptroller. Balad representatives admitted that the money was not spent for rent but instead used for unknown purposes. The comptroller’s report stated that is suspected “fictitious contracts” were used to cover the real use of the money and it is impossible to say whether it was used legally.
As a result of these offenses as well as other large expenditures on gas, salaries and refreshments that lacked receipts, the state comptroller decided to deny the Joint List 1.2 million shekels in campaign funding from the government.
Balad rejected the accusations on Tuesday, calling them “a dangerous escalation of the political persecution of the Arab leadership, following on the unbridled incitement by politicians against Arab parties.”
“Balad vehemently rejects the alleged suspicions against its activists or members,” the party stated. “The police are trying to turn alleged administrative or financial improprieties during the election campaign into a criminal matter in order to balance recommendations regarding [Prime Minister Benjamin] Netanyahu.”
The party stressed that “no one in Balad is suspected of or being investigated over receiving favors or money for themselves,” adding that “Balad is confident that the suspicions will turn out to be baseless at the end of the day.”
The lawyers for the Balad suspects think the police are trying to recruit at least one party activist to turn state’s evidence in the case. At the same time, party sources said on Tuesday they did not expect prosecutors to accept the police’s recommendations in full and the lawyers said they expected only a few party activists, and not the lawmakers, to be indicted in the end. The lawmakers all denied any connection to the campaign contributions during the investigation.