Analysis |

In One Netanyahu Corruption Case, a CEO Faces a Hard Task Too

Next week is the pre-indictment hearing for Shaul Elovitch, whose Bezeq telecom company plays a role in favorable-news-for-favors allegations

Gur Megiddo
Gur Megiddo
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Shaul Elovitz and Iris wife Iris during a court hearing, Tel Aviv, Israel.
Shaul Elovitz and Iris wife Iris during a court hearing, Tel Aviv, Israel. Credit: Moti Milrod
Gur Megiddo
Gur Megiddo

Next week, Shaul Elovitch, the businessman accused of bribing Prime Minister Benjamin Netanyahu in the affair known as Case 4000, is due to have his pre-indictment hearing. The former controlling shareholder of Bezeq, Israel’s leading telecommunications company, is accused of giving Netanyahu positive coverage on his Walla website in exchange for regulatory favors for Bezeq.

The following are some of Elovitch’s main arguments, and what he will have to prove.

As things stand, there is solid evidence that Elovitch gave Netanyahu something – that he acted to fill requests by Netanyahu and his family members to improve news coverage on Walla. This includes hundreds if not thousands of text messages and recorded conversations between Walla CEO Ilan Yeshua and Nir Hefetz, a former media adviser for the Netanyahus who turned state’s evidence.

>> Netanyahu’s corruption cases remain the thing | Editorial

The messages also include indications that Netanyahu received something in return – that Netanyahu went out of his way to advance Elovitch’s interests at the Communications Ministry. In addition, a former director general at the ministry, Shlomo Filber, said great efforts were made on behalf of Bezeq, including leaking ministry information to Bezeq executives, while hiding evidence of this from ministry bureaucrats. This was all on Netanyahu’s orders, Filber testified.

A key issue is that no concrete evidence has come out showing that Netanyahu was aware of the reciprocity – that the slanted coverage came in exchange for regulatory favors.

This isn’t true for Elovitch, who made his opinions clear in several text messages about giving positive news coverage while regulators were handling Bezeq. His attorney will have a hard time providing an alternative explanation.

In 2014, for instance, Elovitch needed Netanyahu to sign a permit letting him place a lien on his Bezeq shares in order to sell bonds for B Com, the holding company through which he controlled Bezeq. That day, Walla published an article about the far-right group Lehava calling on Netanyahu to demand that his son Yair end his relationship with his non-Jewish girlfriend.

This article, despite being on the verge of gossip, struck Elovitch as a serious matter and he thought Bezeq would pay for it. So he sent his son Or a text message: “We’re stupid, we need him to sign tomorrow.” The son responded: “So take it down, you’re right.”

Elovitch could argue that the signature for the lien was pretty much a technical matter, and that there was nearly no chance it wouldn’t happen; he could argue that he sent the message because of the stress he was under overall.

On the other hand, such an argument could hurt Netanyahu’s case. If Elovitch believed that even a technical matter was dependent on positive news coverage for the prime minister, what does that say about much more serious regulatory matters at Bezeq that were worth hundreds of millions if not billions of shekels?

On January 25, 2015, for example, Walla posted an article containing unflattering testimony about how Netanyahu’s wife Sara treated employees at the prime minister’s official residence. The article resembled those on all of Israel’s news websites, but Elovitch feared that the story would hurt Bezeq’s interests. He immediately contacted Yeshua: “Take it down immediately, it will block approval for Yes. I’ll kill you,” he said, referring to the satellite-television provider that Bezeq was acquiring.

Elovitch’s lawyers will probably argue that he didn’t really mean what he said, and that Netanyahu never conditioned approval for the Bezeq-Yes merger. Yeshua carried out Elovitch’s request without hesitation, and the following day published a compensatory article titled “Israel’s ambassador in Washington: Netanyahu has a moral commitment to appear before Congress.” (This referred to Netanyahu’s planned speech on the eve of the U.S. elections.)

Elovitch’s messages say something about his worldview, and this could become part of his defense. “Give the lady [Sara Netanyahu] what you can. He [the prime minister] is killing himself for me,” he wrote Yeshua in July 2015, days after the Bezeq-Yes merger was approved.

Elovitch refused to turn state’s witness against Netanyahu, and apparently believes that no bribes were given. He may truly believe that the relationship was a legal give-and-take. After all, all politicians try to influence news coverage about them, and all businesspeople have relationships with regulators and try to convince them that their requests are reasonable.

Elovitch’s attorneys will probably argue that accusers are unfairly trying to criminalize normal relationships between businesspeople and politicians.

The fact that Elovitch told Yeshua to destroy his phone in order to cover up their actions will make this argument harder to accept. If Elovitch didn’t realize his actions were criminal, why would he seek to cover his tracks?

Another argument is that criminalizing the relationship between journalists and politicians is likely to deter journalists from doing their job in helping preserve democracy. This is a logical argument, but not when coming from Elovitch. He called journalists who showed independent opinions “zeros.” For example, he wrote to Yeshua: “What annoys me is that the big one [Netanyahu] is going out of his skin to help and we can’t compensate him because of a group of zeros.”

Elovitch’s messages reveal that he considers himself fair – he helps those who help him. “The big one [Netanyahu] surprises me positively every day over the most important things. We have to find a way to compensate him,” he wrote to Yeshua in July 2015. “He deserves it and more; I don’t like being in debt.”

Elovitch argues he gave “help,” not a bribe. It’s about being fair, in keeping with a very specific moral code under which politicians and businesspeople keep their word, and no one cares if the public gets a regulator beholden to private interests and slanted journalism.

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