At IBA, Protectzia Is What Gets You on the Air

Independent producers inflated costs for dubious expenses, including ‘consultants’ and middlemen recommended by the broadcaster’s management.

The Israel Broadcasting Authority headquarters in Jerusalem. A new corporation was meant to replace it.
Tomer Appelbaum / BauBau

Yankele Mendel, in case you have never heard of him, is one of the big stars of Channel 1 television. Over the years he hosted a talk show “Where Tonight, Yankele” and in 2012 he moved to a prime spot on Friday nights with a glitzier format “Friday Meetings,” smiling and cracking jokes as he hosted artists and musicians.

The smile wasn’t simple for the cameras. Mendel’s family-owned company, Yad Productions, which produces the program, billed state-owned Channel 1 4 million shekels ($1 million) for 26 shows in 2012-13. But when officials at Israel Broadcasting Authority, which operates the channel, looked into Yad’s real costs, they found they were found to be no more than 2 million shekels.

Yankele Mendel
Raffi Dalya

It turned out that the program was not being produced in the biggest and best-equipped studio facility at Israel’s prime production studio, but in a smaller, cheaper facility. Yad was filming two shows a day there to save even more money.

Mendel isn’t simply a television presenter. He is also chairman of the Israel Artists Union, which has three representatives on the IBA oversight board and one on its management committee.

Stories like the one with Mendel and Yad Productions occurred largely out of the public eye, even though IBA is a government body. TheMarker published an expose two years ago that documented high fees the IBA paid for what were small-scale productions that inexplicably cost as much as major undertakings. Likewise, the State Comptroller found irregularities but couldn’t find evidence of where the money had disappeared to.

Only in August last year did the IBA and its independent producers face scrutiny when its books were opened. That is when new managers were called in after the body was put under control of a receiver and examined the contracts that had been signed over the years with independent producers.

The documents, which were obtained by TheMarker, paint a picture of squandered public funds, insider dealings, windfall profits for producers and others with an inside line into the IBA and other dubious practices.

The IBA managers who controlled the funds that could go to well-connected producers and ensure that others got little or nothing were Yoni Ben-Menachem, who was CEO, and his chief aide, Zelig Rabinovich, who was widely regarded as the power behind the throne at IBA.

Ben-Menachem declined requests for a comment from TheMarker. Rabinovich denied any responsibility. “None of the accusations touch on my area of responsibility at the authority at any time. As far as I know all activities in the IBA in the period discussed were done according to standard under the supervision of various committees and the relevant officials.”

The abuse of public money continues to have an impact today. A new public broadcasting body, better managed and with a more attractive array of programing, is supposed to begin operations next March to replace the IBA. But the content it is inheriting, mostly variety shows produced at a combined budget of 140 million shekels, is of poor quality – of little interest to viewers or unlikely to meet critical acclaim.

In fact, much of the information about irregularities at IBA came from an internal report ordered by Ben-Menachem in January 2014 before the receivers took control, although nothing was done to address the problems it uncovered. The report, which is published here for the first time, deals with two relatively small productions.

One, an Arabic-language interview program hosted by Mira Awad for IBA’s Channel 33, which was supposed to be a simple interview program produced at a cost of several tens of thousands of shekels per installment. But, in fact, each show’s budget ballooned to 114,000 shekels and, if that wasn’t a big enough increase, the producers were paid a one-time fee of 238,000 shekels for equipment and a studio set.

The producers explained that Awad was interviewing personalities from the Arab world, which involved buying expensive equipment. That it turned out was supplied by a company, apparently without competitive bidding, owned by relatives of Yankele Mendel. A recommendation that was termed by the report as “objective” to buy from the company came from Tal Mendel, Yankele’s son and the producer of his Friday show.

It was not clear, the report said, whether the gear was ever delivered or if it was transferred to IBA after the show ended. The few on-air conversations Awad conducted with Arab personalities outside of Israel were in fact conducted on Skype. When an IBA official complained, the company agreed to hand over substitute gear, which IBA officials later termed “mostly aging, to say the least, partly broken or didn’t meet industry standards.”

On a much bigger scale, an investigation by the IBA receiver showed inflated costs for a Channel 1 satirical series “The Jews Are Coming,” one of the few that elicited some excitement from viewers and critics, although because of infighting in the IBA, the show was never broadcast before the receiver took over.

The series was produced by Nihul Plus Productions, a partnership between Yoav Gross and Beni Menashe, which has won many contracts from IBA. The series cost IBA 434,000 shekels for each installment, or a total 6.6 million shekels. But a subsequent examination of the books showed a season cost to the producers of no more than 5.5 million shekels. When the new IBA management ordered a second season, the price fell to 70,000 shekels a show.

“Shabbat Tomorrow,” a program produced in 2013 by Gaga Productions, in which Gross collaborated, budgeted for studio costs of 34,000 shekels per installment on the assumption each would take a day to film. But the true cost for each show was 8,000 because more than one show was filmed on a single day.

All told, Gaga Production billed IBA 5.8 million shekels for 22 installments, but a review of expenses came to the conclusion that the real cost was no more than 4.8 million shekels.

Gross told TheMarker that the new estimates are incorrect. He said his company received 5.64 million shekels for season one and 5.48 million for season two in line with prevailing rates for TV productions. He denied any connection with Gaga Productions.

A recording of a conversation provided to TheMarker between two unnamed producers and an unnamed third party shed light on how producers worked the system at IBA in 2013-14. The two producers spoke about being forced to bring in outsiders to the productions at great cost to win IBA contracts.

Producer A: “It was made clear to us during the bidding process that we wouldn’t get a production contract.”

Producer B: “You have to come with a kind of partner, officially or unofficially.”

C: “A production partner?”

Producer A: “Someone in particular, with connections.”

C: They told you he would be a partner, a macher. Was it clear how he would be compensated?”

Producer B: “The way he was compensated was part of the budget, inside the system. It would be expensive even though we didn’t need him at all on any professional basis It’s not as if they tell you to have a Big brother, it’s less Hollywood than that. You meet and he explains to us in a very general way how it has to work.”

Both producers admit they can have producers for their shows for IBA for less than they were billing it.

Producer B: “The biggest red flag is that you have a middle man who is an essential part of the program. He costs a lot of money and he dictates to you all kinds of things which have little to do with the needs of the production. To say it nicely, it’s a red flag.”

TheMarker has learned that Haim Cohen, the celebrity chef who hosted a show on Channel 1 before moving to the commercial broadcaster Channel 2, to host “Master Chef,” met with Channel 1 three years ago to discuss a new program on the state broadcaster.

But he was told that the condition for the show is that it would produced by a particular company and hire a specific consultant for the series. Cohen confirmed the substance of the conversation.

“After IBA executives heard what I wanted to do for the program, they proposed that I have a third party submit the proposal and be retained as a paid consultant. That angered me and I decided to drop the project,” he said.