Naming Names, Sporting Spirit

Say you were arrested tomorrow morning for allegedly bribing government officials in order to close some giant deal. How likely is the court to slap a gag order on your name and the circumstances of the case?

Not likely at all. The more public money is involved, and the more public officials are muddied, the less likely the court is to grant an order muffling the press.

Unless, of course, the case has security-related ramifications. Then logic vanishes. The court stands to attention, everybody rearranges their features to best demonstrate bright-eyed patriotic zeal and whatever happens, happens behind closed doors.

Three months have passed since a leading Israeli businessman was arrested and released on bail. In parallel the general manager of the Israel Aircraft Industries, Moshe Keret, was grilled. But the press was prohibited from reporting a word about the investigation.

Naturally, every business reporter in the land, every businessman connected with the defense industry, and every politician in town knew perfectly well who the personalities were and what the case was about. But the court blindly marched ahead, diligently shielding the stench emanating from the security sector and muzzling the press.

Israel's defense and security establishment turn over tens of billions of shekels a year. Billions pour from the sector to suppliers, customers, mediators, fixers, lobbyists and naturally to tens of thousands of employees working under extraordinarily comfortable terms.

The greater the waste, the greater the corruption and the lesser the disclosure is. Employing various weird, wonderful and wily excuses, associates of the great defense machine manage to almost entirely shield it from the glare of sunlight.

Patriotism is the safe harbor of the villain, including ones accused of giving or receiving bribes. The financial management of the security establishment is kept secret from the public all in the name of patriotism.

The watchdogs are struck dumb by the very word. "Security" induces the Finance Ministry to help cover up the stream of money to defense and the courts whip out the gag orders.

It is no coincidence that state comptroller Micha Lindenstrauss, who declared he would list the names of all persons who had been inspected, has come to be anathema among Jerusalem's economic circles. He had the temerity to list Moshe Keret's name in his grave report on how the IAI bought Elisra, though he had been under terrific pressure to issue a generalized, vague report without naming names.

The homecoming

Meanwhile, could it be that Eliezer Fishman is coming home? On Thursday his company Industrial Building Corporation (TASE: IBLD). Announced it was buying half a Nazareth mall for NIS 50 million. It already owned the other half.

Separately, the papers had been reporting that Fishman is again considering investments in Israel, in his favorite sectors. One possibility is that the merged cable TV company, in which Fishman would own a minority stake, may buy cellular giant Partner Communications (LSE, TASE, Nasdaq: PTNR).

Throughout Israel's financial crisis Fishman has said and said again, and repeated and reiterated, that He Will Not Do Business in Israel Any More. This is a terrible country, he explained in this or that fashion, and regulation ruins everything.

What's happened? Has the regulation suddenly improved? No. What happened is that the market reversed. When the decade began Fishman had made high-priced, highly leveraged transactions. Now the market is getting better and the capital markets are open to him again. He may have rediscovered that Israel is not that terrible a place to do business after all.

When the markets go his way, Fishman seems happy to do business here. In the last few months his companies have raised hundreds of millions of shekels from the public, through bond offerings to institutional investors that manage our money.

Fishman liked to say that his favorite place for investment was Germany. Among other things he bought himself a nice property on the main and most magnificent drag in Berlin, namely the Unter den Linden. There he can go about his business in peace, he smiles.

Goodness. Is not there any regulation in Germany? There is.

Eliezer Fishman likes to invest in European properties. But he might ask Haim Saban, who's watching hundreds of millions of dollars in profit slip away because the media regulator won't let him sell his ProSieben stake to the Axel Springer newspaper group for about $4 billion.

The German regulator had very interesting reasons for blocking the sale. The watchdog  was afraid Axel Springer would gain too much influence over public  opinion.

That's the kind of complaint leveled against Fishman back when, as he swallowed and set up telecoms companies one after the other.

And what did Matthias Doepfner, Axel Springer's CEO, say when the Teutonic regulator got in the way of the deal he's been pursuing for a year? He said the decision would be respected and they would take it in sporting spirit.

Next time one of Israel's business barons grouses about regulation and how terrible Israel is, don't lose your hair. He may have had a lousy day at the office. Maybe his image was cracked. But surely his mood will improve when the market swings his way.