Herzog won that primary, though he lost reelection as party chairman earlier this year.
Shimon Battat will be charged with accepting an illegal contribution of 40,000 shekels ($11,400) from businessman Gilad Ramot, whose company contributed to the campaign. Prosecutors have held pre-indictment hearings for both men, so charges can be filed immediately.
The contribution was made by RPM, a company owned by Ramot, though it is illegal for corporations to make campaign contributions. Moreover, the donation was not reported to the state comptroller, as required by law.
Herzog was also investigated over the campaign contributions, but Attorney General Avichai Mendelblit decided to close the case against him back in January, saying there was insufficient evidence that Herzog knew about the illegal contribution.
The money was meant to finance a smear campaign against Herzog’s rival for the party leadership, lawmaker Shelly Yacimovich.
The prosecution says Battat instructed Ramot to give the money to Daniel Cohen, an attorney and Labor Party activist. Cohen later revealed the donation in an interview with the daily newspaper Israel Hayom prior to the 2015 Knesset elections.
Ramot denied that the money was a campaign contribution, saying he was paying Cohen for legal services. But he was unable to cite any legal service that Cohen had provided him. Cohen himself denied providing any legal services to Ramot. Cohen said the money was given to him by agreement with Battat to finance a negative campaign against Yacimovich.
Ramot’s lawyer, Daniel Haklay, said the money was paid to Cohen for legal services in the field of private caregiving, a field Ramot is involved in. Haklay said Ramot “didn’t know the money would become an illegal contribution” to Herzog’s primary campaign. Haklay acknowledged that Ramot preferred Herzog to Yacimovich as the Labor Party’s leader, but said his client “denies that he made an illegal contribution, denies that he committed any criminal offense and intends to deny the charge in any criminal trial.”
The prosecution has offered both Battat and Ramot plea bargains, under which they would confess and be convicted of failing to report the campaign contributions to the comptroller. Both are considering the offer.
Battat’s lawyer, Yaron London, did not comment at this stage.
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