The Submarine Affair

Israeli Represented by Netanyahu's Lawyer to Receive Millions for Brokering Deal, German Investigation Reveals

The German newspaper Handelsblatt says further that ThyssenKrupp is looking into the deal following Israeli media reports suggesting improprieties.

Israeli Prime Minister Benjamin Netanyahu surveys a submarine arriving at the Haifa port in January 2016.
Baz Ratner/Reuters

Miki Ganor, the Israeli representative of the German company selling submarines to Israel, will receive some 10-30 million euros for brokering the deal, according to Germany’s Handelsblatt newspaper, which previously reported on corruption at the firm, ThyssenKrupp.

A source in the German company said that although there were no indications of improper behavior by consultants related to Israel, "a comprehensive check" would be made because of recent reports in the Israeli press.

>>All the latest developments into Israel's submarine affair.

Martin Murphy, a senior reporter for Handelsblatt, said Prime Minister Benjamin Netanyahu’s lawyer and confidant, David Shimron, “was involved in Ganor’s work with ThyssenKrupp.”

Murphy reported that “at least in once case, Shimron was present at a meeting between Ganor and a concern from the city of Essen.”

Ganor has represented ThyssenKrupp in Israel since 2009 in arms deals as well as other, smaller deals, according to the report. A source in ThyssenKrupp is quoted as saying that Ganor earned a commission of up to 2% from the deals, “between 10 and 30 million euros.”

A Handelsblatt reporter told Haaretz that the sum is lower than what consultants and brokers in other countries received in similar deals with Germany.

However, the reporter remarked that Ganor is also involved in non-arms related deals that ThyssenKrupp made in Israel, whose value is very high, and so “he received a higher amount.”

The reporter said that the other deals, which accompanied the big submarine deal, served in other countries as a source of corruption and bribery payments in the country with which the deals were signed.

ThyssenKrupp was involved in various corruption scandals until 2011, when company management changed. The allegations included paying bribes to consultants in various countries to help close deals.

German authorities have investigated some of them. However, a company source told Handelsblatt this weekend that the deals tied to “Scandinavia, German and Israel” are considered “really clean,” and exceptional among the other dubious deals the company had pursued in past.

The report said the Israeli-German ties involved in the submarine sale raised questions of possible corruption.

“Shimron is not only Netanyahu’s lawyer but also his relative,” the report said. “The prime minister plays a decisive role in the planned agreement with ThyssenKrupp. He wants to approve the decision for procuring the submarines, in opposition to the Defense Ministry’s position.”