PM Denies Wrongdoing in Leumi Sale

BEIJING - Prime Minister Ehud Olmert commented yesterday during his visit to China on published reports he could be interrogated regarding the sale of Bank Leumi and in the investigation of the Tax Authority. Olmert was asked by reporters if he acted with integrity in handling the Leumi sale while he was finance minister. "Unequivocally yes," he responded, mentioning recent comments in the press by Bank of Israel Governor Stanley Fischer, who said the tender was conducted properly.

Olmert said he has not been notified of any decision to interrogate him. "Yesterday a report aired that had been aired a number of times in the past. When a decision is made, I will comment on it. According to what I heard, the Justice Ministry response was entirely different." (The Justice Ministry stated Tuesday the decision-making process on investigating Olmert is still ongoing.)

Olmert was also asked about the investigation of his administrative aide, Shula Zaken, in the probe of alleged corruption at the Tax Authority. "It is true my bureau chief is being investigated. You certainly noticed that from the first day, she was the only one under house arrest. I phoned to boost her spirits, but it is better I not comment on the investigation."

According to the premier, his only intervention has been in the appointment of outgoing treasury director general Joseph Bachar as temporary director of the Tax Authority.

Olmert commented on the appointment of authority chief Jacky Matza, now a central figure in the probe. "As finance minister, I appointed Jacky Matza. Senior treasury staff, the attorney general and all the senior officials at the Justice Ministry universally supported his appointment. I was instructed by the attorney general not to make an external appointment I considered, as he said this is a large, complex authority and it would be better to make an internal appointment."

Olmert said: "My bureau chief (Zaken) was not involved in Matza's appointment, nor did I hear about it from her, but I did get the support of the Justice Ministry."

Olmert deflected all the questions about the atmosphere of corruption and comments from within his entourage that the civil service is paralyzed by the climate of fear of investigations.

Olmert also refused to comment on reports he plans to oust Defense Minister Amir Peretz. Asked if he thinks Peretz is a good defense minister, as he has said in the past, Olmert responded, "every few days I have to give a declaration of confidence in a minister. It's unnecessary. I said what I said, and I don't have to add to that."

In response to allegations of a rift at the top, Olmert listed his meeting with senior ministers in the two days before his departure: "I met Foreign Minister Tzipi Livni for a one-hour work meeting, I sat with the defense minister for three and half hours and with senior defense establishment officials, with Shimon Peres, with Jacob Edery and I talked to Eli Yishai."

Olmert also said he convenes the Kadima ministers before every cabinet meeting, although a slip of the tongue drew laughter from those present: "Every week I participate in a Likud ministers meeting." Olmert quickly corrected himself.