Taking Stock / Breaking the Silence

Adi Amorai is talking. With the requisite caution, with reservations, tiptoeing on eggshells, yet his message is loud and clear: The Israel Electric Corporation is corrupt to the core, and none of the reports now breaking about its rotten practices are a surprise.

Adi Amorai is talking.

With the requisite caution, with reservations, tiptoeing on eggshells, yet his message is loud and clear: The Israel Electric Corporation is corrupt to the core, and none of the reports now breaking about its rotten practices are a surprise.

Here, for your edification, is a brief summary of the disclosures he made to Mordechai Gilat and Uzi Dayan of Yedioth Ahronoth, and remember that Amorai should know, since he chaired the utility from 1992 to 1995.

1. When arriving at the IEC, Amorai found he had to undergo a sort of vetting by the workers' committee. He discovered that the top management worked hand in glove with the violent workers' committee members, in commission and in omission.

2. The CEO of one of the company's biggest foreign suppliers told him that most of the IEC tenders were concluded in advance. He had decided not to bid in a tender because he believed his rivals had greased top IEC people.

3. The IEC is managed badly and corruptly. "Tremendous waste, millions of dollars worth of inventory that isn't needed or that was bought already malfunctioning, and giant, totally bizarre transactions. Huge amounts of money were squandered for no good reason," Amorai told the journalists.

4. The management supported acquisitions of equipment at highly inflated prices. For instance, one day management proposed to buy $160 million worth of wind-driven turbines that, it later transpired, it could have gotten for $90 million.

5. Amorai tells of enormous pressures imposed on him when he decided that Moshe Katz should retire as CEO, having reached the age. Even more significant, Amorai relates, is the fact that the second Katz left, he took a job at Ofer Brothers, one of the biggest suppliers to the IEC.

6. Amorai tried to bring in a professional CEO, but politicians and top people at the company applied unbearable pressure to bring in Rafi Peled instead, straight from the Jacuzzi that cost him his job as chief of police. Nor did Amorai's attempt to hire a pro as manager of the procurement department work out. He was forced to appoint Asher Cohen, an IEC insider.

7. For the first time, Amorai publicly admits that Rafi Peled was the driving force behind the initiative for the IEC to buy land from Ezra Harel, since deceased. The IEC paid a quarter-billion shekels for the properties, which, as Amorai now admits, it never needed in the first place. A quarter-billion shekels down the drain.

Harel himself leveraged that plum deal with the IEC to raise tens of millions of dollars from the general public. Today the person liquidating his estate claims to have found substantial and grave instances of fraud.

8. Asher Cohen, the procurement chief forced down Amorai's throat, was later caught taking a $330,000 bribe from an IEC supplier. Rafi Peled is at the center of a multi-tentacled criminal investigation spearheaded by the Israel Securities Authority, regarding the collapse of his business empire, usually known as the Peled-Givony group.

9. Gonen Segev had been the energy minister in charge of the IEC at the time. He pressed Amorai to choose the Ofer Bros. for a particular deal. Amorai refused and three months later, he was fired.

Two months ago Segev was arrested for alleged drug-smuggling, forgery and fraud.

An honest man in Sodom

Well, Amorai's revelations are actually not very surprising. Amorai is considered to be one of the straightest public servants Israel has ever known, so the mind boggles at what must have been happening at the IEC when real horse-thieves were in charge over there.

Anybody keeping half an eye on the IEC has always known it's one of the biggest, creamiest and most corrupt pork barrels in Israel. All it takes is a thousandth-percent of a share in the utility's immense NIS 3-6 billion investment budget a year to make a businessman rich for life.

You don't need a steam shovel to dig for the rot, it's right out there. Just look at the rampant nepotism, with kinfolk down the generations serving openly side by side, and how fervidly the rotten practice is supported by the management and board of directors. That in itself screams that the company is a hideous economic mutation.

One thing Amorai the Honest neglected to divulge. Why didn't he call in the cops? Why didn't he rope in the State Comptroller, the press, and demand a sweeping investigation? Why didn't he throw the doors open, letting the light stream in and expose the rot? Why didn't he fire the whole management, lock stock and barrel, and clean out the company's reeking stables?

Amorai should be praised for opening his mouth, however belatedly. Most of Israel's public servants are abject cowards and few would be as frank.

But why did it take him 10 years to disclose that Rafi Peled needlessly transferred a quarter-billion of the taxpayer's money to businessman Ezra Harel? Back then, in real time, we at Haaretz had exposed the entire stinking transaction. We wrote how the IEC management fooled the IEC board, we wrote how Ezra Harel had planted moles at the company. Why did Amorai deny Haaretz's claims at the time and throw his support behind the management? What triggered his sudden decision to speak out?

We can hazard a guess. We think Amorai was scared. He knew that it wasn't only a few IEC fat-cats feeding from that pork-barrel, but an enormous group of people - tycoons, machers, mediators, politicians, Knesset members and ministers, too, all gorging together and all up to their necks in that unkosher swamp. Everybody was eating, everybody was padding their pockets and everybody was looking the other way, and if he wanted to stay alive he had to play their game. Or at least, keep silent.