Behind the Scenes of Leiderman's Dropped Governor Bid, a Claim of Alleged Sexual Harassment

Three days after the new Bank of Israel governor was nominated, Leo Leiderman withdrew his candidacy - the second in a row to drop his bid. How could Netanyahu and Lapid make the announcement without checking thoroughly first?

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On Wednesday, at seven in the evening, before the air had cleared around Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid's announcement that they had tapped Leo Leiderman as the next Bank of Israel governor, a first message arrived: "Its good that the Frenkel affair is over. Unfortunately, Professor Leiderman has many skeletons in the closet. Try to find out why he was forced to leave Deutsche Bank."

Later, there were additions. For example, a phone call from S.V., an Israeli woman who lives abroad. She is close to economic circles in Israel, and is in the know when it comes to the Bank of Israel. S.V., on a summer break at her childhood kibbutz, knows there is some big secret that surrounded Leiderman's sudden embarrasing, personal circumstances under which he resigned from Deutsche Bank - a secret that only a few people know, people who vowed not to reveal it.

The heart of the secret was a claim of alleged sexual harassment. A journalistic inquiry regarding this was sent to the spokesperson of the German bank, which is headquartered in Frankfurt: Really? Was there a complaint that was withdrawn in Leiderman's resignation deal? What is the bank's policy regarding sexual harassment?

Deutsche Bank did not respond to these questions, but on Friday morning they answered the phone and promised to check. In any case, they had heard there about the Turkel Committee, the advisory committee on senior appointments, and were getting ready for an official request from the Israeli authorities. As such, they began gathering material on matters of integrity, ethics and the relationship between him and her, and him and them, or their bank. That does not mean, of course, that the allegations made against Leiderman, anonymously or under a hidden identity, are true. He still hasn't had the opportunity to respond to them and present his own side of the story. But it was becoming increasingly clear: his appointment as Bank of Israel governor would not be smooth, not at all, and as one of the members of the Turkel Committee said Friday regarding the affair, "disgusting."

At the same time, in her kibbutz in central Israel, S.V phoned retired Supreme Court Justice Jacob Turkel, president of the Turkel Committee, in Jerusalem. She told him what she knew, and with whom, in far-off California, it was possible to clarify the details. Turkel, as usual, asked for the information in writing. She promised to mail it. No, the judge insisted, this is urgent. Committee Secretary Arieh Zohar, is sitting by the fax machine - send it now. S.V. looked for a fax in the kibbutz, and toward the afternoon, she sent her missive.

She was not the only one, however. Turkel still hadn't managed to check the information - the committee still had not met to deliberate on it, in preparation for a conversation with Leiderman - when a flood of complaints and claims, it is thought that more than half a dozen, ruled on Leiderman. Netanyahu had not yet managed to update Turkel before he announcement he was withdrawing his candidacy, but Turkel was not completely surprised. At the moment that Netanyahu and Lapid declared that Leiderman was on his way to the bank, Turkel already expected that people with bad intentions would hurry to say what was on their minds. In today's atmosphere, the candidate would be taken to account, and sooner or later, he could fold.

And so, two questions still remain from the Frenkel affair: How can people who see themselves as smart insist on repeating the same mistakes, their own and those of others? How could Netanyahu and Lapid announce the nomination of a new Bank of Israel governor so quickly, without thoroughly checking first? Was sending an advisor - Professor Eugene Kandel - to ask Leiderman if everything was alright meant to be a substitute for a comprehensive check-up, a combination of ultra-sound, x-rays and MRI, in order to avoid a second disgrace in a row? And did Leiderman, who witnessed the Frenkel Affair play itself out to its bitter end, not understand that he could not assume that some secret or another wouldn't come to light?

The first time it took three weeks. The second time it took three days. At this rate, Netanyahu and Lapid will find a third candidate who will take the job for three hours.

Deutsche Bank has declined to comment. Leiderman has yet to respond.   

Leo Leiderman. Credit: David Bachar

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