Hidden in Olmert Indictment Are Charges That He Swindled U.S. Jews

Pattern of Double-Billing Groups

By Nathan Guttman

Published September 02, 2009, issue of September 11, 2009.
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The indictment against former Israeli prime minister Ehud Olmert has riveted Israelis with its allegations that the ex-prime minister took envelopes of cash from supporters for his personal use. But another aspect of the August 30 indictment, one directly relevant to American Jews, has been all but lost amid the fallout:

The Israeli leader, prosecutors charge, bilked 17 prominent North American Jewish charities and pro-Israel advocacy groups for his own benefit.

American Jewish and pro-Israel organizations unwittingly ponied up tens of thousands of dollars in false travel expenses for Olmert that he then used as a personal travel fund for himself and for his friends and family, according to the indictment handed up in Israel.

In a three-year period, Olmert allegedly swindled American Jewish groups out of some $50,000 that they paid, at the request of his travel coordinator, in double and sometimes triple travel expenses. Olmert and his family allegedly used the extra funds for private travel and vacations.

Among the groups are some of biggest organizations in American Jewish life. But most were extremely cautious in their reaction to the alleged scam, stressing that Olmert is presumed innocent until proven guilty.

Olmert’s mode of operation, as alleged in the 60-page indictment, was simple: As a sought-after speaker at Jewish and pro-Israeli gatherings worldwide, he was frequently invited to address different groups. On many occasions, several groups invited Olmert to speak during the same visit to the United States.

The travel agency arranging the tours was allegedly in on the plot, and it billed each one of the groups for full travel expenses, despite the fact that only one of them was actually paying for the tours.

One example of this alleged conduct is a June 2005 visit by Olmert to New York while he was a senior minister in the government of Ariel Sharon. Olmert was invited to speak at two events: a New Jersey fundraiser of Friends of the Israel Defense Forces, and a New York dinner organized by Israel Policy Forum, a pro-peace advocacy group. Both groups were asked by Olmert’s travel coordinator to pay for his client’s first-class flight and to cover flight expenses of his bodyguard. Friends of the IDF paid $10,975, and IPF paid another $15,626. Each group assumed it was solely covering the travel expenses. The actual cost of the flight tickets, according to the indictment, was $13,643. Olmert’s profit from this double charging, the prosecution claims, was $12,958.

This pattern was repeated, according to the detailed list attached to the indictment, 15 times. In some cases, several groups were required to cover the same travel expenses; in others, they were asked to pay for the flights even though the government of Israel already covered the costs. All the alleged double billing took place before Olmert became prime minister in 2006. At the time of the events documented in the indictment, Olmert served as mayor of Jerusalem and as a senior Cabinet minister.

“Based on this misrepresentation on behalf of the defendants, the organizations and the government paid extra amounts of money for funding the defendant’s flight tickets in a way that left him with significant surplus, which was used by him and his family to pay for their private flights and for upgrading the defendant’s flights to first class,” the indictment reads. It goes on to state, “In the acts described above, the defendant defamed the country in the eyes of these organizations and harmed the image of the Israeli public service and the reputation of the State of Israel.”

The list of organizations hit by Olmert’s alleged double-billing operation includes some of the biggest and most prominent organizations in American Jewish life. Among them are Israel Bonds ($14,000), the Simon Wiesenthal Center ($5,000), and the Canadian Society for Yad Vashem ($2,000).

The Jewish Federation of Greater Indianapolis, according to the indictment, paid $10,152 to bring Olmert to speak to its major donors in October 2002. Travel expenses for this trip were also allegedly charged to ORT and to a German Jewish organization. The three organizations paid $5,658 in excess travel expenses.

Michael Papo, executive vice president of the Indianapolis federation, said he has no hard feelings toward Olmert. “As an American, I am obliged to believe he is innocent until proven guilty,” Papo said. He added that the federation was not aware of the double billing and that he is saddened by the allegation. “But,” Papo stressed, “it is not as if he did it because he didn’t care about his Jewish brothers. He may be greedy, but he was not a traitor.”

The America-Israel Friendship League paid $9,633 in November 2004 for Olmert’s travel expenses despite the fact the trip was covered by Israel’s Trade Ministry, according to the indictment. The league’s chairman, Kenneth Bialkin, responded through a spokesman: “We had no knowledge of any possible duplication. We perceived no wrongdoing.”

Other groups declined to comment.

But the silence policy that Jewish groups have adopted toward Olmert’s alleged billing practices when visiting them could come to an end once the case comes to court in Israel. The indictment lists more than 50 activists in these groups as potential witnesses for the prosecution. Among them are executive directors, lay leaders and financial officers of the 16 organizations that were allegedly asked to pay for the travels of the former Israeli leader.

Contact Nathan Guttman at guttman@forward.com

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