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Israel’s AG: Olmert Abused Position To Acquire Favors, Funds From Talansky

Prime Minister Ehud Olmert may be indicted over suspicion of receiving illicit funds from New York millionaire Morris Talansky, Attorney General Menachem Mazuz told Olmert’s legal team Sunday. The indictment is pending an additional hearing, said Mazuz.

In a letter to Olmert’s attorneys, Mazuz stated that he believes the Prime Minister had methodically abused his public office and his status to acquire personal favors from Talansky over a period of time. Mazuz wrote Olmert obtained financial favors in exchange for assisting Talansky in his business ventures, while being in a conflict of interests.

A similar announcement was given to the lawyers of Shula Zaken, then director of Olmert’s office. The actual offenses Olmert is faced with are fraud and breach of trust. The prosecution decided not to include bribery among the charges, for lack of sufficient evidence.

A source in the Attorney General’s office said that no decision has as yet been made whether to prosecute Talansky or Olmert’s former associate, attorney Uri Messer. Mazuz is expected to soon reach a decision on the investment center affair (see below), and any decision regarding Talansky will be announced at the same time.

A source in the Ministry of Justice told Haaretz that Mazuz decided to serve an indictment without waiting for Talansky to complete his testimony, as the evidence accumulated was sufficiently reliable as is.

As published in Haaretz in recent weeks, Talansky is expected to announce his return to Israel for the completion of his testimony shortly, having been promised immunity against self-incrimination by the United States Department of Justice.

The Justice Ministry source also said that the announcement was unrelated to the recent general election and ensuing coalition talks, as Olmert participated in neither.

The investigations into what had become dubbed first the “envelopes case” and later became known as the “Talansky affair” was launched in April 2008, when Mazuz ordered a probe against Olmert on suspicion of taking hundreds of thousands of dollars from the Orthodox Jewish financier.

Olmert was suspected of using the money to cover his campaigns and travel expenses.

Through the period of the alleged exchanges with Talansky, Olmert first served as the mayor of Jerusalem, and then as a minister in Ariel Sharon’s governments.

According to suspicions at the time, Olmert received large sums of cash from Talansky, either personally through Zaken, and through a charity organization ran by Messer. It is alleged that in exchange for the money transfers, Olmert agreed to assist Talansky’s business ventures.

The Mazuz statement yesterday detailed to some degree one alleged occasion, in which Talansky is said to have asked Olmert to assist him in promoting Talansky’s business interests with Israeli businessman Yitzhak Tshuva. Olmert allegedly did make the contact, which is supposed to have resulted in a number of meetings between Talansky and his staff and Tshuva and his staff, leading to the possibility of Tshuva acquiring the services of Talansky’s New York company, Kool-Tech.

Mazuz goes on to claim in the statement that Olmert’s assistance to Talansky through his communication with Tshuva put him in a conflict of interest, namely that of his personal commitment to Talansky and his duties as a government official vested with public trust.

Mazuz also claims that another conflict of interest developed with the resulting commitment of Olmert to Tshuva, as well as to another businessman, Sheldon Adelson, with whom a similar process is alleged to have taken place.

The Attorney General also suggested that Olmert concealed his relationship with Talansky from the state comptroller, against the rules set forth by the Asher Committee on conflict of interest in 1978.

The Prime Minister’s attorney, Yehuda Weinstein, told Haaretz yesterday that the Talansky affair began around a suspicion of bribery, which was, however, completely absent from the indictment. Weinstein said he was bewildered at how a suspicion that brought down a prime minister and launched the country into elections simply disappeared.

Zaken’s attorney said he would have to study the case materials but hopes to prove his client never took a penny and was motivated solely by the desire to do her public duty faithfully.

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