JERUSALEM, Jan. 16 (UPI) -- Police investigations into suspected government corruption have spread to Prime Minister Ehud Olmert.
State Attorney Eran Shendar Tuesday instructed police to investigate Olmert's involvement in the privatization of Bank Leumi, the Justice Ministry's spokesman reported. Bank Leumi is Israel's second largest bank.
Political and legal experts did not expect the investigation to have any immediate serious implications though Hebrew University Political Science Prof. Avraham Diskin told United Press International, "It is clear his (Olmert's) seat is shaking."
According to the Justice Ministry's spokesman, Moshe Cohen, the State Comptroller passed information regarding Olmert's involvement in Bank Leumi's privatization. At that time Olmert was finance minister.
A preliminary police inquiry led to a conclusion there is enough evidence to justify a criminal investigation, Cohen said.
A senior source in the State Comptroller's Office, who asked not to be identified, alleged that Olmert had been, "Very, very intensively involved" in favor of one of the groups that competed in the tender for Bank Leumi's sale.
The source said one of the contenders, a wealthy Australian, is a friend of Olmert and hosted him on in his yacht. The tycoon's lawyer is Olmert's son in law.
Sources in the Prime Minister's Office said Olmert was proud of the process in which Bank Leumi was being privatized.
The Finance Ministry's Legal Adviser Yemima Mazuz supervised the process. Her brother, Menachem Mazuz, is the attorney general that is why he asked the state attorney to handle the case.
Whatever Olmert did at that time, did not seem to make a difference. The economic newspaper, Globes, quoted "sources close to the tender" as saying that one billionaire did not compete while another bought the necessary documents but "ultimately did not participate in the tender."
Bank of Israel's Governor Stanley Fischer said he had noticed, "Only professional disagreements in the affair and nothing more than that," his chief of staff Gaby Fiszman told UPI.
Nevertheless the investigation comes at a time Israel is rocked by suspected corruption at the highest government levels. Tax authority officials have been detained, Olmert's chief of bureau was placed under house arrest because of the tax affair, and Finance Minister Avraham Hirchson might be in hot water over an alleged embezzlement of over $1 million when he had headed the National Labor Union. A Justice Ministry official said they "are aware" of the investigation but "it is not at the stage of asking to investigate him as a suspect."
Israel's last three prime ministers had been subjected to police investigations.
Some of these investigations concerned illegal election funding and violating election laws. "Not corruption," noted Hillel Sommer, a Constitutional Law scholar at the Interdisciplinary Center in Herzliya.
Attorney General Mazuz decided not to press charges against the then Prime Minister Ariel Sharon in one suspected corruption case but another investigation was still open in January 2006 when Sharon lost consciousness.
Sommer said that as long as police is just investigating Olmert, the prime minister does not have to step down or suspend himself.
He would have to stand down only if a charge sheet is presented and that is a long way off. Israel's legal authorities work slowly, Sommer said.
Israeli law allows for impeachment but "We are definitely not there," he added.
The investigation nevertheless exacerbates Olmert's problematic image.
A public opinion poll conducted last week showed that if elections were held now the right wing Likud would emerge first with 29 mandates in the 120 seat Knesset, the Labor Party second with 18 and Olmert's Kadima would trail behind with 12 mandates. Olmert's approval rating dropped to 14 percent, Haaretz reported.
Several opposition Knesset members called for early elections, but that is now new in Israel's political system. Ran Cohen of the dovish Meretz Party said that the moment "Criminal investigation opens, public confidence ends and the government's future (will be limited) to a few months."
Diskin noted that as long as Kadima's Knesset members stick together neither the left nor the right wing parties would have enough mandates to form an alternative government.
The Knesset's current tenure ends in 2010 and legislators are reluctant to call early elections when they are just a year in office.
The question is whether Kadima, formed shortly before last year's elections, will remain united. If Olmert is forced out there will be a struggle over the leadership since there is no obvious successor there. "Nine opportunists" could bolt, join right wing parties that already have 52 mandates and change the government, Diskin noted.
