Olmert faces massive new corruption investigation

By Anshel Pfeffer, April 22, 2010
Former Prime Minister Ehud Olmert is facing questioning in the largest corruption case in Israeli history

Former Prime Minister Ehud Olmert is facing questioning in the largest corruption case in Israeli history

Police investigators believe that they are close to securing the testimony of a number of close associates of former prime minister Ehud Olmert in what is being described as the largest corruption case in Israeli history.

So far, the allegations against Mr Olmert have focused on millions of shekels in bribes that the investigators believe were paid to secure extensive building rights in the Holyland project in Jerusalem. The suspects include a group of building tycoons and senior officials in Jerusalem City Hall.

The massive Holyland apartment complex overlooks the Malcha mall and has been extensively criticised for obtruding on the landscape.

Police are also looking into claims that bribes were given to authorise other major building projects.

Mr Olmert will be questioned by police in the next few days. Sources close to the probe said they were "leaving him for the end, after we collect all the rest of the evidence we can and interrogate all his alleged accomplices".

So far, the most surprising arrest has been that of Uri Lupolianski, the former mayor of Jerusalem who in the decade that Mr Olmert was mayor (1993-2003) served as his deputy and chairman of the local planning commission.

The allegations against Mr Lupolianski include accepting bribes totalling NIS 3 million for approving planning permits for the Holyland apartment complex that exceeded the original building rights by 1,200 per cent.

Mr Lupolianski is not believed to have taken the money for his private use. Most of it was in the form of donations to his medical supply loan organisation, Yad Sarah. Two separate sums of $100,000 are alleged to have gone to a Kollel, or yeshivah for married men, run by his son; and to pay for his election campaign.

Mr Lupolianski has denied taking any bribes and said in a phone-interview with Channel 10 that "Olmert was the one who authorised all the building".

Mr Olmert, who was out of the country when the story broke, returned last Wednesday amid rumours that he would be arrested upon arrival. In a televised statement from his office, he denied ever receiving bribes and said that "the Holyland building plans were totally changed when I was no longer mayor. I had no part in it."

Police are planning to question him and Mr Lupolianski together in order to confront them with their conflicting statements.

So far nine men have been arrested, and some of them released to house-arrest. They include a current deputy mayor of Jerusalem and the former chief municipal engineer, who are also suspected of receiving bribes; three property developers alleged to have given the bribes; and three local political figures who allegedly acted as go-betweens.

One of those arrested, lawyer Uri Messer, is an old friend and former law-firm partner of Mr Olmert's, who is already the main state witness against him in the current graft case being tried at the Jerusalem District Court.

Mr Messer is said to be cooperating with the investigators and police are hoping to secure additional state witnesses from within Mr Olmert's inner circle, chief among them his former secretary and long-time confidant, Shula Zaken. Ms Zaken is currently out of Israel and has therefore not been questioned yet, but she is already Mr Olmert's co-defendant in the corruption trial.

Police are hoping to establish a pattern that will prove the existence of a network of bribery around Mr Olmert during his period both as mayor and trade and industry minister, through which businessmen obtained planning permits and development grants.

Last updated: 1:56pm, April 22 2010