Prosecutors opened up a criminal investigation on Wednesday into Prime Minister Ehud Olmert’s role in the sale of the country’s second largest bank.
State Prosecutor Eran Shendar alleged that the prime minister influencing the tender for the sale of Israel’s Bank Leumi in 2005 by favoring business associates during his time as finance minister.
This serves as one of the biggest setbacks for the prime minister since the Lebanon war last summer, considering he is also facing a number of other corruption allegations. The probe didn’t come as a surprise to the government as rumors of an investigation surfaced during Olmert’s recent trip to China.
The Justice Ministry issued a statement saying the comptroller's report “led to the conclusion that a foundation of evidence has been built that would justify opening a criminal investigation.”
Police Commissioner Moshe Karadi said the national fraud squad would handle the probe as they also conducted the preliminary inquiries.
Police suspect Olmert personally assisted Frank Lowy, an Australian business mogul, to win the bid. In the end, however, Lowy withdrew from the tender shortly before it closed. Lowy, who is not under police investigation, released a statement on Wednesday denying that he or anyone connected to him had done anything illegal and was certain the investigation would prove this.
If Olmert is indicted, he would have to step down as prime minister, but it could take months before a decision is reached. Police must present their findings to the attorney general who has the final say for indictment.
Olmert joins former Prime Ministers Benjamin Netanyahu, Ehud Barak, and Ariel Sharon who have all been subjected to criminal investigations while in office. None of them were ever indicted or resigned.