Friday, January 05, 2007

Corruption in Israel

Joshua Brilliant:

The arrest of the head of the Tax Authority, his predecessor, senior officials and the house arrest of the head of Prime Minister's Bureau this week suggested to Israelis that corruption has reached new heights.

The Tax Authority is responsible for collecting income tax, Value Added Tax, customs and other dues. It is "the only body allowed to put its hand into our pockets and take out money," noted Yediot Aharonot daily.

Police spokesman Mickey Rosenfeld said the authorities suspect the head of the Prime Minister's Bureau, Shula Zaken, of having helped businessmen "position individuals within the Tax Authority." Then, police suspects some of those officials were bribed in order to extend tax benefits to people who did not deserve them.

A secret investigation began half a year ago with, apparently, extensive use of wire-tapings. The first public indication that something was going on was a coincidence. Former Justice Minister Haim Ramon is standing trial for having kissed a female officer in the prime minister's office. The prosecution said no secret wire tapings were made in his case. However, it later reported having picked up a conversation on the Ramon affair when it eavesdropped on Zaken's phone. At that time police did not say why it listened to her conversations.

Police on Tuesday rounded up 22 suspects, almost all of them from the Tax Authority. Six of them hold key positions there, Rosenfeld said. Eight more people were summoned for questioning Wednesday.

Nothing has been proven yet. Zaken's lawyer, Micha Fetman, said her client was not involved in appointments or in seeking tax benefits. Yair Golan, who represents her detained brother Yoram Karshi, told the court his client is a member of Jerusalem's City Council, people ask him for help and he might have made calls or recommendations, but not for pay.

The court extended the suspects' remand. In Karshi's case, for example, it said police has more than "a reasonable suspicion" that he had "unusual influence over events in the Tax Authority." That supports suspicions of "extending bribery and being an intermediary in bribery," the judge added.

Israel has had scandals. Labor lost the 1977 elections, after almost 30 years in power, partly because of the aftershock following the 1973 war but also because of a sense it was corrupt. A minister committed suicide when told he was under investigation and the candidate for the Governor of the Bank of Israel was jailed. The Likud lost elections in 1992 following a sense of disgust with corruption in its ranks.

Corruption seems to have worsened in recent years. Almost all recent prime ministers -- including Binyamin Netanyahu, Ehud Barak, Ariel Sharon -- faced investigations though the suspicions never evolved into charge sheets against them personally. Former ministers are on trial. One of them, Zahi Haegbi accused of making illegal appointments, is still chairman of the powerful Knesset Foreign Affairs and Defense Committee. President Moshe Katsav is suspected of having forced himself upon women and the attorney general is expected to decide whether to charge him with rape. Katsav vehemently denies the claims.

Hebrew University political science professor Menachem Hofnung told United Press International Israel had been among the 10 most honest countries in the world. It dropped to number 34 in a list of some 130 countries.

Hofnung attributed the decline, in part, to the political system of primaries in which politicians bought influence by providing jobs, permits and tax benefits.

The Likud's Central Committee earned a notorious reputation. Former minister Limor Livnat once asked that committee whether it elected the ministers so that they would provide jobs and the resounding answer was: "Yes."

Professor Avraham Friedman, former dean of the School of Government, Diplomacy and Strategy at the Interdisciplinary Center in Herzliya, who was also Civil Service Commissioner, said Israeli society has gone through a "radical change" and has become "very materialistic."

People judge themselves by their economic achievements and the barriers society put up are weak, Friedman indicated. Israeli income tax suspects people of cheating in their reports but when it catches them it shows leniency.

The Israeli system is also doing a better job in exposing wrongdoing, Friedman added.

Prime Minister Olmert is "absolutely not" suspected of any involvement in the latest affair, Rosenfeld said.

However, the prime minister might suffer its consequences, Hofnung maintained.

Olmert survived a series of investigations by the State Controller, while the attorney general and a court cleared him of other affairs. However, every few months something new crops up. Sixty of the people who answered a poll published Wednesday said they believe his personal honesty is "not good." Only 30 percent say it is good, Haaretz daily reported.

If Olmert had been considered beyond reproach, the latest affair would not hurt him, Hofnung said. However he does bear "ministerial responsibility." Olmert employed Zaken and whatever she did was done from his bureau. That is not enough to charge Olmert but it raises questions on his judgment, Hofnung said.

The problem is not just the loss of trust in the Tax Authority, maintained former Supreme Court Judge Yitzhak Zamir. "What is worse is the loss of confidence in the administration as a whole. People are willing to believe the administration is corrupt... and what makes that (sense) worse is the fact there are grounds to this suspicion," he added.

This government might have been the first to include in its guidelines a battle against corruption, Zamir continued. "What did it do (about it)? Nothing at all," he said.

Arrest of Olmert's office manager sends his bureau into crisis mode

Aide to Israel's Olmert arrested in tax probe

The Bottom Line / Is there anyone left who's not corrupt?

Police plan additional arrests in tax bribery probe

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