Israel’s Olmert hit by new scandal


JERUSALEM - Israel’s top government watchdog raised new suspicions of impropriety by Prime Minister Ehud Olmert in excerpts of a report published today.

Olmert, already under investigation over a real estate deal, faced allegations from the state comptroller of political cronyism in appointments at a government-funded business authority while he was industry and trade minister in 2004.

The prime minister’s office, responding to the new report, denied any wrongdoing.

No criminal charges have been filed in any of the cases, but they have drawn headlines at a time when the Israeli leader’s popularity has plunged over his handling of the war in Lebanon.

The state comptroller’s office said it had asked the attorney-general to look into the appointment of four officials from Olmert’s political party at the time, the Likud, to key positions in the Small and Medium-Sized Business Authority.

"The selection process of the three project managers and the way they operated suffered from serious defects," the comptroller’s office, said in an excerpt of a report published in the Haaretz newspaper.

"This fact, together with their political connection with the minister (Olmert), raises concern that political considerations were the basis for selecting the projects," it said.

Calling the appointment procedure "improper", Zvi Vertikovsky, deputy director-general of the state comptroller’s office, told Army Radio: "According to the documents in our possession, there are footprints leading in his (Olmert’s) direction."

In a statement, Olmert’s office said proper procedures were followed in the appointments and that the industry and trade ministry he headed at the time was not involved in launching three projects scrutinised in the comptroller’s report.

In a separate case, the state comptroller’s office has been examining the terms of Olmert’s purchase of a Jerusalem apartment in 2004, but has yet to issue a report.

The prime minister’s office has reserved comment, pending an official approach by authorities on the real estate deal.

Olmert defected from Likud to a new centrist party, Kadima, along with then-Israeli leader Ariel Sharon last year. Olmert formed a Kadima-led coalition government in May.