Israel’s Security Chiefs Were Once Beyond Suspicion. No Longer.

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(Bloomberg Opinion) -- Late last week, in the midst of an Israeli political crisis that has stalemated the creation of a new government for nine months, the state prosecutor handed down indictments to some of Israel’s most trusted former naval officers and senior officials. It may not change the immediate political impasse, but the scandal over defense procurement sheds an unflattering light on an area of Israeli policy that most voters are unaccustomed to questioning.

In what is known as Case 3000, the men are charged with bribery, fraud and money laundering. At the center of the case is Israeli businessman Miki Ganor, a former naval officer who is now the Israeli representative of German shipbuilder Thyssenkrupp. Ganor had been a key state’s witness who changed his mind and is now among the indicted.

In late 2016, a deal was signed to replace three of Israel’s five German-made Dolphin-class nuclear submarines as part of a plan to replace them all. Prime Minister Benjamin Netanyahu thought that didn’t go far enough decided to order a sixth sub (that deal is now suspended pending the investigations). He also contemplated adding three more subs, which most defense experts regard as unnecessary.  

The navy also asked for Korean gunboats to protect Israeli natural gas fields. The government instead purchased larger and more expensive gunboats -- again from Thyssenkrupp and without a tender process. Ganor’s alleged fellow conspirators include the former chief of the navy, the ex-deputy chief of the prime minister’s National Security Council, a retired brigadier general who once commanded Israel’s elite naval commando forces and a recent head of Netanyahu’s staff. 

Also indicted was the prime minister’s personal lawyer (and cousin) David Shimron, who also happens to be Ganor’s lawyer. Shimron is charged with money laundering; he denies the charges and also denies any connection to the bribery and fraud alleged in Case 3000.

In the past, the state prosecutor publicly cleared Netanyahu himself of involvement in Case 3000. That could change. It is hard to believe that the hyper-vigilant and hands-on prime minister, while engaged in decision-making on Israel’s naval acquisitions from Thyssenkrupp, was unaware that members of his inner circle were (allegedly) taking bribes from the firm’s representative. Bibi claims he knew nothing of the alleged actions, but his opponents are calling on the prosecutor to take another look.      

Israel has had its share of personal corruption in high places. In the ‘70s, Prime Minister Yitzhak Rabin was forced to leave office over an illegal bank account. More recently, Israeli President Moshe Katzav went to prison for rape and obstruction of justice. Prime Minister Ehud Olmert, Netanyahu’s predecessor, spent a year and a half behind bars for breaches of trust and bribe-taking during his tenure as mayor of Jerusalem. And, of course, Netanyahu himself is now facing three charges of corruption, bribery and fraud, which he denies. Israelis have learned the hard way not to underestimate the greed and appetite of their elected leaders.

But Case 3000 is different. It is about national security. “As someone who has served in defense for 38 years, I never thought I would hear the words ‘corruption’ and ‘Israeli defense’ in the same sentence,” former Israeli Defense Forces chief of staff Benny Gantz said this week. This is political rhetoric, of course; Gantz is now the leader of the Blue and White opposition party vying to form a government. But the sentiment resonates with the public.

In a time of cynicism and polarization, the IDF is the country’s most trusted institution. In Israel, believing in the absolute honor and dedication of military officials is no luxury; it is what enables Israelis to send their sons and daughters off to dangerous army duty, to invest their savings in the country’s future and to accept what, in other democracies, would be considered confiscatory taxes in return for security. Last year, Israel spent 4.3% of its per capita income on defense. By contrast, the U.S. spent 3.2% and Great Britain 1.8%.

A large share of this money goes to the acquisition of very costly strategic weapons, like the nuclear submarines Ganor was selling. They are a major part of Israel’s second-strike deterrence against Iran. The very idea that decisions about their acquisition were influenced by factors other than calculated defense need is chilling.

Case 3000 raises a number of questions, including what was behind Israel’s decision to drop a plan to buy gunships from South Korea and chose instead more expensive ships from Thyssenkrupp. The affair would not have come to light without the media, led by Channel 13 TV investigative reporter Raviv Drucker. There are people in the government who would prefer to see it end with the current indictments. But determined prosecutors, judges and journalists will likely pursue the case aggressively.

Whatever happens as this legal process unfolds, the scandal will be felt far beyond the current political crisis. From now on it will be much harder for Israelis to maintain a blind faith in the integrity and wisdom of those charged with their security.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Zev Chafets is a journalist and author of 14 books. He was a senior aide to Israeli Prime Minister Menachem Begin and the founding managing editor of the Jerusalem Report Magazine.

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