Netanyahu Legal Woes Worsen as Ex-Top Aide Agrees to Testify

(Bloomberg) -- Benjamin Netanyahu’s legal woes deepened after one of his closest confidants agreed to testify against him in a growing corruption scandal, complicating the Israeli leader’s efforts to hold on to his job.

Shlomo Filber, the suspended Communications Ministry director and onetime chief of Netanyahu’s bureau, signed an agreement to become state witness. He turned on his former boss less than a week after police recommended pressing charges against Netanyahu in two other influence-peddling cases -- and a day after news broke that police were investigating whether another longtime Netanyahu associate sought to bribe a judge.

Filber’s state-witness agreement could represent a major break in the investigation. Former Prime Minister Ehud Olmert went to jail for bribery in 2016 after his longtime secretary turned against him.

“Filber is a close confidant of the prime minister who can fully connect all the dots of all the people,” said Keevoon Global Research head Mitchell Barak, who served as an aide to Netanyahu more than 20 years ago.

While Netanyahu’s allies have rallied to his defense, and no indictments have been served, the scandal has called into question his ability to function as Israel’s leader at a time when security threats are growing on Israel’s northern and southern borders. 

Following Orders

Filber told police he was just carrying out Netanyahu’s orders when he took steps to help Israel’s largest telecommunications company, whose chairman was Netanyahu’s friend, Hadashot News reported Wednesday night, citing what it said were transcripts of Filber’s testimony. 

The station later broadcast a short statement from Netanyahu denying Filber’s reported claims. Netanyahu has denied wrongdoing, framing the corruption allegations as part of a wider effort by left-wing opponents and journalists to bring down his government.

Criminal charges against Filber in a related case will be dropped in exchange for his testimony, Hadashot said. The Israel Police spokesman could not immediately be reached for comment.

Half of the respondents in a Hadashot News poll broadcast Wednesday night said Netanyahu should resign or suspend himself until his legal issues are resolved, while 33 percent said he should stay in office.

“The Netanyahu era is over,” said Avi Gabbay, head of the opposition Labor Party.

Markets Calm

The shekel, which had been strengthening recently, rose 0.3 percent Wednesday in Tel Aviv. The TA-35 benchmark stock index was up 0.2 percent on the day.

Filber already had been investigated on suspicion of crafting rules to benefit Bezeq Israeli Telecommunication Corp., controlled by Netanyahu’s friend Shaul Elovitch. In a new twist to the case, Filber and another Netanyahu aide were detained earlier this week as investigators probe whether the ministry helped Bezeq in exchange for positive coverage of Netanyahu and his wife, Sara, on the company’s Walla! news outlet.

Netanyahu, who stepped down as communications minister because of his friendship with Elovitch, insisted Tuesday he had done nothing to help the company.

“All decisions concerning Bezeq are made by professional committees, by professionals, under close legal supervision,” he said in a Facebook post. “There are no private decisions here. All decisions are transparent and controlled.”

Big Break

Allegations of corruption have dogged Netanyahu for the past two decades, but he has never been charged with a crime. The defection of an aide as close as Filber turns up the heat.

“This looks very problematic and raises the chances of there being an indictment,” said Abraham Diskin, professor emeritus of political science at the Hebrew University of Jerusalem. 

Still, he cautioned, “there’s a long way to go to a conviction. In all these cases it can clearly be proved that Netanyahu’s interests were promoted, but in a criminal case you have to prove deed and intention beyond a reasonable doubt. It’s not enough to just put the circumstances on the table.”

Another former Netanyahu confidant, Ari Harow, signed a similar agreement last year to cooperate in other cases against Netanyahu. It’s unclear how significantly his testimony contributed to the police call to indict Netanyahu in two other corruption cases.

Stand By Your Man

Netanyahu’s coalition partners have stuck by him.

”We’re a law-abiding country, and that means there’s one man and one man only who decides whether or not to indict, and that’s the attorney general,” Finance Minister Moshe Kahlon said Wednesday. Until then, he said, “we’ll continue with our reforms.”

Polls show Netanyahu’s Likud party has remained strong. Naftali Bennett, the education minister and a key coalition partner, criticized Netanyahu for accepting expensive gifts but said at this point he wouldn’t bolt the government.

“No one has an interest in leaving yet,” Diskin said. “But I do hear some voices paving the way to defect the coalition when the time comes.”

Police Files

While Netanyahu has not yet been identified as a suspect in the new Bezeq affair, police last week recommended he be charged in two other cases. In the first, police said they found evidence Netanyahu accepted gifts of champagne, cigars and jewelry worth about 1 million shekels ($286,000) from wealthy friends including Israeli-born Hollywood mogul Arnon Milchan, who allegedly received financial benefits from the government in return.

In the second case, Netanyahu held discussions with the publisher of the Yediot Ahronoth newspaper to promote legislation weakening another daily in exchange for favorable coverage.

It could take months for Attorney General Avihai Mandelblit to review the police files and decide whether to indict Netanyahu. Many such recommendations never ripen into criminal charges -- including two police calls to indict Netanyahu earlier in his career.

--With assistance from Jonathan Ferziger and Gwen Ackerman

To contact the reporters on this story: David Wainer in Tel Aviv at dwainer3@bloomberg.net, Yaacov Benmeleh in Tel Aviv at ybenmeleh@bloomberg.net.

To contact the editors responsible for this story: Alaa Shahine at asalha@bloomberg.net, Michael S. Arnold, Amy Teibel

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