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Netanyahu's Top Rival Says Premier Profited in Submarine Scandal

Netanyahu's Top Rival Says Premier Profited in Submarine Scandal

(Bloomberg) -- Benjamin Netanyahu’s chief rival in Israel’s election next month called for a national commission of inquiry into a scandal surrounding the state’s contract to buy submarines from a German conglomerate, and linked the prime minister to the affair.

Benny Gantz, whose Blue & White party is losing ground in polls ahead of the April 9 vote, accused Netanyahu of personally profiting in connection with the deal -- the only active high-level corruption investigation he’s managed to dodge. A spokesman for the Prime Minister’s Office declined to comment.

“In recent days, new and serious details about the submarine deal have been discovered,” Gantz said Monday at a press conference in Tel Aviv, calling it potentially “the most serious corruption affair” in Israel’s history. Yair Lapid, ex-finance minister and Gantz’s political partner, termed it a monumental national security scandal with Netanyahu “at its center.”

Netanyahu's Top Rival Says Premier Profited in Submarine Scandal

“Sixteen million shekels that went to Netanyahu’s pocket. From a company directly connected to the submarine deal,” Gantz said. “This week, it was also revealed the prime minister approved -- behind the back of the security establishment -- the sale of advanced submarines to Egypt.”

Gantz’s comments came after a report last week that his phone had been hacked by Iran. “Because of their oversight, they are trying to go back to the submarine case, but Netanyahu did not get a single shekel,” said Eli Hazan, international spokesman for Netanyahu’s reelection campaign. “Even Gantz himself said a year ago that there was no corruption” regarding the submarines.

Following new reports that Netanyahu allowed Germany to sell submarines to Egypt, a pair of lawmakers demanded Sunday that a committee be convened to receive a report on the decision-making process. To maintain its military edge in the region, where it has many enemies, Israel includes a clause barring the sale of the same weapons to other Middle Eastern countries, according to Ynet.

Netanyahu’s Likud party denied he waived the clause when the allegations first broke in 2017.

Israel sealed the order for more than $2 billion in submarines and corvette warships from ThyssenKrupp AG beginning in 2015 under a deal that has raised concerns about possible bribery at the highest levels of Israel’s security apparatus. Then-Defense Minister Moshe Ya’alon, who’s running on Blue & White’s ticket, opposed the order at the time, saying the submarine purchases were unnecessary.

‘Fake News’

Police have already concluded there’s enough evidence to charge at least six people in the case, including the prime minister’s personal legal adviser and his former chief of staff.

Netanyahu has given testimony in the probe, but hasn’t been named as a target. Attorney General Avihai Mandelblit has, however, recommended charges against the prime minister in three other corruption cases, pending a hearing.

Last week, Channel 13 TV reported that the state prosecutor’s office is investigating a possible link between Netanyahu and Thyssenkrupp. According to the report, Netanyahu bought shares in a company that was a supplier to Thyssenkrupp before he returned to office in 2009, then made more than $4 million when he sold them.

Netanyahu has dismissed his former business interests as “fake news” and said he reported the sale.

To contact the reporter on this story: Ivan Levingston in New York at ilevingston@bloomberg.net

To contact the editors responsible for this story: Lin Noueihed at lnoueihed@bloomberg.net, Amy Teibel, Robert Jameson

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