Netanyahu, lawyer in deep over alleged ‘pay for play’ submarine deal
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Netanyahu, lawyer in deep over alleged ‘pay for play’ submarine deal

Attorney general urged to investigate prime minister’s personal involvement in multi-billion shekel purchase, reportedly opposed by defense establishment

Raoul Wootliff is the The Times of Israel's political correspondent.

Prime Minister Benjamin Netanyahu aboard the new submarine 'Rahav' at the Israeli navy base in Haifa, on January 12, 2016. (Kobi Gideon/GPO)
Prime Minister Benjamin Netanyahu aboard the new submarine 'Rahav' at the Israeli navy base in Haifa, on January 12, 2016. (Kobi Gideon/GPO)

A long-time personal lawyer to Prime Minister Benjamin Netanyahu is alleged to be at the center of a multi-billion shekel controversy involving Israel’s possible purchase of German submarines with state funds earmarked for security needs.

David Shimron, who has spent years defending Netanyahu against dozens of reports claiming malpractice and misuse of office for personal gain, is being accused of a serious conflict of interest due to his links to the German shipbuilder attempting to sell Israel the vessels.

According to a report by Channel 10 on Tuesday night, Shimron serves as the representative of a German company trying to sell Israel military submarines that Netanyahu has been pushing for Israel to buy against the will of the IDF and former defense minister Moshe Ya’alon.

Netanyahu announced in a cabinet meeting last month that Israel was in the process of negotiating the purchase of three new submarines for the Israeli Navy, which currently maintains a fleet of five underwater vessels, with another slated to be delivered in coming years.

The new submarines — valued at around NIS 6 billion ($1.5 billion) — were intended as replacements for the military’s older models.

The INS Rahav, Israel's newest submarine, sets off from the German port of Kiel toward Haifa, December 17, 2015. (IDF Spokesperson's Unit)
The INS Rahav, Israel’s newest submarine, sets off from the German port of Kiel toward Haifa, December 17, 2015. (IDF Spokesperson’s Unit)

According to the report, neither Ya’alon, who served as defense minister when the deal was first proposed, nor the IDF was in favor of purchasing the new submarines — somewhat of a change of pace in the normal narrative of the defense establishment fighting for acquisitions — as the decision did not fit with the Defense Ministry’s multi-year plan for the army.

But an IDF spokesperson said Thursday that the army did not oppose the purchases, saying in a statement that it informed the cabinet of “the need” for the new submarines.

Netanyahu is said to have started dealings with the German government without informing Ya’alon, who only learned of the plan after news of it leaked out.

IDF Chief of Staff Gadi Eisenkott, Defense Minister Moshe Ya'alon, President Reuven Rivlin and Prime Minister Benjamin Netanyahu at a welcoming ceremony for the new submarine 'Rahav' at the Israeli navy base in Haifa, on January 12, 2016. (Kobi Gideon/GPO)
IDF Chief of Staff Gadi Eisenkott, Defense Minister Moshe Ya’alon, President Reuven Rivlin and Prime Minister Benjamin Netanyahu at a welcoming ceremony for the new submarine ‘Rahav’ at the Israeli navy base in Haifa, on January 12, 2016. (Kobi Gideon/GPO)

Apparently furious, the then-defense minister sparred with Netanyahu in the prime minister’s office, with the two reportedly shouting at one another over the issue.

Ya’alon succeeded in torpedoing the plan, but once he stepped down as defense minister in May Netanyahu renewed the negotiations with the Germans for the new submarines.

Contacted by The Times of Israel, Ya’alon declined to comment on the deal.

According to Channel 10, Shimron represents the German shipyard slated to build the submarines and has been holding high-level meetings on behalf of the company’s Israeli agent Miki Ganor.

Shimron reportedly met with Histadrut labor federation chair Avi Nissenkorn and the head of an IDF labor union in an attempt to secure for the German shipyard ongoing responsibility for the vessels’ maintenance while they are in Israel, as opposed to the navy.

Prime Minister Benjamin Netanyahu's lawyer and coalition negotiator David Shimron (photo credit: Kobi Gideon/Flash90)
Prime Minister Benjamin Netanyahu’s lawyer David Shimron. (Kobi Gideon/Flash90)

Shimron’s involvement has raised questions about a possible conflict of interest for both him and the prime minister, especially given Netanyahu’s determination to complete the deal despite the reported IDF opposition.

“It looks bad,” Michael Partem, vice chairman of The Movement for Quality Government in Israel, told The Times of Israel. “It raises many troubling questions of access and peddling influence and pay-to-play politics.”

The anti-corruption NGO has called on Attorney General Avichai Mandleblit to investigate the claims. “It would appear that Netanyahu gave access in exchange for someone else getting a fee. There is nothing conclusive yet but it is certainly suspicious enough to warrant a police investigation.” Partem said.

Responding to the initial report, Shimron said he “did not discuss these matters with the prime minister,” and denied any effort to influence a decision over the deal.

“I have not spoken with any state officials about the privatization of the naval shipyard, nor I have not dealt with any state officials about vessels purchased by the State of Israel,” he said in a statement.

Netanyahu told Channel 10 that he had never discussed Shimron’s private clients with him and that “the only reason for the deal with the Germans is strategic and economic considerations.”

Writing on Facebook late Wednesday night, Netanyahu said that the deal “was done in an orderly, professional manner with no outside influence and with the recommendation of all the professional bodies in the Defense Ministry, the IDF and the National Security Agency (NSA).”

The NSA, a body operated under the auspices of the Prime Minster’s Office, released its own statements challenging what it called “a wave of false reports” and saying that deal received Ya’alon’s full support.

On Tuesday, a former deputy head of the NSA was arrested on suspicion of taking bribes from German acquaintances to push forward business deals involving Israel’s burgeoning natural gas development.

It’s not known if there was any link between the suspicions against Avriel Bar-Yosef and Shimron.

Judah Ari Gross contributed to this report.

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