Police ask AG for OK to question welfare minister in graft probe

Investigators want to probe Haim Katz about corruption suspicions at Israel Aircraft Industries

By ToI Staff 19 April 2017, 10:15 pm

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Israeli Minister of Welfare and Social Affairs Haim Katz arrives at the weekly cabinet meeting at the Prime Minister office in Jerusalem on September 27, 2016. (Marc Israel Sellem/POOL)

Police have asked Attorney General Avichai Mandelblit to allow them to question Welfare Minister Haim Katz under caution in connection with a probe into alleged corruption at Israel Aircraft Industries, Hebrew media reported Wednesday.

Suspicions of corruption, fraud and breach of trust at IAI became public in March when police raided the defense contractor, arresting 14 people — among them Katz’s son, Yair.

The young Katz, 36, who serves in the senior management of the IAI and has been a member of its powerful workers’ union for four years, was arrested on suspicion of coercing employees into joining the Likud party.

He was arrested along with fellow IAI worker’s union member David Peretz. The two were held after their homes were raided and searched.

Yair Katz (L), son of Welfare Minister Haim Katz (Likud), at a remand hearing at the Rishon Lezion Magistrate's Court, March 22, 2017. (Flash90) — Yair Katz (L), son of Welfare Minister Haim Katz (Likud), at a remand hearing at the Rishon Lezion Magistrate’s Court, March 22, 2017. (Flash90)

The labor union at IAI, which employs some 16,000 people and is Israel’s largest state-owned company, is seen as closely tied to Katz senior, who chaired the union for more than 20 years.

Associates of the minister have slammed what they called “an orchestrated campaign of defamation in the media” aimed at “harming Katz’s name.”

In a separate case, the Israel Securities Authority is investigating suspicions that Haim Katz — while already a minister — bought shares in a real estate company shortly before the company announced it was merging with Airport City in summer 2015. Together with another suspected insider dealer, he is thought to have illegally reaped a NIS 290,000 ($75,000) profit.