A-G orders police to look into German submarine affair

Police say they have ‘new evidence’ amid allegations Netanyahu lawyer used his influence to lobby for shipbuilder in Israel

Attorney General Avichai Mandelblit on Wednesday ordered the Israel Police to formally look into the so-called submarine affair in which Prime Minister Benjamin Netanyahu’s personal lawyer allegedly swayed multi-billion shekel deals in favor of the German shipbuilder he was representing.

Mandelblit gave the go-ahead for the preliminary probe, which is not yet a full-blown investigation, after “police received new information today and following additional developments,” a Justice Ministry statement said. The statement comes amid allegations that Netanyahu and attorney David Shimron may have acted with a conflict of interest in the affair.

Following a meeting with senior police officials, including the head of the Israel Police Investigations Department, Mandelblit instructed the police to examine “various aspects related to the case.”

Hebrew-language media reported this week on allegations that Shimron used his close relationship to Netanyahu to push Israel to purchase several submarines from German shipbuilder ThyssenKrupp, award the company a contract for naval vessels to defend Israel’s gas fields and allow it to build a shipyard in Israel, effectively outsourcing lucrative maintenance of the navy’s vessels.

Last week, Mandelblit suggested there was no cause to open a criminal investigation and earlier Wednesday the Knesset rejected a motion from the opposition Zionist Union to set up a parliamentary commission of inquiry.

Prime Minister Benjamin Netanyahu with then-cabinet secretary and current Attorney General Avichai Mandelblit, May 26, 2015. (Marc Israel Sellem/Pool/Flash90)

Channel 10 television, which first reported the affair last week, said Tuesday it had an email that was “proof” that Shimron used his close relationship to Netanyahu to lobby for ThyssenKrupp.

After Israel issued an international tender for naval boats needed to protect Israel’s gas fields in the Mediterranean in 2014, Shimron reportedly called the legal adviser of the Defense Ministry, Ahaz Ben-Ari, to inquire why a tender was issued, as he wanted the contract to be given to ThyssenKrupp without any competitive bidding.

The Tamar gas-processing rig 24 kilometers off the southern coastal city of Ashkelon, June 23, 2014. (Moshe Shai/Flash90)

Ben-Ari then apparently sent an email detailing the call to Defense Ministry Director General Dan Harel.

“In addition to receiving a copy of the inquiry from the head of the National Security Council, I was also called by Adv. David Shimron who is representing the ThyssenKrupp Consortium, who wanted to know if we were stopping the tender procedures in order to negotiate with his clients, as was requested by the Prime Minister,” says the email dated July 22, 2014.

Both Shimron and Netanyahu have repeatedly denied that either of them had any knowledge of the actions of the other regarding this tender and that both acted independently.

Netanyahu has come to Shimron’s defense, issuing a statement Tuesday calling the attorney “straight as an arrow,” and “a man who is over-scrupulous in adhering to the law and regulations, as well as a first-rate lawyer.”

David Shimron seen at a Likud press conference in Tel Aviv on February 01, 2015. (Flash90)

In response to the email, Shimron told Channel 10 that he had never mentioned the prime minister to Ben-Ari.

“I also did not know anything about the prime minister’s request, which I am learning about for the first time now from the media and the connections made by Ben-Ari,” Shimron said.

“The only explanation for this email … is that Ben-Ari knew about the prime ministers request, which I had not the faintest knowledge of. I also had absolutely no knowledge of the prime minister’s involvement with regard to the boats. Any other interpretation is not connected to the truth.”

The scandal started after it emerged last week that Netanyahu had decided to purchase three new submarines for the Israeli navy over the objections of the Defense Ministry and other senior military officials. ThyssenKrupp makes the submarines, a key element in Israel’s strategic arsenal, and which are subsidized by the German government.

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)

Netanyahu has denied any wrongdoing in the multi-billion shekel deal for the submarines, saying that bolstering Israel’s long-term security needs was the “only consideration” behind the purchases.

Meanwhile, ThyssenKrupp on Tuesday denied that it had appointed Shimron as an official representative.

While Hebrew-language media said Shimron had been hired by ThyssenKrupp’s exclusive representative in Israel, businessman Michael Ganor, the German company denied that Ganor had its approval to hire Shimron.

“Our sales partners are contractually obligated to consult with Thyssenkrupp Marine Systems before engaging sub-contractors. This has not happened,” the company told The Times of Israel, adding that it had no further information on the issue.

“We do what we always do as part of our process, if we get indications of irregularities: We fully check and clarify the facts,” ThyssenKrupp said.

On Sunday, the attorney general announced there were no grounds for a criminal investigation, but said a probe into possible other issues regarding the deal would continue.