Defying AG, ministers advance bill that would let Netanyahu keep financial gift

High Court has ruled PM must return $270,000 he received from his cousin to cover legal fees; Baharav-Miara warns bill could ‘open door to real governmental corruption’

Carrie Keller-Lynn is a former political and legal correspondent for The Times of Israel

(L) Gali Baharav-Miara on February 8, 2022. (Yonatan Sindel/Flash90) and (R) Benjamin Netanyahu, November 2, 2022. (Olivier Fitoussi/Flash90)
(L) Gali Baharav-Miara on February 8, 2022. (Yonatan Sindel/Flash90) and (R) Benjamin Netanyahu, November 2, 2022. (Olivier Fitoussi/Flash90)

The government formally decided on Sunday to back a Likud-sponsored bill to ease donations to lawmakers — including Prime Minister Benjamin Netanyahu — despite the measure being attacked by the attorney general and watchdogs as an opening for political corruption.

If passed into law after four Knesset votes, the measure would enable Netanyahu to keep $270,000 he received from his now-deceased cousin and former benefactor Nathan Milikowsky. Last year, the High Court of Justice ordered the premier to return the gift to Milkowsky’s estate by February 2023, on the grounds that the funds, meant to cover the prime minister’s legal expenses in his ongoing corruption trial, were an illicit gift.

Attorney General Gali Baharav-Miara on Sunday told Justice Minister Yariv Levin that her office was opposed to the bill, and that it was “harmful” and “contrary to the purpose of the [existing public servant gifts] law.”

“It has the potential to open a real door to governmental corruption,” Baharav-Miara cautioned, in an opinion submitted to Levin in advance of the Ministerial Committee for Legislation’s Sunday hearing on the bill. The panel, chaired by Levin, determines the government’s stance on various pieces of legislation.

It is the latest in a slew of bills that can be tied to the interests of individual politicians. Shas lawmakers are currently pushing a bill to block the Supreme Court from exercising discretionary review over ministerial appointments, which would return their party leader, Aryeh Deri, to the cabinet.

In December, the coalition pushed through a Basic Law change to name Deri in charge of two ministries, despite his suspended sentence for financial crimes. It also amended the same quasi-constitutional Basic Law: The Government to enable appointing Bezalel Smotrich as a second, independent minister within the Defense Ministry.

Proposed by Likud MK Amit Halevi, the bill advanced Sunday would amend the existing law governing gifts to a public servant to allow them to receive financial contributions for legal proceedings or necessary medical expenses, on the condition that the funding is only used for that purpose.

The change would also allow donations for legal and medical expenses for other members of a public servant’s family, and for minor crowdfunding campaigns.

The proposal would bar a public servant from receiving funding from a corporation or a minor, or contributions made in cash. It would also disallow anonymous contributions of over NIS 2,500 (around $720).

Likud MK Amit Halevi speaks during a visit to the Oz Vegaon nature reserve in Gush Etzion, West Bank, October 22, 2020. (Gershon Elinson/Flash90)

Omer Makayes, director of the Anti-Corruption Movement watchdog, told The Times of Israel on Sunday that the bill is “personally tailored” to help Netanyahu and creates circumstances for “corruption.”

The bill, he said, “has no checks and balances” and “is not positive at all.” Makayes also said that his organization was weighing its options for petitioning the High Court against the bill, as it has yet to clear the Knesset.

In an October ruling, the High Court determined that the money received by Netanyahu and his wife, Sara, to fund their legal fees while he served as prime minister during his last term was a prohibited gift to a public servant.

The justices ruled that although Milikowsky and Netanyahu were cousins, business interests were a more dominant factor in the gift, and the money went way beyond what was acceptable as a routine gift between family members.

In his response, Netanyahu’s attorney Uriel Nizri claimed the court did not have the authority to make such a ruling and requested that the matter be handled by the State Comptroller’s Permits Committee, but the court rejected the argument.

The law already permits receiving assistance for legal defense, provided that it is not given in virtue of someone’s position as a public servant. This means that Netanyahu could already receive funding for legal expenses, as long as it was not tied to his role as prime minister.

Prime Minister Benjamin Netanyahu, right, and his wife Sara Netanyahu, left, visit the Western Wall in the old city of Jerusalem, January 1, 2023. (Gil Cohen-Magen/Pool via AP)

For example, an official cannot receive funds from a subordinate, or from someone they have influence over in their public office.

Milikowsky gave the Netanyahus $300,000 from 2017 to 2018, and was later paid back $30,000. He died in July 2021 at the age of 78.

Justices also ruled last year that a NIS 2 million ($566,000) loan Netanyahu received from real estate mogul Spencer Partrich was a forbidden gift, but could be repaid according to their agreement, with supervision from the state comptroller, since the loan had been approved by the comptroller and attorney general.

The Netanyahu government has frequently clashed with the attorney general in recent weeks, as it pushes a dramatic restructuring that would increase government control over the judiciary. Critics say that along with other planned legislation, the sweeping reforms will impact Israel’s democratic character by upsetting its system of checks and balances, granting almost all power to the executive branch, and leaving individual rights unprotected and minorities undefended.

Supporters of the overhaul say the changes will end overreach by courts and judicial institutions, which have blocked right-wing efforts to pass measures seen as violating rights enshrined in Israel’s Basic Laws.

Times of Israel staff contributed to this report.

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