The director general of the Communications Ministry was sent to two weeks of house arrest on Thursday, after being questioned for a second time over suspicions he worked illicitly to advance the interests of Bezeq, Israel’s largest telecommunications firm.
In addition, Shlomo Filber was barred by the Tel Aviv Magistrate’s Court from having contact with any other people tied to the probe — including Communications Ministry employees — and is prohibited from accessing his computer or any materials on it, according to Hebrew media reports. He also may not leave the country for 180 days and was ordered to post a bond of NIS 400,000 ($113,000).
An ally and appointee of Prime Minister Benjamin Netanyahu, Filber’s interrogation by the Israel Security Authorities on Wednesday on suspicions of ethics violations and securities fraud came as the state comptroller issued a report alleging that the premier acted improperly while he held the portfolio of communications minister regarding involvement in the Bezeq, headed by his friend Shaul Elovitch.
State Comptroller Yosef Shapira said that Netanyahu did not originally report his personal connection to Elovitch in a conflict of interest declaration, casting a shadow over the way the Communicatons Ministry treated Bezeq, Israel’s largest telecommunications firm.
“The promotion of Bezeq’s interests, without a professional examination of the implications, was likely to cause real damage to competition and the public interest,” the report read.
Shapira wrote that there was a lack of transparency over decisions made by Netanyahu regarding Bezeq before he was barred from involvement with the company and handed over decision-making to Filber.
The watchdog also said that Filber may have acted in ways that benefited Bezeq, citing several cases.
Shapira questioned whether it was possible for Filber to make unbiased decisions against Elovitch in light of the prime minister’s close connection with the Bezeq head.
The ombudsman also found that the Justice Ministry was not, but should have been, involved in examining the implications of telecommunications decisions that benefited Elovitch and Bezeq.
In a statement, Netanyahu’s office called the comptroller report “another futile attempt to create a scandal against the prime minister out of thin air,” according to Channel 10.
Netanyahu and Elovitch “are on friendly terms but nothing more,” and “all the decisions he made regarding the communications market were for the benefit of the public alone,” the statement read.
On Thursday, Netanyahu again referred to the affair as “baseless” and denied being close friends with Elovitch.
“Elovitch isn’t my friend. He’s my acquaintance in a sense that doesn’t require reporting. As soon as the baseless article in Haaretz was published, I acquiesced to the attorney general’s suggestion and stopped dealing with [issues related to] Bezeq,” Netanyahu reportedly said, claiming that the Justice Ministry had ruled that all his dealings with Bezeq were based on substantive issues and not outside interests.
Bezeq, the nation’s largest fixed-line provider, dominates the local communications market and has in recent months been pushing for regulatory permission to merge its mobile, fixed-line, satellite TV and internet subsidiaries, which currently operate as separate business entities as required by the regulator.
But the company has been embroiled in its own legal saga in recent weeks over suspicions of fraud, breach of trust, corporate officers’ offenses, and obstruction of legal proceedings from the Israel Securities Authority.
In June the Tel Aviv Magistrate’s Court issued travel bans of six months to Elovitch, director of the YES television cable company Ron Ayalon, and the YES financial director Michal Neeman.
The restrictions were requested by the Israel Securities Authority as it continued an investigation focused on a major acquisition by Bezeq, the nation’s largest telecommunications operator, of shares in the YES satellite television company.
Elovitch, who also owns the Walla news site, was banished from the offices of his Eurocom Group and Bezeq and prohibited from contacting members of the directorate or other controlling figures in the companies until June 23. He was ordered to deposit a NIS 5 million ($1.4 million) bail bond
In addition to Elovitch, his son Or is also suspected of wrongdoing in the affair, as are Bezeq CEO Stella Handler and company secretary Linor Yochelman, according to the Marker business daily.
Wednesday’s ombudsman report is the latest legal imbroglio to entangle Netanyahu, who is currently under investigation in two cases in which he he is suspected of taking gifts from wealthy businessmen and entering into a quid pro quo with a publisher, respectively. The prime minister has denied wrongdoing in both cases.
Netanyahu has also been linked to the ongoing “Case 3000” inquiry into alleged corruption in the purchase of German-made naval boats and submarines for the IDF. Although the prime minister is not officially a suspect in the submarines affair, his cousin and long-time attorney David Shimron and other associates are.