Comptroller auditors resign amid row over Netanyahu legal defense

Comptroller auditors resign amid row over Netanyahu legal defense

Three members of permits committee leave after new state comptroller backed by PM chides them for demanding premier return unapproved funds

Prime Minister Benjamin Netanyahu chairs the weekly cabinet meeting at his office in Jerusalem on July 7, 2019. (Abir Sultan/Pool/AFP)
Prime Minister Benjamin Netanyahu chairs the weekly cabinet meeting at his office in Jerusalem on July 7, 2019. (Abir Sultan/Pool/AFP)

Three members of the Permits Committee in the State Comptroller’s Office resigned on Thursday amid a dispute over the committee’s demand that Prime Minister Benjamin Netanyahu return hundreds of thousands of shekels he got from a cousin to fund his legal defense.

The committee ordered Netanyahu in June to give back some $300,000 to US businessman Nathan Milikowsky, the third time Netanyahu’s demand to be allowed to receive financial help for his legal defense was turned down.

The panel is charged with overseeing the financial dealings of senior public servants to ensure no conflicts of interest arise. In denying Netanyahu the financial help, it said it was inappropriate for non-Israeli benefactors — the committee also denied the premier’s request for financial help from American businessman Spencer Partridge — to pay for the prime minister’s legal defense in a criminal case relating to his alleged receipt of gifts from wealthy benefactors in Israel and abroad, the so-called Case 1000.

It also said such aid should be sought only if the public servant needs the financial help — and asked Netanyahu to submit an assessment of his assets and net worth. The prime minister has refused to do so.

The committee’s work has now all but ground to a halt with the appointment of a new state comptroller, Matanyahu Englman, a candidate for the post backed by Netanyahu and elected by the Knesset coalition earlier this year.

File: Nathan Milikowsky in 2013, in San Francisco (Drew Altizer Photography)

Channel 13 reported this week on a meeting that took place late last month between Englman and the committee’s members, in which Englman lashed out at them over their demand that Netanyahu return money to Milikowsky, calling it an overstep of the committee’s authority.

“Your job is to decide whether to permit or not, nothing more. Don’t run my office,” Englman was quoted by Channel 13 as telling the committee members.

The resignation by the three panel members, retired judge Ezra Kama and attorneys Nurit Israeli and Avigdor Ravid, is mostly an act of protest, as their two-year terms were due to end next month in any case.

Their replacements will be appointed by Englman.

The committee’s chair, retired judge Shalom Brenner, has not resigned. His term is also set to end next month.

Matanyahu Englman at a press conference at the Knesset after his nomination to be the next state comptroller on June 3, 2019. (Yonatan Sindel/Flash90)

The Netanyahu saga has already claimed a previous committee chair, former judge Oni Habash, appointed head of the Permits Committee in 2012, who resigned in March in protest over what he called “political pressure” being brought to bear on the committee over the Netanyahu question.

Netanyahu has asked for the money to help in his defense against charges of fraud and breach of trust in Case 1000. He also faces those charges in a pair of other investigations known as cases 2000 and 4000. Attorney General Avichai Mandelblit has also suggested bribery charges could be brought in Case 4000.

Mandelblit has said he intends to indict Netanyahu pending an October hearing.

Netanyahu denies all charges in all three cases, and has accused the media and activist prosecutors of conducting a political witch hunt against him.

The latest clash in the State Comptroller’s Office highlights what many observers and longtime officials in the agency are calling a dramatic shift in its function being led by Englman.

Attorney General Avichai Mandelblit attends a ceremony for new Justice Minister Amir Ohana at the Justice Ministry in Jerusalem on June 23, 2019. (Yonatan Sindel/Flash90)

Haaretz reported last month that Englman plans to scale back the office’s probes into public corruption and focus on the post’s traditional and uncontroversial role as the polite internal critic of the state bureaucracy.

The new plans include closing the department in the comptroller’s office responsible for corruption investigations, as well as the introduction of positive feedback into reports on state bodies.

Englman, an accountant by training and former education executive who ran the prestigious Technion institute of technology and the state’s top university regulator, the Council for Higher Education, was sworn in to the job on July 1. He is the first comptroller in three decades who is not a former judge.

His appointment, passed by the Knesset in June with the backing of Netanyahu’s coalition, comes in the wake of two comptrollers, Micha Lindenstrauss and Yosef Shapira, who transformed the post into a key corruption watchdog — drawing praise from non-governmental watchdog groups, but also criticism from some politicians and officials for expanding the role of the office.

The State Comptroller’s Office, which is also the government’s office for public complaints, serves under the aegis of the Knesset and has authority to examine all agencies of government, even the most secretive. In part due to Lindenstrauss’s efforts, the agency has grown in recent years into a significant oversight body with hundreds of attorneys and accountants whose reports often lead to administrative and policy changes.

State Comptroller Micha Lindenstrauss (photo credit: Flash90)
Then-state comptroller Micha Lindenstrauss in 2012. (Flash90)

Lindenstrauss’s focus on corruption drew criticism from those who argued it marked an overstep of his authority, as the comptroller was not intended to serve as a criminal investigative unit. Critics also blamed him for repeated leaks to the media about corruption investigations during his term.

But others praised him for the investigations, and for his media savvy, arguing that under his leadership the comptroller’s office became an effective deterrent to official corruption.

Englman is among the critics of Lindenstrauss’s reshaping of the office. In a recent interview to the Israel Hayom daily, he called for a more “respectful” critique of state bodies.

“The comptroller deals with critique, not law enforcement,” he said. “The central challenge of this post is to create cooperation with the audited bodies. The inspection must not only point out failures, but also encourage excellence and good governance. You do that by making sure the inspection is respectful of the agencies it critiques, and protects their ability to make decisions…. Critique must come from respect, as a tool in the manager’s toolbox.”

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