Erdan told cops he suspected Bezeq owner pushed Netanyahu to remove him – report

Public Security Minister Gilad Erdan reportedly told police he suspected he was removed as communications minister in 2014 in a bid to torpedo reforms he was advancing that would have dramatically weakened the Bezeq telecom giant after the company’s owner, Shaul Elovitch, interceded with Prime Minister Benjamin Netanyahu.

The comments were part of purported testimony Erdan gave to police and financial investigators surrounding the so-called Case 4000 corruption probe, in which the prime minister is suspected of offering regulatory benefits to Elovitch and Bezeq in exchange for positive coverage of him and his family in the Elovitch-owned Walla news site.

Responding to the report on Thursday, Erdan also said Netanyahu had never interfered in his reforms, and the transcripts of his testimony show he had based his suspicions at the time on Elovitch’s boasting, but had no evidence implicating the premier.

Even so, the link between Elovitch’s displeasure over Erdan’s reforms and Netanyahu’s decision to appoint him interior minister in October 2014 is laid out in Attorney General Avichai Mandelblit’s summary of the case against Netanyahu, publicized earlier this year ahead of the prime minister’s pre-indictment hearing in October on charges of graft and bribery in the case.

In his testimony to police, leaked to Channel 12 and broadcast Thursday, Erdan told investigators he was deeply committed to the reform he introduced during his term in the Communications Ministry, from March 2013 to November 2014, that would have weakened Bezeq’s stranglehold on the Israeli telecom market.

Erdan came to the Communications Ministry after the 2013 elections, following in the footsteps of a predecessor, then-Likud lawmaker Moshe Kahlon, who had become one of Israel’s most popular politicians after leading a sweeping reform of the cellular phone market that was credited with more than halving the average Israeli family’s monthly cellphone bill.

Kahlon’s reforms made him popular enough to launch his own party, Kulanu, ahead of the 2015 election, where he won 10 Knesset seats.

“After Kahlon’s term with the cellular [reform], I looked for the remaining significant issues in the communications space, where I could bring competition, and it was clear that Bezeq, with its power, with its annual yield, with its monopoly, with all that, was the main place where you could deliver lower prices,” Erdan told the investigators.

“So I decided to invest all my political capabilities, my public capabilities, to push this reform forward. There was nothing I believed in more than this reform.”

The key plank of the reform proposed by Erdan, and backed by ministry officials, was to open up the landline phone and internet markets previously largely monopolized by the telecom giant to competition.

But Bezeq controlling shareholder Elovitch didn’t take well to Erdan’s efforts, he recalled.

“The wealthy have ways to remember that one guy, and to turn to that person you know, and to try to influence your decisions,” he said. “In this reform there were attempts like that, but I was very committed and believed in its benefits.”

Elovitch, Erdan said, “had this method where he’d complain to everyone who knows me that I’m not listening to him, not giving him the time of day. He’d say to people I know, ‘What does he have against me that’s so personal?’ and I’d say to them, ‘Listen, he’s messing with you, this crying act is his method.'”

Erdan related how Elovitch visited him at his home in the upscale Tel Aviv neighborhood of Tzahala to discuss the reform. “I see nothing wrong with that — that people who feel they’ve been hurt by my decisions come to raise their concerns. I think it’s their right, and it’s my duty to let them, but certainly they [Bezeq] were very very opposed to the reform.”

Elovitch’s complaints focused on his belief that the resulting prices for phone and other telecom services that would emerge from the newly competitive market “would destroy him, and he’d have to sell Bezeq and Bezeq would collapse, all sorts of things like that,” Erdan recalled.

It was then, in the transcript, that Erdan was asked about “other pressures” that may have been brought to bear.

“I assume you’re asking about the prime minister,” he responded. “The only thing the prime minister ever said to me on this issue wasn’t about the merger [between Bezeq and the satellite TV company Yes], or about the wholesale reform or the Bezeq reform. The only thing was to ask me if I’m really listening to them [Bezeq], and giving them the time of day.”

Erdan said he replied, “‘You think I’m not? Does that make sense to you, prime minister? That I would push a reform without listening to them?’ So he said it was important to let them be heard, so they don’t complain. That was my only conversation with him on the issue, and it happened long before I left the job, during a meeting with him at the ministry.”

“I told him [Netanyahu] that this would open up competition, and I felt that they’d complained to him about the prices and said it would collapse the company. He didn’t tell me they’d complained to him. The conversation didn’t last more than four-five minutes.”

Asked if Elovitch himself threatened to turn to the prime minister against the reform, Erdan told the investigators, “I remember vaguely that he’d hint that he has a connection and he can go there.”

“What does ‘there’ mean?” the investigator asked.

“The Prime Minister’s Office,” Erdan said.

“The prime minister?”

“Yes,” Erdan replied.

Erdan was unable to shepherd the reform to its conclusion because he was moved in October 2014 to the post of interior minister, which had just been vacated by fellow Likud lawmaker Gideon Saar’s surprise announcement he was taking a break from politics.

“It was impossible to conclude that something I did in the Communications Ministry to Shaul Elovitch led to the fact that I did not remain” in the ministry, Erdan told investigators. “I was told it’s a political problem, that I can’t hold two ministries [communications and interior] at the same time.

“But I was very bitter. I went to the prime minister and told him to wait [with the promotion], to stop everything, so they decided to give me another 14 days to keep me happy.”

Asked point-blank if he had reason to believe Elovitch had caused his removal, Erdan said, “No, but it’s possible I told people [at the time] that I felt that Shaul Elovitch made it so I won’t stay in the communications portfolio; I may have told people that that was how I felt.”

“What caused that feeling?” the investigator asked.

“Just a feeling. I have no corroboration,” Erdan said. “It was based on the fact that Shaul would occasionally throw out some comment about his influence.”

“You mean his influence on the prime minister?”

“Yes,” Erdan replied.

In the summary of his suspicions laid out by Mandelblit, the attorney general noted that Erdan’s removal came shortly after the prime minister’s confidant Nir Hefetz, now a state’s witness in the case, conveyed to him Elovitch’s opposition to the reform and desire to be rid of Erdan.

In his response to Thursday’s report, Erdan’s office told Channel 12 news that the leaked testimony conveyed “a central fact about which there is no dispute: The prime minister never tried to stop, influence or interfere in any way in the reforms Minister Erdan advanced in the Communications Ministry, despite the fact that they significantly disadvantaged Bezeq and Mr. Elovitch.”

Netanyahu gave a similar response Thursday, and noted that the reforms initiated by Erdan were implemented in the end — when Netanyahu himself served as communications minister.

“[Then-]communications minister Erdan, with the full backing of the prime minister, initiated sweeping reforms related to Bezeq, and it was communications minister Netanyahu who implemented them, costing Elovitch and Bezeq billions,” the response reads.

The Channel 12 leaks came a day after a similar leak from Netanyahu’s testimony to police was carried by the Kan public broadcaster. In that leak, Netanyahu was reported to have told investigators that he had only a casual relationship with Elovitch.

“I can describe to you my relationship with Elovitch as being like my relationship with Aharon Barak,” Netanyahu reportedly said, referring to the former president of the Supreme Court.

“The same few meetings — four or five meetings — the same few meals with wives,” the prime minister told police. “There is no meeting at family events, there is no friendly connection of the type that I have with other people.”

Netanyahu noted that at the time of those meetings, he was also communications minister and naturally had contact with all the country’s major publishers and media figures.

The prime minister ridiculed the accusation that, via then-Communication Ministry director general Shlomo Filber, he sought to benefit Elovitch by influencing the Bezeq reform between 2014 and 2017.

The prime minister claimed it was “absurd” to suggest that “you can take all the professional bodies and give them all the runaround, and that the one who is doing it is Filber. What nonsense. And your whole claim is that I did this because of that fekakta, insignificant site [Walla],” Netanyahu reportedly said, using a Yiddish word for “crappy.”

The probe is the most serious of the three investigations into the prime minister, as it includes a proposed bribery charge for both Netanyahu and Elovitch. Netanyahu is facing indictments, pending a hearing, in all three cases.

Channel 12 on Wednesday published transcripts of the interrogation of Filber, who is now a state witness in the case. He claimed that Netanyahu sought to remove Communications Ministry deputy director-general Haran Levaot because he was standing in the way of policies that would benefit Elovitch.

A Wednesday statement on behalf of Netanyahu called Case 4000 a “blood libel.”

Mandelblit’s lengthy description of Netanyahu’s alleged illicit dealings with Elovitch took up the majority of the 57-page document released in February, setting out the allegations that prompted him to announce a criminal indictment against the prime minister, pending a hearing.

A pre-indictment hearing for Elovitch and his wife, also a suspect, was held earlier this month.

Netanyahu is scheduled to attend his own pre-indictment hearing in the case on October 2-3. These will also cover two other corruption probes in which the prime minister faces additional charges of fraud and breach of trust.

Case 1000 involves accusations that Netanyahu received gifts and benefits from billionaire benefactors. Case 2000 revolves around accusations Netanyahu agreed with Yedioth Ahronoth newspaper publisher Arnon Mozes to weaken a rival daily in return for more favorable coverage from Yedioth. Mozes underwent his own pre-indictment hearing earlier in the month.

Netanyahu denies any wrongdoing in all the cases against him.