Ex-defense chief urges probe into PM's German submarine deal

Moshe Ya’alon says TV report on possible ‘pay-for-play’ deal is ‘disturbing,’ rebuffs National Security Council claims purchase had his ‘full support’

Former defense minister Moshe Ya’alon on Thursday called for a probe into a multi-billion shekel deal to purchase German submarines, which was pushed by Prime Minister Benjamin Netanyahu and in which his personal lawyer is alleged to have a stake.

According to a Channel 10 report this week, neither Ya’alon, who served as defense minister when the deal was first proposed, nor the IDF was in favor of purchasing three new submarines for the Israeli Navy as the decision did not fit with the Defense Ministry’s multi-year plan for the army.

The navy currently maintains a fleet of five underwater vessels, with another slated to be delivered in coming years. The new submarines — valued at around NIS 6 billion ($1.5 billion) — were intended as replacements for the military’s older models.

Netanyahu announced in a cabinet meeting last month that Israel was in the process of negotiating the purchase.

According to the Channel 10 news report, David Shimron, who has spent years defending Netanyahu against dozens of claims of malpractice and misuse of office for personal gain, is being accused of a serious conflict of interest due to his links to the German shipbuilder attempting to sell the vessels to Israel. Shimron serves as the representative of ThyssenKrupp, a European multi-national conglomerate based in the German cities of Duisburg and Essen.

Prime Minister Benjamin Netanyahu’s lawyer and coalition negotiator David Shimron (photo credit: Kobi Gideon/Flash90)

Ya’alon confirmed Thursday that he had tried to dissuade Netanyahu from the deal, saying he had “vociferously objected” to it, arguing that the military did not need additional submarines, not then and “not in the near future.”

Netanyahu reportedly started dealings with the German government without informing Ya’alon, who only learned of the plan after news of it leaked out. Apparently furious, the then-defense minister sparred with Netanyahu in the prime minister’s office, with the two reportedly shouting at one another over the issue.

Ya’alon succeeded in torpedoing the plan, but once he stepped down as defense minister in May in a falling-out with the prime minister, Netanyahu renewed the negotiations with the Germans for the new submarines, the Channel 10 report said.

An IDF spokesperson said Thursday that the army did not oppose the purchases, saying in a statement that it informed the cabinet of “the need” for the new submarines.

“I don’t know what happened or what was signed after I left the Defense Ministry,” Ya’alon wrote on Facebook Thursday, “but [Channel 10’s] Raviv Drucker’s report on the matter is very disturbing and warrants a thorough probe by the relevant authorities.”

Prime Minister Benjamin Netanyahu shakes hands with members of the Israeli Navy at a ceremony welcoming the INS Tanin submarine in the Port of Haifa on September 23, 2014. (photo credit: Kobi Gideon/Government Press Office )

The National Security Council, a body operated under the auspices of the Prime Minister’s Office, has challenged what it called “a wave of false reports” and argued that deal received Ya’alon’s full support. In response, the former defense minister said the NSC’s response was “lacking and did not reflect the reality as I understood it.”

In a statement on Thursday, the NSC said that it was involved “in every stage of the purchase of the submarines” and that the process was handled correctly.

Netanyahu also said that the deal “was done in an orderly, professional manner with no outside influence and with the recommendation of all the professional bodies in the Defense Ministry, the IDF and the National Security Council.”

Netanyahu denied on Thursday that he had any prior knowledge of Shimron being involved in the deal. Netanyahu said that he first learned of Shimron’s involvement when Channel 10 asked for his response before airing the report on Tuesday.

The INS Rahav, Israel’s newest submarine, arriving in Haifa, January 12, 2015.

“Shimron never brought up submarines or ships or any other issue concerning his clients with the prime minister,” the Prime Minister’s Office said in a statement, adding that Shimron had not discussed the German client or any other client with Netanyahu. The PMO said that members of Netanyahu’s inner circles, including Shimron, “know not to discuss their [personal] business dealings with the prime minister.”

“The only consideration the prime minister had [in mulling the German deal] was strengthening Israel’s capabilities in regard to [obtaining] strategic vessels, essential to ensure [Israel’s] future,” the PMO said.

“Any attempts to suggest that he had any other consideration in the decision to purchase submarines for the Israeli Navy are false and lacking any basis in reality,” the statement read.

Shimron’s involvement has raised questions about a possible conflict of interest for both him and the prime minister, especially given Netanyahu’s determination to complete the deal despite the reported IDF opposition.

The state prosecution’s office announced that it would look into the matter, according to Channel 2.

Responding to the initial report Tuesday, Shimron said he “did not discuss these matters with the prime minister,” and denied any effort to influence a decision over the deal.

“I have not spoken with any state officials about the privatization of the naval shipyard, nor I have not dealt with any state officials about vessels purchased by the State of Israel,” he said in a statement.

According to a Channel 2 report Thursday, Shimron wrote a letter to Attorney General Avichai Mandelblit claiming no conflict of interest on his part.

Judah Ari Gross contributed to this report.