Milchan aide said to testify Netanyahus demanded cigars, champagne

According to new leaks from police investigation, PM and his wife had strict system in place to order so-called gifts from billionaire benefactor

Raoul Wootliff is the Times of Israel's former political correspondent and producer of the Daily Briefing podcast.

Arnon Milchan, left, and Benjamin Netanyahu attend a press conference at the Knesset in Jerusalem on March 28, 2005. (Flash90/File)
Arnon Milchan, left, and Benjamin Netanyahu attend a press conference at the Knesset in Jerusalem on March 28, 2005. (Flash90/File)

Billionaire film producer Arnon Milchan’s personal assistant has reportedly told Israeli police that Prime Minister Benjamin Netanyahu and his wife demanded the champagne and cigars that he had allegedly been supplying them, and that they were not merely gifts he gave out of generosity and friendship.

Giving testimony as part of the Case 1000 investigation into alleged charges of bribery, fraud and breach of trust against Netanyahu, Hadas Klein, who serves as an aide and adviser to Milchan, is said to have described the specific arrangements for the deliveries of high-end cigars and champagne.

“Sara [Netanyahu] would ask from bottles of champagne in cases of six or twelve. Bibi would ask for cigars and also knew about the amount of champagne his wife was receiving. The company driver would drive especially to Jerusalem to deliver the champagne and cigars,” Klein told police investigators, according to a partial transcript of her testimony published by Hahadashot (formerly Channel 2) news on Monday night.

Klein, according to another section of the apparently leaked testimony published by Chanel 10 news, said that there were specific procedures in place for ordering the so-called gifts that included code words to prevent detection.

“Sara would send me an email or call me and tell me that ‘the drink,’ i.e., the champagne was finished and request that I bring her more. And not only champagne, also cigars. There was an understanding that Arnon needed to provide the Netanyahus with whatever they wanted. The cigars were requested by [Benjamin] Netanyahu. Sometimes there were code names for the champagne and cigars. It went on for years.” Klein reportedly said.

Prime Minister Benjamin Netanyahu, his wife Sara (C) and their son Yair seen with actress Kate Hudson at an event held at the home of producer Arnon Milchan (right), March 6, 2014. (Avi Ohayon/GPO/Flash90)

The case revolves around alleged illicit gifts given to Netanyahu and his family by billionaire benefactors, most notably hundreds of thousands of shekels’ worth of cigars and champagne from Israeli-born Milchan.

Netanyahu and his wife, Sara, have denied that receiving the gifts constitutes a criminal offense, claiming the value of the items was significantly lower than reported, and that they were mere “trifles” exchanged between close friends.

But Klein’s testimony suggested a relationship that went beyond ordinary friendship. In one session with investigators, she describes “a very intense conversation” with Sara Netanyahu when Klein refused to let her use an employee of Milchan’s for advice on renovating the Netanyahus’ home in Caesarea.

“I didn’t give permission so she screamed that Milchan and I were disrespecting her and Bibi,” Klein said, according to the Channel 10 report. “A few hours later,” she reportedly continued, “Bibi himself called” to complain of their treatment of his wife in light of “what she’s going through in the media.”

Responding to the reports, a spokesperson for the Netanyahu family said in a statement that the details of the testimony were “false claims” and part of a campaign to bring down the prime minister.

“The deceptive attacks continue. What has been claimed of the prime minister and his wife is false. The prime minister and his wife have acted according to the law, and there was therefore nothing wrong,” the statement said. “Beyond this, we have no intention of commenting on the details of the investigation, which contradict these false claims.”

But the testimony appeared to confirm past reports of details provided to the police by Milchan himself.

In January, the Haaretz daily newspaper reported that Milchan told police the Netanyahus had used the code words “pinks” and “leaves” to demand more champagne and cigars, respectively, and that those items were then purchased through people working for Milchan and delivered to the prime minister and his wife by Milchan’s chauffeurs.

While leaked reports of the police investigation have indicated that Milchan spent some NIS 400,000-600,000 ($100,000-150,000) on champagne and cigars for the Netanyahus over the best part of a decade, the prime minister and his wife have reportedly told police the sums involved were far lower, and that the gifts were unremarkable since the Milchans were their best friends.

A receipt for jewelry allegedly purchased for Sara Netanyahu by Arnon Milchan (Channel 2 screenshot)

Another January report purported to show receipts from a store in Herzliya where Milchan was said to have bought jewelry for Sara Netanyahu totaling NIS 57,000. Benjamin and Sara Netanyahu, however, reportedly claim they received purchases worth “maybe a third” of that sum.

As for claims that Milchan kept Netanyahu supplied with expensive cigars on a continuous basis for most of a decade — the lion’s share of the hundreds of thousands of shekels’ worth of allegedly illicit benefits — the Netanyahus reportedly told police he was merely a “social smoker” and that whenever his friend Milchan came to see him, he would bring just three to six cigars, worth about $10 each.

Netanyahu was interrogated under caution for four hours last Thursday evening — his fifth questioning session in the investigation — and was reportedly confronted with Klein’s testimony, among others.

Police were also said to have asked the prime minister about a number of “favors” he may have provided for Milchan in return.

Pressed over reports that he asked US Secretary of State John Kerry three times in 2014 to arrange a long-term visa for Milchan, an Israeli citizen, to live in the United States, Netanyahu has admitted to making a request, but claims it had nothing to do with the gifts he received.

“There is no connection,” Netanyahu said last week amid reports that Israel’s Ambassador to the US Ron Dermer was questioned about the visa request. “My ties with Milchan go years back. He has been a friend for years. I tried to help him because of his contribution to the State of Israel, just as I helped many others.”

In addition to the US visa, police are reportedly investigating whether Netanyahu intervened in the sale of the Channel 10 shares to benefit Milchan financially, and whether the prime minister sought to help the Hollywood producer secure a major stake in Channel 2.

Milchan also allegedly asked Netanyahu to promote a free trade zone near the Jordan-Israel border. The request was said to have been made following consultation with Indian billionaire Ratan Tata, whose Tata business conglomerate may have stood to benefit from the deal. The initiative never came through.

Times of Israel staff contributed to this report.

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