Netanyahu said a suspect in Bezeq probe, will be questioned soon

PM’s wife, Sara, also reportedly likely to be called in by police, who have implicating correspondence between her and senior Bezeq officials

Raoul Wootliff is the producer and occasional host of the Times of Israel Daily Briefing podcast.

Prime Minister Benjamin Netanyahu arrives at a press conference at the Prime Minister's Office in Jerusalem, January 3, 2018. (Yonatan Sindel/Flash90)
Prime Minister Benjamin Netanyahu arrives at a press conference at the Prime Minister's Office in Jerusalem, January 3, 2018. (Yonatan Sindel/Flash90)

Days after recommending Prime Minister Benjamin Netanyahu be indicted for bribery in two separate graft probes, police are now unofficially treating him as a suspect in another corruption investigation and plan to question him under caution in the coming months, police sources were reported as saying Sunday night. In this case, too, Netanyahu is suspected of bribery, Channel 10 news reported.

Hebrew media reports quoted the sources as saying that Netanyahu, in the investigation dubbed Case 4000, is suspected of furthering a deal under which Shaul Elovitch, owner of the Walla news site and the controlling shareholder of the Bezeq communications company, swayed coverage of Netanyahu and his family on Walla, in exchange for the Communications Ministry enacting policies potentially worth hundreds of millions of shekels for Elovitch.

Netanyahu was acting communications minister at the time of several alleged illicit deals made with Elovitch, one of which included helping Bezeq buy the satellite cable provider Yes and override any anti-trust issues raised by ministry officials.

Shaul Elovitch, Bezeq’s controlling shareholder (Calcalist screenshot)

In addition, Netanyahu’s wife, Sara Netanyahu, is also expected to be questioned as a suspect over her efforts to influence coverage via close relations with Elovitch’s wife and daughter, several outlets reported.

Earlier Sunday, after the case was transferred from the Israel Securities Authoirty to the Israel Police,  two “very close” associates of Netanyahu were arrested, along with three senior officials in the Bezeq phone company, and two relatives of one of the officials. The names of those arrested are subject to a gag order, but according to reports, the Netanyahu associates arrested are a media consultant and the director general of an unnamed ministry.

Several media outlets, including The Times of Israel, reported the names of the suspects following the remand hearing, which named them publicly, only to be forced to rescind the publication after the court later ceded to a police request to extend the gag order.

Investigators uncovered strong evidence that Elovitch directed Walla to drastically change its coverage of both Benjamin and Sara Netanyahu, and believe that it is “only a matter of time” before one of the current suspects agrees to testify that Netanyahu was behind the decision, Hadashot news reported.

Channel 10 news aired recordings of Nir Hefetz, a long-time confidant of the prime minister and his former family spokesperson, saying, “I can ask anything of Elovitch: Pelephone, Yes, Bezeq, Bezeq Bein Leumi.”

In another section of the tape, which the report said police believe provides a direct link between Netanyahu and the positive coverage he received from Walla, Hefetz can be heard saying that he had met with “senior global media figures” who had given him a “green light” to go ahead with Bezeq’s purchase of Yes.

Nir Hefetz attends a press conference of Beitar Jerusalem soccer club in Jerusalem on June 25, 2017. (Yonatan Sindel/Flash90)

Last year, it was announced the the director-general of the Communications Ministry, Shlomo Filber, is suspected of illicitly allowing Bezeq to buy shares of Yes. Filber was appointed by Netanyahu in 2015, after the prime minister installed himself as communications minister.

Bezeq is a diversified telecoms operator active in a variety of sectors in the Israeli market: Bezeq Fixed-Line provides internet and telephony services; Bezeq International provides international call services; Pelephone provides cellular services; Yes provides pay TV services; Walla runs an internet news portal service, and there is also an online call center. All of these units are fully owned by Bezeq, but because the firm was historically a monopoly, and because it is still a dominant player in the market, regulatory curbs compel these units to operate as separate businesses, leading to higher costs for Bezeq.

Elovitch owns a stake in Bezeq via a pyramidal company structure: His firm Eurocom Communications Ltd. controls Internet Gold-Golden Lines Ltd. which in turns controls B Communications Ltd. B Communications holds a 26 percent stake in Bezeq, and the rest of Bezeq, 74%, is held by the public via shares traded on the Tel Aviv Stock Exchange.

The Elovitch sale of Eurocom’s stake in Yes to Bezeq started off at the center of an Israeli Securities Authority probe that then broadened to include Yes dealings with Spacecom and the dealings of Bezeq officials and Elovitch with Filber.

Shlomo Filber, director general of the Communications Ministry, during a court hearing in the Supreme Court regarding the closing of the Israel Broadcasting Authorities. May 15, 2017. (Miriam Alster/Flash90)

The latest revelations also appear to reveal a direct link to the Bezeq-Yes deal and Walla’s changing coverage, as dozens of Walla articles began to appear showing the Netanyahus, particularly Sara, in a questionably positive light.

A former Walla official informed police that CEO Ilan Yeshua told the websites senior staff that “now is a bad time for Bezeq, so we need positive coverage of Netanyahu. Let’s get past this crisis and move forward,” the Hadashot report said.

Yeshua is also reported to have said he faced intense pressure to bury negative reporting about Netanyahu and encourage positive reporting about his wife.

Yinon Magal, a former Jewish Home party lawmaker who once edited Walla, has admitted publicly to giving testimony to police regarding the suspicions that Walla’s coverage of Netanyahu was designed to benefit the prime minister and his family.

Earlier Sunday, Netanyahu decried the investigation as “baseless” and part of a “media witch hunt.”

“Another baseless investigation under pressure from the media,” a statement from Netanyahu said. “The media witch hunt continues in full force.

“After the release of air from Case 1000 and 2000, and after it became clear there was no air in Case 3000, the media created massive pressure to create a new balloon, Case 4000. The air will escape from it too,” the statement said, referring to two investigations (Cases 1000 and 2000) where police have recommended indicting Netanyahu, and the so-called submarine affair (Case 3000), in which Netanyahu’s personal lawyers have been implicated.

“The Justice Ministry made it clear in the state comptroller report that the prime minister did not make any controversial decisions,” the statement read, adding that there was no “suspicion of conflict of interest.”

Prime Minister Benjamin Netanyahu (left) and his wife Sara Netanyahu at the Knesset in Jerusalem, June 28, 2017. (Olivier Fitoussi/Pool)

Sunday’s arrests came less than a week after police recommended indicting Netanyahu in two separate graft probes.

Police said it had amassed evidence for bribery, fraud, and breach of trust by Netanyahu, in the two corruption investigations over which he has been repeatedly questioned, known as Cases 1000 and 2000.

In Case 1000, Netanyahu and his wife are alleged to have received illicit gifts from billionaire benefactors, most notably the Israeli-born Hollywood producer Arnon Milchan, totaling NIS 1 million ($282,000). In return, Netanyahu is alleged by police to have intervened on Milchan’s behalf in matters relating to legislation, business dealings, and visa arrangements.

Case 2000 involves a suspected illicit quid-pro-quo deal between Netanyahu and Mozes that would have seen the prime minister weaken a rival daily, the Sheldon Adelson-backed Israel Hayom, in return for more favorable coverage from Yedioth.

The prime minister has also been linked indirectly to “Case 3000,” a large investigation into suspected corruption surrounding the multi-billion shekel purchase of naval vessels and submarines from a German shipbuilder. While Netanyahu has not been named as a suspect, close associates of his, including his personal aides, have been arrested or questioned.

Netanyahu has denied any wrongdoing in the various cases.

Times of Israel staff contributed to this report.

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