State expected to drop corruption case against Likud minister — report
Prosecutor said to argue that evidence against Haim Katz in affair involving IAI union too weak; welfare minister still facing possible charges in second case
The attorney general is expected to close a case against a Likud minister in a major graft probe involving one of Israel’s largest defense contractors, though he may still face charges in a second case.
Welfare Minister Haim Katz will likely see a series of allegations against him disappear, after law enforcement authorities were unable to build a strong enough case against him, according to a report carried by Channel 10 news Thursday.
In February, police recommended that Katz be indicted on bribery, fraud, extortion and breach-of-trust charges over suspicions that he used his position as head of the Israel Aerospace Industries workers’ union to advance his own interests, including promising lucrative employment — both inside and outside the company — to IAI board members who cooperated with him.
Katz was head of the union for two decades before becoming a Likud minister in 2015.
However, according to the report Thursday, State Prosecutor Shai Nitzan is expected to tell Attorney General Avichai Mandelblit that the allegations of wrongdoing in the IAI case are relatively minor and there is not strong enough evidence to win a conviction.
Police had also recommended charging Katz’s son Yair, who headed the union after his father; the company’s current union head, Ehud Nof; union member Eli Cohen; and board member Brig. Gen. (res.) Amal Assad. It was unclear if the cases against them would be closed as well.
Suspicions of corruption at IAI became public last year when police raided the defense contractor, arresting 14 people, including Yair Katz.
The labor union at IAI, which employs some 16,000 people and is Israel’s largest state-owned company, is seen as closely tied to Katz, who chaired the union for more than 20 years.
A State Comptroller report released Sunday found that IAI funneled NIS 15 million ($4 million) a year in public funds to the union between 2006 and 2018, and waived its requirements for financial documentation of the transactions. Katz and his son ran the union during that period.
The relationship between IAI and its union was so skewed, Comptroller Yosef Shapira said, that at times it appeared the former served the latter.
“This activity must be halted immediately,” wrote Shapira, describing the findings as “serious.”
Haim Katz still faces possible charges in a second case in which Nitzan and Mandelblit have already announced their intention to indict.
In May, Mandelblit informed Katz that he would be charged for bribery, fraud and breach of trust pending a hearing, over an illicit quid pro quo with Mordechai Ben Ari, a leading figure in capital markets, in which Katz accepted financial benefits in return for using his position in the Knesset to advance the businessman’s interests.
In October, Katz met Mandeblit for the hearing, in which suspects are given a chance to give their side of a case.
Prosecutors suspect that during the years 2010-2015 Katz and Ben Ari developed a mutually beneficial relationship. Ben Ari, who was a financial adviser for a major public holding company, is suspected of providing free financial management for Katz, earning him millions of shekels. In return, Katz, who from 2009-2013 was the chair of the Knesset Labor and Welfare Committee, allegedly advanced business interests for Ben Ari.
Katz’s attorneys have denied the allegations in both cases.
Katz is one of three ministers known to be facing possible criminal charges, together with Prime Minister Benjamin Netanyahu and Interior Minister Aryeh Deri.
