State prosecution in ‘intense talks’ with Likud’s Haim Katz over plea bargain
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State prosecution in ‘intense talks’ with Likud’s Haim Katz over plea bargain

Negotiations revealed after AG urges High Court to overturn decision granting former welfare minister parliamentary immunity from alleged fraud and breach of trust charges

Likud MK Haim Katz during a Knesset House Committee discussion of his request for parliamentary immunity, February 4, 2020. (Adina Veldman/Knesset)
Likud MK Haim Katz during a Knesset House Committee discussion of his request for parliamentary immunity, February 4, 2020. (Adina Veldman/Knesset)

Israel’s State Prosecution said late Tuesday night that it has been holding “intense talks” with Likud MK and former minister Haim Katz over his signing of a plea deal on corruption charges.

Katz received parliamentary immunity in February to shield himself from the charges of fraud and breach of trust. Attorney General Avichai Mandelblit has urged the High Court of Justice to overturn the decision and allow the former welfare minister to be prosecuted.

But in a Tuesday letter to the court asking to delay a hearing on the matter, which had been scheduled for Wednesday, the State Prosecution acknowledged, “the existence of intense talks [with Katz], which may obviate the need for a decision [on the petition].”

The prosecution said the two sides had tried to complete negotiations before the hearing but “will need another short period of time to finalize an agreement.”

Katz was facing the charges for allegedly advancing a bill on corporate bond repayment pushed by a financial consultant who was a close friend and financial adviser to Katz himself, and which benefited him financially once it became law. Katz was also accused of concealing those conflicts of interest.

The indictment centered on allegations that Katz, while serving as chairman of the Knesset Labor and Welfare Committee from 2005 to 2006 and again from 2009 to 2013, advanced Amendment 44 to the Securities Law at the request of businessman Mordechai Ben Ari.

The law stipulates that companies must repay bond debt to small bondholders before it repays controlling owners — an attempt to buck the influence of wealthy and powerful investors in order to help protect the interests of small investors. Ben Ari’s business represents groups of such small bondholders in several companies.

Attorney General Avichai Mandelblit speaks at the 17th annual Jerusalem Conference of the ‘Besheva’ group, on February 24, 2020. (Olivier Fitoussi/ Flash90)

After Mandelblit’s August 2019 decision to indict Katz, the then-welfare minister resigned from the cabinet, adhering to a practice established in the 1990s with the court-upheld resignations of indicted cabinet members Aryeh Deri and Raphael Pinhasi.

But in February, Knesset members voted 62 to 43 in favor of granting Katz parliamentary immunity from the charges, preventing Mandelblit from filing an indictment against the former welfare minister.

In a written opinion presented to the High Court last month as part of a petition by the Movement for Quality Government in Israel, Mandelblit said the step constituted a “deviation from authority” and was characterized by “extreme unreasonableness.”

Mandelblit argued that Katz’s alleged crimes were not committed in the context of his legislative duties, making him ineligible for immunity.

According to the 2005 law on parliamentary immunity, “substantive immunity” — a form of parliamentary immunity that permanently blocks an indictment and not just while the accused is a serving MK — can be granted by the Knesset for actions the House Committee finds were committed in the legitimate fulfillment of parliamentary duties.

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