OLMERT'S TRAVELGATE - ATTORNEY GENERAL BEGINS MARCH TOWARD

UNCLAS SECTION 01 OF 02 TEL AVIV 002647 SENSITIVE SIPDIS E.O. 12958: N/A TAGS: PGOV PINR IS SUBJECT: OLMERT'S TRAVELGATE - ATTORNEY GENERAL BEGINS MARCH TOWARD AN INDICTMENT 1.(SBU) Summary: PM Ehud Olmert has been subject to the investigation of the Israel Police and the scrutiny of the Attorney General's office since 2005 in regard to at least five separate cases of alleged abuse of authority in public office, dating back over the past fifteen years. Several of the files went nowhere: the Bank Leumi sale was subsequently closed; in the Greek Island Affair Olmert was not prosecuted; and even the Morris Talansky Affair involving allegations of "cash envelopes," which led to Olmert's resignation in September, has so far failed to produce indictments. It was therefore something of a surprise when the Attorney General's office released a somber statement on November 26 informing the public that AG Meni Mazuz had informed the Prime Minister's legal representative that he was considering filing an indictment in the "Rishon Tours" Affair regarding alleged double billing of travel vouchers related to the Prime Minister's travels. The timing, just short of eleven weeks from general elections raised the question of whether Olmert will suspend himself from office and leave Foreign Minister Tzipi Livni to serve as acting prime minister. Livni has demanded that Olmert suspend himself, but Olmert's team says he does not plan to do so. End Summary. MAZUZ SIGNALS AN INDICTMENT IN THE WORKS ¶2. (SBU) The lengthy Hebrew text of the Attorney General's November 26 announcement that he is considering filing an indictment against Ehud Olmert in the Rishon Tours Affair notes that prior to any decision on his part, "and should the Prime Minister wish it, a hearing will be conducted, as is customary, in the presence of the Attorney General." In that hearing "the PM's attorneys will be able to present arguments and facts which will be examined with an open mind as is the practice." The timeframe will be coordinated with the Prime Minister's attorneys. The significance of this last fact is that given Olmert's record in regard to allocating time for the police questioning over many months, it is reasonable to suppose that the hearing will not be a short-lived affair and the Attorney General's office will not be able to expedite it. The chances of completion prior to the February 10, 2009 election date are negligible. RISHON TOURS AFFAIR ¶3. (U) If, as one commentator has suggested, the Hebrew text of the Attorney General's notice to the Prime Minister is in fact a draft of the indictment, then Olmert's attorneys may now be conducting preliminary work in preparation for the hearing. The Attorney General's statement specifies suspicion that Olmert misappropriated 85,000 dollars by means of "double-billing" travel expenses while in public office as Mayor of Jerusalem (1993-2003) and as Minister of Industry and Trade (2003-2006). OLMERT'S LAWYERS RESPOND ¶4. (U) Olmert's lawyers issued a joint statement in reaction to the Attorney General's decision. They claimed that Olmert denied the charges regarding Rishon Tours and lambasted Mazuz for including in his advisory letter various points on which Olmert claimed he had not been questioned at all. Olmert's lawyers told Ma'ariv newspaper: "The procedure of a hearing is exceedingly substantive and it is not without precedent that initial decisions that were taken to indict were overturned in the light of arguments that were raised in the course of such a hearing..." NO POLITICS INTENDED ¶5. (SBU) Attorney General Meni Mazuz has generally appeared reluctant to make a decision which would influence the fortunes of a particular party and to remain above or outside politics; however, news of ongoing or new investigations have often created political crises, such as the Talansky Affair that began in April 2008 and sparked calls for Olmert's resignation that were eventually heeded. The most Olmert can do at this juncture is to suspend himself from office on grounds of "incapacitation" or be suspended upon the recommendation of the Attorney General himself. There is no indication that either of these two scenarios are about to unfold. Should he do so, Livni, in her capacity as "Alternate Prime Minister," would become Prime Minister temporarily (i.e., at least through the upcoming elections). THE RABIN AND KATSAV PRECEDENTS ¶6. (SBU) The moral imperative, however, may yet be invoked in a demand for Olmert's suspension. Non-governmental organizations and even private individuals may petition Israel's Supreme Court to demand that the Prime Minister divest himself, at least temporarily, of the office he holds in light of the gravity of the Attorney General's advisory - which is the first to emerge from all the investigations Olmert has undergone. If they do submit such a plea with the court, they will almost certainly cite the case of former TEL AVIV 00002647 002 OF 002 Prime Minister Yitzchak Rabin. In 1977, Rabin was the head of a transitional government when he was notified by the Attorney General that he was considering filing an indictment against him for violating Israel's currency regulations in the case of the U.S. dollar account which Rabin's wife had maintained in the United States. Rabin immediately suspended himself from office and handed over the reins of power to his arch-rival Shimon Peres. More recently, President Katsav took a leave of absence from his post after Attorney General Mazuz informed him that he was considering an indictment on charges of rape and sexual harassment. Katsav resigned shortly before the expiration of his full term in office in June 2007, and reached a plea bargain that he later reneged on. LIVNI'S DEMAND REJECTED BY OLMERT'S CAMP ¶7. (U) Foreign Minister and Kadima Party Chair, Tzipi Livni, reacted to the Mazuz decision by calling on Olmert to suspend himself from the office of Prime Minister. She reportedly told Kadima cadres on November 27 that "The Prime Minister, like anyone else in Israel, is innocent until proven guilty. But citizen Olmert should fight from home and not from the position of prime minister... The prime minister must suspend himself. There is no other option." In response, an Olmert spokesman, Amir Dan, stated that the prime minister had no intention of suspending himself and accused "politicians" of acting for "political reasons." Should Olmert suspend himself, Livni would automatically become the Acting Prime Minister until elections on February 10, 2009. MORENO