Cyril Kern, the Cape Town-based businessman who loaned Ariel Sharon $1,5-million, shared business interests with a man implicated in an earlier funding scandal involving the embattled Israeli premier.
Kern increasingly appears not to be just a close friend of Sharon, but also well-connected to international business circles that have been funding Sharon and his party, the right-wing Likud.
Kern and Sharon have both attested to their strong friendship that started when they fought together in the 1948 Israeli independence war. Kern got dragged into the funding scandal threatening Sharon’s political career when the Israeli media last week published details of a request by the Israeli attorney general to the South African Department of Justice to probe Kern’s low-interest loan, made a year ago to Sharon’s sons Gilad and Omri.
Kern’s loan was used, indirectly, by Sharon to repay illicit campaign contributions to his 1999 Likud primaries campaign, which launched him towards the premiership. The Israeli state comptroller in 2001 ordered Sharon to repay some of the 1999 contributions after finding that his campaign had accepted foreign funding in contravention of party financing law.
Effectively, Kern’s loan was to have helped Sharon out of trouble by enabling him to repay the earlier illegal foreign funding. Now it has been established that Kern is close to an influential businessman and diplomatic emissary who is under suspicion of being one of the architects of the original illicit funding in 1999.
Kern this week confirmed to the Mail & Guardian that “of course I know” the businessman, Israeli-American Arie Genger. The Israeli newspaper Yedioth Ahronoth this week revealed that Genger was a director during the 1990s of Reldan, the British fashion company then owned by Kern but later liquidated.
Genger has been named in the Israeli press as allegedly the main illicit contributor to Sharon’s 1999 campaign through an Israeli front company, Annex Research. Genger has twice refused to answer Israeli investigators’ questions.
Genger is said to be very close to Sharon, who uses him as his quasi-official emmissary to the White House, where he meets Secretary of State Colin Powell and National Security Adviser Condoleezza Rice. Kern this week described Genger as “the representative of the Likud and Sharon in the United States”.
Kern said, however, that he had been unaware of Genger being implicated in the 1999 funding affair until he read about it in the Israeli media last week. He described Genger as “a really smashing chap”.
Meanwhile, Kern has emerged as more of a businessman than the semi-retired 72-year-old whose local company, the Sourcing Office, was earlier reported to be involved in “furniture, beads and textiles”.
It emerged this week from documents seen by another Israeli newspaper, Ma’ariv, that Kern had been involved in attempts last year to broker multimillion-dollar deals — a diamond venture and the sale of a gold refinery — between Swiss and Israeli investors on the one hand and South Africans on the other.
This fuelled the scandal in Israel as Sharon had earlier vouched that Kern had no Israeli business interests, meaning it would have been impossible for Kern to benefit in return for his loan. Whether acting for Israeli businesspeople is quite the same as having Israeli business interests, Kern clearly tried to use the Sharon clout in setting up the deals: Ma’ariv reported that Kern had boasted in correspondence of his close connection with the Sharon family and also copied correspondence to Gilad Sharon.
It is also in one of these deals, a Sierra Leone diamond venture, that the name of Mario Ambrosini popped up. The M&G last week revealed the close relationship etween Kern and Ambrosini, who is adviser to Minister of Home Affairs Mangosuthu Buthelezi.
Role players in both deals this week confirmed the basics of the Ma’ariv article to the M&G. A spokesperson for the Witwatersrand Refinery near Pretoria confirmed that in April and May last year Kern had represented foreign parties interested in buying the refinery, but said that the negotiations came to naught.
The spokesperson said Kern’s Sourcing Office had approached the refinery “out of the blue”.
Chris Cloete, a South African mining entrepreneur, said he had approached Kern last year to ask for help finding foreign investors for a diamond development in Sierra Leone. Cloete also confirmed that Ambrosini had helped draft the contract with Kern’s potential Israeli investors — a fact confirmed by Ambrosini this week. Cloete said he had approached Kern for help to raise investment after “hearing he invests in gold mines, and so on”.
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