South Africa’s Ministry of Justice this week fended off Israeli accusations that Pretoria was not providing full assistance in a bribery investigation against Prime Minister Ariel Sharon.
If South Africa and Austria did not cooperate with the investigation, Israeli justice officials were quoted as saying in media reports there, the case would be closed.
With the Israeli general election set for March 28, the results of the probe could sway the political balance and irreversibly damage Sharon’s future.
Sharon came under investigation in 2003 following his victory in the general elections after police discovered a series of suspicious money transfers amounting to $4,5-million made to Sharon family accounts. The transfers, which originated in Austria, were made by Cyril Kern — a Jewish businessman from Cape Town and an old friend of the Sharon family.
The Israeli police are investigating whether the loans were intended as bribes for Sharon. Kern has no known business interests in Israel, but police suspect he may have served as a front for other foreign business people heavily invested in Israel and Palestinian territory.
Sharon rejects the accusations. The money, he claims, was lent to his family by Kern to help repay a different bank loan taken out to repay $1,25-million in illegal campaign donations he received before the 1999 Likud Party leadership primaries.
After winning the primaries, Sharon was blasted in a State Comptroller report for accepting illegal donations and was ordered to repay the money. Kern’s ”loans”, he said, helped him to do this.
South Africa entered the picture in 2003 after a request by the Israeli authorities to investigate Kern. South Africa complied with the request and the Israeli police even sent officers to Cape Town to assist.
In November last year, Israel asked South Africa for additional assistance, requesting that Kern be questioned again and that further evidence relating to the source of the funds be transferred to Israel. A similar request was made to Austria in August last year.
Israeli justice sources have now been quoted as saying that South Africa and Austria have failed to provide adequate assistance throughout the investigation. If they continue to do so, the Israeli sources warned, the prosecution would have no choice but to close the case because of lack of evidence.
South African Justice Ministry spokesperson Kaizer Kganyago rejected the accusations this week, saying South Africa had fully complied with the request for judicial assistance. Kganyago said the National Prose- cuting Authority was investigating the affair and was waiting to receive additional information on the money transfers from the tax authorities.
Israeli rights groups fired off letters to Israeli Attorney General Menahem Mazuz this week demanding he wrap up the investigation before the elections.
”It is extremely important that decisions be made about the investigation against the prime minister before the elections,” the Movement for Quality Government wrote. ”The public also has the right to receive an update on the investigations before the elections and to be told whether the case will be closed or the politician will be indicted.”
Last year the Austrian authorities were asked to trace the source of the money, which the Israel Police believes may have come from Austrian-Jewish businessman Martin Schlaff. Schlaff is one of Austria’s wealthiest men and a close associate of several high-ranking Israeli politicians, including Sharon.
He is also part owner of the casino in Jericho, which has been closed for five years, since the beginning of the Palestinian Intifada.
Together with his partners — Casinos Austria and the Vienna-based BAWAG bank, which facilitated the loans to Sharon — Schlaff is waiting for an Israeli government decision to re-open the Palestinian-controlled city of Jericho. With Palestinians religiously forbidden to gamble, Schlaff can only reopen the casino after the government issues an order allowing Israelis back into the desert city.
Sharon’s departure ‘good for the peace process’
This week Ariel Sharon caused the biggest upheaval in Israeli politics in nearly three decades by resigning as leader of the ruling Likud Party, saying it was unfit to run the country. The experts comment:
Professor Avi Shlaim, author of The Iron Wall
”I think Sharon’s decision means a fundamental realignment of Israeli politics … For the first time in many years, there will be a genuine Labour party and a genuine alternative to Likud. That is what makes the election so interesting because of this fundamental shift. Also, this is good for the peace process.”
Chris Doyle, director, Council for Arab-British Understanding
”Given that it’s a short election campaign, Sharon has to get his administration into gear quickly. If he can look like a credible party, then perhaps he can create a roller-coaster; it would be unwise to underestimate him. The next big issue would be whether he can then lure the left.”
Abd al-Munai’m Said, al-Ahram Centre for Political and Strategic Studies, Cairo
”We have achieved one point of progress related to the disengagement in Gaza, and that was because of Sharon and genuine cooperation with Egypt, Europe and the United States. This cannot move forward with the present Israeli structure. With the rise in the power of the settlers, I don’t think Sharon had enough flexibility, so moving out of his party might open the way for serious consideration of the road map and moving forward.”
Edward Walker, former United States ambassador to Israel
”Nobody should confuse this with a willingness to walk away from Jerusalem, or with a near-term discussion of final status. That is not in his agenda.”
Stephen P Cohen, Middle East analyst
”Sharon has helped consolidate the fact that a vast majority of Israelis want an agreement, want the end of the conflict and are willing to have a Palestinian state in order to get it. But it is not clear that he is willing to negotiate to reach that goal … What he did [this week] he has made it harder for someone else to emerge as the leader of Israel.” — Â