State Prosecutor Moshe Lador told the High Court Monday that Prime Minister Ehud Olmert personally received thousands of dollars in cash from American businessman Moshe Talansky and is suspected of fraud and breach of public trust. Lador said the money transfers occurred both in the United States and in Israel and not through a third party, as some observers previously believed.

The police announced this morning (Tuesday) that Olmert will be questioned, under caution, this Friday morning - three weeks after his previous interrogation.  Talansky is also expected to be questioned again, apparently today.

Lador's statement provides the first concrete confirmation of the details surrounding the case. Although the Olmert/Talansky affair has consistently made headlines since the story broke in early May, the story has been shrouded in secrecy.

The police have not uncovered proof that Olmert provided favors for Talansky in exchange for the money, but on the other hand, neither have they found any justification for his having taken the sums without reporting them. Olmert's explanations that he used the money to finance campaign expenses and/or debts have not been proven.

Supreme Court to Decide Re: Talansky Testimony
The Supreme Court still has yet to decide whether or not to allow investigators to take a pre-trial deposition from Talansky early next week. Talansky has been summoned to testify on Sunday, but the move has been challenged by Olmert's lawyers, who say such a move would cause harm to the prime minister's basic right to due process.

It is also unclear whether Talansky will be permitted to leave Israel as scheduled next week, after arriving in Israel  last month to celebrate the Passover holiday with family members. He has been prevented from leaving the country as police investigate his role in the unfolding scandal but fear he will not return for further questioning.

Talansky says he must return to America to care for his wife, but plans to return to Israel next in mid-June for a grandson's wedding.