Olmert Linked to Pre-Liquidation Scam

Ehud Olmert and corruption: Investigative reporter Yoav Yitzchak reports that Olmert, using fictitious arbitration, enabled the dishonest extraction of 5 million shekels from a failing soccer team.

Hillel Fendel , | updated: 3:51 PM

Yitzchak [pictured], reporting on the Hebrew investigative news-site NFC he edits, reveals that Olmert "lent his hand to grave crimes that were committed, including stealing money from creditors, among them the Income Tax authorities, Bank Leumi, players on the Beitar Jerusalem soccer team such as Ronen Harazi, and others."

Yitzchak writes that the above information is known to "some elements, but they have hesitated to take legal measures against Olmert. In addition, some media outlets that have received this information chose to remain silent."

Olmert's role as arbitrator in the Beitar Jerusalem matter in the year 2000 is well-known, Yitzchak writes, but the scoop lies in the fact that the arbitration was fictitious, and in the revelation of Olmert's role in this fiction.

Yitzchak acknowledges that the case is "complex" and requires further investigation. "The decision to open such an investigation is in the hands of Attorney General Menachem Mazuz," Yitzchak writes today, "and in light of Olmert's role as Acting Prime Minister, Mazuz will have to consider the issue with sensitivity but with all due haste."

The essential accusation is that Olmert participated in a procedure that allowed a creditor and a debtor to cooperate on the payment of a debt, part of which may not even have been genuine, at the expense of other creditors.

The story began in 1999, when the Beitar soccer team, encountering financial difficulties, sold off its properties in the Bayit Vegan neighborhood of Jerusalem in order to pay off its creditors.

The property was sold for 27 million shekels. However, Moshe Dadash, the man who essentially ran the team for many years, soon withdrew 5.2 million shekels of the money into his own account. Dadash later claimed that running the team voluntarily had cost him much money over the years, for which he was never reimbursed. He provided no receipts, however. He also claimed a prior debt of $180,000 that had swollen to $540,000.

Olmert, the Mayor of Jerusalem at the time, was asked to be the arbitrator of an agreement between Dadash and the team. The sides arrived for one meeting, at which Olmert asked them to go outside and come up with a compromise. The agreement they quickly came up with was that the money already taken by Dadash would suffice to cover the alleged debts. Olmert signed, and the matter was considered closed.

However, Yitzchak accuses, Olmert never asked to see a 'power of attorney' empowering any of the participants to represent the company in this matter. In addition, the same lawyer represented both Dadash and the team. Finally, Yitzchak maintains, a lawyer involved in the liquidation of Beitar confirmed to him that the arbitration was merely carried out to legitimize a shady deal and to retroactively authorize the taking of money that could have been used to pay off other creditors.

The lawyer, Ami Fulman, said that the sides chose to come to Olmert and not to a judge or another arbitrator, because they knew that Olmert would agree to be a fictitious arbitrator. Olmert has close personal ties with Dadash, Yitzchak alleges.

"Olmert never said a word," Yitzchak writes, "and cooperated with the sides."

On Jan. 1 of this year, Beitar Jerusalem Ltd., specified as a company in the process of being liquidated, sued for the return of the money taken by Dadash.

Olmert was contacted by NFC on Friday for his response. He said only that the issue has been publicized before, and has even been looked into by the State Comptroller and the Associations Registrar.

Yitzchak says, however, that the only aspect of this case that was investigated was Dadash's receipt of money - after which he was in fact ordered by the Registrar to return it.

Knesset Speaker Ruby Rivlin, who was chairman of the Beitar Association at the time - but not when the legal entanglings began - said today, "I knew of no spin or that someone was planning to have the money go elsewhere... If the facts are true, they are grave."

"Olmert can claim that he knew nothing of what was going on," Yitzchak writes, "but in addition to the fact that this would be a groundless claim, can he be considered fit to serve in a senior public position or to run the affairs of the State of Israel?"