Olmert, it is alleged, used his former position as finance minister in order to help two friends who were interested in buying the shares. Olmert has denied interfering in the tender for the state's controlling interest in the bank.
The Prime Minister was notified of the prosecution's order on Tuesday afternoon.
The investigation will focus on suspicions that Olmert tried to steer the tender for the sale of Bank Leumi in order to help Australian real estate tycoon Frank Lowey, a close personal associate, and Daniel Abrams.
Police opened an unofficial "inspection" into the suspicions two months ago. Shendar decided to open a criminal probe after Attorney-General Menachem Mazuz removed himself from the case due to his sister Yemima Mazuz's employment as the Finance Ministry's legal adviser in the privatization of Bank Leumi.
Police Commissioner Moshe Karadi is expected to decide Tuesday who will conduct the investigation along with the prosecution's finance department.
Suspicions that Olmert, in his former role as finance minister, was improperly involved in the Leumi sale first came to light in a report by State Comptroller Micha Lindenstrauss. The main evidence against him is apparently the testimony of former Accountant-General Yaron Zelikha.
An opinion prepared by attorney Michael Karshan of the Justice Ministry recommended a criminal investigation against Olmert in the Leumi affair, on suspicion of fraud, breach of trust and other crimes. However, Shendar then decided that more information was needed, and asked the police to carry out certain inquiries as part of the process of deciding whether to open a formal investigation.
The PM may be probed over two additional affairs as well: the alleged illegal appointments at the Israel Small and Medium Enterprises Authority during his tenure as minister of Industry, Commerce and Labor; and his association with his confidante Attorney Uri Messer who was a partner in Olmert’s law firm until 1988.
Messer was one of the key figures in the affair involving Olmert’s purchase of a luxury apartment on Cremieux Street in Jerusalem. Messer allegedly conducted the business negotiations on Olmert’s behalf.
Reports said Olmert received a US$320,000 discount on the apartment in the capital's ritzy German Colony in exchange for expediting construction permits.
Speaking for the first time last week on Attorney-General Mazuz’s recommendation that he be investigated, Olmert told reporters in China, "I do not feel persecuted; similar reports have been published in the past."
The police investigation ordered by state prosecutor Shendar could result in a coalition crisis and early elections. Olmert was elected in March 2006 as Israel's 12th Prime Minister.
The Prime Minister was notified of the prosecution's order on Tuesday afternoon.
The investigation will focus on suspicions that Olmert tried to steer the tender for the sale of Bank Leumi in order to help Australian real estate tycoon Frank Lowey, a close personal associate, and Daniel Abrams.
Police opened an unofficial "inspection" into the suspicions two months ago. Shendar decided to open a criminal probe after Attorney-General Menachem Mazuz removed himself from the case due to his sister Yemima Mazuz's employment as the Finance Ministry's legal adviser in the privatization of Bank Leumi.
Police Commissioner Moshe Karadi is expected to decide Tuesday who will conduct the investigation along with the prosecution's finance department.
Suspicions that Olmert, in his former role as finance minister, was improperly involved in the Leumi sale first came to light in a report by State Comptroller Micha Lindenstrauss. The main evidence against him is apparently the testimony of former Accountant-General Yaron Zelikha.
An opinion prepared by attorney Michael Karshan of the Justice Ministry recommended a criminal investigation against Olmert in the Leumi affair, on suspicion of fraud, breach of trust and other crimes. However, Shendar then decided that more information was needed, and asked the police to carry out certain inquiries as part of the process of deciding whether to open a formal investigation.
The PM may be probed over two additional affairs as well: the alleged illegal appointments at the Israel Small and Medium Enterprises Authority during his tenure as minister of Industry, Commerce and Labor; and his association with his confidante Attorney Uri Messer who was a partner in Olmert’s law firm until 1988.
Messer was one of the key figures in the affair involving Olmert’s purchase of a luxury apartment on Cremieux Street in Jerusalem. Messer allegedly conducted the business negotiations on Olmert’s behalf.
Reports said Olmert received a US$320,000 discount on the apartment in the capital's ritzy German Colony in exchange for expediting construction permits.
Speaking for the first time last week on Attorney-General Mazuz’s recommendation that he be investigated, Olmert told reporters in China, "I do not feel persecuted; similar reports have been published in the past."
The police investigation ordered by state prosecutor Shendar could result in a coalition crisis and early elections. Olmert was elected in March 2006 as Israel's 12th Prime Minister.