Israeli attorney general orders criminal probe of Olmert's home buy

The Associated Press




JERUSALEM &

The prosecutor's office ordered police to launch a criminal investigation into Prime Minister Ehud Olmert's purchase of a Jerusalem home well below market value, the Justice Ministry said today.




Israel's state comptroller, a government watchdog, has already investigated allegations that Olmert bought the house from a Jerusalem developer in the upscale German Colony neighborhood at $325,000 under market value, raising suspicions of fraud and bribery. The sale took place before Olmert was prime minister.




Olmert declared his innocence and insisted the price he paid was fair.




"We are absolutely convinced of the integrity of the Olmert family's purchase of the house," the statement said.




"This investigation is uncalled-for," it said, adding that Olmert would "cooperate fully" with the investigation.




If Olmert is indicted, he would have to resign. Such a development, however, would be many steps down the road.




This is the second criminal investigation launched against Olmert since he became prime minister in May 2006. An earlier inquiry concerned suspicions that Olmert, as finance minister in 2005, tried to influence the sale of the government's controlling interest in the country's second-largest bank, Bank Leumi, to favor two associates.




The state comptroller, Micha Lindenstrauss, also has accused Olmert of using his influence to steer a government grant to a colleague in 2001, when he was trade minister. Lindenstrauss has recommended that Attorney General Meni Mazuz open a criminal investigation in this case, too.




Suspicions have also clouded two other real estate deals Olmert transacted in Jerusalem and in a trendy Tel Aviv neighborhood.




Olmert has been dogged by corruption allegations throughout his long political career but has never been convicted. He has consistently denied any wrongdoing.




"We are sure the investigation will clearly show that the purchase of the apartment by the Olmert family was made honestly, ethically and for an appropriate price,"




The investigation ordered today also will look into suspicions that Olmert associates helped Alumot, the Jerusalem property developer that sold him the house, obtain irregular construction permits from the Jerusalem municipality, significantly increasing the company's profits. Olmert was mayor of Jerusalem for 10 years.




Israel media reported that Olmert and his wife purchased the home for $1.2 million in late 2004, when he was a senior minister in the government.




Word of the criminal investigation hits Olmert at a sensitive time. He has been meeting with Palestinian President Mahmoud Abbas on renewing full-fledged peace talks. And his popularity, badly eroded by Israel's failed war in Lebanon, had recently surged after a reported Israeli airstrike in Syria.

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