VZCZCXRO7725
PP RUEHROV
DE RUEHTV #4742/01 3401241
ZNR UUUUU ZZH
P 061241Z DEC 06
FM AMEMBASSY TEL AVIV
TO RUEHC/SECSTATE WASHDC PRIORITY 8029
INFO RUEHXK/ARAB ISRAELI COLLECTIVE
RHEHNSC/NSC WASHDC
UNCLAS SECTION 01 OF 03 TEL AVIV 004742
SIPDIS
SIPDIS
E.O. 12958: N/A
TAGS: PGOV PINR KJUS IS
SUBJECT: THE PROPER ORDER OF GOVERNMENT: CORRUPTION AND THE ROLES
OF THE ATTORNEY GENERAL AND THE STATE COMPTROLLER
-------
SUMMARY
-------
1. The proliferation of allegations and investigations into the
conduct of public sector officials recently prompted questions as to
whether Israel's norms of public life have indeed reached an
unprecedented nadir, or whether oversight in the person and
functioning of the Attorney General and the State Comptroller is
characterized by unprecedented zeal. Is ever-widening corruption
driving the preoccupation with norms of public conduct or is Israel
merely witness to a revamping of ethical norms and levels of
transparency? Either way, the guardians of public interest and the
rule of law are finding themselves in the eye of a storm which could
terminate some high-profile careers along the way to higher ethical
standards in Israel's public sector.
---------------------
THE PEOPLE'S ATTORNEY
---------------------
2. Menachem Mazuz, the current Attorney General, walks a fine line
between serving as legal counsel to the government and as guardian
of the public interest. As the final arbiter of whether
investigations warrant indictment of an individual or the closure of
the file, the Attorney General has exclusive authority which may
only be overruled by the Supreme Court. His legal opinions are
binding on government agencies and he bears responsibility for the
consistency of government legislation with the Basic Laws of the
state. Complicating the role of the Attorney General is the fact
that while his office is designated as a non-political entity, he is
appointed by the government on the recommendation of a professional
public permanent committee (chaired by a former Supreme Court
Justice), for a non-renewable tenure of six years (or until the age
of 70, the earlier date prevailing), with a possible extension of
six months.". (Note: Mazuz was the first Attorney General appointed
under this process in 2004. Then-PM Sharon and Minister Olmert
abstained from participation in the government appointment process
due to ongoing investigations. Mazuz later indicted Sharon's son,
Omri, but never issued a formal indictment against the former Prime
Minister.) The guidelines for his office stipulate political
neutrality while defending the state in legal proceedings, alongside
the defense of civil liberties.
---------------------------
THE POLITICS OF PROSECUTION
---------------------------
3. If all these seeming "conflicts of interest" were not
sufficient, Israel's Attorney General operates in an environment of
ongoing political turbulence in which the fate of senior public
figures at the hands of the judiciary may have significant political
consequences for Israel and, on some occasions, even its neighbors.
The most notable dilemma of this kind, faced by the present Attorney
General, was the investigation of the role of then PM Ariel Sharon
in the "Kern loan affair" and the funding of Sharon's Likud party
leadership election campaign. The case reached the scrutiny of the
Attorney General during the sensitive prelude to implementation of
Sharon's disengagement plan and has yet to be closed. Prominent
among the many investigation files still on the Attorney General's
desk are those of President Katzav in regard to sexual harassment
and the issuing of pardons; PM Olmert in connection with real estate
and privatization deals; and the ever-pending investigation of
Minister for Strategic Threats Avigdor Lieberman on suspicion of
illicit business deals during the Russian ruble crisis in 1998 and
corruption linked to Likud party campaign funding in the same year.
-------------------
ORDER OF PRECEDENCE
-------------------
4. While the Attorney General's powers clearly exceed those of the
State Comptroller, the process of audit precedes the order to
investigate and the decision to indict. Israel recognized the
importance of the audit function as far back as 1949 when it enacted
the Basic Law: the State Comptroller and reinforced the office in
1971, when the function of Ombudsman was added to the State
Comptroller's duties. In this capacity, the State Comptroller is the
recipient of complaints from any persons who deem themselves harmed
by a public body which is subject to the Comptroller's audit. State
audit in regard to regularity, legality, efficiency, economy and
moral integrity of state bodies is the primary function of the
Comptroller's office. Since 1973 the State Comptroller also audits
the accounts of the political parties. The State Comptroller is
elected by and accountable to the legislature. Audit findings are
submitted to the Knesset. But findings which give rise to suspicion
of criminal action must be referred to the Attorney General.
--------------------------
ENTER THE ACTIVIST AUDITOR
--------------------------
TEL AVIV 00004742 002 OF 003
5. Distinct from the role of Attorney General, the State
Comptroller's authority is defined in law [State Comptroller Law
1958], thus leaving little to conjecture or interpretation. This
fact serves the present Comptroller well amidst the controversy that
has been stirred up by his unanticipated activism. For as long as
there has been a State Comptroller's office, its reports have
elicited, at best, some momentary indignation and more often a
lengthy "yawn" from the pundits and media alike. Micha
Lindenstrauss, who was elected by the Knesset in 2005, is working to
change all that. Whereas previous State Comptrollers completed
their reports, submitted their findings and left it to the Knesset
or the Attorney General to decide on further action, if any,
Lindenstrauss has flagged certain issues for the attention of the
Attorney General even prior to completion of his audit. In doing so
Lindenstrauss bases himself on Article 43D of the State Comptroller
Law which provides that suspicion of a criminal offence is grounds
for the involvement of the Attorney General, who then has six months
within which to advise the State Comptroller and the Knesset
Committee on State Control of the manner in which he has dealt with
the matter. This effectively introduces checks and balances in
regard to the functioning of the Attorney General. Lindenstrauss has
invoked his powers in this manner in no less a case than the
investigation of the prime minister's involvement in the sale of
Bank Leumi, and has found himself under severe criticism from a
surprising quarter.
---------------------------------
LINDENSTRAUSS IN THE LINE OF FIRE
---------------------------------
6. In the wake of a flurry of disclosures in the media regarding
investigations by the State Comptroller of high-level political
figures including PM Olmert, five prominent professors published a
vituperative attack on Micha Lindenstrauss. The broadside, accusing
Lindenstrauss of threatening "the proper governing order in Israel,"
was published in early November as an advertisement on the front
page of the Ha'aretz daily newspaper and simultaneously in the mass
circulation Yediot Acharonot. The professors, including Arik Karmon,
the president of the Israeli Institute for Democracy, Amnon
Rubinstein, president of the Herzliya Interdisciplinary Center and
Yaffa Zilbershatz, Dean of the Law Faculty at Bar Ilan University,
accused Lindenstrauss of "irregularities and misconduct" and alleged
that his office, specifically his advisor on corruption issues,
former Israel police commander Yaakov Borovsky, was deliberately
leaking information to the media on sensitive aspects of
investigations in progress.
-------------------------
ALLEGEDLY OUT OF CONTROL
-------------------------
7. One of the five professors, Shlomo Avineri of the Hebrew
University's Department of Political Science, was widely interviewed
by the electronic media and went as far as to allege that a form of
witch-hunt was in progress. While concurring that the
investigations were legitimate and necessary, Avineri insisted that
the leaks to the media prior to completion of the comptroller's
investigation were unacceptable. The public, Avineri claimed,
viewed these leaks as actual findings without benefit of a hearing.
Investigations, Avineri declared, must be carried out discreetly
and, if the findings warranted it, they should be submitted to the
public, the Knesset and the police. The State Comptroller's office,
he said, had until now been free of politicization, and had been
held in high regard. It was the job of the investigators, Avineri
affirmed, to fight corruption and not to fight heads of government.
If they were fighting the heads of government that was a political
matter and its place was within the political system. Asked if
there was a possibility that political motives were involved in the
conduct of the State Comptroller, however, Avineri said he would not
dream of making such an allegation.
------------------------------
TAKING ON THE STRATEGIC THREAT
------------------------------
8. Whatever the motive force driving the activism of the present
State Comptroller, the consequences of his activism have the
potential to galvanize oversight and control in ways that can only
benefit compliance with reasonable ethical norms in public life. As
far back as April this year, Lindenstrauss admitted that he had
discovered that "governmental corruption is broader and deeper than
what I thought...." In an interview with Yediot Acharonot,
Lindenstrauss identified what he deems a greater evil than
corruption itself: "I found initial signs of something very
dangerous: Acceptance of corruption."
-----------------------------------
CORRUPTION IS NOT THE GREATEST EVIL
-----------------------------------
TEL AVIV 00004742 003 OF 003
9. Israel's standings in a comparative international index of
perceptions of corruption show a progressive deterioration in
Israel's rankings. A report by Transparency International, issued
in early November, showed Israel ranked 34 out of 163 countries
placed in descending order, compared with 28 in 2005 (26 in 2004; 21
in 2003; 18 in 2002; 16 in 2001). Transparency International plans
a study of corruption in Israel in 2007, but until such a study is
undertaken, there is scant indication of whether corruption in
Israel has increased internally. What is clear is that the activism
of State Comptroller Micha Lindenstrauss is controversial not only
among the subjects of his scrutiny but in academic and intellectual
circles which pose disturbing questions as to who should watch over
the watchdogs of "proper government".
-----------------------------
THE DEMISE OF THE SACRED COWS
-----------------------------
10. In recent days, the Knesset Committee on State Control invited
Lindenstrauss to answer his critics in a special session dealing
with the allegations of leaks from his office. Lindenstrauss told
the committee that he was undeterred by the accusations that he was
persecuting the prime minister or exceeding his purview: "There are
no more sacred cows" he declared. "This is over. Everyone is
equal... There are no more situations of sweeping matters under the
carpet. That is over. Matters will be open, transparent; people will
know what is going on."
JONES