New Allegations in Israeli Naval Procurement Scandal

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File image courtesy schlomiliss / social media

By MarEx 2017-01-30 17:01:33

On Monday, the administration of Israeli prime minister Benjamin Netanyahu denied allegations of impropriety in the procurement of four surface craft from German conglomerate ThyssenKrupp. 

"Contrary to allegations in the media, the purchase of four surface crafts was conducted in accordance with the recommendations of the Navy and the Defense Ministry," Netanyahu's office said in a statement. 

The new questions regarding the contract for surface vessels add to a growing controversy over a $1.5 billion contract with ThyssenKrupp for three submarines. One of Netanyahu's close associates, attorney David Shimron, is suspected of serving as the firm's paid representative in Israel. On Friday, former defense minister Moshe Ya'alon testified that Netanyahu himself had been involved in cancelling an open tender for the subs so that the contract could go directly to ThyssenKrupp – against the wishes of the Israeli defense establishment. 

Israeli attorney general Avichai Mendelblit has opened an investigation into Netanyahu's possible conflicts of interest. The prime minister's office denies the allegations and says that the submarine deal was "done in an orderly and professional process with no outside influence and with the recommendation of all the professional bodies in the security establishment."

The naval procurement investigation is not the only corruption scandal involving Netanyahu's associates. Brigadier-general Avriel Bar-Yosef, Netanyahu's nominee for the post of national security advisor, was questioned late last year in connection with charges of bribery and fraud. He allegedly failed to disclose his ties to German businessmen who were interested in Israel's offshore gas reserves – ties which may have included the receipt of material benefits. 

The questions surrounding the Israeli procurement agreements are not the only ones for ThyssenKrupp. In 2015, the German paper Handelsblatt reported that the firm was investigating the possibility that its employees had used bribery to promote sales in Turkey, Pakistan, Greece, South Korea and Indonesia.