Olmert suspected of fraudulently keeping travel expenses (2nd Roundup)

Jerusalem - Israeli police announced serious new suspicions of corruption against Prime Minister Ehud Olmert Friday, saying that for years he allegedly submitted travel expenses for the same trip abroad more than once, pocketing the surplus. Olmert is suspected of submitting receipts for flights around the world to various public bodies, including the state, as if they each 'were the only one financing the flight described in the receipt,' said a joint statement issued by the Israeli Justice Ministry and police, faxed to Deutsche Presse-Agentur dpa. He allegedly put the extra money in a special bank account on his name and used it for private trips abroad made by his family and himself, it added. He allegedly did so while travelling abroad as mayor of Jerusalem and as trade and industry minister over the past years. The statement said he in this way 'fraudulently' accumulated 'significant sums' over years. It did not give a figure, but Israel Radio said the money allegedly pocketed by Olmert amounted to hundreds of thousands of US dollars. The receipts were sent to the various bodies by Olmert's travel agent, which also managed his special bank account, the statement said. The premier's spokesman, Mark Regev, denied the allegations. 'The prime minister is convinced of his innocence of any wrong- doing and strongly believes that as this investigation continues, that innocence will be clearly demonstrated,' he told dpa. The new suspicions surfaced as part of an ongoing police investigation against the premier, which is looking into allegations that he illegally accepted tens, and possibly hundreds, of thousands of US dollars from a US businessman and fundraiser, Morris Talansky, over a period of 15 years, before being elected prime minister in early 2006. They are based on documents and witness accounts collected during the past weeks. Israel's attorney-general as a result authorized broadening the police investigation against Olmert already a month ago, but did not announce this so as to avoid jeopardizing a questioning session of the premier scheduled for Friday, in which detectives confronted him with the new suspicions. The dramatic announcement comes as Olmert's political future is already becoming increasingly uncertain. His largest coalition partner, the Labour Party, has forced him to agree to holding early primaries in his own, centrist Kadima, which the party decided this week to hold in mid-September. Olmert, 62, had earlier hoped that a crucial cross-examination of Talanksy next Thursday by his own lawyers would change the negative perception of him and reduce pressure on him to resign. But the grave new suspicions are likely to do the opposite. Talansky had given his version of events in a pre-trial testimony to a Jerusalem court in late May. He said he had given Olmert 150,000 dollars, much of it in cash in envelopes because he was asked to do so, between 1992 and 2005. He said he raised the money on behalf of Olmert, then a member of the hardline Likud party, for ideological reasons. Talansky however has since turned against Olmert and become the key state witness in the case. Olmert's associates have accused Talanksy of belonging to hardline circles, hinting the premier's ideological shift in favour of a two-state solution to the Israeli-Palestinian conflict, an Israeli withdrawal from the occupied territories and a possible division of Jerusalem, may be behind the rift. Olmert has admitted to receiving several envelopes, but with hundreds of dollars only, not thousands or tens of thousands. His lawyers and spokesmen have said they were legitimate reimbursements for food and accommodation expenses, paid for by his hosts when invited to speak at events in the US. He has said the larger donations were all used to cover, in part retroactively, four election campaigns - when he ran for mayor of Jerusalem in 1993 and 1998 and for the Likud leadership in 1999 and 2002. But police are investigating whether a future trade-off was expected in return for the donations, which could prove the allegation of taking bribes. The Israeli Ma'ariv daily on Thursday printed letters written by Olmert, among others one to top Las Vegas real-estate mogul Sheldon Adelson dating November 2005, asking the addressees to consider the services of Talansky's company, Cooltech, which produces mini-bars for hotels. Olmert has promised to resign if the police investigation materializes into an indictment against him.