Former Bank of Israel governor Jacob Frenkel withdrew his nomination on Monday to return to the position, following an ongoing scandal over an alleged shoplifting incident at a duty free shop in a Hong Kong airport.

Frenkel’s return to the post has hit a number of road bumps since his nomination in late June. First, a scandal reemerged over the bloated compensation package he received following his first term, which lasted from 1991 to 2000. The state comptroller at the time forced Frenkel to return NIS 238,000 to the government. The Turkel Committee, appointed to evaluate Frenkel’s nomination, said in early July that it would set the incident aside.

The next bump, which ultimately proved his undoing, followed a Haaretz report that Frenkel was detained at a Hong Kong airport in 2006 over allegedly shoplifting a bottle of perfume.

Though Frenkel claimed the incident was a “misunderstanding,” the fact that he did not report it to the commission posed a further legal hurdle. Attorney-General Yehuda Weinstein had opened an investigation into the matter.

“In an unreasonable and intolerable way, they put a man on the stakes without all the facts, simply based on speculation,” Frenkel wrote in his statement, according to Channel 2.

The fact that Frenkel had served as vice chairman of the international insurance group AIG from 2004-2009, the years leading up to its spectacular near-failure in the 2008 financial crisis, went largely unmentioned.

“Of course whoever knows the truth knows – The Turkel Committee knows, I know – but there is no room to continue in this process,” Frenkel wrote in his statement. “I came to that conclusion and notified the prime minister and finance minister that I am withdrawing my nomination.

“I am, of course, very sorry about that, because I hoped to aid the effort, to help close the gaps in Israel, to help curb the cost of housing, to help the middle class, and I will continue to do so as much as possible from other places.”

In a joint statement, Prime Minister Binyamin Netanyahu and Finance Minister Yair Lapid expressed their regret at Frenkel’s decision.

“In the atmosphere that exists today, we are not far from the day that nobody will want to go near public life,” they said.

The two added that they would choose another nominee in the coming days.

Lapid further lamented the “missed opportunity” in a Facebook post, slamming the media for the circus surrounding Frenkel’s nomination.

“Frenkel could have been exactly what we needed,” the former journalist wrote. “A man of 70, an Israel Prize winner, one of the world’s most respected economists suddenly discovered that anyone who has a keyboard can sully and slander and write terrible things about him that were not even checked.”

Frenkel was poised to replace Stanley Fischer, who stepped down at the end of June after eight years in the role. Fischer’s deputy, Karnit Flug, has served as acting governor since his departure.

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