The New Jerusalem Foundation, a charitable organization aimed at raising cash for projects in the capital, has found itself in the unenviable position of being founded by Prime Minister Ehud Olmert - the main suspect in the latest police investigation to scandalize the country - and having as treasurer Morris Talansky, the NY financier whose donations to Olmert lie at the center of the probe. "What on earth is going on here?... Once this goes public," it's no big deal, former New Jerusalem Foundation director Zvi Raviv told the Post. "Is there [an] attempt to depose the prime minister by people who are supposed to keep law in this country? Every time this kind of affair hits the public arena, my confidence in justice fades," he said. "If the prime minister knowingly broke the law, he should be punished. There's no question about it. But he has already been tarred and feathered... I don't understand how this could happen - we have a country to run." Despite its close links to Olmert and Talansky, the foundation firmly maintains that it has nothing to do with the investigation. "We support those with special needs, children, and teenagers," said Moshe Begaon, an NJF spokesman. "We fund dance centers, libraries in schools, provide help for the deaf, and holiday food packages." Bringing up the foundation's name in connection with the police investigation was "unjustified," Begaon said. "The police are not interested in the foundation. This causes damage to our contributions." The foundation's Web site has been down since January as part of an upgrade, Begaon said. "It has nothing to do with the investigation," he insisted. Established by Olmert in 1999 (when he was mayor of Jerusalem), the New Jerusalem Foundation is not to be confused with the Jerusalem Foundation founded by longtime mayor Teddy Kollek. Olmert called on Raviv to help launch the NJF, and he went on to become the organization's first director (the charity is now headed by Pinchas Weil). "Olmert asked me to come on board as his fundraising adviser for municipal projects. I saw that without Clause 46 [which allows for tax reductions for charity donations], I cannot do my job. So I initiated the establishment of the NJF in the US first and then a year later in Israel. And Ehud Olmert was the head of the foundation... I did the fundraising," Raviv recalled. From its outset, the NJF courted controversy when it failed to register itself as a nonprofit organization with the Interior Ministry or to report millions of dollars in contributions in 1999. This newspaper reported eight years ago that Jerusalem municipal "opposition members fear the mayor [Olmert] has been avoiding proper reporting of the foundation's activities because he has been using it to raise funds for his own political needs." The allegations failed to stick, however, and the charity went on to register itself in Israel in 2000. In the US, it already enjoyed legal recognition, and was registered under the name of American Israel Public Affairs Committee treasurer Gary Wallin. When Wallin passed away, Raviv searched for a new treasurer. He found Morris Talansky. "I was looking for someone to do the same thing for very little money - we paid $500-$600 a month to Moshe Talansky. That included all of his expenses. I didn't want to spend money on bureaucracy; I wanted most of the money to go to Jerusalem. Talansky was our address," Raviv said. Talansky's Long Island, New York, home address is listed as the New Jerusalem Foundation's American office. "He was 90 percent a volunteer. And to involve the name of the NJF in the affair under investigation is a travesty of the truth," Raviv told The Jerusalem Post. "I know that Talansky and Olmert were friends. I know that Talansky raised campaign moneys for Ehud Olmert. I do not know how it was transferred. This was done entirely by [Olmert associate] Uri Messer. Once, four checks crossed my path from Brazil and when I asked Olmert what to do with them, I was told to give them to Uri Messer, and that's exactly what I did. This money was campaign money, $5,000 in total, and the matter was checked thoroughly by the police about 10 years ago. "I had no contact with Talansky about campaign money. You must differentiate between campaign money, which is what Talansky did, and the NJF, which is what I did," he said. Raviv said the current allegations made no sense to him. "What does make sense to me is that the law limiting donations to elections primaries is impossible in a place like in Israel. Legally, a candidate can't raise more than NIS 5,000 [per household] in the 12 months preceding the elections. The problem is that in Israel, there are early elections every two to three years... There is no force in the world that is able to raise the required money based on contributions and to divide it into 12 month payments that are under the legal limit. Primaries cost millions of dollars." Which is why, Raviv said, American politicians invented the concept of "soft money," sums raised by private individuals for a candidate. Australian diamond tycoon Yosef Gutnik raised "soft money" for opposition head Binyamin Netanyahu in 1996. After Netanyahu's election victory that year, Raviv continued, [Ehud] Barak went to the High Court of Justice, saying that raising soft money was illegal. "He lost. Then Barak's brother told me: Great - now we know to finance our campaign. All of Barak's campaign a few years later was based on soft money. Talansky raised funds for Olmert - this money is either campaign money or soft money. Barak, Netanyahu, and Sharon all got away with it," Raviv said. Asked why he believed Talansky contributed the money in question to Olmert, Raviv said that "Jews the world over believe that contributing to leading Israeli politicians will shine some of the glory back on them." Talansky wanted to bask in Olmert's glory, Raviv said, pointing out that Talansky was very experienced in fund-raising, and he and Olmert agreed that he would work to raise funds for Olmert's campaign.