Matza first to fall with plea bargain in tax scandal

Former Tax Authority first among "Tax Authority Eight" to be convicted; was charged with accepting a bribe, fraud, and breach of faith.

By DAN IZENBERG
January 10, 2011 01:23
2 minute read.
Jackie Matza

jackie matza 311. (photo credit: courtesy)

The first of the “Tax Authority Eight” who are standing trial on corruption charges was convicted in the Central District Court on Sunday after reaching a plea bargain with the state prosecution.

The Tax Authority affair, if substantiated, is one of the most serious cases of corruption in the public sector in the history of the country.

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Former tax authority chief reaches plea deal with state

According to the state’s account, two private businessmen, who were representing clients whose fortunes were significantly affected by the amount of taxes they paid, used their influence to install Jackie Matza as the director of the authority and then used him to appoint other senior officials who would be in their debt.

According to the plea bargain, which was revealed in court, the state agreed to drop from the amended indictment the charge against Matza of accepting a bribe and to reduce the number of charges of fraud and breach of faith from eight to five. Both the original and amended indictments include one charge of being an accessory to bribery.

The Penal Code calls for a maximum punishment of seven years in prison for accepting a bribe. A charge of fraud and breach of faith carries a maximum sentence of three years in jail.

The parties did not reach an agreement on the sentence to be handed down against Matza.

The court is obliged to accept the amended indictment submitted by the state but is free to determine the sentence within the constraints of the law.

In accepting the plea bargain, Matza confirmed that most of the allegations in the original indictment, which still apply to the six other suspects being tried in the Central District Court (suspect Shula Zaken is being tried in the Jerusalem District Court) were true and therefore will likely be the prosecution’s key witness in the trial.

The two businessmen who allegedly arranged Matza’s appointment were Ya’acov Ben-Gur and Yoram Karshi, the brother of Zaken, who served as an adviser to thenfinance minister Ehud Olmert. Karshi arranged a meeting between Matza and Zaken. When Matza was later appointed to the job, he was certain that Ben-Gur, Karshi and Zaken had engineered it.

According to the indictment, “Ben- Gur and Karshi extended help to Matza to advance his appointment to director of the Tax Authority. Ben-Gur and Karshi did this in the expectation that as director of the authority, Matza would act on their behalf and provide them with influence [over decisions].

“Ben-Gur and Karshi wanted influence primarily to appoint Tax Authority employees according to their demands, expecting that these employees would do them favors. Matza accepted the help of Ben-Gur and Karsh in the race for the post of director although he knew that they had a business interest in the authority,” it read.


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