Gaydamak adviser posts bail after arrest for tax evasion

Milshtein tells reporters outside court "mistakes were made" but "things would be straightened out.

By YAAKOV LAPPIN
gaydamak sad 248.88 (photo credit: Judy Siegel [file])
gaydamak sad 248.88
(photo credit: Judy Siegel [file])
The Israel Tax Authority arrested Yossi Milshtein, former senior media and strategic adviser to tycoon Arkadi Gaydamak, on Sunday on suspicion of tax evasion amounting to over NIS 1,200,000. Milshtein arrived at the Tel Aviv Magistrate's Court for a custody hearing, and was released on bail. Milshtein told reporters outside of the court he was a salaried employee for the duration of his working life, with the exception of the year 2001, adding that he hoped he would not be made to pay for others' mistakes. He added that he did not feel persecuted by the authorities and that he was confident that the Tax Authority was just doing its job. "Mistakes were made," Milshtein said, adding that "things would be straightened out." Milshtein is suspected of failing to submit tax reports, or of filing partial reports during a six-year period, between 2001 and 2007, and for failing to submit a declaration of assets. His arrest came following an undercover investigation managed by the Tax Authority. According to one of the suspicions, Milshtein allegedly received NIS 1 million in 2006 to his bank account but failed to declare the income. Police are also focusing on a failure to declare the receipt of NIS 208,000 from lawyer Amos Mimon in 2005, following a legal dispute. Milshtein's lawyer, Hila Boaron, said it was a complaint by Mimon to the Tax Authority which set off the investigation. Mimon denied lodging a formal complaint against Milshtein. During the custody hearing, the court agreed to a Tax Authority request to place a travel ban on Milshtein to prevent him from leaving the country. Milshtein's former boss, Arkadi Gaydamak, is the subject of an intensive police investigation over money laundering suspicions, an investigation Gaydamak says is part of a political witch hunt against him. Gaydamak is currently hospitalized in Moscow where his lawyers say doctors have found a heart defect, and where he has undergone a series of treatments. Gaydamak launched a failed bid to become Jerusalem mayor, expressing deep disappointment with his loss in the race to head the capital. The poor polling in the local elections of the billionaire's Social Justice Party led to a decision not to register the party as a contender in next week's general elections. Gaydamak remains the chairman of the Betar Jerusalem soccer club.