Finance Minister Avraham Hirchson was being questioned under warning on Tuesday afternoon for allegedly turning a blind eye to embezzlement committed during his tenure as head of the National Labor Federation in Eretz-Israel. Hirchson was questioned for seven hours and would be called for another session of questioning, Israel Radio reported in the afternoon. Five of Hirchson's former employees were arrested in early January, but police have not reported any tangible progress. The investigation is being handled by the National Financial Crimes Unit. The allegations regarding Hirchson surfaced in late December. The Financial Crimes Unit's close-lipped chief, Lt.- Cmdr. Yoav Segelovich, was tapped to question the head of one of the country's most powerful ministries.
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All five of the people arrested were former employees of Nili, an organization that operated educational institutions under the union's umbrella.
Police believe that Ovadia Cohen, Nili's former head, embezzled approximately NIS 5.5 million from the organization in 2003. Allegedly, Cohen informed Hirchson of his crimes, and Hirchson fired him, but did not report the crime.
Cohen supposedly took the money to cover black-market loans. It was only in 2005 that accountants discovered the money was missing and reported the matter to the police.