Finance minister suspected of embezzlement when labor union head.
By JPOST STAFF, REBECCA ANNA STOILhirschson 298.88(photo credit: Ariel Jerozolimski)
The National Financial Crimes Unit (NFCU) in Lod questioned Finance Minister Avraham Hirchson under caution for more than seven hours on Thursday about an alleged embezzlement of funds when he served as chairman of the National Workers' Union.
This was the third time Hirchson was questioned about the allegations, which he continued to deny.
The investigation is set to continue and Hirchson is due to be questioned for a fourth time shortly. Sources close to Hirchson said that the finance minister remained defiant and had no intention of stepping down.
However, Channel 10 reported on Thursday that there was an ongoing dispute between Hirchson's advisers about whether the finance minister should suspend himself.
Since the allegations were raised first against him, the Legal Forum for the Land of Israel watchdog organization has called several times for Hirchson to quit. In a letter addressed to the finance minister, the organization warned that although he was presumed to be innocent, public confidence in the government would be reduced to zero as long as he remained in office.
Last week, Hirchson was questioned for eight hours, and, according to police officials, failed to convince his investigators that a large amount of money deposited into his account was obtained legally.
On Thursday, detectives, equipped with bank statements and financial documents from the labor union, continued to ask Hirchson to explain the deposits, amounting to some NIS 1 million, to his account at a Tel Aviv branch of Bank Hapoalim.
Hirchson said that the funds had been transferred to him by his son, Ofer, and by a wealthy aunt from Italy who had helped him during his wife's illness, Channel 10 reported.
The NFCU confirmed that some of the money had been deposited by Ofer, but it believed that the funds were paid in on Hirchson's instruction, since his son was in financial trouble when the deposits were made and could not have had so much money himself at the time.
Police are also investigating a suspicion that Hirchson used some of the embezzled money to pay Ofer's gambling debts.
Ofer Hirchson was also questioned regarding the allegations.
Police suspect that the money was obtained through embezzlement from Nili, an organization that operated educational institutions under the umbrella of the National Workers' Union, and other nonprofit organizations affiliated with the union, including the March of the Living, which brings Jewish youth and Holocaust survivors together in an annual commemoration.
Hirchson was also asked about the funding for his Likud primary run in 1999 and the alleged involvement of the NWU treasurer Ovadiah Cohen in the embezzlement scandal.
Initially, police believed that Cohen, former head of Nili, embezzled approximately NIS 5.5m. from the organization. Police now believe the extent of the alleged embezzlement was far greater than previously believed, perhaps surpassing NIS 10m.
Police thought that Hirchson knew that funds were being stolen from the union he headed for 10 years. However, rather than probing Hirchson for administrative negligence - ignoring embezzlement - police are now investigating the minister on suspicion of fraud, violation of public trust, theft as a manager and of signing off on false accounting statements.
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