Talansky says he gave Olmert $150,000

NY financier recounts to court 10 occasions between 2002-2005 when he handed PM cash envelopes.

Prosecution witness Morris Talansky told the Jerusalem District Court on Tuesday that he gave Prime Minister Ehud Olmert $150,000 over a period of about 14 years, including $68,000 to help him in the 2002 Likud primary campaign. Talansky also said he had loaned Olmert at least $50,000 and never been paid back. It was not clear from his testimony whether the loans were part of the overall sum of $150,000. Israel Television reported that Labor leader Ehud Barak, after consultations Tuesday night, was considering calling on the prime minister to suspend himself from office or resign. At the request of the lawyers representing Olmert and his former bureau chief, Shula Zaken, Talansky's cross-examination will resume on July 17, after he returns from the United States. Olmert's chief lawyer, Eli Zohar, formally began to question the witness in the last few minutes of Tuesday's hearing. Talansky was questioned for about eight hours on Tuesday, with a few brief rest breaks. He entered the courtroom at 9 a.m., dressed in a gray suit and wearing a tie and a black kippa. Talansky looked grim as he walked to his seat, but was cooperative and animated as he answered the questions of State Attorney Moshe Lador and even, from time to time, gave his opinions on various issues in Israeli society unrelated to the issue at hand. During Lador's questioning, it became apparent that Olmert received several categories of funding from Talansky. First, there was money that Talansky gave the prime minister from his own pocket for what he was told were Olmert's campaign expenses. A second was money for expenses, given to Olmert by Talansky and other contributors to make up the difference between the money he received for speaking tours and what he spent to make the trips more comfortable, such as flying first class instead of business class or staying in a better hotel suite. Third, Olmert received money from benefits that were held on his behalf in New York. The money that was raised was given to Talansky, who would hand it over in cash to Olmert the following day. Fourth were the loans that Olmert asked of Talansky and promised to pay back. Fifth and finally, a mysterious sum of $380,000 was transferred from accounts apparently belonging to two companies that Talansky headed, to the account of Uri Messer, Olmert's close friend and personal lawyer. It was not clear from Talansky's testimony how much money Olmert raised at the benefits that Talansky and others arranged for him. Talansky said he only kept a record of the cash he withdrew from his own bank account to give to Olmert. As was already known from media reports, Talansky said he'd given the money directly to Zaken or Olmert. However, he also told the court that he had met with Messer in New York and given him envelopes of money for Olmert "once or twice." After Olmert became minister of industry, trade and labor in 2006, Talansky visited his office three or four times, and on some of these occasions, gave Zaken envelopes of cash. The sums ranged from $3,000 to $8,000. Talansky said US law prohibited withdrawing more than $10,000 at one time without having to register the withdrawal. Also revealed during Lador's questioning was that Talansky, according to his own "guesstimate," met with Olmert in New York 10 times from 2002 to 2005 and brought him money in an envelope each time. "I would visit him at his hotel on my way to work," Talansky recalled. "He was always busy, so I only stayed 10-15 minutes. I handed over the money in the envelope, and he immediately put it in his suitcase. He did not open the envelope while I was there." Talansky explained Zaken would call him before Olmert came to New York and tell him how much cash he should hand over. Olmert made it clear from the first time Talansky gave him money that he wanted the funds in cash. In his testimony, Talansky said Olmert had explained to him why, but he did not understand. Nevertheless, from then on, all the money he gave Olmert was in cash. Not another word was ever said about that stipulation. It was just understood, Talansky testified. He gave examples of money that he'd paid Olmert over the years. Once, he said, Olmert had asked him for a loan of $25,000-$30,000 so that he could take his family on vacation to Italy. He said he would pay it back. Talansky said he gave him the money but did not get it back. On another occasion, when Talansky went to visit Olmert at his New York hotel, Olmert asked him for a loan of $15,000. Talansky went straight to the bank and brought back cash in a CitiBank envelope. "I told Olmert I'd like him to return the money as soon as possible," Talansky recalled with a touch of irony. "Famous last words." Another time, Olmert called Talansky from Washington, where he was staying at the Ritz Carlton. Olmert told him he had used up the credit on his credit card and asked to charge his hotel expenses to Talansky's card. The bill came to $4,717.49. Olmert, according to Talansky, did not pay it back. When Olmert flew to New York to attend his grandson's brit mila (circumcision), Talansky asked him to appear at a benefit for a religious technical school in Israel. Olmert came and spoke, but asked Talansky for expenses. Talansky pointed out that Olmert had come for a family occasion, but the sponsors nevertheless raised $3,000 for him. On another occasion, Olmert came to speak in Colorado at the World Forum international economic conference. Since the sponsors did not pay his expenses, he asked Talansky for the money. Talansky said he gave him $3,000. Before the Likud primary in December 2002, Olmert asked Talansky to contribute to the campaign. "He called me up and said he needed a lot of money," recalled Talansky. "I asked him how much. He said $70,000. I was shocked. I decided it would be the write-off. I believe it was the last money I gave him." The most bizarre episode raised in Lador's questioning had to do with deposits totaling $380,000 that apparently were transferred from two companies owned by Talansky to Messer. Talansky had established two companies to do business in Israel, but both failed. He told Lador he did not know whether any money had been left in the accounts. Lador then showed Talansky bank statements indicating that $380,000 had been transferred from several banks, apparently from these companies, to Messer. Talansky told Lador he had not authorized the transfers and knew nothing about them. On another occasion, said Talansky, Messer came to him in New York and asked for a guarantee to cover an overdraft accumulated during Olmert's second mayoral race. Talansky got angry. "I told him he's like a sieve, always asking for money, and tore up the letter," he told Lador. But in the end, Talansky agreed to sign a letter prepared by Messer in which he asked Olmert to return the money for the guarantee he had posted for Olmert, even though he had not actually posted the guarantee. "I don't know why I signed it," said Talansky. "I was the biggest fool." Talansky cried twice during the testimony - once when he asked the court to take his personal problems into consideration because his wife was sick at home in Woodmere, New York, and again when he recalled how the police had treated him during interrogation. "I was afraid of them," he said. "They shouted at me. They threatened me. They treated me like a criminal. I had to tell my children and grandchildren where I was [during his first interrogation]. The people who did this to me can never redeem themselves for destroying the trust my family had in their father and grandfather." Talansky also told Lador he had asked police to bring him face-to-face with Olmert. When Lador asked why, Talansky replied, "I felt anger. Anger about our conduct - mine, too. I wanted to tell him this was no way to build a relationship or run a country, by taking cash all the time. And I had gone along with that." But the most intriguing question of all was why, indeed, Talansky did go along with it. He explained it more than once. "I always admired Ehud Olmert," he said when explaining why he had agreed to support him in his first election campaign for mayor of Jerusalem. "He was intelligent and articulate. I thought that if he decided to become mayor of Jerusalem, he would keep it united. I had extreme admiration for him. He was well-liked, and I thought he represented true leadership. I felt the most important thing was unity. What had destroyed the Jews in the past was senseless division, lack of understanding of the other person's belief." Later, Lador asked him why he had given Olmert the money for his vacation in Italy. "As I said, he was a friend," replied Talansky. "I had loaned him money previously. His word is gold and he was my friend." Talansky also described Olmert's address to the US Congress after he became prime minister. "It was a most dramatic and moving speech," said Talansky. "A most masterful talk. There has must have been 50 interruptions for applause. I felt extremely vindicated that the choice of this man could lead to the salvation of Israel." A Justice Ministry spokesman told The Jerusalem Post after the hearing that the state prosecution did not want to give an assessment of Tuesday's hearing while the testimony was still going on. However, one official told the Post that based on Talansky's appearance and testimony, it was easy to detect the signs of truth and sincerity in his demeanor and the way he spoke. Channel 1 reported that officials in the State Attorney's Office and the Attorney-General's Office voiced satisfaction at Talansky's testimony, and were completely convinced that they possessed incriminating evidence against Olmert. However, Lador emphasized that Talansky's testimony on the vast sums of money that he allegedly gave Olmert throughout the years was not necessarily a prelude to an indictment. "No decision has been made in the case... no indictment is being considered," Lador told Army Radio as he left the courtroom. "The early testimony cannot even be assessed by us at this stage." As in any case, he said, "the decisions on whether to file an indictment or close the case are made after the investigation is concluded."