State witness: Cherny instructed me to give Olmert bribes

In first day of marathon testimony in Holyland trial, "S.D." says the businessman approved the bribes he paid out, asked him to head a straw company; witness's identity remains under a gag order.

Former prime minister Ehud Olmert with lawyer in court 311 (photo credit: Marc Israel Sellem)
Former prime minister Ehud Olmert with lawyer in court 311
(photo credit: Marc Israel Sellem)
The state's main witness in the Holyland Affair, whose identity remains hidden under a gag order, testified Sunday morning that businessman Hilel Cherny directed him to give money to a number of public officials, including former prime minister Ehud Olmert, who was the Jerusalem mayor at the time.
The testimony given at the Tel Aviv District Court, was the first in a series of hearings of the state’s main witness that will run from 8:30 a.m. to 8:00 p.m. almost every day for two weeks. The witness is officially known only as “S.D.,” who according to reports is the key to the case against Olmert and many of the other defendants.
"S.D." also testified that Cherny asked him to become the CEO of a straw company, saying that Cherny had to approve every action, including to whom bribes were paid and the amount of the payments.
Until now there were only procedural hearings, but this was the beginning and one of the most important parts of the state's legal assault.
The 112-page indictment charges that Holyland real estate developers paid tens of millions of shekels to public employees and elected officials to advance the Jerusalem construction projects, including by substantially shortening planning times, smoothing over planning objections, rezoning land, giving tax breaks and increasing the permitted amount of construction.
Indicted alongside Olmert are former Jerusalem mayor Uri Lupolianski, former Jerusalem deputy mayor and city councilman Eliezer Shamhiof, Olmert’s former bureau chief Shula Zaken, city councilman Avraham Finer and former city engineer Uri Shetret.
Those also charged include businessman Hilel Cherny, former Polar Investments CEO Avigdor Kelner, Polar Investments manager Amnon Safran, Shimon Galon, the CEO of Kardan Real Estate and Jerusalem entrepreneur Meir Rabin.
Three companies are named on the indictment: Holyland Tayerut Ltd, Holyland Park Ltd and Holyland Leisure Services Ltd.
The indictment includes charges against former chairman of Bank Hapoalim and Israel Salt Industries Dan Dankner and former Israel Lands Authority head Yaakov Efrati, for alleged bribery.
The indictment also alleges bribes relating to Polar Investments’ real estate interests in Yavor Farm, Shalem Farm and Mevchur Farm north of Kiryat Gat.
On January 5, 2012, the Tel Aviv District Court issued a gag order preventing publication of the name and identity of the main state witness.
The order is highly unusual because S.D. is a witness who is neither the victim, the accused nor an undercover agent, each of who can receive gag orders in special circumstances.
At an earlier hearing in January, Yediot Aharonot and Olmert’s attorney both argued that the gag order was “ridiculous” since information in the indictment made it easy for people to deduce S.D.’s identity, and that these details were already in the public domain on websites such as Wikipedia.
Rejecting these arguments, the court said that the public’s right to know had to be balanced with concerns about the integrity of S.D.’s testimony if his identity were revealed.
The court also referred to a police evaluation report regarding potential threats and media harassment directed toward S.D. if the gag order were lifted.
Most of what the public has learned officially about S.D. came from a statement released about half a year ago by the State Attorney's Office, which explained that S.D. first turned to police through his lawyers in the second half of 2009. S.D. offered to reveal to the authorities everything he knew about the Holyland real estate project and about alleged criminal offenses relating to Israel Salt Industries, as well as Yavor, Shalem and Mevchur Farms. He did so in order to commence civil lawsuits against others involved in the affair.
Following S.D.’s offer, Attorney- General Yehuda Weinstein conducted negotiations with S.D.’s legal team, alongside a wide range of other law enforcement officials.
Through his lawyers, S.D. revealed details of the alleged corruption scandals to the state authorities. After the state verified S.D.’s allegations, it granted him immunity and a number of other concessions in exchange for full cooperation in prosecuting the case.
During the investigation, S.D. gave more than 70 statements to the police, and handed over a large quantity of documents regarding the Holyland Affair and Israel Salt Industries.
Besides immunity, the state gave S.D. a free pass from the Tax Authority (the State Attorney’s Office said this was also because S.D. has no financial resources), waived payment of fees for S.D.'s civil suits related to the Holyland Affair and covered part of S.D.’s Holyland-related legal civil defense expenses, in the amount of NIS 8,000 per month, from August 2010 through June 2011. The State Attorney’s Office explained that it was paying some of S.D.’s legal fees to help maintain S.D.’s commitment as a state witness.
The state’s agreement with S.D. also puts him into the witness protection program, along with financial assistance to ensure a reasonable standard of living. staff contributed to this report.