Israel orders graft probe into Olmert

Israel's chief prosecutor yesterday ordered a criminal corruption probe of Prime Minister Ehud Olmert over the purchase of a Jerusalem home.
Attorney General Menahem Mazuz "has decided to order the police to open a criminal probe in the Cremieux Street affair," a justice ministry statement said.
The Israeli premier is suspected of having received an effective bribe when he and his wife purchased a home in west Jerusalem for an estimated 300,000 dollars below market price, the statement said.
In return, Olmert's associates are alleged to have helped the construction firm that refurbished the property to gain construction permits from Jerusalem city hall, which Olmert headed as mayor between 1993 and 2003.
State Comptroller Micha Lindenstrauss has been investigating the sale since February.
Olmert, 61, who was cleared in March 2006 of any wrongdoing in another property deal, has denied the allegations.
"We are sure and completely certain that the process of purchasing the Olmert family apartment on Cremieux Streets was innocent and correct," Olmert's office said in a statement. "We regret the decision to continue the investigation."
"The prime minister will fully cooperate with the investigation in order to bring about its swift closure," it said.
"We are certain that its outcome will show that the purchase of the apartment by the Olmert family was done in a correct and legal manner and at a fair price," it said.
Monday's investigation marks the second criminal probe currently faced by the Israeli premier, whose ratings have slowly been rising from the single digits where they have languished for months following the war in Lebanon last year.
In January, Mazuz ordered an investigation of Olmert over his alleged abuse of influence in the privatisation of the country second-largest bank, Bank Leumi.
That probe focused on suspicions that Olmert, when acting finance minister in 2005 under former premier Ariel Sharon, tried to steer the sale of Bank Leumi toward his friend, real estate baron Frank Lowey.
The bank was eventually sold to another company with no relation to Lowey.
The prime minister was the subject last year of several corruption investigations involving property deals and appointments, although no formal charges have yet been filed against him.
Israel's leadership has been rocked by a series of corruption and other scandals over the past year, sinking the ratings of Olmert and his governing coalition.
These have included a sex scandal involving former president Moshe Katsav and a graft investigation of finance minister Avraham Hirshson, who has since resigned.
Another investigation is looking at alleged widescale corruption in the nation's tax authority, which has forced the resignation of Olmert's personal secretary and close aide of 30 years, Shula Zaken.