Follow-up: Israeli Knesset Orders Full Investigation of Prime Minister
Sharon's Appointee to Coordinate Disengagement Policies

byline: David Bedein, Israel Resource News Agency
29 July 2005

On Thursday, July 28th, 2005, MK Uri Ariel's office informed the press that
the Knesset has formally delegated the Israel State Comptroller to launch a
formal investigation into the allegations that Eival Giladi, appointed by
Israeli Prime Minister Ariel Sharon to coordinate public policies of
Israel's Disengagement process, remains in a situation of conflict of
interests, since Giladi also administers the Portland Trust, whose task it
is to raise half a billion dollars of capital to develop housing and
business interests for Palestinian Arab interests who would replace the
Jewish communities slated for eviction.

MK Ariel asked for a copy of the conflict of interests agreement which the
PM office had announced on July 26th that Giladi had signed an hour before
the Knesset Controls Committee had met on that same day.

However, the PM office would not provide a copy for the Knesset.

An examination of the official Knesset record of July 13th, 2005 finds
that the government of Israel had already misled the Knesset on this matter,
when an Israeli government minister, Meir Shitrit, responded to MK Ariel's
questions about Giladi's conflict of interest by saying that Giladi had
already signed the conflict of interest agreement, which the PM office
admitted on July 26th to the Knesset Committtee that he had not done so.

With disengagement public policy being coordinated by Giladi, the question
remains as to whether Giladi will remain in his position and whether Giladi
represents the tip of the iceberg of Israeli government conflicts of
interest.

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Here is the release issued by Israel Resource News Agency on July 26th in
this regard:

Key Sharon disengagement adviser to be probed for conflicts of interests

By David Bedein,
Israel Resource News Agency July 26th, 2005

The Knesset Controls Committee is demanding a full scale
investigation of PM Sharon's appointment of Brigidier-General (res.) Eival
Giladi, to coordinate disengagement policies. The Committee has cited
issues related to a conflict of interest for the Israeli official who heads
up largest Palestinian business development operation.

On Tuesday, July 26th, 2005, the Knesset Controls Committee met in special
session to consider the case of Giladi, the official appointed by the
Israeli Prime Minister to coordinate all public policy aspects of
disengagement among all the Israeli government offices involved in the
process: the police, the general secret service, the IDF, The government
press office, the "Sela" office for relocation, the Prime Minster's office
and the Foreign Ministry.

The Knesset Controls Committee, the mandate of which is to consider
accountability in government service and to report to the Knesset and to
the Israel State Comptroller, called into question Giladi's conflict of
interest, which were first revealed by the Israel Resource News Agency in
early July, and which was also picked up by the Makor Rishon newspaper.

The conflict of interest charge is based on the fact that Giladi was named
to his role by the Prime Minister of Israel while maintaining his role as
the head of the Portland Trust, a British based non-profit business
development foundation which aims to raise half a billion dollars to invest
in the social and economic development of Gaza, to help Palestinians
replace the infrastructure of the Jewish community in the Katif district of
Gaza after it is to be destroyed.

When Knesset Controls Committee chairman Dr. Yuri Shtern asked
representatives of the Prime Minister's office as to the basis for
appointing Giladi to his position, their only response was that they had
received a letter from Gideon Meir, the deputy director of the Information
Division of the Ministry of Foreign Affairs, dated April 4th, 2005, stating
that Giladi was "the only man qualified for the job" to coordinate the
disengagement information policy for the government of Israel. Giladi was
appointed to his position on April 10th, 2005.

The PM's office could provide no answer as to why his position was not put
forward in the framework of a public tender, in order to offer the position
to other candidates.

The PM's office could not explain why it did not go according to the law
and asked for special permission to appoint such a senior government
official without going through the standard tender process.

Dr. Yuri Shtern, MK Uri Ariel and MK Zvulun Orlev, all members of the
Knesset Controls Committee, each asked if Giladi had been asked to sign a
"conflict of interest" agreement, which would prevent Giladi from entering
into any situation where he might be personally benefiting from any
government role that Giladi would undertake.

The answer: One hour before the Knesset Controls Committee meeting, Giladi
signed the proverbial "conflict of interest" agreement. Following that
announcement, Ozrad Lev, former financial advisor to the Palestinian
Authority and also a former high ranking Israeli intelligence officer, and
the author of a seminal book on Arafat's bank accounts, testified to the
Knesset Controls Committee that the appointment of Giladi represented a
"built-in" conflict of interest for Giladi, and that "Giladi must choose
between Portland Trust and the Israeli government".

Lev mentioned the precedent of Israeli government liaison to the
Palestinian Authority, Mr. Yose Ginnosar, who was later hired by PA
chairman Yassir Arafat to represent Palestinian Authority business
interests. Lev noted that former attorney general Elyakim Rubenstein had
ruled that Ginnosar could not perform both roles at once, since the
government of Israel was also in negotiation with the Palestinian Authority.

The conclusion of the Knesset Controls Committee session was that the
committee asked that the Knesset invoke clause 97b of the Knesset State
Comptroller act, to order a mandatory Israel State Comptroller
investigation into the conflict of interests posed by the PM appointment of
Eival Giladi as the coordinator of Israeli government disengagement public
information policies, since he is at one and the same time the head of the
largest business development foundation for business development in the
Palestinian Authority. The Speaker of the Knesset approved of the subject
for "quick" consideration in the Knesset plenary of July 28th, 2005.

If the Knesset does authorize a formal investigation of Giladi's
appointment, pressure may be brought to bear on the office of the Prime
Minister to suspend Giladi's position until the investigation can take its
course.