Israeli police arrested associates of Prime Minister Benjamin Netanyahu and senior executives from Bezeq, the country's largest telecommunications group, after Israel's markets watchdog uncovered new information during its investigation into the company.
The Israel Securities Authority has been investigating Bezeq over possible fraud and financial reporting offences and company officials, including its former chairman, were arrested in 2017.
Investigators were looking into allegations that Bezeq received benefits in return for enabling favorable media coverage of Netanyahu in a case dubbed Case 4,000 after a series of corruption cases directly or indirectly involving Netanyahu.
A spokesman for Netanyahu denied the allegations.
A joint statement from the police's Lahav 433 anti-corruption unit and ISA said details of the new probe were under a gag order.
Bezeq said in a statement to the stock exchange it had no additional information on the new investigation. A company spokesman declined to provide further details.
In June 2017, the ISA said it was investigating suspicions that former Bezeq chairman and controlling shareholder Shaul Elovitch had meddled in the 2015 merger between Bezeq and its satellite TV provider Yes for personal financial gain.
- Shaul Elovitch, controlling shareholder of Bezeq
Elovitch, who owns the Eurocom Group that controls Bezeq, has denied any wrongdoing and no charges have been brought against him.
In November, the ISA said it had found enough evidence to support bringing criminal charges against senior officials at Bezeq, leaving it to Tel Aviv prosecutors to decide whether to indict.
"Due to evidence the securities authority uncovered in the Bezeq affair that raised suspicions of additional crimes, this morning a new joint investigation was opened … in which a number of suspects were arrested, including senior executives in the Bezeq group," the joint statement said, providing no further details.
A 48-hour gag order issued by a Tel Aviv judge prohibits publication of information that could identify the suspects.
The new investigation is expected to focus on suspicions that Bezeq received benefits in exchange for favorable coverage of Netanyahu on Walla News, also controlled by Eurocom.
"This is another false allegation against the prime minister," a spokesman for Netanyahu said. "The prime minister did not act in favor of Elovitch and Bezeq, not for favorable coverage or anything else."
Elovitch stepped down as chairman at the outset of the investigation in June and was temporarily replaced by David Granot.
Activist investor Elliott on Jan. 16 disclosed it held 4.8% of Bezeq and called for the resignation of all its directors implicated in the investigation and those affiliated with Eurocom.
Elovitch is under pressure to sell Eurocom, which is laden with nearly 1 billion shekels ($280 million) in debt.
Bezeq shares were down 0.1% on the Tel Aviv Stock Exchange on Sunday.
This development comes after police recommended Netanyahu be charged with bribery last Tuesday in two separate corruption cases, called Case 1,000 and Case 2,000.
Case 1,000 centers on gifts Netanyahu and his wife, Sara, are said to have received from billionaire businessmen Arnon Milchan and James Packer.
Case 2,000 focuses on an illicit deal Netanyahu allegedly tried to strike with Yedioth Ahronoth publisher Arnon Mozes under which Yedioth would soften its aggressive anti-Netanyahu stance in return for the prime minister working to pass legislation that would help Yedioth financially or use his influence to curtail Israel Hayom, Yedioth's rival.
Netanyahu denies wrongdoing in both those cases and it is up to the attorney general to determine whether to file charges against him, a decision that could take months.
Regarding Case 1,000, Milchan's attorneys blasted the police last weekend. According to them, Milchan was questioned six times but was under warning only during the past two sessions. Milchan's attorneys told Israeli media that the proceedings against Milchan were unjust because he was not warned at his first session before speaking to a lawyer. If he was indicted, they said, they would argue that the first sessions were inadmissible in court.
Regarding Case 2,000, Channel 10 News reported the head of Tel Aviv District Attorney's Office Taxation and Economics Division, Liat Ben Ari, agrees with the police position and believes the case is solid against Netanyahu.
A statement from the office, however, said, "The publication is denied. No one has formed an opinion. It's understood that the legal position on these cases will be formulated only after the evidence that was gathered in the investigation by prosecuting authorities is thoroughly reviewed, and all other reports on this matter are the sole responsibility of the publisher."
There is also a Case 3,000, which, like Case 4,000, does not directly involve Netanyahu but his associates. It refers to an ongoing criminal investigation into possible conflicts of interest surrounding Israel's 2015 procurement of submarines and other vessels from German conglomerate ThyssenKrupp.
