Israeli court extends detention of Labor Union Chief Arnon Bar-David over Histadrut corruption scandal

The Rishon Lezion Magistrate’s Court extended on Monday morning for the second time the detention of Arnon Bar-David, head of the Histadrut – Israel's powerful national labor union. His detention was extended by four days, until this Thursday.

Judge Dorit Saban Noy stated: “The picture is troubling. The Histadrut [Israel’s national trade union federation] was run like a business belonging to a private individual. At his will, he appointed people to key positions; at his will, he dismissed them – sometimes without even minimal qualifications, and sometimes they themselves did not understand why they held the position.”

The judge noted that suspicion had strengthened regarding a “bribery network between the suspect and other involved parties.”

Yesterday, for the first time, Bar-David admitted during questioning that Ezra Gabay had given him cash. This came after several interrogations in which he had denied it – but after investigators played him a wiretap recording, he acknowledged the transfers.

After repeatedly listening to the recording, he claimed the money was a loan he had not yet repaid.

Attorney Micha Fettman, representing Bar-David, told the court that the matter involved three cash transfers of NIS 10,000 (about $3,000) each.

Bar-David said during questioning about Gabay: “I saw him as a political adviser who opened doors for me in Likud and connected me with ministers – and he still serves today as an adviser in the right-wing bloc.” A police representative stated in court that Bar-David confirmed during questioning that Gabay had indeed assisted him in some of these matters.

It also became known that a senior figure in Israeli football had given testimony as part of the case.

Yesterday, the court also extended until Thursday the detention of Adv. Shabi Michaeli, head of the Histadrut’s Corporations Authority, suspected of bribery and other offenses. Police representatives said that new developments had emerged in the investigation.

A report by KAN News last night said investigators are also looking into suspicious appointments to fictitious positions, as well as a series of appointments to positions and directorships in Histadrut-affiliated companies allegedly made in exchange for bribes.

According to the suspicions, Bar-David appointed an associate to a fictitious paid position – “Chairman of the Histadrut Corporations Authority.” During Michaeli’s interrogation, investigators asked him what his powers were in that role. He replied: “I’m still waiting to find out. I have no job description. My powers are unclear and being figured out as we go.”

The Histadrut corruption affair

The main suspicion at the heart of this serious corruption case involves a “give-and-take” system allegedly run by senior Histadrut officials with a businessman. Under this system, clients who hired Ezra Gabay’s services received jobs in local authorities and public corporations – in exchange for financial benefits allegedly given to senior Histadrut officials.

The method: The businessman owns an insurance company and allegedly maintained bribery relations with senior officials in the Histadrut and union heads. In exchange for benefits and favors, he used them to gain control of job placements in municipal corporations, local authorities, and government companies. In return, he secured insurance contracts from those same bodies, channeling the profits back into his company.

Head of Israel Police Lahav 433 anti-corruption unit, Commander Meni Benjamin, said after the investigation became public:“This is a covert investigation that lasted about two years, during which suspicions arose of offenses involving integrity and public trust, allegedly committed by public officials and business figures. The emerging picture shows a ‘give-and-take’ relationship between businesspeople and public-sector actors. The investigation is ongoing, and more suspects are expected to be questioned.”