"Olmert Corruption Probe Exposes Murky Role of U.S. Money in Israeli Elections."

The Forward's Marc Perelman: "Olmert Corruption Probe Exposes Murky Role of U.S. Money in Israeli Elections."

... Israel had a system of private financing until the late 1960s, with virtually no oversight of party financing. In response to the rising cost of campaigning, the parties agreed to put in place a mixed funding system in 1973, with public money apportioned according to Knesset representation alongside private money, including funds from foreign donors. The growing share of private funding prompted a decision before the 1992 elections to limit private donations to 55,000 shekels, roughly $22,000 at the 1992 rate.

In 1994, however, campaign financing rules were rewritten. In addition to increasing public funding and putting in place more stringent transparency requirements, they entailed a drastic change of private funding rules: The ceiling was slashed to 1,000 shekels (around $350 at the 1994 rate) and limited to Israeli citizens exclusively. As a result, Israeli parties now rely almost solely on public funding.

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The shift of private financing toward individuals from parties has landed a number of leading politicians in legal trouble.

Each of Olmert’s three immediate predecessors as prime minister — Ariel Sharon, Ehud Barak and Benjamin Netanyahu (the latter two now Olmert’s main rivals for office) — have faced investigations over political financing. None of them, however, has been charged with wrongdoing.

more at:
http://www.forward.com/articles/13393/