Suspects remanded in Israel-Germany submarine deal probe

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FILE PHOTO: Soldiers from the Israeli navy stand on the Rahav, the fifth submarine in the fleet, as it docks in Haifa port

JERUSALEM (Reuters) – Three suspects were remanded in custody and a fourth ordered held under house arrest on Monday after Israeli police questioned six people on suspicion of corruption in a $2 billion deal to buy submarines and patrol craft from Germany.

The 2016 deal has been under public scrutiny since it emerged that Prime Minister Benjamin Netanyahu’s personal lawyer also represented the local agent of the German conglomerate ThyssenKrupp Marine Systems set to build the vessels.

The six, who were questioned under caution on suspicion of bribery, fraud and tax offences, include public officials and private citizens, police spokeswoman Luba Samri said. No further details were immediately available.

German authorities also are looking into the deal.

In June, German magazine Der Spiegel reported Germany’s national security council had approved the sale of the three nuclear-capable submarines to Israel and that authorities inserted a clause into the contract giving it the right to void it if corruption allegations were proven.

The Justice Ministry said in February that Netanyahu himself was not a suspect in the investigation into the 2016 contract for ThyssenKrupp to build three submarines and a 2015 agreement with the company to purchase four patrol vessels for Israel’s navy.

Israeli Channel 10 reported last year that ThyssenKrupp Marine Systems’ Israeli intermediary had retained Netanyahu’s personal lawyer, David Shimron, to act on his behalf.

Shimron has denied any wrongdoing and has said he never discussed the deal with the prime minister so as to avoid any conflict of interest. Netanyahu has given his full backing to his lawyer, who is a distant relative.

Netanyahu is under investigation in two other criminal cases and denies any wrongdoing in both. One case involves gifts from businessmen and the other focuses on discussions Netanyahu held with a newspaper publisher on more favorable media coverage in return for curbs on competition from a rival newspaper.

(Reporting by Maayan Lubell; Editing by Gareth Jones and Bill Trott)

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