Lieberman Indictment: Good for Peace?

| Mon Aug. 3, 2009 3:09 PM EDT

Over the weekend, Israeli police suggested that the state indict its own right-wing foreign minister Avigdor Lieberman on charges of fraud, money laundering, and obstruction of justice.

Lieberman and his associates are suspected of establishing several companies, some of them shell companies, in order to launder millions of shekels and funnel them into his own pockets. Police have investigated whether Lieberman continued running these alleged operations even after becoming a public official.

In addition, police believe Lieberman and his associates tried to obstruct the police investigation in at least three separate instances, by changing the names of companies he allegedly established in Cyprus after he suspected the police had identified them.

Lieberman has denied wrongdoing, saying that the allegations are his opponents' attempt to smear his name and oust him from the government. "For 13 years the police have conducted a campaign of persecution against me," he said. "As much as my political strength and the strength of [my party] Yisrael Beitenu rise, the campaign of persecution also intensifies."

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Lieberman, a divisive figure in Israel due to his hard-line nationalism, was the kingmaker in Israel's recent election. After the vote split evenly between the right-wing former PM Benjamin Netanyahu and centrist Kadima leader Tzipi Livni, Netanyahu agreed to form a coalition government with Lieberman's nationalist Yisrael Beitenu party to seize power. Since he took over as foreign minister, much of the international community has been reluctant to deal with Lieberman, who once suggested that all Palestinian Israelis be required to take a loyalty oath.

But Lieberman's views are more accepted among Israelis and hard-line pro-Israel groups here in the US. Morton Klein, the head of the hawkish Zionist Organization of America, said earlier this year that Lieberman has been "falsely demonized as an extreme right-winger" and "tainted because of his outspoken concern over the Israeli Arabs as being disloyal." Klein has also criticized Barack Obama as potentially the "most hostile president to Israel" in American history.

Though this is not the majority viewpoint among American Jews, it has been shared by some who are worried that Obama is less pro-Israel than his predecessors. Demanding that Israel stop building settlements in the West Bank, and start being open to diplomatic talks with Iran, has set some on edge. But critics of Obama's open diplomacy could be set back if Lieberman, the face of right-wing Israeli politics, is taken down on corruption charges. And the coming investigation could mark yet another signal that the Netanyahu government will follow the Obama administration's lead on the peace process, rather than the other way around.

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