New allegations emerge about Israeli leader

Investigators on Friday said they had widened their probe into fraud allegations against Israeli Prime Minister Ehud Olmert to include evidence he had cheated charitable groups, further imperiling his already shaky prospects for staying in office.

The latest accusation, announced in a joint statement by the Ministry of Justice and the police, is that Olmert billed multiple charitable organizations for the same flights, and then used the extra money to fund vacations during his tenure as mayor of Jerusalem and trade minister. In addition to billing the organizations, Olmert also billed the government, the statement said.

The organizations included groups that help soldiers, mentally disabled children and the physically handicapped, according to sources close to the investigation. They also included the Holocaust memorial Yad Vashem, which operates under a state charter.

The statement said a travel agency coordinated the fraud on Olmert's behalf. Olmert would speak to various groups during trips abroad and then ask each one to separately pay the airfare, according to the statement. A source close to the investigation said Olmert pocketed in excess of $100,000.

The allegations come in the wake of testimony by New York businessman Morris Talansky that he gave Olmert $150,000 over nearly 15 years. Talansky said he believes Olmert used the money to fund a lavish lifestyle.

A spokesman on Friday said Olmert would continue fighting the charges.

“The prime minister is convinced that he has done nothing wrong and that as this investigation continues, his innocence will clearly be shown,” said Mark Regev, Olmert's spokesman.

But Olmert has said he will step down if indicted, and investigators indicated Friday that they are near that point.

Meanwhile, Olmert faces political pressure from allies to step aside.

If Olmert does resign, it could lead to new elections, and stall U.S.-backed efforts to reach a peace agreement between Israel and the Palestinian Authority by the end of the year. Olmert also opened negotiations with Syria, which could be jeopardized by a change in government. Special correspondent Samuel Sockol contributed.