Israel has deposited some $160 million in a secret Tel Aviv bank account belonging to Palestinian Authority leader Yasser Arafat since 1994, an Israeli newspaper reported this week.
An inquiry by senior officials from European Union donor countries found that only Arafat and his economic adviser were authorized to draw funds from the account, located in a Tel Aviv branch of Bank Leumi, according to the Israeli daily Ha’aretz.
Other sources said the Palestinian Authority official in charge of finance, Mohammed Zuhdi Nashashibi, also has access to the account.
The money in the account is Israeli refunds of tax revenues levied on fuel used by residents of the Palestinian autonomous areas, the paper said.
Other tax revenues Israel is obligated to return under the Israel-Palestinian economic accords are deposited in four bank accounts in the Palestine Bank and the Arab Bank in Gaza.
Ha’aretz quoted an internal document from the International Monetary Fund, which said the money in the Tel Aviv account “is not under any kind of supervision or monitoring by the Palestinian Finance Ministry.”
International donors have demanded full accountability of the Palestinian budget before releasing funds.
Ha’aretz reported that the Tel Aviv account appeared to be a way to circumvent this supervision. The account also appeared to be a way for Palestinian Authority clerks whose employment was not approved by the donor nations to receive money.
An Israeli government source said some of the money was earmarked for a possible emergency. According to the source, the money could also serve the Palestinian leader in the event of an uprising against him.
Labor Knesset member Avraham Shochat, who served as finance minister in the Rabin and Peres governments, did not deny the existence of the account.
Interviewed on Israel Radio, Shochat said the economic agreements called for various revenues to be transferred to different accounts.
“We have our own matters to deal with,” he said. “We can’t be on top of theirs.”
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