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Peres Denies Memo Charge He Was Offered Pipeline Bribe

February 24, 1988
See Original Daily Bulletin From This Date

Israeli Foreign Minister Shimon Peres denied again Tuesday that the Labor Party, which he heads, was promised a bribe in return for Israel’s acquiesensee to the construction of an oil pipeline from Iraq through Jordan to the Red Sea.

“Ridiculous…idle chatter,” Peres said when he was asked during a visit to Nablus about the alleged bribe, a claim made in a Sept. 25, 1985 “for your eyes only” memo to U.S. Attorney General Edwin Meese III from his friend E. Robert Wallach.

The memo and other documents, which are the center of an investigation by a special prosecutor on whether Meese acted properly on the suggestions of bribes, were made public by Meese’s lawyers Monday.

But Peres made no mention of Wallach’s link in the memo of the funds for Labor with increased immigration of Soviet Jews as a means of helping Labor win the next Knesset election.

“There is a need to provide Israel with an increasing flow of Ashkenazy (sic) Jews (from the Soviet Union) to help balance the influx of Sephardic-Oriental Jews who have a natural affinity and affiliation with Likud,” Wallach wrote. “From the standpoint of American interests, the advantage is evident.”

In the memo, Wallach also reported on a conversation between Peres and Bruce Rappaport, a Swiss businessman who was a partner in the project and reportedly was close to the then-premier. Wallach also had an interest in the project.

“He (Rappaport) confirmed the arrangement with Peres to the effect that Israel will receive somewhere between $65-$70 million a year for ten years out of the conclusion of the project,” the memo said.

“What was also indicated to me, and which would be denied everywhere, is that a portion of the funds will go directly to Labor,” Wallach added in his memo.

Interviewed on CBS-TV’s “Face the Nation” Sunday, Peres said he would have “thrown out of the window” anyone who offered a bribe to the Labor Party or to him personally.

In the interview, he admitted he wrote Meese a letter on Sept. 19, 1985 in support of the pipeline and received one from the attorney general on Oct. 7. The letters were among the documents released.


The Peres letter, in which he apologized for a Hebrew letter-head since he had no English letterheads at home, said the then-premier “would go a long way to help it (the pipeline) out. But then discretion is demanded on our part.”

Peres wrote Meese that “I have asked my friend Bruce (Rappaport) and Bob (Wallach) to let you know the whole story.”

In the letter, Peres said he would discuss the pipeline with Secretary of State George Shultz when he was in Washington in October 1985. But Meese wrote back that Shultz had disqualified himself from the issue since the major contractor for the project was the Bechtel Group Inc., for which he had worked before becoming secretary of state, and that discussion should be held with Robert McFarlane, who was then national security adviser. McFarlane’s successor, Adm. John Poindexter, later killed the project.

The Soviet Jewry issue was mentioned at the start of Wallach’s memo, when he noted that Edgar Bronfman, president of the World Jewish Congress, in talks with Soviet leader Mikhail Gorbachev was given a message to Peres that Soviet Jewish emigres would be allowed to fly directly to Israel.

Wallach recalled an earlier memo in which he noted for Meese disputes between Israel and American Jews over Israel’s complaint that the majority of Soviet Jews go to the United States rather than Israel although they have visas for Israel.

He also noted that Rappaport “has been financing private polls for quite a long time in Israel on behalf of Labor-Peres. They demonstrate an increasing strength for Labor and the high probability of elections, no later than March 1986.”

The election was not held and the Labor-Likud unity government continues, with elections expected sometime this year.


The memo also notes that Rappaport said that Peres stressed that the release of the Rev. Benjamin Weir, who had been held hostage in south Lebanon, “was as a result of the efforts of the State of Israel, and no one else.” He (Peres) indicated that they would also arrange for the release of the remaining six.

Weir was released after the first shipment of missiles by Israel to Iran. This was the beginning of the United States initiative to Iran which was abandoned when the hostages were not released.

“There is a feeling that the U.S. ‘owes’ and that the accomplishment of this project, as outlined in my memo, is appropriate,” Wallach wrote. He added that Peres felt the United States should be doing more to facilitate the pipeline since “it is so obviously in the interest of everyone involved.”

Peres said in Nablus Tuesday and earlier in the CBS interview that he believed the pipeline would help the peace effort in the Middle East and assure Israel of oil supplies.

(JTA Tel Aviv correspondent Hugh Orgel contributed to this report.)

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