Ex-Israeli PM Olmert accused of seeking bribes

Updated at 10:15 a.m. ET

JERUSALEM - Former Israeli Prime Minister Ehud Olmert was indicted Thursday on new corruption charges for allegedly seeking hundreds of thousands of dollars in bribes in a wide-ranging real estate scandal that dwarfs the other cases in which he's accused.

According to the indictment, millions of dollars illegally changed hands to promote a series of real estate projects, including a controversial housing development in Jerusalem that required a radical change in zoning laws and earned the developers tax breaks and other benefits.

Jerusalem residents have long suspected that the hulking Holyland housing development, built on a prominent hilltop, was tainted by corruption. Thursday's indictment against Olmert — who was the city's mayor when the project ballooned — cemented those doubts about his integrity.

He is also suspected of influence-peddling in another, smaller real estate deal included in the indictment, which charges a total of 13 government officials, developers and other businesspeople in three separate schemes.

All the alleged crimes took place while Olmert was mayor of Jerusalem and minister of industry and trade, positions he held before becoming prime minister in 2006. Olmert has denied all the charges.

The former Israeli leader is already standing trial on separate charges of accepting illicit funds from an American supporter and double-billing Jewish groups for trips abroad — also before he became prime minister.

He has denied those charges, too, and claims no wrongdoing during a three-decade political career dogged by suspicions of corruption but no convictions. The accusations, however, forced Olmert to resign after a three-year term as prime minister in 2009.

The Holyland case broke two years ago on the strength of a businessman involved in the project who turned state's witness.

The indictment accuses Olmert of seeking money, through a middleman, from Holyland developers to help out his brother, Yossi, who fled Israel because of financial problems. According to the indictment, Yossi Olmert received about $100,000.

Ehud Olmert is also accused of asking the middleman to help out city engineer Uri Sheetrit, who also had money woes. Sheetrit later dropped his opposition to the broad expansion of the Holyland complex, which burgeoned from a small development into a massive, high-rise project that sticks out from its low-rise neighbors. According to the indictment, Sheetrit received hundreds of thousands of dollars in bribes.

The 87-page indictment also ensnares other powerful Israeli figures. Former Jerusalem Mayor Uri Lupolianski, who succeeded Olmert, was charged in the Jerusalem real estate scandal. Danny Dankner, the former chairman of Israel's second-biggest bank, was charged with offering hundreds of thousands of dollars in bribes to a government official to rezone land for one of his businesses.