Israel's Sharon In Bribery Mess

An Israeli businessman was indicted Wednesday on charges of bribing Ariel Sharon with hundreds of thousands of dollars, further complicating the prime minister's clouded legal situation

Analysts said the indictment against real-estate developer David Appel increases the chances that Sharon himself may face charges. If Sharon is eventually indicted, he'd be obligated to resign, reports CBS News Correspondent Robert Berger.

Sharon was not charged with any criminal wrongdoing, and officials in his office said he was conducting business as usual Wednesday.

"The prime minister continues to work as scheduled and has not changed anything in his work," an official said on condition of anonymity.

Nonetheless, opposition lawmakers called on the prime minister to resign.

"He should resign," said former Finance Minister Avraham Shochat of the Labor Party. "He is polluting the atmosphere."

"There is no chance that the prime minister will resign his post, nor is there a chance that charges will be filed against him," Army Radio quoted an unnamed close associate of Sharon as saying.

Army Radio reported that Labor Party chairman Shimon Peres has asked that the party whip prepare a no-confidence motion.

Appel was indicted in the Tel Aviv Magistrates court for allegedly giving Sharon hundreds of thousands of dollars to promote an ambitious real-estate project in Greece when Sharon was foreign minister in 1999 and to help rezone urban land near Tel Aviv before and during Sharon's term as prime minister.

During 1998-1999, the indictment said, Appel "gave Ariel Sharon a bribe in recognition of activities connected to the fulfillment of his public positions."

It said Appel paid a total of $690,000 to Sharon's family ranch in the Negev desert. Appel, a powerful activist in Sharon's Likud Party, also promised his support to Sharon during two election campaigns, the indictment said.

The indictment also charged Appel with bribing Vice Premier Ehud Olmert to promote the Greek project when Olmert was mayor of Jerusalem in the late 1990s.

It also charged that Sharon's son, Gilad, received hundreds of thousands of dollars in consultation fees for the Greek project. Prosecutors believe these funds were used to bribe Ariel Sharon.

"(Appel) and Gilad agreed to this arrangement despite the fact that the defendant knew that Gilad had no relevant professional qualifications," the indictment said. It also charges that Appel continued to pay Gilad even after it became apparent the Greek project was not going anywhere.

Appel's lawyer, Moshe Israel, denied the charges.

"There is no doubt he is innocent," Israel said.

In order for Ariel Sharon to be charged, prosecutors must be convinced that a bribe was accepted with criminal intent.

But Wednesday's indictment of Appel added uncertainty to Ariel Sharon's legal problems. The prime minister also is being investigated for alleged involvement in illegal campaign financing. Prosecutors suspect a $1.5 million loan was provided by foreign businessmen during his 1999 primary campaign for Likud Party leadership.

Moshe Negbi, Israel Radio's legal affairs analyst, said, "It is not reasonable to believe that Sharon did not know what this money was being offered for."

Eyal Arad, an adviser to Sharon during the 1999 elections, played down the accusations.

"If it was a serious issue, with real proof against the prime minister, that would require a separate debate and of course an indictment against him," he told Israel Radio.

Even if Ariel Sharon is not charged, public pressure and anger within the ruling Likud Party could force him to step down, political analyst Emmanuel Rosen said on Army Radio.

The Yediot Ahronot daily said that Likud members are already preparing for a possible leadership battle. Leading contenders include former Prime Minister Benjamin Netanyahu and Foreign Minister Silvan Shalom.