Milchan testifies lavish gifts to Netanyahus were ‘excessive,’ unreciprocated

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Billionaire Hollywood mogul Arnon Milchan told a court in Jerusalem Monday that lavish gifts of champagne, cigars, and jewelry he plied Prime Minister Benjamin Netanyahu and his wife with were excessive, but he only realized there was an issue when contacted by investigators.

Milchan made the comments while giving testimony for a second day in the blockbuster criminal trial of Netanyahu, who is accused of graft and breach of trust for accepting the expensive gifts in one of three cases he is on trial for.

Milchan, whose production credits include “Pretty Woman,” “12 Years a Slave,” and “Bohemian Rhapsody,” also told the Jerusalem District Court via video from the UK that despite the gifts being given in a spirit of friendship, he had never received any gifts from the Netanyahus.

Netanyahu’s wife Sara flew to the UK to be present in the conference hall in the Old Ship Hotel in Brighton where Milchan was testifying. Lead prosecutor Liat Ben Ari repeatedly alleged that Sara could be communicating via eye contact and facial gestures with Milchan and demanded that they avoid eye contact.

Milchan told reporters later that her presence did not affect his testimony.

For the second straight day, dozens of Israeli anti-Netanyahu protesters confronted Sara Netanyahu outside the Brighton hotel, shouting “shame” at her, in the vein of the anti-government protests that have sprouted around Israel and elsewhere since the current coalition took office.

According to prosecutors, Milchan gave Netanyahu and his wife Sara $200,000 worth of cigars, champagne, and jewelry over the course of several years. Netanyahu is accused of having illegally provided various favors for Milchan in that time, including helping him in his effort to obtain a long-term residency visa in the US, and attempting to advance legislation that would have benefited Milchan’s tax liability had it been passed.

On his first day of testimony on Sunday, Milchan, 78, confirmed he had provided an ongoing supply of luxury cigars, champagne, and other items to Netanyahu and his wife Sara, largely at their request. He discussed how his gift-giving became routine, how he, Netanyahu, and Sara developed codes to refer to the different types of gifts, and how he gave his personal assistant “carte blanche” to fulfill any request the Netanyahu couple might make.

Sara Netanyahu leaves the Old Ship Hotel in Brighton, UK after the first day of testimony there by Israeli film producer Arnon Milchan, via video, in the trial of Prime Minister Benjamin Netanyahu, June 25, 2023 (Twitter screenshot; used in accordance with clause 27a of the Copyright Law)

The Hollywood tycoon painted a picture of a close friendship with Netanyahu, which largely aligned with the prime minister’s version of events. He said the gifts were made within the framework of that friendship, and not part of any quid pro quo arrangement, as the prosecution and indictment contend.

At the end of the first day of testimony, however, Milchan conceded that in the statement he gave to police in 2016 he had said he felt “disgusted” by the Netanyahus’ lack of boundaries when requesting gifts, even though in subsequent testimony he sought to walk back that statement to some extent.

On Monday, Milchan said the gifts didn’t affect his friendship with the Netanyahus until a police investigation was opened and at which point, he said he realized the gifts were “excessive.”

Asked whether he had ever refused a request for gifts, Milchan said: “Not that I remember.”

Milchan also again stressed that he considered the Netanyahus friends, but recounted that he told police he felt uncomfortable that his gifts were not reciprocated.

Opening Monday’s hearing, lead prosecutor Liat Ben Ari asked Milchan about a piece of jewelry he had bought for Sara Netanyahu that allegedly cost NIS 10,000 ($2,760). Milchan said he didn’t remember the exact amount but believed it was less than that.

Ben Ari then asked him about gifts that Australian billionaire James Packer gave to the couple. Milchan explained that he introduced Packer to Netanyahu as he saw the Australian as an important contact for Israel to help with the economy and international relations.

“I know that Packer really wanted to be connected and to endear himself to Netanyahu,” Milchan said.

“I know he’s more generous than me,” Milchan added, saying that for Packer, NIS 100,000 ($27,600) “seemed like a small amount.”

The indictment accuses Netanyahu of using his influence to assist Milchan to secure a US visa extension by drawing on his diplomatic contacts, including former US Secretary of State John Kerry.

Prosecutors also accuse Netanyahu of working to push legislation that would have granted Milchan millions in tax breaks.

Arnon Milchan (left) and Benjamin Netanyahu at a press conference in the Knesset, on March 28, 2005. (Flash90/ File)

Milchan testified Monday that he had turned to Netanyahu and many others — including current opposition leader Yair Lapid — for help about the visa extension. He said Kerry called him one day and met with him at a hotel. Describing Kerry as a good friend, he said he was told Kerry could not help.

Milchan confirmed that on one occasion, he arrived at the Netanyahus’ official residence in Jerusalem with champagne and cigars and asked the premier during a meeting if there was anything new regarding his visa, whereupon Netanyahu told his aide Ari Harow — now a state witness in the case — to find out.

Milchan said Netanyahu eventually said he couldn’t help, but told him to seek assistance from then-US envoy to Israel Dan Shapiro, who helped resolve the matter. It was unknown whether Netanyahu had spoken to Shapiro about the visa.

Regarding the tax breaks granted to returning Israelis, Milchan said that he spoke in 2013 with then finance minister Yair Lapid about it. He then spoke to Netanyahu who, he said, told him he would talk to Lapid about it too. Lapid testified last week about his involvement in the tax break issue.

Several times during the questioning, Ben Ari — apparently unsatisfied with Milchan’s deviation from what he had said earlier — asked Milchan whether she should “refresh” his memory on a certain topic.

Ben Ari asked Milchan why he eventually stopped supplying the Netanyahus with gifts, but he responded he couldn’t remember. The prosecutor then prompted him by citing remarks he had made during his investigation when he said “it could be that I was a less welcome guest at Balfour,” the prime minister’s official residence on Balfour Street in Jerusalem.

At one point, Netanyahu’s lawyer Amit Hadad intervened and said: “This is unbelievable; every question [his] memory needs to be refreshed.”

Milchan retorted at Hadad: “You’re making me look like an idiot who doesn’t remember anything.”

Prime Minister Benjamin Netanyahu seen leaving the Jerusalem District Court where he listened to the testimony of businessman Arnon Milchan in the prime minister’s corruption trial. (Alex Kolomoisky/POOL/Flash90)

Milchan was also quizzed on his promotion of a project with Indian businessman Ratan Tata to establish a free-trade zone between Israel, the Palestinian Authority, and Jordan. He said Netanyahu helped out with efforts to advance the project, but Milchan insisted that though he himself may have had a financial gain from its success, his motive was to promote peace in the region.

Netanyahu, who has attended very few hearings during his trial, was in the courtroom on Sunday and Monday. Milchan, who is not charged in the case, greeted him in Hebrew over the two-way video broadcast, using Netanyahu’s nickname: “Shalom, Bibi!”

Milchan’s testimony had been scheduled to continue longer, but he made several requests for the court to reduce the amount of time he would need to testify, alluding to health problems, particularly with his back.

The testimony is being aired in a Jerusalem courtroom for judges and other lawyers — who can also ask questions of Milchan — and for journalists and other attendees to watch.

On Tuesday, Netanyahu’s defense lawyers were set to begin a scheduled eight days of cross-examination.

Milchan is testifying in one of three cases being brought against Netanyahu. The other two, Case 1000 and Case 2000, which include charges of bribery, fraud and breach of trust, accuse Netanyahu of exchanging regulatory favors with powerful media moguls for more positive coverage.

Netanyahu denies wrongdoing, claiming he is the victim of a witch hunt orchestrated by a liberal media and a biased justice system.

In other developments, Netanyahu’s defense team objected Monday to a prosecution request that the trial be speeded up by holding sessions even when the court system is in recess and to add additional trial days during proceedings next year.

On the other hand, the attorneys also said they do not object to publishing the content of a meeting last week between the defense, prosecution and judges in which the judges reportedly cast doubt on the ability of prosecutors to show that Netanyahu took a bribe in Case 4000, the most serious of the three cases.

The trial, which began in 2020 and has still not seen Netanyahu himself testify, has featured more than 40 prosecution witnesses, including some close former Netanyahu confidants who turned against the premier.

Witness accounts have shed light not only on the three cases against Netanyahu but also revealed sensational details about his character and his family’s reputation for living off the largesse of taxpayers and wealthy supporters.

Milchan’s aide, Hadas Klein, testified last year that the Netanyahu family “loves gifts.”

The idea of a plea bargain has repeatedly surfaced, but prosecutors for now appear determined to see the trial through.

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