Israel's Foreign Minister Told He Will Be Indicted for Fraud

JERUSALEM -- The Israeli attorney general today told Foreign Minister Avigdor Lieberman that, pending a hearing, he will be indicted for fraud, money laundering and witness-tampering, a move that could eventually bring the collapse of the government.

Lieberman faces up to 10 years in jail if convicted.

The draft indictment had been expected this week but caught Lieberman off guard as he sat on the podium of his ultranationalist Yisrael Beitenu party in Jerusalem. Lieberman's face tightened as he took the call from his lawyer.

"I never acted illegally," Lieberman said after being informed of the charges.

In the past Lieberman had said he would resign immediately if he was indicted, but today his aides said he will not resign until after the hearing, which could take months.

Most Israeli analysts said they believed the hearing is only a formality.

"I haven't seen the evidence, but the attorney general would not present such serious charges if it wasn't based on hard-core evidence," Jerusalem lawyer Jonathan Livny told AOL News. "I'm only sorry it took 10 years, and nobody should have such serious accusations hanging over his head without the police and attorney general taking action."

The charges against Lieberman first surfaced a decade ago. The Russian-born foreign minister is accused of overseeing the transfer of millions of dollars to what police described as shell companies and accounts of people close to Lieberman. The police recommended that he be indicted on all of these charges plus bribery more than a year and a half ago. The draft indictment announced today does not include the bribery charge.

The police also recommended indicting Lieberman for breach of trust in the case of Israel's former ambassador to Belarus, who allegedly showed Lieberman secret documents from the investigation.

Lieberman's Yisrael Beitenu party is Israel's third largest party and the senior coalition partner in Israeli Prime Minister Benjamin Netanyahu's government. If Lieberman is indicted, he will have to step down. The question is whether he will take the 15-seat party with him. That would leave Netanyahu with only 68 seats in the 120-seat parliament and likely lead to new elections.

"Lieberman may decide to try to topple the government and cause new elections in Israel," pollster Rena Mazliah told Israel Television Channel 2. "He will try to portray Netanyahu as moving too far to the left. And in new elections, he would probably get even more seats than he has today."

Lieberman is one of Israel's most controversial politicians. He has called for Arab citizens of Israel to have to swear loyalty to the state. His hard-line platform gets strong support from many of Israel's more than 1 million Russian immigrants.

The internal political turmoil comes as President Barack Obama is poised to announce a new peace initiative and Palestinian officials have said they will ask the U.N. to recognize a unilaterally declared Palestinian state in September.

"It is time for the American administration to move before September," Nabil Abu Rdeineh, a spokesman for President Mahmoud Abbas, said today.

Israeli Defense Minister Ehud Barak has warned of a diplomatic "tsunami" if the U.N. General Assembly recognizes a Palestinian state.