(Updates to add details from the indictment)
By Maayan Lubell
JERUSALEM, NOV 23, (Reuters) - Secret recordings, powerful media moguls, illicit gifts of cigars and champagne, betrayals by trusted aides. The three corruption cases against Israeli Prime Minister Benjamin Netanyahu have all the makings of a political thriller.
On Thursday, after more than three years of investigations, the most dominant Israeli politician of his generation was charged with bribery, fraud and breach of trust.
Investigators have not revealed the informants who provided the first tips about alleged corruption by the veteran conservative nicknamed "King Bibi." But from there they methodically picked off members of the prime minister's inner circle of hand-picked aides and senior officials as state witnesses against him. The mounting evidence was revealed in a series of tantalizing leaks that undercut what prosecutors allege was Netanyahu's scheme to control his public image by trading regulatory favors to news companies for positive coverage.
The man who charged the prime minister was Israel’s Attorney General Avichai Mandelblit - who was chosen for the job by Netanyahu in 2016 after having served as his cabinet secretary starting in 2013.
"I had the privilege of working with him and witnessing his many talents and capabilities as prime minister," Mandelblit said in announcing the charges. "The decision to file an indictment against him was made with a heavy heart."
Netanyahu has denied wrongdoing from the beginning of the investigations and remained defiant in his emotional prime-time national address on the night of his indictment. He called the cases an “attempted coup” to overthrow him, based on “fabrications.”
The probe began with tips trickling into investigators.
"Something smelled rotten, but it wasn't clearly criminal," a law enforcement source with direct knowledge of the investigation told Reuters.
Mandelblit launched an initial inquiry in July 2016, soon after Netanyahu chose him as attorney general. Investigators soon focused on dealings between the prime minister, Israeli Hollywood producer Arnon Milchan and Australian billionaire James Packer.
The inquiries would eventually lead to Case 1000, in which Netanyahu is charged with fraud and breach of trust for allegedly requesting and receiving gifts from Packer and Milchan, which included a regular supply of cigars and champagne.
The indictment alleges Netanyahu helped Milchan with various business interests. Milchan and Packer provided testimony and have not been charged with any wrongdoing.
During a separate probe of Netanyahu's former chief of staff, Ari Harow, investigators stumbled on a Pandora's box: secret recordings made on Harow's mobile phone.
They documented a series of meetings between two men who were then known publicly as enemies: Netanyahu and Arnon Mozes, the owner of Israel's best-selling newspaper, Yedioth Ahronoth, and the popular news website Ynet.
"It was jaw-dropping," said the source, describing the moment investigators first heard the recordings.
In meetings held between 2008 and 2014, the two allegedly discussed a deal in which Mozes would provide positive coverage of Netanyahu and negative coverage of his political rivals, while Netanyahu would push for regulations on Yedioth's biggest competitor, Israel Hayom, a free daily owned by U.S. casino mogul and Netanyahu supporter, Sheldon Adelson.
The 63-page indictment released on Thursday quotes a meeting held in December 2014 during the run-up to the 2015 election. Prosecutors allege the two men discussed a bill that would have limited Israel Hayom's circulation.
"We need to make sure you are prime minister," Mozes allegedly told Netanyahu. "Assuming there will be a law that you and I have agreed upon, I will do my utmost best that you stick around for as long as you want to."
The bill the two men discussed would never become law, and the coverage of Netanyahu in Yedioth and Ynet did not substantially change.
The recordings shocked prosecutors as they digested them over six hours, the source told Reuters.
"That was a big drama," said the source. "It's hard to believe something like this can even happen."
The recordings set off the investigation that led to Case 2000, which charges Netanyahu with fraud and breach of trust and Mozes with bribery.
Harow served two stints as Netanyahu’s chief of staff before resigning in 2015 amid allegations that he improperly advanced his own business interests while holding the position.
Harow turned state’s witness against Netanyahu in 2017 as part of a plea deal in which he confessed to fraud and breach of trust.
Mozes's lawyers denied wrongdoing in a written statement and called prosecutors allegations of bribery an "erroneous and warped interpretation" of the recordings.
The most serious case against Netanyahu, Case 4000, did not start with the prime minister. In 2017, Israel's Securities Authority (ISA) was investigating Shaul Elovitch, the chairman of the country’s biggest telecommunications firm, Bezeq Israel Telecom. ISA was investigating whether he had illegally profited from a 2015 deal in which Bezeq bought out his remaining shares in a satellite TV company.
Netanyahu, who at the time also served as Communications Minister, was not a suspect.
One of the key figures in the probe - Shlomo Filber, then director-general of the communications ministry - was picked for the government job by Netanyahu soon after he took over the communications ministry. The investigation revealed a secret backchannel between Bezeq and Filber, according to the indictment.
Investigators later found evidence pointing to the prime minister's involvement in regulatory moves that prosecutors allege provided a benefit worth about 1.8 billion Shekels ($500 million) to Bezeq. The company has denied wrongdoing.
In 2018, Filber turned state witness against Netanyahu.
Case 4000 alleges that Netanyahu's regulatory favors for Elovitch were part of a wider "give and take" relationship.
Bezeq controlled a popular news website called Walla. The indictment alleges that Netanyahu made a series of regulatory concessions that benefited Elovitch in return for better coverage of him and his family on the website.
It describes a dinner in which Netanyahu and his wife, Sara, hosted Elovitch and his wife, Iris, a few weeks before Israel's 2013 election.
"The defendants agreed that Netanyahu and his wife will be able to make demands on Mr. and Mrs. Elovitch concerning their media coverage," the indictment said.
The Netanyahus allegedly made hundreds of demands over the next few years for Walla to change headlines, remove negative reports about them and increase exposure of positive ones.
The Elovitches have been charged with bribery and obstruction of justice. Shaul Elovitch has also been charged with money laundering. The couple denies any wrongdoing.
The indictment cited a striking example of Netanyahu’s influence on the news involving a rare interview he gave Walla, days before a 2015 election.
"Netanyahu was very angry about the questions," Dov Gilhar, the journalist who interviewed him, told Israel's public broadcaster Kan in March. After the interview, "Netanyahu ripped the neck-mic off, threw it on the floor, says nothing, gets up, walks into his office and slams the door."
Gilhar told Kan that he had expected the exclusive interview to be published quickly, but two days passed before a chopped-down version ran after being edited without the journalist's involvement.
The indictment alleges the edits were dictated by Netanyahu and Nir Hefetz, the media advisor to the prime minister's family at the time and his former official spokesman.
Hefetz turned state witness in 2018. Netanyahu has been charged with bribery in this case, as well as fraud and breach of trust.
Netanyahu's demands on Walla ceased around January 2017, the indictment said, when the prime minister and Elovitch became concerned about an investigation into their dealings and Walla stopped complying with requests to favor Netanyahu in its coverage.
Walla's news desk did not respond to a request for comment.
Netanyahu said on Thursday that quid pro quo relations between politicians and the media were common, but he was being singled out.
"They weren't after the truth," Netanyahu said of police and prosecutors. "They were after me."
Attorney General Mandelblit has rejected Netanyahu's accusations. A source close to Mandelblit described him as "very fond of Netanyahu."
"But at the end of the day, there's no room for sentiment," the source said. "Either the evidence tells the story or it doesn't."
Reporting by Maayan Lubell; Additional reporting by Dan Williams; Editing by Stephen Farrell and Brian Thevenot