Jacob Frenkel shoplifting claims may be probed

The Turkel Committee, expected to convene this week to approve the nomination of Prof. Jacob Frenkel as the new Bank of Israel governor, may be forced to discuss a new allegation that Frenkel was detained at the Hong Kong airport seven years ago in possession of perfume bottles he failed to pay for at the Duty Free.

The incident was either a case of shoplifting, an accident or a misunderstanding. According to Frenkel, it was "an unfortunate misunderstanding," a conclusion he says the Hong Kong authorities reached as well.

A member of the Turkel Committee told Calcalist on Friday that he believed the story was "groundless." Another member said it was the first time he had heard about it.

The Turkel Committee senior civil service appointments has held four meetings so far, in which it heard from Frenkel, Prime Minister Benjamin Netanyahu, Finance Minister Yair Lapid and former Bank of Israel Governor Stanley Fischer, and was scheduled to conclude its examination of the "cleanness" of Frenkel's appointment as the central bank chief this week.

In addition, the committee has received many responses and objections to the appointment, mostly based on a 2002 State Comptroller's Report which stated that during his previous term as Bank of Israel governor, Frenkel had taken hundreds of thousands of shekels in wage benefits which he was not entitled to and which were eventually returned to the state coffer.

The committee said it was convinced that the incident was an innocent mistake and should not prevent the appointment.

The committee also received reservations over Frenkel's alleged responsibility for the AIG crisis. A committee source said that it did not discuss any conflict of interest issues in regards to Frenkel's ties with gas and oil tycoons.

Director of the National Information Bureau at the Prime Minister's Office Yarden Vatikai said on behalf of the committee, "The committee on senior appointments headed by Judge Turkel, which is looking into the appointment of Prof. Jacob Frenkel as Bank of Israel governor, will convene in the coming days to continue its discussions. Among other things, it will look into different appeals submitted to the committee in recent days."

Prof. Frenkel said in response, "The incident took place seven years ago and ended in nothing. The local authorities in Hong Kong reached the conclusion that it was an unfortunate misunderstanding, and expressed their apology and appreciation for my decision not to claim damages for the misunderstanding.

"I expect to take office as governor of the Bank of Israel in early October, after my appointment is approved by the Turkel Committee and by the Bank of Israel. I see it as a national mission for the benefit of the economy and the State."