Inquiry ordered into Sharon's election funding

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Israel's Prime Minister, Ariel Sharon, and his son, Omri, are facing a police investigation into allegations that campaign finance laws were violated in the preparations for this year's elections, which Mr Sharon won with a landslide.

Israel's Attorney General, Elyakim Rubinstein, ordered the criminal inquiry after the state comptroller, Eliezer Goldberg, reportedthat Mr Sharon may have broken the law by setting up fictitious companies to channel funds from abroad to fund his political activities during the pre-election primaries for the Likud leadership.

Reports in Israel yesterday said police were expected to summon for questioning both the Prime Minister and his son. Omri Sharon, 36, served as aide and occasional unofficial diplomatic envoy for his father and was in charge of the campaign in the run-up to the February poll.

Mr Sharon's office issued a statement saying the Prime Minister had "full faith in the judicial system", and the decision taken to hold the inquiry was "acceptable".

"Any violations, were without a doubt, unintentional, and will be corrected in full," the statement said.

Previously, the Israeli leader has said that his son alone dealt with money matters.

In a report released last month, the comptroller, Mr Goldberg, listed violations of campaign laws, which strictly limit fundraising from abroad. The report said Mr Sharon's son raised large sums of money from outside Israel by using a company called Annex Research as a front. The company was reportedly used to pay 5.9 million shekels (£1m) to people supplying services to Mr Sharon's campaign.

As a result of the investigation, the comptroller fined the Likud Party 600,000 shekels, (£100,000) and the Labour Party – now members of Mr Sharon's coalition government – 1 million shekels.

Similar allegations were made after Israel's 1999 general election against the former prime minister Ehud Barak, causing a political furore and international headlines. But Israel's war with the Palestinians, the US-led assaults on Afghanistan, and Mr Sharon's strong standing among the Israeli electorate have prevented the new investigation becoming a major scandal.

The investigation into Mr Barak's campaign funding continues, but no charges have been filed.

It is not the first time that Omri Sharon has been the source of trouble for the Israeli premier. In the past two years, he has become his father's trusted adviser, and he has carried out several delicate behind-the-scenes diplomatic missions, including meeting Yasser Arafat – a man branded by his father as a murderer and a terrorist.

There have been allegations arose inpolitical circles that his role breached a nepotism law which forbids close relatives from being employed in the same government department.

¿ The mutilated body of a Hamas activist was discovered near the West Bank town of Nablus yesterday. The Palestinians said Hani Rawajbeh, 22, was killed when an Israeli tank opened fire on him. An Israeli army spokesman said soldiers in the area did not open fire.