Witness in Olmert corruption probe questioned

American Jewish businessman Morris Talansky did major political, if not legal, damage to Ehud Olmert last month by alleging that the Israeli leader accepted hundreds of thousands of dollars in cash. According to the original accusations, Olmert received the cash as bribes or illegal campaign financing, and used it in part to fund his high living.

Olmert's lawyers also tried to erode the credibility of law enforcement authorities by suggesting that, in their zeal to nail the prime minister, they alternately intimidated Talansky and offered him special treatment.

The outrage provoked by Talansky's testimony in May seriously damaged Olmert's credibility and prompted his Kadima Party to set new leadership elections, to be held by Sept. 25.

Olmert has denied wrongdoing but promised to resign if indicted. If he has any chance of surviving politically, the effort to discredit Talansky might be his only lifeline.

Olmert's allies note that he's been written off before but has managed to emerge intact. He has survived four other corruption probes since he became prime minister in 2006. And he held onto his job even though he was widely perceived as bungling a monthlong war against Lebanon's Hezbollah guerrillas in 2006.

If Olmert were to leave office prematurely, it could hamper Israel's efforts to make peace with the Palestinians and Syria.

The 75-year-old Talansky appeared nervous throughout much of the cross-examination Thursday, drumming his fingers on the table, fidgeting with a plastic cup and at one point asking for a break. He offered contradictory statements and at times was unable to remember dates, sums and the details of litigation he had been involved in.

Lawyers spent more than six hours grilling him about previous testimony and attempted to undermine his credibility by pointing out contradictions in his statements.

During his testimony, Talansky acknowledged that his memory might not always have served him well on details of dates and sums. But he insisted that "I don't believe I invented stories" and that "the totality" of his accounts was accurate.