Robert Maxwell, who once fired a reporter who had cheated on his expenses, had been secretly stealing the pension funds of his employees to support Mossad. The wholesale thefts mirrored Mossad’s own ruthless cunning and increasing willingness to take high-risk gambles.
Maxwell had personally removed the money through a series of interlinked financial maneuvers which, years later, would leave fraud investigators awed by his skilled duplicity. Maxwell had given mass-scale swindling a whole new dimension, transferring hundreds of thousands of dollars at a time into the special account Mossad maintained at the Bank of Israel in Tel Aviv. The funds had sometimes been laundered through an account the Israeli embassy in London had with Barclays Bank. Other banks Maxwell used for his fraud, unbeknown to them, included Credit Suisse in Geneva, the bank from which Ben-Menashe had transferred $450 million of ORA profits, with Maxwell’s connivance. Sometimes the stolen pension funds traveled around the world, touching down at Chemical Bank in New York, Australia’s First National Bank, and banks in Hong Kong and Tokyo. Only Robert Maxwell knew the money was purloined and where it was at any given time in its journey. What made matters worse was that he frequently ordered his newspapers to attack “white-collar crime.”
Victor Ostrovsky, a Canadian-born Israeli who served as a Mossad case officer from 1984 to 1986, was the first to discover what had been happening:
“Mossad was financing many of its operations in Europe from money stolen from Maxwell’s newspaper pension fund. They got their hands on the funds almost as soon as Maxwell made the purchase of the Mirror Newspaper Group with money lent to him by Mossad, together with expert advice he received from its financial analysts. What was sinister about it, aside from the theft, was that anyone in his news organisation, travelling anywhere in the Middle East, was automatically suspected of working for Israel, and was only one rumor away from the hangman’s noose.”
On visits to Israel, Maxwell was feted like a head of state; he was a regular guest of honor at government banquets, and was given the finest accommodations. But Mossad had taken the precaution of being prepared should the proverbial “hand that fed it” suddenly withdraw its largesse. Discovering Maxwell had a strong sexual appetite and, because of his massive size, favored oral sex, Mossad arranged that during the tycoon’s visits to Israel he was serviced from one of the stable of prostitutes the service maintained for blackmail purposes. Soon Mossad had acquired a small library of video footage of Maxwell in sexually compromising positions. The bedroom suite of the hotel where he stayed had been rigged with a concealed camera.
Ostrovsky’s allegations had surfaced in two personal books that still inflame the entire Israeli intelligence community.
Ironically, the Israeli government had ignored the advice of Maxwell to say nothing about Ostrovsky’s claims. In a meeting in Tel Aviv with Prime Minister Yitzhak Shamir, the tycoon cited what happened when the Thatcher government tried to halt publication of a book by a former MI5 officer, Peter Wright. His
The same fate had befallen the Israeli government. Pressured by serving and former members of Mossad—Meir Amit and Isser Harel had been particularly vocal in demanding action against Ostrovsky—Shamir ordered his attorney general to take legal action to halt the former
The case also stoked Shamir’s virulent anti-Americanism, rooted in a fixed belief that the United States was partially responsible for the Holocaust. There were claims that he believed that President Roosevelt should have come to an “arrangement”—one of Shamir’s favorite words—with Hitler to replace Britain, then the dominant power in the Middle East, with the Third Reich. In turn, Hitler would have allowed the Jews to travel to Palestine, and the Holocaust would never have happened.