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During his prolonged cross-ex-
amination of the first witness,
Nadav Shukrun, defense attor-
ney Uri Wagman tried to show
that excessive travel expenses
and lax accountability were stan-
dard at the Agency. Mr. Shukrun
was responsible for expense re-
imbursements of the Agency's de-
partment of emissaries from 1991
to 1994.
But Judge Shalom Brenner
appeared to indicate he was not
buying the defense's rationale.
According to reports of the trial,
he said the department's im-
proper operation did not auto-
matically exonerate the
defendant's behavior.
The fact that a practice is wide-
spread "does not make it a per-
missible one," the judge said.
This week, Mr. Shukrun's tes-
timony implicated the Jewish
Agency as a place where lavish
spending was the norm. He said
emissaries were routinely given
Mr. Shukrun's
testimony
implicated the
Jewish Agency.
highly inflated advances when
they traveled, while Mr. Wagman
showed there were instances of
executives being reimbursed for
trips without submitting any re-
ceipts.
"There is no doubt there will
be an impact on the Jewish
Agency," said one Agency official,
"but it is too early to measure the
damage."
One thing is certain, he added.
It is not only the image of the
Agency which is at stake, but the
very "willingness to contribute
(money) through the Jewish
Agency."
The timing of the trial is not
good, another official said.
The Agency's board of gover-
nors is scheduled to convene here
later this month, and the Dias-
pora fund-raisers in attendance
will be exposed to a near-daily
barrage of negative publicity
about the Agency.
Board of Governors Chairman
Mendel Kaplan may also find
himself on the defensive. Mr. Ka-
plan initially adopted a low-key
approach to the affair, determin-
ing that Mr. Dinitz made an in-
advertent error.
But the board is unlikely to
take official action this month on
a permanent replacement for Mr.
Dinitz, who is expected to vacate
his post formally by the end of
year.
Sources say the tenure of Act-
ing Chairman Yehiel Leket will
probably be extended until Feb-
ruary, at which time a new per-
manent chairman will be
installed.
Meanwhile, the Agency is al-
ready on the defensive against
charges that it is outmoded and
should be dissolved.
Labor Knesset Member Hagai
Meirom is the newest member of
• this chorus. Late last month, he
called for the Agency to be abol-
ished within five years.
Mr. Meirom made the call as
part of a proposal for overhaul-
ing the Labor Party and rewrit-
ing its platform. He was assigned
the job of party reorganization by
Prime Minister Yitzhak Rabin.
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Tel Aviv (JTA) — A day after it
declared independence, the tiny
Pacific island-nation of Palau es-
tablished full diplomatic relations
with Israel.
A mutual-recognition agree-
ment was signed by Israel's am-
bassador to Fiji, Shmulik Moyal,
and Palau's foreign minister, An-
dre Uherbclau.
Formerly a part of the Trust
Territory of the Pacific Islands
which fell under U.S. supervision
as part of a United Nations man-
date established after World War
II, Palau is located east of the
Philippines and north of Papua
New Guinea.
Comprising an archipelago of
340 islands and atolls, only ten of
which are inhabited, Palau has a
total population of 16,000.
Israel is the fourth country to
establish diplomatic relations
with Palau, following similar
moves by the United States,
Papua New Guinea and the Fed-
erated States of Micronesia.
Palau's economy is based on
tourism and fishing. According to
an agreement, the United States
remains responsible for Palau's
security.
Palau is the 14th country from
the Pacific island region of Ocea-
nia, and the 147th nation in the
world, to establish full diplomat-
ic relations with Israel.
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In Jericho
Tel Aviv (JTA) — Russia will
soon establish a low-level liaison
office in the autonomous Jericho
region in the West Bank.
The decision to open an inter-
est section in Jericho, which offi-
cially fell under Palestinian
self-rule in May, was announced
in Moscow during an official vis-
it there by Palestinian leader
Mahmoud Abbas, who is also
known as Abu Mazen.
While he does not hold a min-
isterial portfolio in the Palestin-
ian Authority, Mr. Abbas is
perhaps best known for signing
the Declaration of Principles on
the White House lawn in Sep-
tember 1993 along with Israeli
Foreign Minister Shimon Peres.
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