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Nation & World Investigation of Barak's campaign threatens to hinder peace process by Ron Kampeas Associated Press i JERUSALEM — A criminal inquiry launched Thursday into Prime Minister Ehud Barak’s campaign finances threat ened to erupt into a scandal that could hinder his efforts to secure a compre hensive peace by year’s end. The investigation, based on recom mendations in one of the toughest comp troller reports ever released in Israel, led opposition lawmakers opposed to Barak’s revived peace efforts to call on police to investigate the prime minister himself. The comptroller, Eliezer Goldbeig, fined Barak’s party $3.2 million — al most three times the $ 1.2 million he says they raised illegally. Barak denied any wrongdoing and said he would appeal the fine. Goldberg’s report details transfers from overseas sources — banned under Israeli law — into nonprofit groups set up to back Barak’s election bid last May. In some cases, the overseas donors apparently did not know where the mon ey was headed. The Camilla fund was set up by Swiss millionaire Oktav Buettner to relieve poverty and promote educa tion in Israel. Instead, one of the al leged beneficiaries was the “The Asso ciation to Advance Taxi Drivers,” which printed pro-Barak bumper stickers. Buettner died in 1998, and the fund has since been administered by Yitzhak Herzog, a lawyer who led Barak’s cam paign and who is now the Cabinet’s secretary. According to Goldberg, Her zog similarly transferred funds from a Canadian charity that employed him into Barak’s campaign. Goldbeig did not name the charity. It is the first major breach in Barak’s credibility, and has discomfiting echoes of the scandals that plagued — and helped Barak defeat—Benjamin Ne tanyahu, who is under police investiga tion for bribery and theft allegations. “He knew about the system,” Ariel Sharon, the leader of the opposition Likud party, said of Barak. “Perhaps not all the details, but he knew about the system.” That remark drew derision from gov ernment ministers, who noted Likud’s repeated brushes with scandal, including Sharon’s disastrous 1982 invasion of Lebanon. “When Sharon speaks of ‘truth,’ I get queasy,” said Absorption Minister Yuli Tamir. The scandal also comes as President Ezer Weizman, another prominent peace process supporter, is under police inves tigation for allegations he improperly ac cepted money from a French business man in the 1980s and 1990s. Attorney General Elyakim Rubin stein said it was not known whether Barak would be personally taigeted in the probe, but that “every relevant person will be investigated.” In addition to illegal fundraising, po lice may also investigate the possibility of fiaud and deception, Israel TV reported. Goldberg says he found nothing in his investigation to contradict Barak’s claim that he knew nothing of the apparently illegal fundraising—but said tha( was no excuse for not seeing the “red light” be fore him. The prime minister may not face a court of law, but faces the “court of public opinion,” Goldberg said. In a hastily organized press confer ence, Barak said he had not known of any illegal practices by his party, but that he did not have “any problem with an in vestigation.” But Barak had been counting on Her zog to coordinate the campaign to win a referendum on an eventual peace treaty with Syria, a deal that will likely involve ceding strategic land. The prime minister is mired in dis agreements with the Palestinians and the Syrians that could kill his hopes of coming to a comprehensive peace with all of Israel’s neighbors by the end of this year. The investigation was already having an effect. Barak had planned to spend Thursday touring the northern border with Lebanon and preaching peace on Is rael’s last active front-line; instead he was parrying Goldberg’s thrusts. Goldberg seethed at the lack of co operation from Barak’s One Israel party, noting some of the overseas donors re main anonymous. Goldbeig said the large fine levied against the party was needed to stem a tide of corruption. “There must be a very clear, red line between capital and governance,” he said. He cited several other major parties for similar irregularities, including Likud, which he fined $ 120,000. They also face criminal investigation. Regardless of the investigation’s con clusion, the episode is likely to leave a lasting stain on the career of a man who campaigned on “integrity” and described Netanyahu’s government as having de livered “too many lies for too long.” ‘He [Barak] knew about the system. Perhaps not all the details, but he knew about the system.’ Ariel Sharon Likud party leader Senator threatens bill to remove flag Associated Press South Carolina’s Senate Majority Leader is ready to bring the state’s Con federate flag controversy to a floor de bate — one way or another. Sen. John Land, D-Manning, says he will introduce legislation to remove the Confederate flag from the Statehouse dome if a compromise cannot be reached during the next two weeks. Land is helping to lead Senate nego tiations on the issue that’s divided the Legislature along racial and party lines. Some people see it as a symbol of racism and others as a mark of the state’s her itage. The National Association for the Ad vancement of Colored People has im plemented a tourism boycott of the state until the flag is removed. Some legisla tors say no action will be taken until the boycott is lifted. Land said he’s aware of no meetings scheduled to move the compromise process forward in the Senate. Land wants to speed up the compromise with the flag removal bill, but has not drafted that bill. But if he does introduce legislation, he’s talking about all or nothing propo sition — the flag comes down, period, without moving it somewhere else on the Statehouse grounds. “Wfe have to resolve this matter,” Land said. “We’ve been trying to do it through diplomacy. But then, I reckon, the war is next.” The flag’s Senate defenders are skep tical about Land’s approach. “It won’t get very far,” said Sen. Lar ry Martin, R-Pickens. “I would expect there to be a serious floor fight.” If the vote followed party lines, Land is among 24 Democrats in the Senate, which also has 22 Republicans. Sen. John Courson, R-Columbia, helped draft a 1994 compromise proposal that passed the Senate but failed in the House. He said flag defenders would table a bill to remove the flag before it got to a vote or would lock the measure up in a filibuster. Flag opponents don’t have the 29 votes needed to stop a debate, Courson said. House members say they will wait for the Senate to pass a bill before taking up the issue. House Judiciary Committee Chair man Jim Harrison, R-Columbia, promised quick action by his committee and said a Senate flag bill could reach the House floor for full debate within three weeks of Senate passage. Proposals include moving the flag to the Confederate soldiers monument in frontoftheStatehouseortoastatuehon- A oring Civil Whr Gen. Wide Hampton in back. Black lawmakers and the NAACP don’t like the soldiers memorial idea and flag supporters don’t like the alternative. Land said he was drafting three pro posals to see if any consensus could be built. One would put the flag in a glass case in the Statehouse foyer. Another puts the first Confederate national flag, or Stars and Bars, at the soldier’s monument and the battle flag at the Hampton monument. The third proposal puts a square battle flag at the Hampton statue and the Stars and Bars at the memorial to Confederate women. Orrin Hatch quits GOP race, endorses Bush for president Associated Press Washington — Sen. Orrin Hatch dropped out of the presidential race Wednesday and endorsed George W. Bush, a man he once quipped would be a good president only af ter spending eight years as Hatch’s No. 2. He sad his admiration for Bush had grown during their months on the campaign trail. “I believe Governor Bush is the one who can unite the party and bring the White House back to us,” Hatch said as he announced his own withdrawal. He made the announce ment at the Capitol, his wife Elaine by his side. “Now that I am out, I think Governor Bush is the only person who can get things done, cut marginal tax rates so that we can keep this economy going, improve our schools." Hatch, 65, said he might have waited too long to start his long-shot candidacy. He got into the race last summer, months or years after other candidates. Hatch raised and spent about $2.5 million for his cam paign, rejecting an additional $1 million in possible federal matching funds. He had hoped to raise $36 million. 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