New whiff of scandal in Israel bank chief nomination

Jacob Frenkel, who withdrew his nomination from the Bank of Israel's top job, speaks at the World Economic Forum in Davos on January 27, 2010. The withdrawal of a second nominee in a week for the Bank of Israel's top job has filled newspapers with speculation over the cause, ranging from astrology to sexual harassment. (AFP/File)

JERUSALEM (AFP) – The withdrawal of a second nominee in a week for the Bank of Israel's top job filled newspapers with speculation on Saturday over the cause, ranging from astrology to sexual harassment.

Leo Leiderman, an academic and adviser within Israel's largest bank Hapoalim, was the choice of Prime Minister Benjamin Netanyahu and Finance Minister Yair Lapid.

His nomination was to have been confirmed on Sunday by a commission tasked with reviewing senior official postings.

But Leiderman announced on Friday he would not be taking up the post, without giving a reason.

On Monday, first choice Jacob Frenkel also withdrew after allegations resurfaced that he had tried to shoplift duty-free perfume at Hong Kong airport in 2006.

Israeli media said Leiderman's decision could be linked to his penchant for regularly consulting an astrologer, although he was quoted on the radio as saying family reasons were behind his withdrawal and that it had "nothing to do with astrology, which is just a hobby".

Haaretz newspaper came out with another explanation.

Leiderman had pulled out to avoid a scandal over his past employment at the Frankfurt headquarters of Deutsche Bank, it said, alleging a sexual harassment case.

It said letters of protest over the allegation had gone out to the postings commission when Leiderman's name emerged to head the Bank of Israel.

Netanyahu and Lapid now still have to find a successor to Stanley Fischer, formerly of the International Monetary Fund, who stood down in June after a successful eight years in the job.