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The Israeli Knesset (parliament) House Committee on Sunday approved President Moshe Katsav's request to extend his suspension until the end of his term, local daily Yedioth Ahronoth reported.

The Knesset House Committee objects the fact that the president did not resign, particularly after the attorney general announced that there was cause for an indictment on serious offenses, the report said.

"Under these circumstances, and once the president chose not to resign but to declare that he was unable to perform his job, the Knesset House Committee approves the announcement and declares that the president is temporarily unable to perform his job, starting from the current suspension period until the end of his term according to the law," the committee was quoted as saying. Katsav on Wednesday asked the Knesset House Committee to extend his suspension period until further notice.

The Knesset approved Katsav's request for a three-month suspension on Jan. 25, two days after Attorney General Menahem Mazuz announced he intended to indict Katsav on charges of sexual crimes.

Meanwhile, the police denied claims by Katsav's attorneys that they had used illegal wiretaps in the sexual misconduct case against the president.

Last Friday, one of Katsav's attorneys said that the president's close aides had "convincing proof" that their telephones had been wiretapped over the past few months, when the president was under investigation by the police over his alleged crimes including rape.

However, the State Attorney's Office told the High Court of Justice in the name of police that no wiretaps had been employed,"not with his family, not in his immediate environment, not in his home, not in the president's office and not in any other place connected to the president."

Katsav is facing potential indictment on charges of sexual crimes involving four women, giving private gifts paid for out of public funds, harassing a witness and obstructing justice. The president has denied the allegations and vowed to fight for his innocence.

Finance Minister resigns

Israeli Finance Minister Abraham Hirchson stepped down temporarily Sunday to battle allegations of fraud and embezzlement at a previous job.

The move was expected since Hirchson had been under investigation for months and was under heavy pressure to quit, and had no negative effect on financial markets.

Israeli Prime Minister Ehud Olmert will step in as acting finance minister, a Finance Ministry spokesman said.

Hirchson issued a statement saying he had notified Olmert he was stepping down immediately. His lawyer told reporters the suspension would last three months to allow police conclusions to be released.

Hirchson denied any wrongdoing. "Now I can devote all my energies to the struggle to clear my name," he said.

Police opened an investigation into Hirchson in January and he was questioned four times on suspicion of illegal money transfers when he headed Nili, a non-profit body linked to the National Workers' Organization.

"We're talking about embezzlement and suspicion that large sums of money were transferred illegally," said National Police spokesman Micky Rosenfeld.

Police were set to brief Israeli Attorney-General Menachem Mazuz on the investigation. Mazuz will then decide whether to press charges.

Hirchson has been in the post for about a year and he has mainly stuck to a status quo on free-market policies and reforms begun by former Finance Minister Benjamin Netanyahu in 2003.

Arab lawmaker quits

Israeli Arab lawmaker Azmi Bishara, under criminal investigation in Israel, resigned from the Knesset Sunday at the Israeli Embassy in Cairo and said he would stay abroad for a time because of a "racist" climate.

Israeli Embassy spokesman Benny Sharoni confirmed that Bishara, the subject of an Israeli police investigation into unspecified criminal allegations, handed his resignation to Ambassador Shalom Cohen at a meeting Sunday morning.

Bishara, who heads the anti-Zionist party Balad, has clashed with Israel's justice system in the past by making solidarity trips to Syria and Lebanon and invoking parliamentary immunity to evade prosecution for visiting "enemy states".

"Exile is not an option. Return is definite but the matter will take some time and arrangements. I want to set the rules of the game," Bishara told the Arab news channel Al Jazeera.

(Xinhua News Agency, China Daily via agencies April 23, 2007)