Foreign spy charges whip up top-level security storm

By BRIDGET CARTER, TONY STICKLEY AND EUGENE BINGHAM

EXCLUSIVE - Two men believed by senior Government figures to be Israeli secret service agents have been arrested in Auckland trying to obtain a false New Zealand passport.

The case has set off alarm bells that Mossad spies may be masquerading as harmless New Zealand travellers abroad.

Prime Minister Helen Clark said last night she would not comment while the case was before the court, but confirmed the Government had raised the matter directly with the Israeli Government.

"There will be a strong and public response to this matter once the court action has concluded," she told the Weekend Herald.

Officials, lawyers, police and Helen Clark's spokesman refused to confirm or deny the Mossad link.

The acting Israeli Ambassador, Orna Sagiv, last night refused to comment.

The case is the first known example of foreign agents appearing in a New Zealand court since the 1985 arrest of two French agents who blew up the Greenpeace ship Rainbow Warrior in Auckland harbour, killing one crewmember.

It is understood the Israeli Government wanted the case kept out of the New Zealand court system, and this issue is likely to have been a point of diplomatic friction.

But the case has proceeded, indicating the Government has not bowed to pressure from Israel.

International security concerns are at an all-time high and New Zealand views the clandestine Israeli secret service activities here with grave concern.

Weekend Herald investigations into the case were stonewalled by New Zealand officials until the men appeared in the Auckland District Court yesterday.

Urie Zoshe Kelman, 30, and Eli Cara, 50, have denied three joint charges including attempting to obtain a New Zealand passport and participating in an organised crime group to obtain a false passport.

Details that emerged in court revealed two other men were involved.

Zev William Barkan, 37, has fled the country and authorities concede they would not know where to find him. A fourth man is believed to be here but police say the others refuse to identify him.

The group had been in and out of the country since last November. Cara, who says he is a Sydney-based travel agent, has travelled in and out 24 times since October 2000.

The court heard the visits since last year were allegedly for the purpose of obtaining a false New Zealand identity for one of the men.

They allegedly made a passport application using a birth certificate of a cerebral palsy sufferer who authorities say was an innocent victim of the scam.

After being tipped off by Internal Affairs, detectives mounted a surveillance operation on March 23, dispatching a package meant to resemble the passport and watching to see who would pick it up.

In the meantime, Cara and Kelman were allegedly carrying out their own surveillance of the package.

Cara was approached by police as he sat in a cafe across the road from one drop-off point. Kelman was arrested after he was seen walking away from another point, throwing a cellphone into bushes.

Kelman and Cara first appeared in court late last month. At yesterday's appearance their case was fast-tracked in highly unusual circumstances. They were committed for trial by consent of the defence, although they did not admit there was a prima facie case.

The men were granted bail by Judge Chris Field who imposed reporting and curfew conditions after rejecting police applications to keep them in custody because of flight risk.

Police were represented by Auckland-based prosecutor Fletcher Pilditch, though Wellington has taken a clear interest in the case and the office of the Solicitor-General, Terence Arnold, QC, has also been involved.

Outside court, Cara denied being a member of the Israeli secret service. Asked if there had been a misunderstanding, he said, "I think so."

As he left the building last night, Cara pulled the hood of his green coat over his head and put his sunglasses on. Kelman, who is a tall, slim man with freckles, short red hair and glasses, refused to answer questions.

During the morning he wore a mauve shirt and carried a plastic Hallensteins shopping bag. Later he had changed into a green T-shirt.

A person at Auckland's President Plaza hotel, where Cara has been staying, said he knew Cara and that he seemed to spend a lot of time in the gym. Kelman has been staying at the Kiwi Hotel in Queen St and the Duxton Hotel. He has Israeli and Canadian passports.

Internationally, there have been cases of Mossad agents being discovered trying to pass themselves off as nationals of neutral countries. In 1997, Mossad agents were caught using Canadian passports during a failed assassination attempt on an Islamic official in Jordan.

In 2000, a Mossad operative was handed a suspended sentence after being accused of espionage and repeated use of false identity documents in Switzerland.

New Zealand passports have become increasingly sought-after on the black market, not just for spies but for terrorists and drug couriers.

Four years ago, a member of an al Qaeda cell that plotted to bomb Los Angeles at the turn of the millennium was uncovered travelling on a stolen New Zealand passport.

It is understood the Government is concerned that revelations that Mossad agents may be using New Zealand travel documents could put New Zealanders at risk.

Helen Clark said last night: "The Government takes seriously any action which challenges the integrity of the New Zealand passport system."

MOSSAD

* Mossad is Israel's foremost intelligence agency. It was formed in 1951 and is based in Tel Aviv, with the Hebrew name meaning institute.

* Once highly respected for its skill, the shadowy organisation has been plagued with a series of bungles, from botched assassination attempts to agents being caught using fake passports.

* One of its biggest coups was in 1960 when it found Adolf Eichmann, the Nazi who drove the "Jewish Solution" in Europe, then hiding in Argentina.

* But it has lost manpower in recent years and in 2000 it threw open its doors with its first public recruitment drive.

* A 2001 advertisement invited newcomers to become "a partner in the production of clandestine technology".

* Its latest spy chief, Me'ir Dagan, lost his mobile phone this year when his car was broken into in Tel Aviv in February. Mossad ordered the phone company to remotely erase the phone's memory.