Israeli army chief sold stocks hours after Hizbollah raid

METULLA - Israel's Chief of Staff was under renewed pressure yesterday after a disclosure that he sold around $43,000 of stocks within three hours after the Hizbollah border raid which triggered the month long Lebanon conflict.

Dan Halutz, the head of the Israel Defence Force (IDF), was reported by the Israeli newspaper Maariv to have telephoned his investment manager on July 12 to sell his personal portfolio as senior military and political figures were discussing the military response to the raid, in which two soldiers were abducted.

There is no suggestion that General Halutz did anything illegal and the newspaper quoted him as saying in response to what he called the "malicious and tendentious" report that the sale could not be linked to the war.

He said he had made it because of previous losses and added: "At the time I did not expect or think that there would be a war."

But the report added a new element to an already mounting post-war debate in the wake of the admission by Ehud Olmert, Israel's Prime Minister, that there had been "deficiencies" in the management of the war.

General Halutz, the former commander of the airforce, had been criticised earlier in the campaign for relying too heavily on aerial bombardment in Lebanon.

The Labour Knesset member Collette Avital told the Ynet news service: "There is a serious problem here in his priorities when the security of Israel hangs in the balance....The country burned and all that interested him was his investment portfolio."

The IDF said last night: "The Chief of Staff works day and night to protect the lives of the citizens of the State of Israel and the soldiers of the IDF and any attempt to connect his private matters to the event of the kidnapped soldiers is absurd."

The latest row came as General Halutz told Army Radio that the withdrawal of Israeli troops from southern Lebanon would take around a week to ten days to complete.

An estimated 2000 troops were withdrawn yesterday though Israeli troops shot dead five Hizbollah guerillas who the Army had said had advanced on its forces.

As soldiers and civilians in the Galilee panhandle which juts into southern Lebanon continued to acknowledge that Israel had not won a clear victory against Hizbollah, in Kyriat Shimona, five miles south of here, shops opened and buses began returning with residents who had fled to the south to escape Katyush a rockets.

Foreign Minister Tzipi Livni told a meeting of activists in the dominant Kadima that the international community had a responsibility to implement the UN Security Council decision aimed at keeping armed Hizbollah groups out of southern Lebanon.

But Alison Touval 49, originally from Southgate, London who has been a resident in a local kibbutz for the last 18 years said "There are a lot of unanswered questions."

Touval added that she hoped that the peace would last ten years until her sons had been through the army.

"It's not clear how the peace agreement will work and whether it's a peace. We are part of a global and world problem. I don't think our problems are so different from those of other people around the world."

One Russian-born Israeli signalman returning from the border, Marat aged 29 said: "I don't think it was a victory. It seems that Hizbollah was left with the upper hand."

Adding that he feared a renewed war would be necessary, he added: "The Lebanese people didn't want war and nor did we."

UNICEF said that relief workers were hastening to follow a stream of around 6000 Lebanese refugees returning home to southern Lebanon.

In the border village of Kila, some two kilometres east of here the first signs of life could be seen as a handful of cars drove through the seemingly deserted streets and at least half a dozen yellow flags of the sort flown by Hizbollah fluttered above buildings.

Sam Echadif, the supermarket manager in Metulla, said he hoped that "next time" the Army would prepare a full scale war to clear Hizbollah out of southern Lebanon once and for all.

He added: "No matter what the politicians say, we have lost."

- INDEPENDENT