Israel PM Says Lieberman 'Returning to Government' after Acquittal

An Israeli court on Wednesday acquitted Avigdor Lieberman on corruption charges, paving the way for the hardline nationalist to return to the post of foreign minister.

The anticipated return of Lieberman -- a tough-talking former bouncer with a history of incendiary anti-Arab rhetoric -- could further complicate already faltering U.S.-brokered talks with the Palestinians.

His return to the cabinet would be frozen if the attorney general files an appeal, but Israeli Prime Minister Benjamin Netanyahu appeared certain that Lieberman would soon return.

"I congratulate you on your unanimous acquittal and am happy about your returning to the government so that we can continue working together for the good of Israel," Netanyahu said in a statement.

The stocky 55-year-old Lieberman was put on trial on charges of fraud and breach of trust over his appointment of Israeli diplomat Zeev Ben Aryeh to the post of ambassador to Latvia after he tipped Lieberman off about a police probe into his affairs.

The prosecution said the appointment was given as a reward and represented a serious conflict of interests, particularly as Lieberman had not made anyone aware of Ben Aryeh's tip-off.

Although the three judges at the Jerusalem Magistrates Court agreed he had engaged in "inappropriate conduct," they did not find it worthy of a criminal conviction and announced his acquittal in a hearing which lasted just a few minutes.

Opposition leader and Labor party chief Shelly Yachimovich urged Attorney General Yehuda Weinstein to fight the court ruling.

"Public corruption is no less grave than political corruption and we are talking here about a corrupt person," she told army radio.

The ruling is a watershed in the political career of a man who holds a key position in Israel's governing coalition, which is jointly led by an alliance of Netanyahu's right-wing Likud and Lieberman's hardline nationalist Yisrael Beitenu.

"I want to thank the court," said a jubilant Lieberman after the hearing.

"After 17 years (of investigations), it is behind me... I am putting this matter behind me and I look forward to the challenges ahead."

Deputy foreign minister Zeev Elkin, of Lieberman's Yisrael Beitenu party, told public radio that there was "no longer any reason for Avigdor Lieberman not to resume his post."

But the reintroduction of the tough-talking Lieberman to the heart of coalition politics could have implications for U.S.-brokered peace talks with the Palestinians, which began in late July after a nearly three-year hiatus and have made little visible progress.

Lieberman's exoneration came as U.S. Secretary of State John Kerry was in Jerusalem holding talks with Netanyahu aimed at shoring up the negotiations, which have been shaken by recent Israeli moves to advance settlement construction.

Army radio said Lieberman's return to the coalition would be "a harsh blow to Kerry."

Critics have long accused Lieberman of racism towards the Palestinians and Israeli Arabs, especially after he said much of Israel's Arab-populated areas should be joined to a Palestinian state in exchange for Israel keeping its West Bank settlements.

Lieberman has called for Gaza to be treated "like Chechnya" and urged Israel to treat its Hamas rulers "like the United States did with the Japanese in World War II."

He has even shown open disdain for the moderate Palestinian President Mahmud Abbas -- who met Kerry in the West Bank on Wednesday -- calling him a "diplomatic terrorist" and an obstacle to peace.

Commentators warned that Lieberman's reentry into coalition politics could be a rallying cry for the far right, which opposes any concessions to the Palestinians.

Despite his resignation from the cabinet, Lieberman remained a member of parliament and leader of Yisrael Beitenu, which merged with Likud in October 2012. A debate on the future of that alliance is to be held by Lieberman's party later this month.

During his enforced absence from the cabinet, Lieberman still held a position of influence thanks to his role as chairman of the high-profile parliamentary committee on foreign affairs and defense.

The position of foreign minister was temporarily filled by Netanyahu, who reportedly promised Lieberman he would keep the position open for him until the completion of the trial.