In addition to his work as a member of the Israeli Knesset and a minister in Benjamin Netanyahu’s government, Israel’s religious affairs minister also finds time to dabble in real estate. In early March –with the war in Gaza still raging, budget talks and the government’s busy agenda – Shas lawmaker Michael Malkieli somehow found the time to register a new company to purchase a property and lease it out. The company was registered the very day after Malkieli appeared before the State Comptroller’s Permits Committee to ask for special permission to set up a company, in direct violation of the regulations governing ministers’ conflicts of interest and the Knesset Members Immunity, Rights and Duties Law, which bars lawmakers from taking on any additional occupation or employment. The committee, chaired by retired judge Shlomit Dotan, approved Malkieli’s request.

Malkieli, a 42-year-old Jerusalem resident who previously served on the city council, has a master's in public policy from the Hebrew University of Jerusalem. He has been a member of the Knesset since 2016. He was appointed religious affairs minister in December 2022, when the current government was sworn in. Five months after his appointment, in May 2023, he asked the Permits Committee for special permission to hold around 400,000 shekels in his bank account, far in excess of the legal limit imposed on Knesset members. In addition, he asked for permission to set up a company with a business partner, in order to purchase a property and lease it out.

The committee convened to discuss Malkieli’s request on March 6, having previously asked Malkieli and his family to submit additional documentation. Malkieli appeared before the committee in person in order to present his case, explaining that he was “de facto involved in the business of buying and selling apartments.” Indeed, various documents show that Malkieli owned, leased and sold real estate assets even when he served as a rank-and-file parliamentarian. Malkieli refused to divulge to Shomrim how many apartments he owns, saying merely that he spends all his time and energy on the Religious Affairs Ministry. It is important to note that, in 2021, Malkieli submitted a bill related to the real estate industry; the aim of the proposed legislation was to do away with any transparency in publicly accessible land registry records, removing any reference in them to mortgages.

Either way, according to the summary of the Permits Committee’s meeting, Malkieli guaranteed that he would not take any active role in the company he sought permission to establish and that all of its activity would be managed by his business partner. The committee, which granted him permission, said that Malkieli “undertook to act to further buffer the private company, by appointing an external and independent representative, a professional accountant, with whom he had no prior acquaintance, to act on his behalf in all matters relating to the company, to make decisions at his sole discretion and not to provide the minister with any information.”

The committee did not reveal the identity of Malkieli’s business partner but, the day after the meeting, a new company was registered under the names of Malkieli and a Jerusalem lawyer called Kobi Ifrah – a personal friend of and former business partner of the minister, who even loaned him money when he served as an MK. The company was established in order to purchase a commercial property and subsequently lease it.

Ifrah is not the first partner that Malkieli has taken on in his real estate ventures. A Shomrim investigation has found that he also jointly owned property with another Jerusalemite, who also owned a production company working in the ultra-Orthodox sector. In 2017, a year after Malkieli was first elected to the Knesset, he and his partner were sued by a couple who had rented one of their apartments in Jerusalem. The suit described the couple as destitute and said one of them had previously been unhoused. According to the couple, they signed a lease on the apartment but, when they moved in, they discovered that it was so moldy as to be uninhabitable. They vacated the apartment so that it could be renovated and claimed that Malkieli and his partner refused to let them move back in once renovations had been completed.

As a reaction, Malkieli and his partner initiated a countersuit. Eventually, the dispute was resolved through arbitration, leading both parties to withdraw their respective cases. When approached for comment on the matter, Malkieli declined to discuss it, citing respect for the plaintiffs. Another legal dispute involving the same property was filed in 2020.

Malkieli refused to divulge to Shomrim how many apartments he owns, saying merely that he spends all his time and energy on the Religious Affairs Ministry. It is important to note that, in 2021, Malkieli submitted a bill related to the real estate industry.

As mentioned, Malkieli declined to divulge to Shomrim how many properties he owns. “I don’t deal with that and I am not interested in it,” he said. “I am fully dedicated to the ministry.” When asked why he has not yet submitted his conflict-of-interest arrangement, he responded that he has submitted all the required documentation to the Permits Committee.

The Justice Ministry, for its part, said that Malkieli has submitted a binding draft of his conflict-of-interest arrangement, which will be made publicly available once it has been finalized.

The State Comptroller’s Office issued the following statement: “The decision in question is not indulgent of the minister. The committee’s decision is stringent and greatly limits the minister and came after the committee ensured that, apart from this one-time investment, he will not deal in any way, shape or form with this investment in the future. For example, the committee demanded that Minister Malkieli distance himself from the entire decision-making process with regard to the investment. In addition, the committee ruled that the minister can only take a loan from a bank and that he must repay the loan he took from his business partner before he was appointed minister, he must appoint a trustee to conduct activity related to the property without involving the minister, he must not update the minister in any way and the minister must act in accordance with the conflict-of-interest arrangement that the attorney general imposes on ministers. Any suggestion otherwise is a distortion of the truth and displays a lack of understanding of the decisions made by the Permits Committee.”