Sharon's son indicted for corruption over 'illegal' fundraising in election

The 41-year-old Likud MP is alleged to have raised more than six million shekels (£740,000), seven times the legal limit, most of it from foreign donors. He is said to have channelled large sums through straw companies to suppliers and service providers. Other firms were allegedly instructed to issue false receipts.

The Prime Minister's son was charged in Tel Aviv magistrates' court yesterday with forging corporate documents, perjury and breach of trust. Prosecutors rejected a plea bargain that would have saved him from going to jail.

The indictment will embarrass Ariel Sharon, who is fighting for his political life after forcing through the evacuation of 25 Gaza and West Bank settlements against the wishes of most of his party. Polls suggest Benjamin Netanyahu, who resigned as Finance Minister in protest at the disengagement, would beat the 77-year-old incumbent in primaries ahead of next year's general election.

Menahem Mazuz, the attorney general, earlier decided not to press charges against the Prime Minister, who said he did not knowhow the funds were raised. Commentators said that his son's trial might bring out new evidencethat would persuade prosecutors to think again. Omri Sharon waived his parliamentary immunity, saying he preferred to argue in court that the law made it impossible to run a legal campaign.

"Experts believe the reasonable expense for such a campaign is about 10 times the sum permitted by law," he contended. "This law has never been enforced."

The attorney general declined to prosecute Ehud Barak, Mr Sharon's Labour rival in the 2001 general election, after his campaign managers exercised their right to remain silent.