Police have raided the Ministry of Industry and Trade and seized documents as part of the corruption probe of Prime Minister Ehud Olmert, Army Radio reported.
Police did not immediately comment.
Olmert is suspected of accepting large sums of cash from a Jewish-American donor. Some of the donations are believed to have been made during Olmert's tenure as minister of industry and trade between 2005 and 2006.
Others are believed to have been made while he was mayor of Jerusalem between 1993 and 2003.
On Monday, police raided Jerusalem's city hall and confiscated documents from there.
Police spokesman Micky Rosenfeld said the police’s anti-fraud team conducted the raid. He said the seized documents were connected to Olmert's time as mayor between 1993 and 2003 but had no further details on their contents.
The investigation has cast a shadow over Israel’s 60th anniversary celebrations and embarrassed the prime minister at a time when he should be enjoying the limelight. President Bush arrives this week to take part in the national celebrations.
Olmert’s legal troubles have also raised doubts about his ability to reach a peace deal with the Palestinians. With U.S. backing, Olmert and Palestinian President Mahmoud Abbas have set a year-end target for a peace agreement meant to end six decades of conflict. During his visit, Bush is expected to take stock of the talks and push for more progress.
The scandal has set off speculation that Olmert may not be able to remain in office long enough to complete the negotiations. Olmert, who denies wrongdoing, has said he would resign if he is indicted, and even if he hangs on to power, he may not be strong enough politically to win support for a peace deal.
A poll Monday said six of 10 Israelis think Olmert is not capable of promoting peace with the Palestinians because of the investigation. Sixty percent of those polled also said they don’t believe Olmert’s claim that he didn’t funnel money into his own pocket. The survey had a margin of error of 4.5 percentage points.
The poll was the first since police disclosed last week that they are investigating suspicions that Olmert illicitly took envelopes stuffed with hundreds of thousands of dollars in cash from Morris Talansky. Police were questioning the Long Island, N.Y., businessman Monday.
An Israeli police official said investigators are looking into many allegations against Olmert, including possible money laundering, accepting bribes and campaign finance violations. The official, who spoke on condition of anonymity because the investigation is continuing, said the case is looking at a 12-year period.
The Justice Ministry has been deliberately vague on what laws the Israeli leader might have broken because the probe — expected to take months — is at an early stage, a ministry official said.
Since becoming prime minister, Olmert has been a suspect in several corruption affairs involving real estate deals and questionable political appointments. He has been questioned several times in the past by police but has never been charged. Some of the investigations remain pending.
In an interview broadcast Sunday on Channel 10 TV, Talansky denied trying to bribe Olmert.
“I never thought in any way that the money that I gave him for the purpose of his becoming mayor or electioneering was in any way illegal or wrong,” he said.