Israel investigates Arafat funding

The Israeli prime minister, Ariel Sharon, has ordered a full investigation into allegations that an Israeli envoy was involved in setting up a Swiss bank account for the Palestinian leader, Yasser Arafat, and his financial adviser.

The former Shin Bet official, Yossi Ginossar, is alleged to have transferred money to an unknown destination.

He has denied any wrongdoing. He said all his business activities had been legal and he had not engaged in business while on government missions.

The Palestinian senior negotiator, Saeb Erekat, rejected the allegations, which he said were part of an Israeli smear campaign against the Palestinian Authority.

From the newsroom of the BBC World Service