Police seize more Olmert papers

Mr Olmert denies the accusations that he accepted bribes

Israeli police have raided the Ministry of Industry and Trade as a corruption investigation into Prime Minister Ehud Olmert continues, official radio says.

The raid follows one on Jerusalem's city hall on Monday.

He is suspected of accepting bribes from a American Jewish businessman during his time as Jerusalem mayor and later as a minister.

He has admitted accepting election campaign donations from Morris Talansky but said he took no money for himself.

Police have now seized documents from Mr Olmert's time as both mayor of Jerusalem and minister of industry and trade.

Mr Olmert is already being investigated in several other corruption scandals.

Police questioned Mr Talansky on Monday and have asked him to remain in Israel until later in the month.

Morris "Moshe" Talansky - a New York-based financier - is said to have given hundreds of thousands of dollars in cash to Mr Olmert at a series of meetings in the 1990s and early 2000s.

Mr Olmert said Mr Talansky had helped him raise funds for election campaigns but he insisted everything had been legal.

Mr Talansky has also said all his actions on behalf of Mr Olmert were legal.

Mr Olmert became prime minister in 2006 after being minister for industry and trade from 2003-2006 and mayor of Jerusalem from 1993-2003.

Resignation calls

The accusations have cast doubt on Mr Olmert's ability to negotiate with the Palestinians and there have been growing calls for his resignation.

Mr Olmert has said he would only resign if prosecutors filed criminal charges.

Mr Talansky says the money was legitimate campaign donations

The latest difficulties for Mr Olmert became public last week as Israel celebrated the 60th anniversary of its establishment as a state.

President Bush is to visit Israel this week to take part in the Israeli celebrations and to give the peace process a push.

Some opposition MPs have said the investigation would prevent Mr Olmert from devoting sufficient attention to running the country.

Israeli media are talking about the possibility of the government falling and early elections being held, says the BBC's Paul Wood in Jerusalem

The expected political beneficiary of all this would be the hard-line opposition leader and former prime minister Benjamin Netanyahu, says our correspondent.

A poll released on Monday indicates that six out of 10 Israelis do not believe Mr Olmert's claims of innocence.

The same ratio said he should resign.