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Credit: Reuters/Nir Elias By Jeffrey Heller JERUSALEM | Tue Jul 10, 2012 2:58am EDT JERUSALEM (Reuters) - Ehud Olmert was found guilty on Tuesday of a corruption charge in the first criminal trial of a former Israeli prime minister, but acquitted on two other counts in what was widely seen as a significant victory for him. Although Olmert was convicted of fraud and breach of trust, he was found not guilty on more serious charges that included allegations he received cash bribes from a U.S. businessman and double-billed Israeli charities for overseas fund-raising trips. It was not immediately clear when Olmert, 66, would be sentenced. He could face up to five years in jail. The former prime minister is also battling, in a separate case, charges over the construction of a hulking luxury apartment complex that dominates a Jerusalem hilltop. Olmert was accused of taking some $150,000 from the U.S. businessman, pocketing more than $92,000 by double-billing the charities and helping to advance the business interests of a long-time friend. He denied any wrongdoing. The court convicted him only in connection with aiding his friend while serving as minister of trade and industry before becoming prime minister in 2006. Israel's Haaretz newspaper described the verdict on its website as a "crushing defeat" for the prosecution. The popular Ynet news site, called the outcome a "legal earthquake", confounding widespread expectations of a triple conviction. The U.S. businessman, Morris Talansky, testified that he gave Olmert envelopes containing hundreds of thousands of dollars. Olmert says the money was used for electioneering, denying he benefited personally in return for advancing the businessman's interests. The court said prosecutors had failed to prove the payments were illegal. Olmert resigned as prime minister in September 2008 after the accusations surfaced, saying he wanted to clear his name. But he stayed on as caretaker until March 2009 when Prime Minister Benjamin Netanyahu's government was sworn in. Olmert claimed he had achieved significant progress in talks with the Palestinians aimed at securing a final Middle East peace deal, offering an Israeli withdrawal from much of the occupied West Bank. But no agreement was reached and negotiations held under Netanyahu collapsed in 2010 in a dispute over Israeli settlement building on land Palestinians want for a state. Prosecutors said millions of dollars in bribes were paid to Olmert, Jerusalem's mayor from 1993 to 2003, and other civil servants to ensure the approval of plans for the Holyland towers. Olmert has denied this. Israel has already witnessed a former head of state put behind bars. Former president Moshe Katsav was convicted last year of raping an aide when he was a cabinet minister in the late 1990s and molesting or sexually harassing two other women who worked for him during his 2000-2007 term as president. He began serving a seven-year prison sentence in December. (Writing by Jeffrey Heller, Editing by Allyn Fisher-Ilan and Crispian Balmer) World Israel Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above. 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