Israel's attorney general said yesterday that he was considering indicting Prime Minister Ehud Olmert in connection with allegations the he unlawfully took cash-stuffed envelopes from a Jewish-American businessman.

The final decision will be made after a final hearing with Olmert or his lawyers, should they choose to have one, Attorney General Meni Mazuz said in a news release.

Should Mazuz file charges, Olmert would become the first Israeli prime minister ever indicted. Olmert has denied any wrongdoing and his spokesman Amir Dan said yesterday that any charges against the Israeli leader would be unfounded.

A string of corruption suspicions involving Olmert severely weakened him politically and forced him to announce his resignation late last year. He remains Israel's caretaker leader until designated Prime Minister Benjamin Netanyahu puts together a new government within the next few weeks.

Of the various allegations against Olmert, the most detailed have come from Morris Talansky, a New York businessman who testified in an Israeli court that he handed envelopes stuffed with tens of thousands of dollars to Olmert before he became prime minister, in part to help finance a luxurious lifestyle of expensive hotels and fat cigars.