MK Dov Khenin (Joint Arab List) asked the attorney general to launch an investigation into the finances of the right-wing group Elad, after a Haaretz investigative report revealed that the group received hundreds of millions of shekels from companies based in international tax havens.

"The report proves that Elad's conduct lies well in the gray, and requires an investigation by the authorities," the Joint Arab List lawmaker said. Khenin also asked the attorney general to order an immediate cessation of state and public funds to the group.

Elad, which operates in East Jerusalem, has two main focuses: settling Jews in the largely Arab Silwan neighborhood and running tourist and excavation sites. The chief tourist site is Ir David – the City of David – which it runs for the Israel Nature and Parks Authority.

On Sunday, a Haaretz report showed that the group received donations worth over 450 million shekels ($115 million) between 2006 and 2013, most of which coming from companies registered in global tax shelters like the Bahamas, the Virgin Islands and the Seychelles, and it is unclear who controls them.

"Just like we said all along, the real problems are not with the peace groups and with the human rights groups but with the extreme-right organizations," Khenin said. The lawmaker slammed the NGO bill, which seeks to out the funding sources of leftist groups, saying that the Haaretz report showed that the bill "doesn't deal with the real problems (that exist in right-wing groups) but is only meant to as a political tool of incitement against opposition groups in Israel."

Zionist Union co-chair Tzipi Livni also responded to the report by criticizing the NGO bill, saying that the revelation of the hundreds of millions of shekels in funds from unknown donors for Elad proves that "there's no such thing as half-transparency in democracy."

Meretz MK Michal Rozin requested the Knesset's State Control Committee to hold an emergency discussion, saying that the "clandestine donations show that for the government, the value of 'transparency' is nothing more than a cover for the political persecution of Israeli human rights groups."

In early February, the NGO bill passed its first reading in the Knesset, with 50 in favor and 43 against, the first of three votes before it can become law. The version that was voted on would require that all groups getting more than half their funding from foreign governments disclose that in any publication or position paper that the organizations issue. Disclosure would also have to be made in the course of any contact that the groups have with elected officials and at any meeting at which minutes are taken.

The legislation has now been referred for further debate at the Knesset committee level and is expected to undergo additional changes before it is submitted for the two remaining votes. For his part, Prime Minister Benjamin Netanyahu is interested in having the bill require that any organization getting foreign government funding be subject to the legislation “from the first dollar” and not only if the groups get over half of their financial support from governments abroad.