James Packer stars in charges against Israeli Prime Minister Benjamin Netanyahu

Israel’s Prime Minister Benjamin Netanyahu has been charged on allegations of corruption after an investigation found he received lavish gifts from billionaires including James Packer.

Israel’s Attorney-General has formally charged Prime Minister Benjamin Netanyahu in a series of corruption cases, throwing the country’s paralysed political system into further disarray and threatening the long-time leader’s grip on power.

Capping a three-year investigation, Attorney-General Avichai Mandelblit charged Mr Netanyahu with fraud, breach of trust and accepting bribes in three different scandals.

It is the first time a sitting Israeli prime minister has been charged with a crime.

Israeli Prime Minister Benjamin Netanyahu and Israeli Attorney-General Avichai Mandelblit. Picture: AFP

According to the indictment, Mr Netanyahu accepted hundreds of thousands of dollars of champagne and cigars from billionaire friends, offered to trade favours with a newspaper publisher and used his influence to help a wealthy telecom magnate in exchange for favourable coverage on a popular news site.

The indictment does not require Mr Netanyahu to resign but is expected to raise pressure on him to step down.

Israeli Prime Minister Benjamin Netanyahu. Picture: AFP

Mr Mandelblit was set to issue a statement later today, as was Mr Netanyahu, who has called the allegations part of a witch hunt, lashing out against the media, police, prosecutors and the justice system.

The most serious charges were connected to so-called “Case 4000,” in which Netanyahu is accused of passing regulations that gave his friend, telecom magnate Shaul Elovitch, benefits worth over $US250 million ($367 million) to his company Bezeq.

In return, Bezeq’s news site, Walla, published favourable articles about Mr Netanyahu and his family.

A man walks by an election campaign billboard showing Israel's Prime Minister Benjamin Netanyahu, the Likud party leader, in Tel Aviv, Israel, in April. Picture: AP

The relationship, it said, was “based on a mutual understanding that each of them had significant interests that the other side had the ability to advance.”

It also accused Mr Netanyahu of concealing the relationship by providing “partial and misleading information” about his connections with Mr Elovitch.

Two close aides to Mr Netanyahu turned state’s witness and testified against him in the case.

Billionaire businessman James Packer (L) listens to Prime Minister Benjamin Netanyahu of Israel address a joint meeting of the United States Congress in the House chamber at the US Capitol on March 3, 2015 in Washington, DC. Picture: Getty

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The indictment also said that Mr Netanyahu’s gifts of champagne from billionaires Arnon Milchan and James Packer “turned into a sort of supply line.”

It estimated the value of the gifts at nearly $US200,000 ($A294,000).

The indictment said Mr Netanyahu assisted the Israeli Milchan, a Hollywood mogul, in extending his US visa.

It was not immediately clear what, if anything, Mr Packer received in return.

Both Mr Milchan and Mr Packer denied any wrongdoing and face no charges.

Originally published as James Packer stars in charges against Israeli Prime Minister Benjamin Netanyahu