US donors pump millions into Israeli settlements, report finds

Private American donors have pumped more than $220 million into Jewish West Bank settlements in recent years through tax-deductible donations, effectively subsidizing a policy opposed by U.S. administrations for decades, according to an investigation published in an Israeli newspaper on Monday.

The Haaretz daily found that some 50 nonprofit organizations from across the U.S. were raising funds for settlements in the West Bank, an area the Palestinians want as part of a future state, along with east Jerusalem and the Gaza Strip. Israel captured all three areas in the 1967 Mideast war.

The newspaper said the money's tax-deductible status means the U.S. government "is incentivizing and indirectly supporting the Israeli settlement movement," even though Washington opposes settlement construction and views it as an obstacle to peace with the Palestinians.

Peace talks collapsed last year and a wave of Israeli-Palestinian violence is entering its third month. Near-daily Palestinian attacks, mostly stabbings, have killed 19 Israelis, while more than 108 Palestinians have been killed. They include 73 people said by Israel to be attackers, with the remainder killed in clashes with Israeli troops.

In the latest violence, Israeli police said a Palestinian stabbed an Israeli outside a holy site in the West Bank city of Hebron on Monday, seriously wounding him before being shot and killed by officers at the scene. The site is holy to Jews, who refer to it as the Tomb of the Patriarchs, and to Muslims, who refer to it as the Ibrahimi Mosque.

Hebron, home to some 850 Israeli settlers who live in heavily guarded enclaves surrounded by tens of thousands of Palestinians, is a frequent flashpoint of violence. Many of the Palestinian attackers in the past months of bloodshed were from Hebron.

Israel accuses Palestinian political and religious leaders of inciting the violence. But the Palestinians say it is the result of nearly half a century of Israeli occupation and dwindling hope for gaining independence. They say the continued expansion of Jewish settlements on captured lands proves that Israel does not want peace. Israel says the issue of settlements should be dealt with in peace talks along with other thorny disputes.

The Palestinians and much of the international community view settlements as illegal and illegitimate. Nearly 600,000 Jewish settlers live in east Jerusalem and the West Bank.

Over the weekend, U.S. Secretary of State John Kerry warned that continued settlement construction and other Israeli policies in the West Bank could endanger Israel's future as a Jewish, democratic state.

The Haaretz investigation found that some of the money sent by American donors has gone toward providing legal aid to extremist Jews through an Israeli group called Honenu.

The report also said some of the money was spent on paying the salary of settler leader Menachem Livni, an Israeli jailed in connection with his activities in a radical Jewish group that carried out attacks against Palestinians in the 1980s. The money has otherwise gone to acquiring buildings in the West Bank and east Jerusalem and improving the living conditions of Jewish settlers, the report said.

The report reviewed funds donated between 2009 and 2013, the latest year for which there is extensive data, the newspaper said.