Israeli officials were not available for comment on the Channel Ten report that Attorney-General Menachem Mazuz had closed the case due to lack of evidence against Sharon.

Mazuz is expected to issue his formal decision some time this week.

Indictment would likely force Sharon from office and derail his strategy of "disengagement" from the Palestinians, which the cabinet approved in principle last week in a vote that enraged his pro-settler partners and triggered a coalition crisis.

But removal of the indictment threat would give Sharon a boost in scrapping all 21 Jewish settlements in the Gaza Strip and four of the 120 in the West Bank by the end of 2005.

The bribery case focuses on payments of hundreds of thousands of dollars that an Israeli land developer was said to have made to Sharon's son Gilad, hired in the late 1990s as an adviser on a never-completed project to build a Greek resort. 

The developer, David Appel, was indicted in January on charges of trying to bribe Sharon. Israel's chief prosecutor has officially recommended indicting the prime minister as well. 

Not first time

The current probe is not the first time Sharon has a run-in with an investigative commission.

In 1983, an Israeli tribunal investigating the 1982 Lebanon invasion, found him indirectly responsible for the massacre of some 2800 unarmed Palestinian men, women and children in the Sabra and Shatila refugee camps in Beirut.

Lebanese Christian phalangist militiamen had been allowed into the refugee camps by Israeli forces who were responsible for security in Beirut.

When news of the mutilated bodies of Palestinians littering the streets reached Tel Aviv, mass demonstrations called for Sharon's ouster.

The tribunal eventually ordered him removed from his post as defence minister.

Sharon is currently still facing probes in two other corruption scandals.