Its investigation findings could signal a turning point in the murky saga of the property deals and help the patriarch, Irineos I, cling to his job.

It is not clear to what extent the findings might have been influenced by the Palestinian Authority's attempt to wrest the properties from Jewish hands.

Senior Palestinian officials have said their main objective is to cancel the property transactions and that Irineos has been cooperating with them.

Church rebels, including leading Greek Orthodox clergymen in Jerusalem, have been trying to fire Irineos, accusing him of involvement in the transfer of two hotels and other properties in east Jerusalem to groups that seek to expand the Jewish presence in east Jerusalem.

Patriarch denials

Palestinians seek east Jerusalem as a future capital, and the transactions have angered the church's predominantly Palestinian flock.

Irineos has denied involvement and has refused to leave his post.

"He did not take part in the transactions at any stage, and did not receive any money"

Palestinian Authority report

For the past few weeks, he has been holed up in his apartment in the Greek Orthodox Patriarchate in the Old City, while the rebels have prevented him from entering his office in the compound and have been running day-to-day

Last month, the religious court of the Greek Orthodox Church in the Holy Land declared Irineos defrocked and demoted to the rank of monk.

In May, world Orthodox leaders declared that they no longer recognise Irineos' authority, and a temporary replacement was selected days later.

Property deals

Legally, however, church leaders cannot dismiss him: Only the governments in areas where his congregation lives - Israel, Jordan and the Palestinian Authority - have the power to do that, by withdrawing their recognition of him.

Only Jordan has done so, and Israel is unlikely to take action that would compromise Jewish land deals in east Jerusalem.

The Greek Orthodox Church has
appointed a temporary leader

The church has said its land deals were conducted by a former financial officer, Niko Papadimas, who vanished several months ago and now has European arrest warrants against him.

Irineos has insisted he did not know about the leases. In its report, the Palestinian Cabinet committee wrote that it found no evidence that Irineos was aware of the property deals.

"He did not take part in the transactions at any stage, and did not receive any money," the committee wrote in the report, published on Monday in the Palestinian Al Quds newspaper.


The committee also maintained that the transactions were illegal because they were not signed by the church's leadership body, or synod.

The committee alleged that Irineos was the victim of a conspiracy by leading clerics and Israeli extremists, who allegedly were trying - each for their own motives - to oust him.

Archbishop Aristarchos, chief secretary of the Greek Orthodox church in the Holy Land and a leader of the church rebels, said Irineos should step aside despite the Palestinian Authority exoneration.

"He still has responsibility, because he gave the authorisation [to Papadimas] which enabled this long-term lease," Aristarchos said.

Joseph Richter, a Jerusalem lawyer for a company that's taken over property at the heart of the affair, refused to comment on the Palestinian Cabinet committee report.