"For 13 years now the police have been persecuting me"
Israeli foreign minister
"For 13 years now the police have been persecuting me, and as my political strength and the strength of Yisrael Beitenu have grown, the attempts to drive me from public activities have gathered pace."
Police will in the coming days submit the recommendation to Menahem Mazuz, the attorney-general, who will decide whether to press charges.
Lieberman will be forced to step down if the indictment goes ahead.
Last month, police concluded a decade-long criminal investigation into Lieberman, who according to local media is suspected of receiving illegal donations through bank accounts opened by his daughter in Cyprus.
The Ynet news website reported that investigators had uncovered between six and eight front companies and multiple accounts allegedly used to finance Yisrael Beitenu's campaigns.
'Body of evidence'
Lieberman had held around $2.5m in illegal funds in the Cypriot accounts, the website said.
Television reports said police had presented a "body of evidence that would allow charges of money laundering and obstruction of justice to be pressed against Lieberman, his daughter Michal and two other people".
Lieberman has been questioned repeatedly by the police on suspicion of corruption, fraud, money-laundering, abuse of confidence and obstruction of justice.
In May, he was interviewed by police for a fifth time in a marathon five-hour session.
In 2007, Lieberman successfully appealed to the supreme court to stop the investigation but the decision was overturned in 2008, allowing police to follow a money trail to Cyprus, where they found enough evidence to recommend charges, Ynet said.
With 15 seats in Israel's 120-seat parliament, Yisrael Beitenu is the main coalition partner of the right-wing Likud party led by Benjamin Netanyahu, the Israeli prime minister.
An immigrant from the former Soviet Union, Lieberman's appointment has sparked controversy because of his stance towards Israel's Arab minority, which critics say is racist.