HA’ARETZ 1. CLAIMS: “ISRAELI “MOLE” IN PENTAGON; CONCERNS IN JERUSALEM OVER HARM TO RELATIONS WITH US. FBI: Pentagon employee Larry Franklin systematically delivered information to Israel via AIPAC; Israel denying espionage. 2. TENET PREVIOUSLY ACCUSED: ISRAEL HAS AGENT IN US; CHILL IN MOSSAD-CIA RELATIONS. 3. FOUR ISRAELIS MISTAKENLY ENTERED KALANDIA – AND WERE RESCUED FROM ENRAGED MOB. 4. IS EGYPT BACKING OFF FROM SUPPORT FOR DISENGAGEMENT? Next dialogue between senior-ranking Israeli and Egyptian security officials postponed; senior security source: Has been turning point in Egyptian approach to disengagement. 5. FRANCE: SHARP RISE IN ANTI-SEMITISM. Number of anti-Semitic incidents reported since beginning of year rose by 300% over all of 2003. MA’ARIV 1. New affair clouds relations with US. SUSPICION: MOLE IN SERVICE OF ISRAEL. The investigation: FBI checking whether Israel operated mole in Pentagon. The suspect: Larry Franklin, information analyst employed by Middle East Dept. The information: US suspects – sensitive material on Iranian affairs was transferred to Israel. The denial: Israel insistent – “We do not operate spies in US.” 2. ALMOST LYNCH IN KALANDIA. Four Israelis caught in refugee camp. IDF rescued them from enraged mob. YEDIOT AHRONOT 1. Suspicion in US: Senior Pentagon official transferred information to Israel. ISRAEL: “ESPIONAGE AFFAIR – A LIE.” Larry Franklin under FBI surveillance already for one year. Assessments in Jerusalem: Possible that pentagon itself leaked information to Israel via AIPAC in order to stimulate Israeli pressure to act against Iran.

[Note: HATZOFEH was unavailable today.] ______________________________ SUMMARY OF EDITORIALS FROM THE HEBREW PRESS Yediot Ahronot comments on the espionage scandal in the US and speculates that, “Of course, it is impossible to ignore the hints coming from the US that this is an internal American feud ahead of the coming presidential elections.” The editors suggest that official Washington is, in effect, signaling Israel that, “You’re getting on our nerves,” and caution that, “Only those of us who are devoid of understanding are ready to quarrel with the greatest power in the world.” Yediot Ahronot, in its second editorial, believes that there is no way to keep details regarding the evacuation of unauthorized settlement outposts secret and urges the government and the security services, “to assume that what is happening will always be known in advance in Judea, Samaria and Gaza – and act accordingly.” Yediot Ahronot, in its third editorial, accuses Education, Culture and Sports Minister Limor Livnat of self-aggrandizement in flying twice to Athens in order to congratulate – and be photographed with – Israeli Olympic medallists Gal Fridman and Arik Zeevi.