THE scandal threatening to bring down the Israeli Government and shatter the career of Prime Minister Benjamin Netanyahu began with a short report on a state television channel three months ago. Reporter Ayala Hasson, citing unnamed sources, claimed the aborted appointment by Mr Netanyahu two weeks before of a little-known Jerusalem lawyer, Ronnie Bar-On, as attorney-general was even more controversial than it had seemed at the time. Mr Bar-On, an activist in Mr Netanyahu's Likud Party, had been named to the top legal position in the country despite the fact that he was undistinguished as a lawyer and had a practice devoted mainly to defending small-time criminals. The uproar following the appointment, including protests from within Mr Netanyahu's Cabinet, induced Mr Bar-On to resign two days later. The affair seemed little more than another minor scandal for Mr Netanyahu, whose poor political judgment has been repeatedly displayed since assuming office in June. However, the report by Hasson cast a sinister new light on the episode. Hasson indicated that Mr Bar-On's appointment had not been simply a case of cronyism but a conspiracy aimed at thwarting the law. The central figure in this alleged conspiracy was Arye Deri, a former interior minister and head of the religious Shas party, an important component of Mr Netanyahu's seven-party coalition Government. For three years, Deri had been on trial on various charges of fraud and the case was now nearing its end. According to Hasson, Deri had concluded a deal with the director of the Prime Minister's Office, Avigdor Lieberman, by which Mr Bar-On would be named to the vacant attorney-general's post and see to a plea bargain for Deri if he were convicted. This would spare Deri a jail sentence. In turn, Deri would ensure Shas support for Mr Netanyahu in the forthcoming vote on Israel's withdrawal from Hebron. Police investigators initially said their probe would be a swift one. In the end, the investigation lasted three months and involved the questioning of 60 witnesses, some for days on end. Many were cautioned that what they said might be used in evidence against them. The public was shocked to learn, again through a leak to the state television channel, that Mr Netanyahu was among those cautioned. After Mr Bar-On resigned, the Government hastily appointed the respected judge Elyakim Rubinstein to the post of Attorney-General. He will have a central role in deciding Mr Netanyahu's fate. Israel's state prosecutor will make an announcement today on whether Mr Netanyahu will be indicted or not. Palestinian leader Yasser Arafat has ordered Palestinian security forces to resume co-operating with their Israeli counterparts. The decision follows meetings last week between Mr Arafat and the Israeli army Chief of Staff, Amnon Shahak, and between the head of the Israeli Shin Beth security service and heads of the Palestinian Preventive Security Service.