Israeli-American woman hostage to rejected Russian prisoner swap, officials say

Russia attempted to use an Israeli-American woman sentenced today to 7.5 years in prison on drug charges as a bargaining chip in a failed prisoner swap, Israeli officials tell me.

Why it matters: Russia's proposed prisoner swap included the release of Naama Issachar, who was sentenced on Friday in Moscow, in exchange for a Russian hacker set to be extradited to America. Israeli officials tell me they believe Russia's security services were behind the effort, and that the affair will inflame tensions between the countries.

• The officials also say they believe Issachar's unusually harsh punishment is a result of Israel's rejection of the Russian proposal.

The two prisoners

The hacker, Alexei Borkov, is a Russian national from St. Petersburg. He was arrested in 2015 while vacationing in Israel after Israeli authorities received an Interpol red notice.

• The U.S. accused Borkov of hacking credit card databases of U.S. citizens and sharing those credit card details with other hackers.
• After Borkov's arrest in 2015 Israel's then-justice minister, Ayelet Shaked, signed an order to extradite him to the U.S.
• Before the extradition could be carried out under Israeli law, a court review was required, followed by a second order from the justice ministry.
• Russia asked Israel several times to release Borkov, but Israeli officials told them to wait for the court's decision.

Issachar, a dual Israeli-U.S. national, was transiting through Moscow's airport several months ago on her way back to Israel from India.

• Customs officials found 9 grams of marijuana in her suitcase, and she was arrested for drug possession. Several weeks later, the charges were increased to attempted drug smuggling.
• Shortly after Issachar’s arrest, the Russians started raising her case in connection to Borkov's. That's according to Israeli officials who say Israel concluded Russia's intelligence and security services were driving the effort.

Behind the scenes

At some point over the summer, the Russians formally proposed the prisoner swap, Israeli officials say. The Israelis rejected it for two reasons:

• First, it would be very hard to approve such a deal legally.
• Second, they didn’t want to reject a U.S. extradition request tied to alleged Russian cyber crimes.

In late August, the Israeli supreme court approved Borkov’s extradition to the U.S.

• Two weeks later, Israeli Prime Minister Benjamin Netanyahu met Russian President Vladimir Putin in Sochi.
• The proposed Russian deal was discussed, the Israeli officials say, and Netanyahu stressed to Putin that the punishment sought by Russian prosecutors for Issachar was disproportionate.
• Netanyahu stressed to Putin that even if he wanted to make such a deal, the supreme court's ruling made it impossible.

The latest: Netanyahu and Putin discussed the issue again on a phone call earlier this week, but no progress was made.

What they're saying: After the Russian court verdict, the Israeli foreign ministry issued a harsh statement:

"Israel gravely views the verdict given today in Russia concerning Israeli citizen Naama Issachar. This is a substantial & disproportionate punishment for a young Israeli with no criminal record, who arrived in Moscow with the intention of catching a connecting flight on her way home to Israel. Unfortunately, Russian authorities have not as yet heeded our requests to conduct the case appropriately in accordance to the circumstances of her arrest."

Netanyahu tried to cool down the crisis and after the verdict, he issued a second statement stressing his appreciation of Putin's efforts on the matter and added he hopes a solution will be found.

Editor's note: This story has been corrected to reflect that the U.S. did not accuse Alexei Borkov of hacking American banks and demand his extradition. The U.S. accused Borkov of hacking credit card databases of U.S. citizens and sharing those details with other hackers.