In a new twist to the corruption scandals dogging Israeli Prime Minister Benjamin Netanyahu, the embattled premier on Tuesday was forced to deny that one of his top aides attempted to bribe a judge in exchange for closing an investigation into his wife.
The Haaretz daily said Gerstel had spoken about the incident at the time to her colleague Esther Hayut, who is now the Supreme Court's chief justice.
Netanyahu and his family's spokesman, Ofer Golan, has denied the allegations.
Mr Netanyahu, who held the communications portfolio until past year, has not yet been named as a suspect in the case but is expected to be questioned.
"There is a tremendous effort here to preserve the left's monopoly in the media, " Netanyahu said in a statement posted on Facebook.
"Hefetz never made such a ludicrous offer and was never asked to do so and we can not believe he would do such a thing on his own accord", a statement issued on behalf of the prime minister read.
Last September Attorney-General Avichai Mandelblit said he was considering indicting Sara Netanyahu for fraud over suspected use of state funds for personal dining and catering services amounting to some $100,000.
Police investigators suspect that in return for Bezeq's subsidiary news website Walla's favorable coverage of Netanyahu, Communications Ministry regulators-when Netanyahu was serving as Communications Minister concurrent with his tenure as prime minister-gave Bezeq preferential treatment in order to increase the communications giant's profits - enough to enable Boss Elovitch to repay the huge sums he had borrowed in order to gain control of the Bezeq empire.
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"If you meet with Justice Gerstel in a closed room and ask her to close the investigation against Sara Netanyahu in exchange for her appointment as attorney general, what would her response be?"
Shaul Elovitch, the controlling shareholder and CEO of the country's biggest telecoms company, and his wife have also been arrested as part of the probe. Another statement went on to call Caspit's report slanderous and said the journalist, who recently published a book on Benjamin Netanyahu, had an "absurd obsession with the prime minister's wife".
The prime minister has also been linked indirectly to Case 3000, a large investigation into suspected corruption surrounding a multi-billion-shekel purchase of naval vessels and submarines from a German shipbuilder.
Sara Netanyahu was under investigation at the time for a range of alleged offenses in the Prime Minister's Residence Affair.
"He will try to emphasize to the Israeli public his value as someone who they have to thank for the strong economy and for Israel's standing in the world", said David Makovsky of the Washington Institute for Near East Policy.
Netanyahu has not been named as a suspect in the Bezeq affair, but a spokesman for his family had responded to media reports on the investigation, calling them "yet another empty probe" that would yield nothing. In return, police say Netanyahu operated on Milchan's behalf on USA visa matters, legislated a tax break and connected him with an Indian businessman.
In the second case, Netanyahu is accused of offering a newspaper publisher legislation that would weaken his paper's main rival in return for more favorable coverage.
Mr Netanyahu has long accused the Israeli press of being biased against him and has taken steps to counter it by promoting more sympathetic outlets to him.