Jerusalem  - Israeli Prime Minister Ehud Olmert is being investigated for allegedly illegally pocketing hundreds of thousands of dollars from a US businessman, local media reported late Thursday.

The funds were reportedly received during his term as mayor of Jerusalem from 1993-2003, Channel 10 television said after a court in Tel Aviv lifted a news blackout on details of the latest corruption probe against Olmert.

In a last minute press conference in Jerusalem, Olmert said he had accepted funds for his election campaign, but denied ever accepting bribes. He said he would resign if charges were brought against him.

Police questioned Olmert in the case last week.

Three members of the Pensioners' Party this week announced they are withdrawing from Olmert's ruling coalition in the scandal's wake and joining a new party. Their withdrawal leaves Olmert with the backing of just 64 members of the 120-seat parliament. (dpa)