The decision by Ari Harow to provide testimony against the premier came after he reached an agreement with the prosecutors on Friday.
A US-born Israeli immigrant, Harow served two stints as Netanyahu’s chief of staff from 2009-10 and 2014-15 before he stepped down over allegations he had improperly handled private business affairs.
An Israeli court injunction said Harow had turned witness but barred publication of any details about what he would tell investigators or testify to.
It added that under the deal with the prosecutors, Harow agreed to confess to fraud and breach of trust and noted that he would be sentenced to six months’ imprisonment, commuted to community service, and a fine of 700,000 shekels ($194,000).
He has been reportedly providing investigators with information about two of the ongoing investigations into Netanyahu.
The police have been interrogating Netanyahu, 67, over allegations that he unlawfully accepted lavish gifts from wealthy supporters and separately held talks with the publisher of a top-selling Israeli newspaper for positive coverage in exchange for diminishing the impact of a free pro-Netanyahu daily.
The four-term premier has rejected any allegations of misconduct saying repeatedly that he is the target of a campaign by political opponents. His family spokesman said Netanyahu would withstand what he described as a “witch-hunt” designed to force him from office.
In 2000, prosecutors decided there was insufficient evidence to indict Netanyahu and his wife Sara following an investigation.
The probe then looked at whether they unlawfully kept gifts presented to Netanyahu during his first term as premier between 1996 and 1999.