The federal government is investigating the Israeli firm Finkelstein Metals, which plays a key role in the manufacturing of the Iron Dome anti-missile defense, according to information reported by the Hebrew newspaper Maariv.

According to the investigation, the Israeli company received financial aid from the government that wasn't allocated to them. Finkelstein Metals operates from a "development zone," making it ineligible for federal subsidies. Along with this, the United States allowed the company to sell its products at inflated prices, according to the Jerusalem Post.

The decision to investigate the company and possibly impose sanctions shocked the Israeli government, according to Hebrew media. The timing of this investigation coincides with the pressure that the Biden administration intends to exert on Netanyahu's government in order to slow the pace of the Israel Defense Forces inside the Gaza Strip.

According to Maariv, Finkelstein Metals has a 3% market share in the United States and does 75% of its business within North American borders. This investigation could violate trade cooperation agreements between Israel and the United States.

Key in the Iron Dome production chain

Finkelstein Metals' production is part of the production chain for Israel's anti-aircraft defenses. The Jerusalem Post explained that the company is the only one that produces some metal components used by the Rafael Defense company to produce the Tamir missiles that the Iron Dome uses as ammunition.

The Iron Dome anti-aircraft system is the most common Israeli-produced battery used to counter rocket fire launched from Gaza and Lebanon against Israel.

In the past, the White House leaked to the press that arms sales to Israel might be reduced to put pressure on Netanyahu's government to stop its advance in Gaza, but that equipment intended for Israel's anti-aircraft defense would be excluded.