Deputy Attorney General Shai Nitzan instructed the police to launch an investigation against several prominent rabbis in the Orthodox community on suspicion of incitement.
Tuesday's decision followed petition filed by the Israel Religious Action Center (IRAC) back in March. The IRAC filed its petition following several media reports suggesting Rabbi Chaim Kanievsky decreed that Jews were no longer allowed to hire Arab laborers.
The rabbi issued the alleged ordinance following the deadly attack on Mercaz Harav rabbinical seminary in Jerusalem.
Also implicated in the case is Haim Barzilai, Rabbi Kanievsky's operations officers, who reportedly sent "supervisors" out to the Orthodox community in order to ensure that the rabbi's word was adhered.
The Attorney General's Office did, however, find no grounds to launch an investigation against Rabbi Kanievsky at this time.
The IRAC also asked the State to investigate alleged incitement by other prominent rabbis, the likes of Yitzhak Shapira, David Drukman, Daniel Stavsky, Ido Alba and Rabbi Yehuda Kroizer.
The rabbis are suspected of issuing calls for revenge against Arabs following the attack on Mercaz Harav.
Two-dozen rabbis are also suspected of distributing flyers after the bulldozer attacks in Jerusalem, describing east Jerusalem residents as "the tip of the iceberg of a national problem which has become an existential threat to the people is Zion."
Also under investigation is Rabbi Dov Lior of Kiryat Arba, who warned his followers against the perils of hiring Arabs or having them as tenants.
The Israel Religious Action Center issued a statement saying "over the past few months we have seen deterioration in incitement activity in Israel. This matter should concern anyone who cares about the Israeli democracy. We welcome these investigation and home the will serve justice."