Israeli police arrested members of Prime Minister Benjamin Netanyahu's inner circle over the weekend.
Police said Hefetz and Shlomo Filber, the former director of the Communications Ministry under Netanyahu, are suspected of promoting regulation worth hundreds of millions of dollars to Israel's Bezeq telecom company.
The police brought Hefetz to court on Tuesday to extend his detention beyond Thursday, which the court had already granted in the Bezek media affair, in order to question him further about the new case.
Nir Hefetz, also a former spokesman of Netanyahu, is suspected of offering a retired judge, Hila Gerstel, the position of the attorney general if she would drop a corruption case against Netanyahu's wife Sara.
He said that all changes to state policy regarding Bezeq were vetted and approved by officials at the professional expert level.
Mr Netanyahu denies any wrongdoing and said the latest charges against him were merely a continuation of a wider media-orchestrated witch hunt against him and his family.
Hefetz and Filber have been in custody since Sunday.
Among those arrested is Nir Hefetz, Netanyahu's former family spokesperson, and Shaul Elovitch, the multi-millionaire owner of an Israeli news organization who is considered a close friend of Netanyahu.
"As for the second claim which is no less preposterous and no less perfidious regarding appointment of the Attorney General: "I never asked Nir Hefetz about this, he never offered me anything about it, and you know what?" But as suspicions grow, "it becomes more hard politically to support Netanyahu", says CNN.
Israeli Prime Minister Benjamin Netanyahu waves during the opening ceremony for a bomb-proof emergency room in a hospital in Ashkelon, Israel, Tuesday, Feb. 20, 2018.
Last week, in connection with two other cases, Israeli police recommended indicting Netanyahu for bribery, fraud and breach of trust, "opening the way for what could be the biggest challenge yet to the right-wing leader's political survival", says Reuters.
They are suspected of promoting a deal to give Netanyahu and his wife favorable coverage in Walla, a news site controlled by Bezeq, in return for the promotion of regulations worth hundreds of millions of US dollars to the telecom company.
The attorney general must now decide how to move forward with the police recommendations on the Yediot Aharonot affair and another case involving gifts from Hollywood producer Arnon Milchan and Australian billionaire James Packer, in a process that could take months.
In return, police say Mr Netanyahu had operated on Mr Milchan's behalf on U.S. visa matters, legislated a tax break and connected him with an Indian businessman.
Sara Netanyahu was in 2017 indicted on fraud and breach of trust for misuse of public funds by ordering catered meals to the official prime ministerial residence in Jerusalem while falsely claiming that the residence did not employ a cook. While Netanyahu has not been named as a suspect, close associates of his, including two personal aides, have been arrested or questioned.
This would not be the first time that Netanyahu has been accused of trying to win good press in corrupt ways, as police believe the premier sought a secret deal for favourable coverage with the publisher of top-selling newspaper Yediot Aharonot, whose publisher Arnon Moses could also face bribery charges.