Deputy Prime Minister Julia Gillard has assured Australians their passports are safe, after three forged passports were apparently used by suspects in a political assassination.
Mossad, Israel's secret service, is widely believed to be behind the organised hit on senior Hamas operative Mahmud al-Mabhuh in a Dubai hotel room last month.
Three Australian passport-holders, Joshua Bruce, Adam Korman and Nicole McCabe, are believed to have had their identities stolen and used in fake passports held by three suspects in the assassination.
"We do know that in terms of passports in this country basically they're very safe," Ms Gillard told the Nine Network on Friday.
"It's less than half a per cent that go missing each year and most of them would be lost in pretty benign circumstances.
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"You know they're at the back of the sock drawer and no one can find them."
Ms Gillard said any use of Australian identities by the Israeli government for secret police assassinations would not be tolerated.
"If there's any suggestion Australian identities have been used by the Israeli government for this purpose then that is completely unacceptable," she said.
"Democracies have to be accountable for their actions and we'll be making sure that Israel is accountable and this is fully investigated."
Israel foreign ministry: we are not accused
Meanwhile, Israel is trying to play down diplomatic tensions with Australia amid suggestions it forged the Australian passports in an organised hit on Mahmud al-Mabhuh.
The federal government has warned Israel it will not be considered "a friend" if found to be involved in passport fraud targeting three Australians.
The Israeli ambassador was called to Parliament House by Foreign Minister Stephen Smith for an urgent meeting yesterday.
But Israeli foreign ministry spokesman Yigal Palmor denied that diplomatic ties were under strain.
"I haven't heard any government accuse Israel of being involved in that, not in France, not in Britain, not in Ireland, not in Germany and now not in Australia," he told ABC Radio on Friday.
"There have been many hints, or direct accusations by media (but) ... they don't represent any official stance. "We don't think we should feel concerned."
Dubai police have said they are almost certain Israel was behind the murder, but that comment did not come from the Dubai government, Mr Palmor said. Asked directly if Israel denied being involved, he declined to respond saying there had been no accusations.
"(So) I refuse to stand accused."
