An organization representing Holocaust survivors in the US has petitioned a New
York court to block both the American Jewish Joint Distribution Committee and
the Conference of Material Claims Against Germany from having any role in the
allocation of Jewish assets reclaimed from Swiss banks.
In a motion filed
on Monday by the Holocaust Survivors’ Foundation-USA, the group appealed a May
13 decision by Judge Edward Korman granting the Claims Conference the right to
disburse $12.5 million in recovered assets, half of which will be allocated to
survivors in Israel and the other half to “needy victims in the rest of the
The controversy surrounds the disbursement of the final $50m.
from a $1.25b. Settlement Fund extracted from Swiss banks that held looted
Jewish assets during and after the Second World War.
attorney Samuel Dubbin, who represents the HSF, only around four percent of the
total restitution monies will go to American survivors, despite the fact that
they constitute “20%” of needy survivors.
Aside from its objections to
the court’s division of the funds, the motion also castigated the Claims
Conference over a recent fraud scandal in which employees bilked the restitution
body of $57m. over the course of almost two decades.
the HSF, the conference’s “negligent management and oversight” in its “dismissal
in 2001 of information detailing the ongoing fraud” rendered it unfit to oversee
the allocation of further funds.
Despite a 2001 anonymous tip-off letter received by the
conference, a subsequent internal probe failed to uncover the ongoing fraud.
After that letter went public in May of this year, a Claims Conference
spokeswoman placed responsibility for the matter on Karl Brozik, the employee
who conducted the initial investigation. Brozik died in 2004.
JTA subsequently reported that a paralegal working for the law firm of
then-board member and pro-bono counsel Julius Berman launched a second
investigation, which also failed to uncover the fraud. Berman became the
conference’s chairman in 2002.
Last week, after several calls for an
independent investigation by board members, the Claims Conference appointed
ombudsman Shmuel Hollander to conduct a probe and present its findings before
the next board meeting in July.
“Given the hundreds of millions of
dollars this court has [in earlier decisions] entrusted to the Claims Conference
and its influential board member the JDC,” the HSF wrote, the disclosure of the
conference’s response to the fraud committed against it “should be sufficient to
warrant this court staying the effect” of its ruling giving the Claims
Conference access to the remaining Swiss funds.
survivors group demanded, the court should appoint an “independent and public
investigation” into the Claims Conference’s “handling of all settlementrelated
funds and responsibilities” and hold a “public hearing” on the
Calling for a “truly independent team of forensic investigators”
to take a look at the Claims Conference, HSF lawyer Dubbin wrote that his
clients “submit that it would be tragic... to allow any more Holocaust victims’
money to be controlled by the Claims Conference.”
Speaking with The
Jerusalem Post on Wednesday, Dubbin said that his clients believed that it was
unfair for 75% of the funds to go to survivors in the former Soviet Union while
only 4% going to US survivors when over 80,000 American survivors were living
below or near the poverty level.
“It is well known everywhere,” he said,
“that survivors do not receive the home care, food, medicines, hearing aids,
dental care, eyeglasses, rent and utility assistance, and other necessities for
a dignified and healthy old age.”
Meanwhile, he said, “the Claims
Conference has spent over $250m. of these funds for research, documentation, and
education projects while tens of thousands of survivors have suffered... with
many dying too early and in misery.”
Speaking with the Post, Haim Roet, a
former board member who left the conference in 2010, expressed his view that the
conference “should allocate the money available directly to the Holocaust
survivors in need and not also to institutions, as was the practice so far, that
only marginally deal with Holocaust survivors.”
Moreover, he said, the
court decision to transfer the Swiss money should be deferred for half a year
until a “completely new board” can be established.
The decision of Roet –
a former World Bank economist – to resign from the board was due to his refusal
to be “a rubber stamp for decisions taken by the chairman,” the Jewish Daily
Forward recently quoted him as saying.
“We currently are
reviewing the filing,” a JDC spokesman told the Post. “Above all, in the
dozen years since the US Federal Court entrusted JDC with this critical mission,
we have used those funds to better the lives of tens of thousands of poor,
elderly Nazi victims in the former Soviet Union. JDC’s execution of the court’s
decision has been repeatedly approved and praised by the court and the survivors
The Claims Conference declined to comment.