World Jewish Congress president Ronald S. Lauder has asked Conference on Jewish
Material Claims Against Germany chairman Julius Berman and executive vice
president Gregory Schneider to respond to allegations of covering up fraud, The
Jerusalem Post has learned.
According to the allegations, senior
conference executives covered up a 2001 communiqué exposing ongoing fraud within
their organization that ultimately cost $57 million.
Both Lauder and WJC
secretary- general Michael Schneider sit on the board of directors of the Claims
Conference, which works to secure restitution from the German government for
Lauder made the request in a letter to Berman and
Schneider on Friday.
In another private letter provided to the Post by
someone familiar with the matter, Lauder again referred to allegations of a
cover-up, calling them a “long-term issue with potentially serious implications”
before announcing that a task force was being formed by WJC CEO Robert Singer to
“deal with and follow through on this and related issues.”
force, Lauder wrote, is to be chaired by Michael Schneider and include WJC
general counsel Menachem Rosensaft.
Lauder’s push toward an investigatory
panel stems from allegations that senior executives at the Claims Conference
knew of the fraud in 2001, failed in their obligation to maintain adequate
oversight and covered up their alleged negligence.
Earlier this month,
conference employee Semen Domnitser, along with co-defendants Oksana Romalis and
Luba Kramrish, was found guilty by a New York court of defrauding the Claims
Conference of $57m. through the approval of falsified restitution
The fraud was discovered in 2009, and dates back to 1993. It
involved falsified applications to the Hardship Fund, an account established by
the German government to provide one-time payments of approximately $3,360 to
those who fled the Nazis as they moved east through Germany, and the Article 2
Fund, through which the German government gives pension payments of
approximately $411 per month to needy victims of the Nazis who spent significant
time in a concentration camp, in a Jewish ghetto in hiding or living under a
In 2001, an unsigned letter made its way to the desk of
the Claims Conference’s director in Germany, Karl Brozik, which accused
Domnitser of approving five claims that the anonymous author believed ineligible
While The Forward reported that Brozik copied senior
conference officials, including Gregory Schneider, on correspondence discussing the allegations, Claims Conference spokeswoman Hillary
Kessler- Godin denied the report, telling the New York-based newspaper that “the
entire investigation in Germany, directed by Dr. Brozik [who was senior to Greg
at the time], was never shared with Greg. The entire investigation that occurred
did not include Greg and involved people senior to him.”
Conference has blamed Brozik, since deceased, for accepting Domnitser’s
explanations of his behavior and allowing the fraud to continue.
letter on Friday to Schneider and Berman, Lauder asked if the “existence of the
aforementioned letter of June 6, 2001, and the subsequent communications
regarding that letter among members of the Claims Conference professional staff
ever disclosed to the board of directors and/or the members of the executive
committee of the Claims Conference, or other members of the Claims Conference
key professional staff?” Lauder wrote that, if such communications were in fact
disclosed, he wanted to know if they were “duly minuted.”
ascended to the WJC’s presidency in 2007, Lauder said that one of his focuses
would be on building “transparency” at the Claims Conference. In an interview
with The Jewish Week after announcing his candidacy, Lauder told editor Gary
Rosenblatt that the conference had “anywhere between $900m.
billion available at a time when 80,000 Holocaust survivors in Israel are living
below the poverty line. And the question is why is the Claims Conference holding
the money?” WJC general counsel Menachem Rosensaft told the Post on Sunday that
while Lauder “asked for this task force to be set up, at the moment we are
limiting ourselves to waiting for a response to the questions he asked in [his]
letter” to Berman and Schneider.
Spokeswoman Orly Joseph said that the
Claims Conference was not aware of the WJC task force, but that it welcomed “all
inquiries into this issue or any other, subsequent to the important guilty
verdicts of those convicted of defrauding our organization, especially from our
longstanding board members, like WJC president Lauder.”
Joseph said that
at the conclusion of the Domnitser trial, Berman had “asked Amb. Reuven
Merhav, chairman of the executive committee, to head a Select Leadership
Committee of the board to formulate an appropriate course of action for the
conference to the issues surrounding the 2001 letter,” adding that “we look
forward to its deliberations and recommendation.”
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