Over the past few days, there have been additional mind-boggling exposures of
further scandals, lack of transparency, cover-ups and ethical failures at the
highest possible levels of the Claims Conference leadership and management.
Unless these latest reports appearing in The Jerusalem Post and JTA are refuted,
we must demand the immediate resignations of all those engaged in the
It was in April 2007 that I wrote the first of 21 articles
calling for a reform of the Claims Conference and appealing to the Board to
ensure that wherever possible, all funds being directed to general projects be
frozen and instead steered toward ameliorating the plight of the desperate
elderly and ailing survivors unable to afford food, medicine and basic
necessities of life. I repeatedly stated that it was our obligation as Jews, and
in particular the duty of the Claims Conference, to ensure that these survivors
would live out their remaining years with a modicum of dignity.
response of the Claims Conference to me and other critics avoided the key issues
and amounted to personal abuse and hysterical efforts to intimidate the media,
even threatening them with libel proceedings.
When the $57 million fraud
was discovered in 2009, the Claims Conference board carried a series of
resolutions praising its impeccable management and supervision.
Julius Berman lauded his chief executive Greg Schneider as a hero for having
exposed the fraud and for his alleged exemplary performance of
This, despite the fact that more than $57m. was stolen over a
period of 15 years with the connivance of a senior manager in the Claims
Conference’s New York head office, and none of the senior leadership was willing
to accept responsibility or accountability.
Such behavior would never
have been tolerated in any public or government instrumentality. Resignations at
key levels would have been immediate and mandatory.
This latest scandal
was only exposed due to a fortuitous exchange between the defense and
prosecution in the course of the trial of the Claims Conference manager
convicted as the ringleader of the fraud, which was astutely noted and followed
up by The Forward’s Paul Berger. Otherwise, to this day we would have been
unaware that the senior members of the Claims Conference management had been
warned of the nature of the scam in an anonymous 2001 letter, but had failed to
effectively follow up.
Indeed, at the trial, current CEO Greg Schneider
even had the gall to allege that he was “shocked” when he first learned in late
2009 about the fraud that he and his colleagues (including former CEO Gideon
Taylor and other senior management personnel) had failed to prevent.
storm erupted once these facts were revealed. World Jewish Congress President
Ronald Lauder, a Claims Conference board member, demanded to know if and when
the board was informed of the 2001 letter alerting the Claims Conference to the
fraud. He also expressed frustration with the management of the Claims
Conference by setting up a WJC Task Force to investigate the matter.
initial responses from the Claims Conference leadership were incoherent and
contradictory. At first, the spokeswoman said the matter was closed and that
there was nothing more to be said. Other spokespersons then began making excuses
for the failure of management to follow up the 2001 letter. Ultimately, they
laid the entire blame on Karl Brozik, a director in the Berlin office who,
having died in 2004 at age 78, is obviously unable to defend himself. To lay the
blame on a person who was in Berlin and not even located in the New York office
in which the fraud took place, and who is moreover deceased, speaks for
That the management was incompetent and failed to adequately act
as a trustee for these funds is now no longer in dispute. But ultimately, what
has totally destroyed the credibility of both the management and leadership of
this organization is not merely the negligence – which itself reached
frightening proportions – but the cover-up.
Had the leadership and
management acted honestly and taken responsibility for their failures, they
would not face a scandal of such a vast scale. One should bear in mind that it
was not the Watergate scandal that finally brought down President Nixon. It was
We are entitled to now assume that the desperate resistance
to the repeated calls for an independent investigation was due to the fact that
both the management and chairman Julius Berman were concerned the episode could
expose their personal failures to stem the theft of at least $57m. earmarked for
This issue becomes more pertinent following yesterday’s
mind-boggling discovery by JTA’s Uriel Heilman that Julius Berman himself (in
his then capacity as counsel to the Claims Conference) was advised in 2001 and
fully aware of the fraud allegations, even undertaking to probe the matter. He
effectively lied when he informed board members that the first he heard about
the scam was when Schneider drew it to his attention.
Berman’s own personal involvement and failure in the matter, it is shocking that
he would permit his spokespeople to lay all the blame for this enormous fraud on
one of his deceased former colleagues in Berlin.
This is not merely a
breakdown of transparency, but amounts to morally inexcusable and unconscionable
behavior and represents a breach of trust. It makes him unfit to hold office in
any Jewish organization, least of all the organization disbursing billions of
dollars and designated as trustee on behalf of the Jewish people for sacred
In response to these exposures, Jewish Agency chairman
Natan Sharansky has now belatedly called for an independent review of the
organization. That is not enough. Unless the facts referred to above are
demonstrated to be false, Julius Berman, the senior management and professionals
responsible for the lack of oversight enabling the fraud or engaged in the
subsequent cover up must resign forthwith.
The members of the board of
the Claims Conference have much soul-searching to do. They were all urged to
call for an independent review of the organization years ago. Had they done so,
we could have been spared this scandal and shame. They should now try to make
amends by reforming the organization, replace the management and seek to ease
the plight of the survivors.
I would hope that Reuven Merhav, the head of
the Claims Conference Executive Committee and former director-general of the
Israeli Foreign Ministry, assumes a major role in a revamped organization. I
have known Merhav for over 30 years and frequently collaborated with him on
international Jewish affairs. He is a man of unquestioned integrity and
represents the antithesis of the arrogance and lack of transparency displayed by
the current leadership.
We can only pray that a new leadership team will
represent the aspirations and ethics of the Jewish people and conduct itself
That this scandal was permitted to compromise the standing
of the Jewish people reinforces Lord Acton’s dictum “power corrupts and absolute
power corrupts absolutely.”
The writer’s website can be viewed at