Bank Leumi agrees to pay NIS 130m. to Holocaust victims

Despite high hopes, restitution organization agrees to ‘cut our losses’; money will go to heirs of victims, projects to help survivors.

bank leumi 248 88 aj (photo credit: Ariel Jerozolimski [file])
bank leumi 248 88 aj
(photo credit: Ariel Jerozolimski [file])
Bank Leumi and Hashava – The Company for Location and Restitution of Holocaust Victims’ Assets ended months of arbitration by signing an agreement in which the bank will pay the company NIS 130.8 million, the two sides announced Sunday.
The money will go to heirs of Holocaust victims and toward projects that help Israeli Holocaust survivors – more than a quarter of whom live under the poverty line, according to government estimates.
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The total includes NIS 20 million, re-evaluated to NIS 25.8 million, already paid by the bank to Hashava in 2007. In exchange, Hashava has withdrawn all claims against Bank Leumi.
Leumi and Hashava agreed in February 2010 to enter talks under the mediation of Professor Omri Yadlin of Tel Aviv University and former High Court justices Tova Strassberg-Cohen and Ruth Elias-Sternberg.
Hashava had previously filed an NIS 305 million lawsuit against Leumi in the Jerusalem District Court in June 2009, based on their estimate that there were thousands of accounts at the bank that belong to Holocaust victims.
Hashava, a private corporation established in 2006 whose shares are held by the state, has also demanded that the Mizrahi Tefahot and Mercantile banks return the Holocaust victims’ money that they currently hold in trust. The company has stated in the past that it would wait until the end of its arbitration with Leumi before deciding whether to take any action, while the two banks have until now denied liability. An inventory on Hashava’s website lists more than 60,000 mostly unclaimed assets in Israel that belonged to Holocaust victims, most of them in real estate, but many at these banks and other institutions.
Former MK Colette Avital, who initiated the creation of the Parliamentary Inquiry Committee that led to Hashava’s establishment and today serves on its board of directors, told The Jerusalem Post that the compromise fell short of what the company had originally wanted, but that it agreed to enter mediation with Leumi after realizing that if it waited for a court verdict, by then “there would not be anybody to return the money to.”
“When we see that we are banging our heads against the wall, and time keeps moving and people keep aging and waiting many years for the money, in the end we need to settle everything and just cut our losses,” she said.
Avital said she understood the importance of the issue after returning from New York, where, in her role as Israeli consulgeneral during the mid-1990s, she had been active in the fight to free Holocaust victims’ assets being held in Swiss banks, only to find that Israeli banks were also suspected of holding onto victims’ assets.
“I said to myself, ‘It can’t be that we are fighting against Swiss banks and yet we in Israel are almost guilty of the same thing, that we are not willing to return the money,’” Avital said.
Dan Waldman, the executive director of Amcha, an organization that provides mental health support to Holocaust survivors in Israel with the help of Hashava funding, also welcomed the news.
“For what Amcha does, it [the agreement with Leumi] is certainly not too late, if we can make things easier for the mental health of Holocaust survivors and improve their lives,” he said.
Waldman said that Hashava had funded his organization for the past three years, which helped them to run a project that has so far provided 10,000 treatment sessions to survivors confined to their own homes. He said that such treatment was virtually unattainable to those who were not part of the project.