How $57 Million Holocaust Fraud Unfolded at Claims Conference

Letter From Manhattan Federal Court

Done Deal: German Finance Minister Wolfgang Schaeuble, right, and Julius Berman, chairman of the Conference on Jewish Material Claims Against Germany, sign an agreement to expand benefits to Holocaust survivors.
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Done Deal: German Finance Minister Wolfgang Schaeuble, right, and Julius Berman, chairman of the Conference on Jewish Material Claims Against Germany, sign an agreement to expand benefits to Holocaust survivors.

By Paul Berger

Published May 09, 2013, issue of May 31, 2013.
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The federal courtroom in Manhattan was notably empty considering the eye-catching size and target of the fraud: a 15-year campaign to falsely claim $57 million meant for some of the world’s neediest Holocaust survivors.

Only a smattering of friends and relatives of the three accused were in the 26th-floor courtroom for the climactic closing statements on behalf of the two women and one man alleged to have colluded in the scheme. After half a day of deliberation, the jury found all three guilty.

But for some, miles away from the Daniel Patrick Moynihan courthouse, across America and overseas, the guilt of the three was of secondary importance compared to the alleged culpability of the organization tasked with administrating those funds: the Conference on Jewish Material Claims Against Germany.

The Claims Conference administers an array of funds set up by the German government to restitute Holocaust survivors. Critics want to know how such an enormous fraud could have been perpetrated for so long without being detected.

“If you are running an organization and you have oversight responsibility that [is not] fulfilled properly, you have to have some accountability and take some responsibility,” Isi Leibler, a longtime critic of the Claims Conference, told the Forward.

Leibler singled out Claims Conference Chairman Julius Berman and Executive Vice-President Greg Schneider for particular criticism in a recent Jerusalem Post opinion article. Leibler, a former World Jewish Congress official who lives in Israel, wrote that instead of launching an independent review following the fraud, the two men orchestrated a “Stalinist” board resolution that absolved the Claims Conference of all blame.

“Such contemptuous rejection of all managerial accountability in the wake of such a massive fraud would be inconceivable in any public company or government body where resignations or dismissals would have been mandatory,” Leibler argued.

In an interview with the Forward, Berman rejected Leibler’s charges. Liebler, he said, was just looking for a scapegoat for the fraud. Far from being a “bunch of nebishes,” the Claims Conference board, which is comprised of representatives from more than 20 organizations including B’nai B’rith and the American Jewish Committee, is independent and beholden to no one, said Berman. (Samuel Norich, Forward Association president, is on the board representing the Jewish Labor Committee.)

Berman also pointed to a recent review of the Claims Conference, conducted by Deloitte & Touche, as evidence that the matter had been independently investigated.


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