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.
getty images
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.
  • Print
  • Share Share
  • Single Page

(page 2 of 4)

The Deloitte & Touche review looked at the Claims Conference’s application procedures, which have been revised since the fraud was discovered. It did not investigate whether top Claims Conference officials could have prevented the fraud.

Berman said that finding out how the fraud occurred is “just a detail, but much more important is how we are going to make sure it won’t happen again.”

Sam Dubbin, a Florida lawyer and another long-term Claims Conference critic, said that whether the Claims Conference could have known or should have known about the fraud is irrelevant. “It’s damning either way,” Dubbin said.

The fraudsters’ four-week trial, which began on April 8, featured many disputes of its own. About the only thing not in dispute was that the fraud was massive and long-running.

During two days of summation, over May 6 and 7, the jury was reintroduced to war-torn Eastern European towns and villages, to ghettoes and concentration camps, to forged documents from the Moscow Red Cross and the Hebrew Immigrant Aid Society and to Russian surnames that tied knots in attorneys’ tongues.

Jurors also had to understand the various criteria set by the German government to decide which survivors qualified for compensation from two funds, The Hardship Fund and The Article II Fund.

The Hardship Fund makes a one-time payment of about $3,500 to Jews who were forced to flee their homes during World War II. The Article II Fund pays a monthly lifetime pension of about $350 to Jews who lived in hiding or under a false identity for at least 18 months during the war and whose present income falls below a certain threshold.

According to the FBI and government prosecutors, the $57 million scheme was facilitated by Russian-speaking Claims Conference employees and aided by a network of runners and recruiters who submitted thousands of claims on behalf of people across North America who were ineligible for the funds.

Prosecutor Rebecca Rohr told the court that recruiters sent blank application forms, signed by Russian-speaking immigrants and their children, to the Claims Conference, where employees then forged documents and made up false survival stories. After applications were approved, the recruiters demanded thousands of dollars, often paid in cash or money orders, which was then shared with Claims Conference employees.

Rohr produced records showing money orders from Colorado, Massachusetts, California, New Jersey, Illinois and New York.

The jury was unaware that before the trial began, 28 people, including nine former Claims Conference employees, had already pleaded guilty to fraud and, in some cases, witness tampering. The three on trial in Manhattan were convicted of mail fraud and conspiracy to commit mail fraud. Of the three, only one, Semen Domnitser, was a recent Claims Conference employee.


The Jewish Daily Forward welcomes reader comments in order to promote thoughtful discussion on issues of importance to the Jewish community. In the interest of maintaining a civil forum, The Jewish Daily Forwardrequires that all commenters be appropriately respectful toward our writers, other commenters and the subjects of the articles. Vigorous debate and reasoned critique are welcome; name-calling and personal invective are not. While we generally do not seek to edit or actively moderate comments, our spam filter prevents most links and certain key words from being posted and The Jewish Daily Forward reserves the right to remove comments for any reason.





Find us on Facebook!
  • Jon Stewart responds to his critics: “Look, obviously there are many strong opinions on this. But just merely mentioning Israel or questioning in any way the effectiveness or humanity of Israel’s policies is not the same thing as being pro-Hamas.”
  • "My bat mitzvah party took place in our living room. There were only a few Jewish kids there, and only one from my Sunday school class. She sat in the corner, wearing the right clothes, asking her mom when they could go." The latest in our Promised Lands series — what state should we visit next?
  • Former Israeli National Security Advisor Yaakov Amidror: “A cease-fire will mean that anytime Hamas wants to fight it can. Occupation of Gaza will bring longer-term quiet, but the price will be very high.” What do you think?
  • Should couples sign a pre-pregnancy contract, outlining how caring for the infant will be equally divided between the two parties involved? Just think of it as a ketubah for expectant parents:
  • Many #Israelis can't make it to bomb shelters in time. One of them is Amos Oz.
  • According to Israeli professor Mordechai Kedar, “the only thing that can deter terrorists, like those who kidnapped the children and killed them, is the knowledge that their sister or their mother will be raped."
  • Why does ultra-Orthodox group Agudath Israel of America receive its largest donation from the majority owners of Walmart? Find out here: http://jd.fo/q4XfI
  • Woody Allen on the situation in #Gaza: It's “a terrible, tragic thing. Innocent lives are lost left and right, and it’s a horrible situation that eventually has to right itself.”
  • "Mark your calendars: It was on Sunday, July 20, that the momentum turned against Israel." J.J. Goldberg's latest analysis on Israel's ground operation in Gaza:
  • What do you think?
  • "To everyone who is reading this article and saying, “Yes, but… Hamas,” I would ask you to just stop with the “buts.” Take a single moment and allow yourself to feel this tremendous loss. Lay down your arms and grieve for the children of Gaza."
  • Professor Dan Markel, 41 years old, was found shot and killed in his Tallahassee home on Friday. Jay Michaelson can't explain the death, just grieve for it.
  • Employees complained that the food they received to end the daily fast during the holy month of Ramadan was not enough (no non-kosher food is allowed in the plant). The next day, they were dismissed.
  • Why are peace activists getting beat up in Tel Aviv? http://jd.fo/s4YsG
  • Backstreet's...not back.
  • from-cache

Would you like to receive updates about new stories?




















We will not share your e-mail address or other personal information.

Already subscribed? Manage your subscription.