Contrary to his earlier claims, one of American Jewry’s most prominent leaders was warned about a serious Holocaust compensation scam more than eight years before the fraud became public.
Julius Berman, who is chairman of the Conference on Jewish Material Claims Against Germany, then directed his own inquiry into the fraud allegations but failed to act on the fraud taking place. He also kept news about the allegations and his actions from his fellow board members at the Claims Conference, where the fraud was occurring.
Documents obtained by the Forward show that Berman, the Claims Conference’s top lay leader, personally directed an early investigation into the fraud at the organization, which processes restitution claims for Holocaust survivors. The fraud ultimately netted its participants $57 million in German government funds meant for needy survivors.
The documents obtained by the Forward contradict a May 15 statement by Claims Conference spokeswoman Hillary Kessler-Godin that laid responsibility for the group’s failure to stop the fraud early exclusively on the shoulders of Karl Brozik, its former director in Germany, who died in 2004. It was Brozik, said the spokeswoman, who led the investigation into detailed allegations about the scheme that the group received in an anonymous letter in June 2001.
The Claims Conference failed to pursue the early tipoff, disclosed by the Forward on May 14, even though a staffer’s preliminary investigation of the letter’s charges supported its allegations. Semen Domnitser, a Claims Conference employee, was convicted on federal fraud charges on May 8 of this year as the scheme’s ringleader.
The documents obtained by the Forward establish that Gideon Taylor, then the Claims Conference’s executive vice president, worked together with Berman on his own separate follow-up investigation. In a fax Berman sent to Taylor on Sept. 5, 2001, from the law firm Kaye Scholer, where he was a senior partner, Berman cited the anonymous letter and its allegations, and wrote:
“You will recall that … I arranged for Ryan Tan, a paralegal in this office, to interview Mr. Domnitser and, then, review the relevant files.”
“I am sending along to you his report. As of this point, it is still in draft form, and I await your comments prior to the finalization.”