Claims Conference at Crossroads as Fiery Meeting Looms for Holocaust Group

Critics Want Answers on Botched $57M Fraud Probe

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By Paul Berger

Published July 07, 2013, issue of July 12, 2013.
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The annual board meeting of the organization responsible for allocating billions of dollars in Holocaust restitution money is a famously heated affair.

But for Julius Berman, chairman of the Conference on Jewish Material Claims Against Germany, this year’s conference promises to be one of the most contentious; indeed, it may turn out to be one of the most divisive in the group’s 62-year history.

For multiple reasons, Berman’s longtime leadership of the group is on the line. First and foremost, he faces a challenge from critics over his response to a 2001 letter, later proved accurate, warning of a conspiracy involving Claims Conference employees to defraud Holocaust funds.

But that is not the only issue besetting the Claims Conference as its board members fly in to New York for the two-day meeting, which begins on July 9. Like Pandora’s box, the 2001 letter has set loose other questions about the managerial competence of the group’s leadership.

In other developments:

• The Claims Conference has declined to respond to questions about what insurance coverage, if any, it had to offset the $57 million lost from the fraud.

• The former head of a large not-for-profit organization that cares for survivors says he fears that the Claims Conference may open itself up to further fraud as it expands one of its funds into the Former Soviet Union.

• A leading Jewish demographer says Claims Conference data on Holocaust survivors in the Former Soviet Union are inflated.

• An expert in not-for-profit management at Harvard University’s Kennedy School of Government says it is “outrageous” that the Claims Conference refuses to support an independent investigation into its failure to follow up on the early warning it received of the fraud conspiracy.

• The New York State Attorney General’s Office is reviewing the matter, the Forward has learned.

Meanwhile, as the Forward went to press, a war of words continued between board members over how soon — and how much of — an internal investigation of the handling of the 2001 letter, would be made available to the rest of the board.

The Claims Conference did not respond to requests for comment put to it on several of these issues by the Forward. But Sidney Zoltak, a board member representing the Canadian Jewish Congress, said that he, for one, was reserving judgment until the crucial board meeting.

“We don’t want to get out the gallows before the accused is sentenced,” he told the Forward. “Let’s wait for the verdict first.”


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