Agency Slow To Handle Holocaust Claims

By Nathaniel Popper

Published December 10, 2004, issue of December 10, 2004.
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In 1998, when an international agency was formed to help Holocaust survivors collect on their prewar insurance policies, Alex Moscovic thought he finally might be able to recover the policy his parents whispered about as the Nazis were marching into his native Hungary in 1944.

Moscovic filed his claim in 2000 with the agency, known as the International Commission on Holocaust Era Insurance Claims. In 2003, the European insurers finally released a list of prewar policyholders, and Moscovic was on it. But he has not heard a word since then, and he is beginning to lose faith.

“I hope that I will live long enough to receive something else,” said Moscovic, who lives in Hobe Sound, Fla. “But I’m not expecting much from them at this stage in the game.”

Moscovic is not the only one who has found the commission, a consortium of European insurance firms, Holocaust survivor groups and American state insurance regulators, to be slow and inscrutable. In the last few months, the commission has been subjected to a withering round of criticism. Two weeks ago, the Israeli Knesset raked it over the coals in a resolution slamming its lack of transparency and accessibility.

Known by the acronym Icheic (“eye check”), the commission faced criticism from its earliest years, including two congressional hearings, but most called it growing pains. In the past year, the commission has instituted several reforms that have increased the transparency of the process and won over some doubters. But many critics remain unimpressed.

“There are so many issues that have never been addressed,” said Sidney Zabludoff, who worked as a consultant on Icheic at the Conference on Jewish Material Claims Against Germany until May, when he resigned because of continuing problems in claims processing.

One of the most withering barrages of criticism yet came on the eve of Icheic’s annual meeting, November 16. Harshest was a report from the Washington State insurance commissioner, which suggested, among other things, that one-fifth of the claims filed in Washington state were not found in Icheic’s files. Fully 10% were said to have been lost altogether.

Icheic’s chief operating officer, Mara Rudman, said that although there was little evidence that claims had been lost, the commission was working swiftly to address concerns about missing claims. At the annual meeting in Washington, commission chairman Lawrence Eagleburger, a former secretary of state, gave an upbeat assessment. He said the commission had given out $108 million to claimants to date and planned to finish processing claims in December 2005.

Just a year ago, only about $35 million had been distributed. The progress won praise from New York State Insurance Superintendent Gregory Serio.

“Over the last year and a half, the Icheic process has improved dramatically,” said Serio, whose office has handled more Icheic claims than any other state.

The work is far from done, though, and many question whether Icheic will be able to meet its December 2005 deadline. Critics note that at the last meeting in April, a completion date of December 2004 had been announced. Since its founding, Icheic has fully processed only 42% of the 79,769 claims it has received, and just over 5% have received offers from the insurance companies. To critics, the speed is distressing, but worse is the care in processing the claims.

In June, before Washington State issued its report, California insurance commissioner John Garamendi wrote his own critical letter to Icheic. It elicited a scathing, seven-page reply from Eagleburger.

“Icheic management is sloppy,” Garamendi wrote to Eagleburger. “And too many of Icheic’s interpretations of the rules favor the insurers.”

The Icheic specialist on Garamendi’s staff, Leslie Tick, said that few of the core issues raised in the letter have been addressed. The Washington state report had called for an audit of Icheic, and Tick said California would support that idea. California and Washington say their arguments are strengthened by the fact that their insurance regulators are among the only ones in the country that have had the same full-time staff member working exclusively with Icheic claimants since the process began six years ago.

Several Holocaust survivors on the Icheic board took issue with the Washington state report, in particular questioning its suggestion that Icheic’s performance demeaned the memories of Holocaust victims.

One top survivor spokesman, Roman Kent, chairman of the American Gathering of Jewish Holocaust Survivors, denounced the Washington complaints publicly in a speech at the annual meeting. Speaking to the Forward afterward, Kent said the report was “so derogatory that I as a survivor don’t want to have anything to do with them.”

Kent’s group has taken a positive stance toward Icheic’s performance since Rudman took over operations in the summer of 2003. Other survivor organizations, though, continue to criticize the commission for the meager sums it has succeeded in winning back for survivors.

The annual meeting of Icheic came at a crucial time, just a few weeks after a federal court in California dismissed a major lawsuit brought by Holocaust-era insurance holders against Assicurazioni Generali, the Italian company that insured many Jews before World War II.

The suit, brought by survivors who had grown impatient with the slow progress of the Icheic process, had been seen as presenting problems for Icheic. Like other Holocaust restitution agencies, Icheic is expected as part of the negotiating process to promise targeted firms that a settlement of claims will end their legal exposure.

Of all the restitution programs established in the late 1990s — including Swiss banks, stolen art, slave labor and abandoned real estate — Icheic is widely agreed to have had the most difficult path. In part this is because much of the decision-making was given over to the European insurance companies, which were seen as particularly unfriendly to survivors’ demands.

Most Eastern European Jews held accounts with three giant insurers, which spent years after the war demanding documentary proof that most survivors could not provide. The insurers also claimed that policies signed in Eastern Europe — where most of Hitler’s victims lived — had been expropriated after the war by the communist regimes and were no longer the companies’ responsibility. Icheic was criticized for not putting enough pressure on the insurers to find solutions.

The result frequently has been seemingly endless waiting for claimants like Moscovic, often with no information about the progress of their claims. Even some of the 12 Icheic commissioners — representing insurers, survivor groups and state regulators — say they have had trouble getting information from Icheic.

The transparency issue turned explosive last week, when Eagleburger announced that Icheic would be severing its agreement with the Generali Trust Fund, a Jerusalem-based organization handling Generali claims. The Israeli government representative on Icheic, veteran negotiator Reuven “Bobby” Brown, said he was unhappy with the decision to sever ties, but he was more unhappy that he had not been included in the decision-making process beforehand.

“The decision may or may not have been right, but I would have liked the process to be more inclusive,” Brown said.

Icheic’s break with the Generali Trust Fund was the subject of a Knesset resolution, which accused Icheic of trying to hold on to claimants’ money to put into separate programs for Holocaust survivors.

Ironically, Eagleburger’s decision to sever ties with the trust fund is one of few decisions supported by the California and Washington regulators, both longtime critics of the trust fund. But Tick, at the California office, said she understands Brown’s feelings.

“When I inquire about a particular claim,” Tick said, “it can take Icheic months to get back to me, and Icheic generally agrees with the insurance companies.”






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