More Suspects Charged in Claims Conference Fraud
By Paul Berger October 12, 2011
Eight more suspects have been charged with taking part in a multimillion dollar fraud against the Conference on Jewish Material Claims Against Germany, authorities announced today.
The fraud investigation has focused on New York’s Russian-speaking community, which was stunned when 17 people, six Claims Conference employees in a New York processing office and 11 accomplices, were arrested last November.
At the time, authorities believed the fraud totaled about $42.5 million. Now, they estimate the fraud at $57 million, said Preet Bharara, the U.S. Attorney for the Southern District of New York.
Bharara said five of the eight new arrests were former Cl aims Conference employees: Ella Voskresenskiy, 41, Zlata Blavatnik, 64, Viktor Levin, 71, Henry Gordin, 74, and Genrikh Kolontyrskiy, 79. A ninth suspect is expected to be charged soon.
The Claims Conference said two of the five were “terminated” in 2006 and the rest were fired in November last year. They are accused of approving almost 5,000 fraudulent claims in return for kickbacks.
Their arrests, coupled with a handful of new arrests this year, brings the total number of accused to 30. So far, ten people have pleaded guilty to charges related to the fraud.
The scheme, which was uncovered in 2009, was led by Russian-speaking Claims Conference employees who rubber-stamped hundreds of fraudulent claims over more than a decade.
They were aided by so-called “recruiters” who gathered documents from thousands of members of the Russian-speaking community and then had them altered or in some cases forged so that they would comply with compensation requirements set by the German government.
The Claims Conference has sent letters to people it believes to have made fraudulent claims. Suspects can either return the money or appeal.
A Claims Conference spokesman said more than 600 people have agreed to repay about $4.7 million. But so far only $1.7 million has been recovered. The Conference has agreed to accept a further $3 million in installment payments.
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