Report: Pol Mishandled ‘March of the Living’ Funds

Israel’s state comptroller has opened an investigation into charges that the country’s minister of finance, Avraham Hirchson, mishandled the funding of an iconic Holocaust education project, the March of the Living, in possible violation of both nonprofit laws and campaign finance laws.

The charges are contained in a bruising cover story published June 16 in Seven Days, the weekend magazine of Israel’s largest newspaper, Yediot Aharonot. The article, by investigative journalists Michal Graievsky and Niv Alexander, details a series of financial and other transactions that appear to suggest an improper overlap between Hirchson’s role as founder and international leader of the March of the Living and his former political role as a Likud leader. The newspaper reported three days later that the state comptroller had appointed a team to probe the charges.

Hirchson, a close associate of Prime Minister Ehud Olmert, is a veteran Likud leader who left the party last fall to join Ariel Sharon’s new Kadima party. A longtime Knesset spokesman on Holocaust affairs, he is credited with conceiving and launching the March of the Living. Since 1988, the march has brought more than 150,000 youth from around the world for an annual 1.5-mile walk from the gates of Auschwitz to the Birkenau extermination camp. It is administered through a complex web of nonprofit agencies in Israel and America.

The most serious charge in the Seven Days article relates to Hirchson’s Likud primary campaigns in 1996, 1999 and 2002, which it says were headquartered in the Tel Aviv offices of the March of the Living nonprofits.

The article quotes Hirchson’s attorney as responding to the charge by suggesting that the two operations might have been housed near each other in a large office building; however, the magazine said, the building is a modest, five-story residential building with a single office suite on the ground floor.

In contrast to that potentially serious charge, most other allegations in the article amount to little more than minor technical infractions and sloppy bookkeeping, several observers said. Still, the article and the resulting government investigation could prove damaging to the operational abilities of a Jewish institution widely hailed for its profound impact on Jewish teenagers worldwide.

One Israeli official with ties to the Likud party, who spoke on condition of anonymity, labeled the article “a smear campaign.” Another senior Israeli political figure who knows Hirchson and has dealt with Diaspora issues in the past, and also spoke on condition of anonymity, characterized Hirchson as “a very decent man.” At the same time, the political figure described one of the Yediot reporters as a respected journalist known for her professionalism and for the thorough scope of her investigations.

In the United States, where recruitment for the March of the Living is carried out in conjunction with local Jewish federations, synagogue groups and bureaus of Jewish education, recruitment coordinators in several cities responded nervously to calls from the Forward. Most said that they had not yet heard anything about the allegations. Officials with the main March of the Living organization said that a detailed letter responding to the Yediot article would be sent to March of the Living’s recruitment partners in the near future.

The bulk of the allegations relate to a purported overlap between Hirchson’s Likud role and his role as founder of the March of the Living. Hirchson served in the 1980s and ’90s as a senior official in the National Labor Federation, a small Likud-dominated trade union. The article describes cash transfers from the financially troubled union to March of the Living nonprofits that were recorded as loans and later converted to grants, in amounts that appear not to have been fully reported. According to Yediot, 1.4 million shekels ($300,000 by today’s exchange rate) was the amount reported, but a total of 7 million shekels ($1.6 million) was actually transferred. The article quotes current and former union officials defending the loans as a way of showing support for the project in its early years.

The article also raises questions about a $1.4 million donation to the March of the Living in 2005 by the Conference on Jewish Material Claims Against Germany, a New York-based organization that administers Holocaust reparations and restitution funds. According to the article, the Claims Conference allocated the funds to a March of the Living agency in Tel Aviv, despite the fact that the agency had been shut down in 2002 in response to other complaints. The donation ended up in the account of a New Jersey-based March of the Living agency, the International Center for the Study of Jewish Heroism.

The vice chairman and international director of that center, David Machlis, said in an e-mail to the Forward that the New Jersey office “has served as liaison to the Claims Conference since the initial inception of our relationship.” Machlis explained that, starting in 2004, because his office “was continuously involved in preparing and submitting proposals and in providing reports to the Claims Conference, it was also appropriate that this same entity assume responsibility for receiving and distributing the funds received from the Claims Conference.”

Asked about the allegations, a spokeswoman for the Claims Conference, Hillary Kessler-Godin, said, “We review all our grants, including those to March of the Living, on an ongoing basis.”

March of the Living officials expressed confidence that the investigation would have no adverse effect on either the program’s number of participants or its level of financial support. “Our stellar reputation will carry us through in light of any baseless accusations that might have arisen,” Machlis said in an e-mail to the Forward.

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Report: Pol Mishandled ‘March of the Living’ Funds

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