Claims Conference Ombudsman Will Probe Botched Fraud Investigation
An ombudsman will investigate how top officials at the Conference on Jewish Material Claims Against Germany handled an anonymous letter that could have drastically reduced a multi-million dollar fraud at the organization.
Julius Berman, chairman of the Claims Conference, has faced growing calls from board members for an independent investigation into the 2001 letter, which warned that a handful of employees were submitting and approving fraudulent claims on behalf of themselves and family members.
Berman announced in May that a four-man committee would look into the matter. The committee’s chairman, Reuven Merhav, told board members that his committee has decided to refer the matter to the Claims Conference’s ombudsman Shmuel Hollander.
“The Committee decided to ask the Ombudsman’s Office…, being both independent and possessing the relevant expertise, to investigate the facts surrounding the 2001 letter,” Merhav wrote in a June 6 email.
Merhav added that the ombudsman will pass his findings to Merhav’s committee, which will in turn formulate its own recommendations. The committee’s report will be presented to the Claims Conference’s full board at its annual meeting, to be held in New York in early July.
The 2001 letter, which went into detail about who was responsible and how they could be exposed, was introduced into evidence during the recent trial in New York of three people implicated in the fraud.
Following receipt of the letter, top Claims Conference officials were involved in two investigations that raised further concerns about Claims Conference employees. However, it appears that no further action was taken against them.
The fraud is thought to have continued for about 15 years. By the time it was discovered, in 2009, thousands of ineligible people had received Holocaust payments totaling $57 million from the German government.
Thirty-one people, including more than a dozen former Claims Conference employees, pleaded guilty to or were convicted of fraud.
A spokesman for the German Ministry of Finance said the German government had only recently learned about the 2001 letter.
“This letter became public during the trial,” a ministry spokesman said. “It became also public only then, that the [Claims Conference] did conduct an internal investigation after receiving this letter, which did not provide any indication of fraud.”
The spokesman added: “This letter will now again be subject to a new investigation, carried out by an internal commission of the [Claims Conference] under the guidance of Reuven Merhav. We have to wait for the results of this investigation.”