Claims Conf. committee report calls for restructuring, half its members disown it

NEW YORK (JTA) — A new Claims Conference report on the organization’s mishandling of a 2001 warning about internal fraud called for a restructuring of the Claims Conference, saying best practices and competence were missing.

But two of the four members of the committee tasked with reviewing the 2001 episode disavowed the report and resigned on Sunday.

The committee was asked to review how the Claims Conference acted after receiving an anonymous letter in 2001 identifying several highly problematic restitution claims processed by the Claims Conference. Top Claims Conference officials who looked into the allegations, including the current chairman of the organization, Julius Berman, failed to detect that a broad fraud scheme was underway that would reach $57 million before it was stopped in 2009.

“Best practice and competence, were missing in respect of this matter,” the report said of the 2001 episode. It said there was a “real need for improvements in the Claims Conference’s administration, management and governance, generally.”

The report was produced for the committee by Claims Conference ombudsman Shmuel Hollander. After receiving the report, two of the committee’s four members disavowed it and resigned, saying the report was seriously flawed and they could not stand by it.

“I believe that the report is inappropriately perforative, contains material factual errors, and does not take into account the substantial management improvements made subsequent to 2001,” committee member Abraham Biderman, the chairman of the Claims Conference’s personnel and management committee, wrote in a letter on Sunday to Berman. “In addition the affected parties were not given appropriate due process to react and respond to the factual statements contained therein. Please make sure that my name is not included among the committee members when the report is shared with the Board or released publicly.”

Committee member Roman Kent, the Claims Conference treasurer, also resigned, insisting that his name be excluded from the report.

The two remaining committee members — Reuven Merhav, chairman of the executive committee of the Claims Conference, and Robert Goot, chairman of the governance committee — stood by the report. The Forward, which broke the story, posted the report online on Monday.

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