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As Ruling Nears in Swiss Bank Case, Groups Demand a Piece of the Money

March 17, 2004
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A chunk of the remaining money in the $1.25 billion Holocaust-era Swiss banks settlement seems headed to the poorest of Holocaust survivors in the former Soviet Union.

That was the most likely scenario after the presiding judge in the case, Edward Korman of the U.S. District Court of Eastern New York, issued a scathing rebuke last week to an appeal by U.S. Holocaust survivors who want $200 million from the settlement to fund social services for the neediest among them.

In a blunt, 50-page memorandum, Korman denied the appeal by the Holocaust Survivors Foundation-USA as “vague” and “flawed.”

In contrast, he called “informative” a new survey that concludes that the poorest and neediest survivors are in the former Soviet Union.

“All individuals who survived the Holocaust bear scars, and all merit relief,” the judge wrote of his aims in administering the money. “Nevertheless, left with limited funds to distribute, I had to render a judgment as to whose need was the greatest.”

David Schaecter, president of the Florida-based Holocaust Survivors Foundation, which represents 50 grass-roots groups with some 20,000 members around the United States, said they were “devastated” by Korman’s remarks.

“The dignity of the survivors has been snatched away from them and the death rate among survivors is accelerating, and we get the back of the hand from this court,” he said.

Schaecter’s remark was the latest salvo in the six-year struggle over the Swiss banks settlement, a landmark 1998 deal under which survivors or the heirs of looted Swiss bank deposits were to receive $800 million in restitution out of a total settlement of $1.25 billion.

Korman ruled several years ago that the poorest Jewish Holocaust survivors should receive 75 percent of the money remaining after the account holders were paid.

That set off a global scramble among more than 80 groups from Israel to Peru, sparking a minefield of moral, legal and financial questions about Holocaust reparations.

Claimants included governments and individual Jews, homosexuals, Holocaust museums and researchers, Chasidic groups, and Gypsies, also known as Roma.

So far, about $145 million has been paid out to account holders or their heirs, according to the “special master” the court appointed for the case, Judah Gribetz. Some of the 21,000 people listed as account holders have not stepped forward, while the Swiss banks have been accused of withholding key account information that Korman said has slowed the restitution process.

In addition, a total of $582 million has been allocated so far to other victims, including slave laborers, refugees and poor survivors in the former Soviet bloc.

“Every penny of the $582 million that has been given out has gone to a human being,” Gribetz told JTA.

The Holocaust Survivors Foundation long has suggested that the remaining money be distributed globally “according to where the survivors live,” the group’s attorney, Samuel Dubbin said, adding that survivors in the United States were no less deserving than others.

Dubbin points to the National Jewish Population Survey 2000-01, which put the number of U.S. survivors at between 25,000 and 56,000, with between 18 percent and 32 percent living below the poverty line.

Yet the court has made the fund “into a pool for charity,” he said. “That’s just not legally permissible nor morally proper.”

In addition to surveys by the group Dubbin represents, two reports in the Swiss banks case attempt to identify and quantify the current living conditions — and even the war-era suffering — of Holocaust victims worldwide.

The Cohen Center for Modern Jewish Studies at Brandeis University conducted one study comparing the latest “hardship and need” among survivors in the former Soviet Union, Israel and the United States. The center’s director, Leonard Saxe, called it “an odious task, a problematic task, to make comparisons.”

Brandeis undertook the $50,000 study on behalf of the American Jewish Joint Distribution Committee, which helps care for some 225,000 elderly Jews and their families in the former Soviet Union, and which is among scores of parties vying for the available Swiss bank funds.

The report “was not designed to make the policy decision but simply to lay out the facts about the situation of victims in different countries and the resources they have available to them,” Saxe said.

Brandeis undertook the work with the proviso that the JDC “would not have a say in how it came out,” he added.

The Brandeis report surveyed four earlier studies of survivor demographics and living conditions, showing that of the survivors worldwide — estimates of their numbers range from 687,900 to 1.92 million — 39 percent to 47 percent live in Israel; 13 percent to 23 percent live in the former Soviet Union; 15 percent to 17 percent live in the United States; 17 percent to 21 percent live in Europe; and 2 percent to 5 percent live elsewhere.

The poorest are in the former Soviet Union, concentrated in Belarus, Moldova, Russia and Ukraine, living on as little as $18 a month in pensions and receiving limited health care, the report said.

Even the 19 percent of poor survivors in Israel and 36 percent in the United States receive more in pensions or social security aid and can access better and cheaper medical care, the report said.

Herbert Block, the JDC’s assistant executive vice president, said any money the organization received from the settlement would pay for food, home care and medicine for survivors in the former Soviet Union, but the agency has not requested a specific amount.

“It could be hundreds of millions, it could be next to nothing,” Block said.

Among others vying for the money were the Israeli government and the World Jewish Restitution Organization in Jerusalem, which commissioned a study on survivor needs by Hebrew University demographer Sergio DellaPergola.

The WJRO has urged Korman to allocate 55 percent of the remaining Swiss money directly to Holocaust victims, 25 percent for social services and 20 percent for Holocaust remembrance.

DellaPergola gave Israel’s minister of Diaspora affairs, Natan Sharansky, a report that categorized the survivors’ wartime suffering as “hardest” for those who were in concentration camps or ghettos or were slave laborers; “medium” for refugees or those whose lives were seriously disrupted; or “lower” for any Jews who suffered duress during the Holocaust, such as having their rights curtailed.

DellaPergola could not be reached for comment, but many familiar with the report said it ignited a firestorm of criticism and that the index of comparative suffering later was removed.

“It’s not clear you can develop an algorithm to make difficult moral and justice-based decisions,” Saxe said.

The battle over the money could erupt again in Korman’s court April 29 after representatives from the competing groups make a pitch for their funding proposals. After the hearing, Gribetz is due to make allocation recommendations to the judge, who has said it could take months until he makes a final decision.

The Holocaust Survivors Foundation’s Schaecter vowed the group will demonstrate at the courthouse.

“It is a shame we have to go to this extent to get our message heard,” he said.

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