Claims Conference Fraud Now $50 Million
ShareTuesday, June 7, 2011
Stewart Ain Staff Writer
The amount of fraudulent Holocaust claims uncovered by the Claims Conference has grown from $42.5 million in November to nearly $50 million, and the organization said the full extent of the fraud is not yet known.
The crime, which was first discovered by the Claims Conference in late 2009, has so far resulted in the arrest of 17 people, including six insiders. The office of Manhattan U.S. Attorney Preet Bharara said in November that the investigation was continuing.
The fraud began when the German government began paying monthly pensions to survivors in 1994. Initially, the fraud was said to total $24.5 million. But a continuing review of hundreds of pension claims has increased that figure to $35 million.
In addition, a continuing review of claims submitted for one-time $3,600 Hardship Fund payments has found the fraud there totals $14.3 million; the initial figure had been $18 million. That brings the total amount of the fraud to date to $49.3 million.
The 17 people arrested were all said to be part of a scheme that in part preyed on unsuspecting Russian Jewish immigrants in Brooklyn, many of whom are elderly. The group placed ads in local papers to lure them and then promised money if they would provide them with copies of their identification documents.
Once the fraudulent papers were created, it is alleged that the three Claims Conference employees made sure the claims were approved.
A spokesman for the Claims Conference said the “bulk” of the suspected fraudulent cases have now been reviewed and that although others will still be checked over “many more months,” fewer are expected to be fraudulent.
“Our theory is that many of the individuals who were receiving pension checks were not even aware of what was submitted on their behalf,” the spokesman said. “We believe that when we send them the material that was submitted in their behalf, they will realize they were not entitled to the pension and admit it.”
Of the 875 people found to have submitted fraudulent pension claims, 62 have agreed to return $2.2 million and 427 others are appealing. A judge is expected to begin hearing those appeals in the next few weeks.