Holocaust survivors say Israel kept their assets after WWII

JERUSALEM — During the past few years, Jewish organizations pressed Swiss banks to make good on dormant bank accounts that belonged to Holocaust victims. And Rachel Schreiber, an 86-year-old Israeli, started feeling uneasy.

As the battle heated up, the Polish-born Schreiber was filled with memories from 1935 — just two years before she married, moved to Palestine and left behind her parents and sister, who later perished in the Holocaust.

During a summer vacation from her dental studies in France, Schreiber returned home to Warsaw. While there, she had a conversation with her father, Henoch Nutkewicz, a wealthy real estate businessman, about his partner's success in getting a large sum of money out of Poland.

The money was not deposited in Switzerland, but in the Anglo-Palestine Bank, the precursor of Bank Leumi, Israel's second largest bank today.

"My father told me it was our money, too," says Schreiber. "Until the restitution issue came up, I never thought about it. It's one thing if Switzerland tries to avoid responsibility, but my money is here in Israel."

During the past few weeks, since the Knesset decided to launch a commission to investigate the issue of Holocaust-era assets in Israel, hundreds of Israelis have been coming forward with similar stories.

Schreiber's case was submitted in November in a lawsuit that prompted Bank Leumi to open its files on dormant accounts. Hers is just one of many cases that illustrate how Israel's record on restitution may be open to question.

Critics say Israel has waited too long to investigate what happened to financial and real estate assets that Holocaust victims deposited or purchased in pre-state Israel.

"It is a moral outrage that the state of Israel and Jewish organizations are campaigning against European companies, Swiss banks and foreign governments at a time when the state of Israel has not even bothered to look at the issue," says Gil Raveh, an Israeli lawyer who is Schreiber's grandson.

The issue was first raised in 1997 by Yossi Katz, a geography professor at Bar-Ilan University.

While conducting a study on the history of the Jewish National Fund, Katz discovered a document from 1947 in which the JNF asked Bank Leumi for information about financial assets it held that may have belonged to Holocaust victims.

Leumi responded that it could not provide information for reasons of banking secrecy.

"I nearly fell off my chair," says Katz. "I said to myself — this is exactly what happened with the Swiss banks."

In January, Bank Leumi posted 13,000 dormant accounts on its Internet site — www.bankleumi.co.il — dating from the bank's establishment in 1902 through 1955. The bank will accept queries on the accounts until July 31.

Bank Leumi denies that it ever tried to hide the fact that it had dormant accounts.

"There were all sorts of reports in the press accusing us of saying that we had no dormant accounts," says Riki Carmi, Bank Leumi's spokeswoman. "We always said that we do have dormant accounts and there may be some that date back to the Holocaust."

But Leumi — believed to hold the most Holocaust-era accounts of all Israeli banks — says it is not to blame. Many were confiscated by the British Mandate in Palestine, which seized all property belonging to citizens of enemy states during World War II.

In addition, the bank said, any accounts it did have were transferred to Israel's administrator general many years ago.

"This is why there is not much money in them," Carmi says. "We are talking about very low sums."

Meanwhile, since Katz first discovered the problem, he has delved into archives in Israel and Britain to produce a book, soon to be published in Hebrew, "Forgotten Property: What Became of the Assets in Israel of Holocaust Victims."

Katz estimates that Israeli banks and the government's administrator general, who manages abandoned property, may hold $64 million worth of financial assets belonging to Holocaust victims.

Furthermore, he believes that many parcels of land — perhaps worth even more than the financial assets — were purchased in pre-state Israel by European Jews who died in the Holocaust.

"The question now is how will the committee work," says Katz. "This committee must consult with experts from various fields. If it misses the point and remains a political forum, it will not be worth anything."

Colette Avital, a former consul general in New York and now the Knesset member heading the committee, insists its work will be serious.

Since announcing the formation of the committee in mid-February, she has received about 40 letters a day from heirs of victims who claim they have assets in Israel.

"Many of these people have been corresponding extensively with some of these institutions and have been given a runaround," she says.

Avital believes the issue has not been seriously addressed until now because survivor groups feared that launching a campaign in Israel would undermine efforts to secure a deal with Swiss banks and European companies.

"I think the contrary," she says. "We can come up with a clearer bill of conscience by saying that we are investigating."

Bobby Brown, adviser to Sallai Meridor, co-chairman of the World Jewish Restitution Organization, says that at least regarding heirless property there is a fundamental difference between the Israeli and Swiss banks.

Israel, he says, had to absorb hundreds of thousands of Holocaust survivors after World War II, so any use it made of heirless property is morally justified.

Nevertheless, Brown adds, when it comes to property that can be identified and claimed by heirs, Israeli institutions must live up to the same standards that Jewish groups expect from any government or country — namely that claimants must be compensated with a reasonable reassessment of the assets' value today.

"I think this committee is not going to find a lot of money, but it will find a few outrageous stories that must be addressed. If we have demanded justice in so many countries it should be done in Israel, too."