Bay Area Holocaust lawsuit targets Vatican Bank and CIA

In a fight to win restitution for people like 84-year-old Allan Herskovich of El Cerrito — a native of what was formerly Yugoslavia who lost his parents and other family members at Auschwitz — two lawyers are taking on a couple of formidable opponents, the CIA and the Vatican Bank.

Tom Easton and Jonathan Levy, who represent Herskovich and 27 other plaintiffs in a lawsuit filed last year, continued their push two weeks ago by asking a federal judge in San Francisco to get the Vatican Bank to divulge its ownership.

A hearing on the ownership question had been set for Oct. 31 in San Francisco, but the defendants requested leave to prepare over-length briefs of up to 40 pages, asking that the lawsuit be dismissed. Those briefs will be filed by Nov. 10. The plaintiffs have requested extra time to answer these over-length briefs and a hearing is not expected for several months, according to Easton, who is based in Bend, Ore.

In August, Easton and Levy, a Cincinnati attorney, filed a related lawsuit against the CIA and the U.S. Army to obtain access to some 250 papers they say will reveal important information about who wound up with assets that were stolen from Holocaust victims.

Easton and Levy contend that the Vatican Bank and other private banks profited illegally from the Holocaust by accepting and laundering valuables stolen by the Nazis and the Nazi-backed Ustashe regime, which went on a reign of terror in Yugoslavia.

The Vatican Bank and the Franciscan Order were named in the original lawsuit, which was filed in U.S. District Court in San Francisco in November 1999. In September, a federal judge ruled that the Swiss National Bank could be added to the lawsuit.

Plaintiffs' lawyers say restitution for thousands of Ustashe regime victims and their heirs could amount to "hundreds of millions of dollars."

All of the legal wrangling seems to be too much to digest for Herskovich, who still runs the electric shaver shop he opened in Richmond in 1957.

"All I know is that I've never gotten a nickel [in restitution] from anybody," said the man who went on to open 13 other shaver shops around the Bay Area.

In Zagreb, now Croatia, Herskovich's father owned a textile manufacturing business that his lawyers contend was valued at $1.5 million prewar U.S. dollars by Yugoslavia's communist government in 1948. However, most of the family's property was looted.

"I see people getting [restitution] from many different countries, but I've never gotten anything," Herskovich said. "I don't know one fellow who came from my country who has gotten anything."

Herskovich is one of several Bay Area residents and native Yugoslavs named in the class-action lawsuit.

The others are David and Zdenka Baum Ruchwarger Levy of San Mateo; Fred Zlatko Harris of Pleasant Hill; and a non-Jew from Berkeley, Desa Tomasevic Wakeman, a Serb who spent time in a concentration camp near Zagreb and lost family in the diabolic Jasenovac death camp.

Easton and Jonathan Levy contend that gold, silver and jewels plundered from Jews and others in Croatia and Bosnia — mainly Serbs and Roma/Sinti people (formerly referred to as Gypsies) — went from the hands of the Ustashe into the Vatican Bank and other financial institutions.

The lawyers' inquiries center on Father Krunoslav Draganovic, a Croatian Catholic priest who was a member of the Ustashe, a nationalist movement that ran the country under Nazi occupation.

Draganovic, who died in 1983, is believed to have stolen millions of dollars in loot. Soon after the war, he moved to Rome, established ties with the Vatican and its bank, and, while using a seminary as a front, ran the infamous "ratline," an escape route to South America for Nazi war criminals.

Draganovic was also in the pay of the CIA for several years, Levy contends. He and Easton are seeking CIA and Army documents that reveal new details of Draganovic's career.

Other documents, he said, will show that without the help of Britain and the United States, the Ustashe would have been destroyed. He contends that Western intelligence helped propel former Ustashe members into positions of influence in countries such as Argentina, Paraguay and Venezuela.

"The documents, even the ones we have now, are very troubling," Levy said recently. "What's been released looks like it's just the tip of the iceberg."

Levy said the CIA files have been withheld on the grounds of national security, to which he added, "It's just incomprehensible that there are any national security issues on records that are 40 or 50 years old."

He expects a settlement soon in which the CIA and Army hand over some, if not all, of the requested records.

The other part of Levy's fight right now is the lawsuit against the Vatican Bank.

In responding to the plaintiffs' motion for disclosure of ownership, the Vatican Bank said in court papers that the motion was "burdensome, premature and in the public domain," according to Levy.

"Who owns it is very important in the way the lawsuit proceeds," he added. "It's a very mysterious organization. In their legal papers, they quoted an Italian professor saying there are 30 sources that say what the ownership of the Vatican Bank is, but he didn't list a single one."

Levy said the owner might always be the current pope, in this case Pope John Paul II. "If that's the case, then we'd have to determine in what capacity the pope owns the bank," Levy said. "Or maybe their charter lists God as the owner."

In any case, the question of ownership will not be answered soon. The Vatican Bank's motion to dismiss, on six different counts, will likely put that request on the bank burner. A hearing on the motion to dismiss will then be scheduled several months down the line.

Andy Altman-Ohr

Andy Altman-Ohr was J.’s managing editor and Hardly Strictly Bagels columnist until he retired in 2016 to travel and live abroad. He and his wife have a home base in Mexico, where he continues his dalliance with Jewish journalism.