The Jewish Week is always here for you.
We need your support now.
Your contribution will help us bring you vital news
and frequent updates about the impact of COVID-19.
Anteing Up For Survivors

Anteing Up For Survivors

The chairman of a committee of Israeli banks insisted last week at a press conference here that the banks never hoarded the deposits of Holocaust victims, but said they were willing to pay more to the heirs of survivors who were found to be shortchanged by the system when their money was returned.

“We acted in good faith and did everything required,” said the official, Eitan Raff, who is also chairman of the Leumi Group, on Feb. 3. “For us it is not an issue of money. It’s one of normative behavior and conscience.”

Raff said Israeli banks behaved nothing like their counterparts in Switzerland that refused to return money to the heirs of Jewish Nazi victims who had opened accounts before World War II. The Swiss banks settled suits against them by heirs for $1.25 billion.

Yona Fogel, first executive vice president of Bank Leumi Le-Israel, said 2,500 Jews living in “enemy countries” who had deposited money in what later became Israeli banks had those funds seized by the British at the outbreak of the war.

When the State of Israel was established in 1948, the British transferred those deposits to Israel’s General Custodian of Abandoned Property.

Zvi Barak, chairman of the Knesset committee that investigated the behavior of Israeli banks, told the press conference that Israeli banks held another 1,000 accounts of Jewish Holocaust victims who either had not lived in enemy territory or whose residency was uncertain. The British ordered the latter accounts frozen during the war.In the years after the war, Barak said the heirs of more than half of the 3,500 Jewish Holocaust victims were able to get the money back. But he said the British had imposed fees on each account they held, as did the banks when returning the money. Consequently, about 20 percent of the money in the accounts was not returned.

Barak said his committee, which was chaired by Colette Avital, recommended that the banks make good for the fees imposed and suggested that the accounts receive a 3 percent interest each year.

Raff said Bank Leumi believed the interest rate should have been half of that but agreed to pay 3 percent, which works out to an additional 35 million shekels (about $8 million) — 24 million shekels to be paid by the State of Israel and 10 million shekels by the banks (9 million shekels by Bank Leumi alone).

Avital said her committee recommended an interest rate of 4 percent per year starting at the outbreak of World War II on Sept. 1, 1939.

“The banks refused that, saying Israel didn’t become an independent country until 1948 and so it should be calculated from then,” she said in an interview in her Knesset office.

Avital said she would like to see this money placed in a central account. Any money that went unclaimed would then be considered heirless and be used for the “welfare of survivors.”

But Barak said he is against putting the money in a central account, believing it would create an incentive not to find heirs in order to increase the amount given to organizations that would work for the benefits of survivors.

Raff said that for the banks to pay 3 percent interest to the heirs of survivors, they would need the Knesset to adopt special legislation. Without it, he said, the banks could be sued by other depositors for giving preferential rates to one group of depositors.

read more: