New formula could cut payments to Holocaust survivors, heirs
By Amiram Barkat, Haaretz Correspondent

In a decision that might cut payments to Holocaust survivors, a panel of experts has determined that the estimated value of bank accounts in Israel of victims of the Holocaust has been revised to only about NIS 400 million, rather than nearly NIS 1 billion.

The figures have been submitted to Justice Minister Daniel Friedmann and are to be released Monday morning.

The panel of experts was established in June of last year by then justice minister Haim Ramon, in accordance with the law passed in early 2006 mandating the restitution of the properties of Holocaust victims. For decades, the state has been holding on to money that was deposited in Israeli bank accounts by European Jews who later died in the Holocaust. Under the new law, the state is supposed to transfer these funds to a government company tasked with locating and restoring property belonging Holocaust victims.

The mandate of the panel of experts was to determine how the real value of the bank deposits should be calculated as well as the manner in which the payments should be divided between the state and the banks, which were required to pay for the years the money lay in the dormant accounts.

Two years ago, the Knesset Inquiry Committee on the Location and Restitution of the Assets (in Israel) of Holocaust Victims estimated the real value of the same accounts at about NIS 1 billion, one-third of which is the banks’ responsibility. Although the panel of experts was supposed to be independent, one of its members, Prof. Yair Orgler, was appointed to the board of directors of Bank Hapoalim while the committee was still carrying out its mandate. Orgler denies any conflict of interest between his activity on the committee and on the board.

The new estimate of the real value of the deposits is based on a formula chosen by the panel of experts. Had the committee adopted the formula proposed by committee member Yehuda Barlev, an accountant, the estimated value of the dormant accounts would have reached the NIS 1 billion mark.

The committee’s decision to adopt the formula it chose theoretically saved the state and the banks hundreds of millions of shekels in payments to heirs of the original account-holders, needy Holocaust survivors and Holocaust memorial institutions. Committee Chairman Prof. Yakir Plessner told Haaretz that the formula was chosen with professional considerations only in mind, and denied that any vested interests affected the decision.

An examination by Haaretz raised several questions with regard to the committee’s conduct. In addition to Orgler’s appointment to Hapoalim’s board, it turns out that Plessner was giving confidential protocols from the panel’s sessions to attorney Ram Caspi, who represents Bank Leumi, without the knowledge of the other panel members. Plessner said Monday that he did so because he believed in good faith that the forum’s sessions came under the Freedom of Information Law. In another questionable move, Plessner appointed an aide to the director general of the Finance Ministry to the sensitive position of committee secretary, in violation of laws regulating conflict of interest.

According to a statement released Monday by the government company, “This is additional proof that the State of Israel is violating the rights of Holocaust victims and the families of the victims.”

In December, it was reported in the news media that Orgler would be appointed to the board of Bank Hapoalim. Yesterday, however, Orgler claimed he saw no conflict of interest and said that the committee made its most recent important decisions in December, one month before he formally joined the bank’s directorate.