Millions of dollars meant to help survivors of the Jewish Holocaust instead were stolen and fraudulently given to thousands of people who were not eligible for the funds, Justice Department officials said.
The FBI said insiders who were responsible for verifying requests to the Conference On Jewish Material Claims instead helped commit a massive fraud. Investigators said in exchange for kickbacks, the employees signed off on bogus applications submitted in part by Russian immigrants who falsely claimed they had lost their homes and belongings during the Nazi era. Seventeen people have been charged in the outrageous swindle.
“The alleged fraud is as substantial as it is galling,” U.S. Attorney Preet Bharara said.
Officials said Semen Domnitser was one of the alleged ringleaders who signed off on fraudulent applications from more than 4,000 people. In all, more than $40 million in funds provided by the German government meant for survivors was stolen or is unaccounted for, prosecutors said. Investigators said the Claims Conference first uncovered some of the alleged fraud and alerted the FBI to the ongoing scheme.
One of the funds allegedly ripped off was the “Hardship Fund” which pays approximately $3600 in a lump sum to individuals from the former Soviet Union and other Eastern European countries who can show they lost their homes and were in hiding during World War II. Other victims can claim payments up to $21,000 annually if they can show they lived under harsh conditions during the Nazi-era.