State comptroller to comb unclaimed assets here, push other states to do the same.
Fourteen years after the comptrollers of New York State and New York City helped to win a settlement with Swiss banks over unresolved Holocaust-era claims, New York State Comptroller Thomas DiNapoli is offering to help survivors recover more of their money.
He reached out recently to the Israeli Holocaust-era restitution task force Project HEART and offered to match the state’s database of more than 28 million unclaimed accounts against Project HEART’s database of 150,000 survivors and heirs who claim to have lost property in the Holocaust through confiscation, looting and forcible sale.
“Years ago an attempt had been made to find matches, but now with all the sophisticated technology we have it is the time to take another look out of respect for aging survivors and their heirs in New York,” DiNapoli told The Jewish Week.
He said the state is holding nearly $12 billion in unclaimed funds that come from a variety of sources. About 40 percent of the money is from dormant bank accounts, 10 percent from checks from insurance companies that were never cashed and life insurance policies whose beneficiaries were never paid, 16 percent from unpaid corporate checks, and 5 percent from un-cashed checks from brokers and dealers, DiNapoli said.
He added that he plans to “reach out to other comptrollers in other states” to get them to similarly crosscheck their unclaimed accounts with that of Project HEART’s.
In July 1998, New York led a group of more than 800 city and state financial officers nationwide in threatening phased sanctions beginning Sept. 1 against Swiss banks unless they resolved claims that they were hoarding the accounts of Nazi victims killed in the Holocaust. Intense negotiations were then launched that led to a $1.25 billion settlement.
DiNapoli was asked also about working with the state’s Department of Financial Services, which regulates insurance companies, to resolve claims that not all Holocaust-era insurance policies have been paid.
“We are just starting this effort [with Project Heart],” he replied. “They will share their ideas with us and we look forward to a real partnership.”
Bobby Brown, director of Project HEART, said by phone from Jerusalem that in his talks with DiNapoli he plans to raise the issue of outstanding insurance policies.
“We want to discuss that issue and see what the scope and possibilities are — what powers the comptroller and other governmental bodies have to try to reach an agreement that would do justice to those who have outstanding [insurance] claims,” he said.
Brown noted that an effort to resolve those claims between 1998 and 2007 by the International Commission on Holocaust Era Insurance Claims (ICHIEC) failed because it resolved only 14,000 claims and didn’t have the cooperation of all insurance companies.
“There should be no statute of limitations on stolen property,” Brown said.
Leo Rechter, president of the National Association of Jewish Holocaust Survivors (NAHOS), welcomed DiNapoli’s offer and said he hoped that survivors who need it most could recover some of New York’s unclaimed funds.
“A lot of survivors are suffering and cannot pay their rent or for hearing aids or eyeglasses,” he said.
Brown said that prior to the Holocaust, Jews hoping to flee Poland “might have opened a bank account in New York or bought a life insurance policy in New York. … There could be any one of a thousand things that could have caused Jews in Europe to open bank accounts in New York, as we know they did in Zurich and Tel Aviv.”
“We have had submitted to us over 150,000 [claim] forms from survivors and their heirs, and we are getting about 1,000 more every week,” he added. “These are people whose family lost property under the anti-Jewish legislation of the pro-Nazi governments in Nazi-occupied Europe and who never received compensation.
“It’s been very difficult with all of the efforts on restitution focused on community property to deal with individual claims. We decided that in the survivors’ waning years — while we still have the privilege of survivors — that we have to do everything we can to put forth their claims. They are entitled now to compensation for their property.”
Brown said that in running his database of claimants against New York State’s, care has to be taken to ensure privacy because his list belongs to the government of Israel. And he said the technical side still has to be worked out.
“I hope we can start by the end of the year,” he said.
Rechter said also that he hopes DiNapoli could work with the Department of Financial Services to resolve outstanding insurance claims. He noted that he co-wrote a letter to that department and Gov. Andrew Cuomo last December to point out that ICHIEC recovered “less than 3 percent of more than 550,000 outstanding policies sold to Holocaust victims, leaving over $20 billion unpaid (in today’s value).”
Rechter then asked that the department expand its new regulation regarding insurance companies to cover three European insurance companies doing business here: Generali, Allianz and AXA. The new regulation requires all insurance companies that do business in the state to use databases to identify all of their deceased life insurance policyholders and then make a concerted effort to find and pay their beneficiaries.
Failure to issue such a directive, Rechter wrote, would result in a “double standard” that would mean the “state’s efforts to secure payment of Holocaust victims’ and survivors’ policies is far less rigorous” than that pursued for all other beneficiaries.
Rechter said that after receiving no reply to his letters, he filed a Freedom of Information Law request July 20 requesting that Cuomo and the department provide him with all correspondents and documents relating to the issue he had raised.
“We ask that this request be expedited and the records produced immediately,” he wrote. “Most Holocaust survivors are in our 80s and 90s and time is of the essence.”
Rechter, who said he still believes Holocaust survivors and their heirs deserve the right to sue insurance companies if these and other efforts fail, said the state promised a reply within 20 days.
Meanwhile, Assemblyman Joseph Morelle, chair of the Assembly Committee on Insurance, said a bill that would make law the Department of Financial Services’ regulation requiring insurance companies to “affirmatively seek out and find beneficiaries of policies they had written” passed the State Legislature overwhelmingly and is now awaiting Cuomo’s signature. He said it covers only policies kept electronically.
Morelle said that once some “technical issues” the governor’s office raised are resolved so that Cuomo can sign the legislation into law, he plans to work on new legislation that would cover insurance companies’ paper records in order to encompass Holocaust-era policies. But he said some legal questions needed to be resolved first.
“How do we extend this to Holocaust victims and others who have claims?” he asked. “We have to work out a system using fairly old records. We have already spoken with experts in the insurance world and others familiar with the reparations paid by the banks.”
“The reason we are interested in this is because this is still fresh enough and we want to help survivors,” Morelle added. “We just have to make sure it is done properly and yet we want to do this as quickly as we can. We are trying to understand international agreements to make sure we are not bound by them. What I am pleased with is that we have established an affirmation that requires insurance companies to look back. Now have to take the next step to go back to the ‘30s. … We’re going to go the extra mile.”
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