$16-Million Holocaust Fund Embezzled

A leader of West Germany’s Jewish community who died last year embezzled nearly $16 million in government funds intended for Holocaust survivors, according to a report released today.

The report, prepared by federal and Jewish officials, added that attempts to get the money back have been unsuccessful.

After the January, 1988, death of Werner Nachmann, the 62-year-old chairman of the Central Council of Jews in Germany, investigators found that he had run a massive embezzlement scheme involving reparations paid by the West German government.

It is the largest scandal to hit West Germany’s Jewish community and led to calls for greater supervision of governmental funds intended as reparations for Jewish survivors of the Nazi terror.

Investigators found that Nachmann, as the supervisor of the bank accounts where the money was kept, had been routinely skimming off the interest for his own use.

The council has sued a bank, which the report did not identify, to try to get the money back. Other attempts to recover it have been unsuccessful, according to the report.

Most of the money went into a failing textile business and other firms Nachmann ran, and at one point the council threatened to bring charges against his family and co-workers to get it back.

Today’s final report said, however, that there were no grounds for criminal charges against any other people. Most of the embezzlement took place between 1981 and 1987, and the scandal led to the resignation of the council’s general secretary in July, 1988.

“The embezzlement is based on the one side on Nachmann’s criminal actions and on the other on a lack of oversight,” said the report released by Interior Minister Wolfgang Schaeuble and current Jewish Community chief Heinz Galinski.

Galinski said in July, 1988, the affair had inflicted “the worst damage” on the West German Jewish community, which numbers about 36,000 people. About 530,000 Jews lived in Germany when the Nazis took power in 1933.

Galinski also has said the federal government in Bonn should have played a more active role in supervising the fund, which totaled $210 million.

Overall, West Germany has paid more than $43 billion in various forms of reparations to survivors of the Holocaust and their families.