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tv   Hearing on Holocaust- Era Insurance Claims  CSPAN  September 21, 2019 6:44am-8:01am EDT

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>> today's hearing is going to be holocaust era insurance claims. what to do that went out. difficult topic in many ways but i am glad we are having that hearing. senator feinstein, i really i want to opening statement, i will defer to you. >> percival thank you mr. chairman. for holding this hearing. today we are discussing holocaust era insurance claims. it's interesting before and during the second world war, many europeans purchased insurance policies to protect their assets and loved ones. while many of these individuals perished as victims of the
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holocaust, those who survived and the heirs of those who did not have sent attempted to collect the proceeds from those policies. however, beneficiaries have found it difficult to collect on these policies. because the paperwork had often been left behind or destroyed during the genocide. to remedy this and justice, american insurance regulators, european insurance companies, the state of israel, and jewish and survivor organizations in 1998, established by check. it is ich eic. the international commission on holocaust era insurance claims. the mandate very interesting was twofold. first i checked and identified holocaust victims. who purchase the insurance policies and second, i checked
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would administer the repayment of those payments using relaxed standards of proof. so the claimants who lacked documentation or face other barriers to repayment could still receive some measure of justice. i checked actually facilitated the payment of over $300 million to almost 48000 holocaust survivors. there heirs and the families of holocaust victims i checked paid an additional 1,609,000,000 towards humanitarian programs benefiting holocaust survivors. all of this was done at no cost to the claimants. to maximize the amount of compensation that went to survivors and eras of victims. the i checked process here is the rub ended in 2007 and since
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then, some european insurance have continued to play claims voluntarily and the new york state insurance department has helped process the claims of individuals who missed icheic deadline the state department on president clinton mr. chairman, bush and obama, argued in court that i check was the exclusive process for resolving your coast era insurance claims several jewish and survivors groups including the american gathering of jewish holocaust survivors and the international also supported icheic and the ongoing new york state process as the best way to resolve those claims. the question before us today, is both of the icheic process and
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the ability to submit newly discovered claims to the new york state department of financial services works. some of the witnesses on our panel, argue that new legislation is necessary. so i very much thank you for calling this hearing. i think it's a very interesting issue and need to be interesting what happens. so thank you. >> i am glad i defer to you, that made perfect sense. thank you very much. senator scott, we will to the community and i look forward to hearing from you. >> good morning and thank you for holding this important hearing today. let's we will david normal son, the president of the holocaust survivors in florida. when he was born in czechoslovakia in 1920 and was sent to auschwitz in 1924. dave and i'm grateful you could join us here today to testify on this important topic. so we can make sure there holocaust survivors like yourselves, receive the help you need absolutely deserve.
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pq also to the entire panel of witnesses who appear today and for all of those who work to make sure we honor the memory of millions of holocaust victims and that we do everything in our power to support of survivors and their families. folic acid is more than history lesson. it is the stark reminder that evil and hate exists in this world. as governor of florida, when he took a stand against discrimination and prohibited state agencies and local governments from contacting the company his boycotting israel. because israel should never be a partisan issue. as us senator i will continue to support israel and take action against those who should do those on. i memory of all of those who suffered was never we can. every generation must heed the call to action in face of evil. this is the holocaust enduring lesson have been kind. thank you for the opportunity to be here. >> thank you very much senator scott. you have come to me several times about the importance of the hearing and i'm glad we are able to get a schedule and appreciate your passion. the harvard feelies.
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>> come forward please. >> back ground noises. [background sounds] great. so thank you all for coming and we have on our panel today, mr. barrett weevil, congressional research. to get that right. loophole. they will. congressional research service.
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you say your name sir. testing. normal scene. okay thank you. holocaust survivors of miami florida. director newly your state financial. mr. stewart, former us investor as special advisor and holocaust issues that the us department. and will start with here. >> mr. chairman. thank you for having me here today. my name is baron, i'm a specialist in financial services at the congressional research service. just for members of the audience who might not be familiar with the irs, we are division of the library of congress. our role is to provide objective, nonpartisan research
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and analysis to congress and it takes no position on the desirability of any specific policy or advocate for policy outcome. i have provided some written testimony with increased detail about the issues that we are talking about today and i'd also like to recognize my co-author paul from crs who contributed greatly to the written testimony. my specialty is crs is interested in so i am going to talk start off talking a little bit about pre-world war ii insurance markets and get into the efforts to my comps compensation after the fact. and finish in talking about policy evaluations that are at significant issue today. so pre-world war ii and central and eastern europe interest at that time was not only designed to compensate in the inventive but death of a loved one that had significant asset allocation accumulation properties. policies typically ran for 20 years. at the end of the policy of the
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person were still alive, they would receive the value at the time. they could have surrender value before hand. so these were very significant assets of the jewish population and further populations in the area. there is specific policy by the nazi government to attempt to expropriate these and other assets through the prewar and worktime. post-world war ii, there were aphids particularly in west germany at the time to provide compensation and restitution from people who had suffered after people would have these assets taken from them. these efforts though for many people feel short. and this is especially the case in the eastern part of europe. it was on soviet domination where companies at the nationalized and in some cases private insurance were in most cases didn't exist following the communist takeover. and so, generally recognized that for that part of europe, there was little to no compensation. in the 1980s, the issues came
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before again on both insurance and in areas like slave labor with bank accounts room a variety of international efforts to address this with icheic being the mode that was chosen in the insurance realm. now icheic was very much at individual actualized claims driven process. they attempted to identify potential claimants to seek out claims to adjudicate claims with the reduced standard. and to get resources to pay off those claims or provided primarily from various european companies. the contrasting approach, which has been significant source of the criticism that is, by check, could be seen as sort of a macro top-down approach. to consider how much insurance and assets might've been outstanding, in central and eastern europe at the time it
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into judge both of or not the icheic process has done a good job in writing and paying off some value of this. as feinstein mentioned, about $300 million have paid in claims by icheic, another hundred 169 million other compensation and this of course our values from the early part of the two thousands, if if you just sent to the present day, you get a full but higher depending on what rates you use. estimates for the president value of unpaid holocaust insurance claims and your range from approximately 2 billion to about $25 billion in current day values. as an economist, i would say that there are a variety of economic tools that you can use to find in these numbers. but significantly, as you drill down to have the numbers developed, you very quickly come to very normative judgments of with the proper and what to use
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and what accounts have been paid or unpaid claim in the light. so i can go into greater detail in terms of how some of these numbers are developed if members of the committee are interested. but i think what i probably leave on is simply that significant judgment in this in normative judgment and how you do this that the economic tools really only get you so far in determining what the right answer is. and so with that, i will finish my testimony. i look forward to any questions you might have. >> mr. normal scene,. >> my name is david. i was born in czechoslovakia in 1928. my father, was self employed business. selling beer and wine and liquor and cigarettes.
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the business was part of by the house. in 1944, we were all deported to the ghetto. and then to ostrich and with no windows but they put into buckets. one was for a bathroom and was for was for drinking. my parents and my four brothers, my sister, grandfather, and i am the only member of my family to survive. because my time is limited here, i give you my deposition about the hungarian goal train, the case to tell you how i survived. believe me, i was lucky. now let's talk about the insurance.
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i remember that was on our house, the said it wasn't insurance by generality. the course we have no documents for obvious reasons. when we came home, there was nothing left in the house. in 98, we worked out insurance commission the lesson, for a state law to make the companies publish all of the names and allow survivors to go to court. they wouldn't cello. that was when the companies came up with the idea of icheic. because treasure from the states. everyone everyone told us icheck was not binding unless you agree to a settlement, so with all
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ndose promises i applied. they say they could not find my father's name. they send me a check for $1,000 as humanitarian payment. survivors resent the idea of humanitarian payments instead of the actual fund we now are paid instead ofar citing case of trouble. survivors are also in shock that the u.s. government took away our right to go to an american court. remember, those are contracts, not charity. how would those state and justice department people and those judges feel this they would lose everything, and then their own government said they could not even go to an american court? and then their own government said they couldn't even go to
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court. like every other american citizen, they wouldn't stand for it, and we won't either. i'm here to ask you to change that. sadly, you might here from some jewish groups that are against congress passing the law, but they are not -- i repeat, they are not holocaust survivor groups and do not represent survivors in any way. i have more bad news, half of the holocaust survivors live in poverty and cannot afford basic necessities of life. even though germany gives more money every year, it is still not nearly enough. it does not matter that our insurance rights were taken away.ig most survivors are poor and suffering anyway. besides we havesi in writing frm
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the german ambassador that they would never threaten to withhold funds for survivors. needs because of laws for insurance. but thousands of survivors suffered and died in misery over these past 15 years, and it was so unnecessary. $25 billion is what the companies owe. we believe of all politics should be honored -- policies should be honored in full value, and the rest should be used to help survivors in need. without action by congress, insurance companies will be the heirs of the victims of the holocaust. this unacceptable. i am 90 years old, about to turn 91. for the past 30 years, i have visited hundreds of classrooms not only in florida speaking to
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students and adults about my experience. i do this not because i enjoy e telling the stories about. they are mostly very sad. i do this because i believe that all people have an obligation to becomeat educated about the holocaust, to remember and to emmake a personal commitment tht they will do everything they can to never let such atrocities happen again. notch to the jewish people and t to anyone else. and now i'm ending with i will be more than willing to stay after this hearing and talk to anybody that would like to ask or talk about all these stories that i told you. thank you very much. >> thank you, sir. thank you very, very much.
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mr. dubbin. >> thank you, mr. chairman. my name's -- my name is sam dubbin, counsel to the holocaust survivors foundation usa. on behalf of the survivor community, we thank you for holding the hearing for the members, for coming here. this morning i am saddened to reportni that alex, one of the group's founding members, passed away over the weekend. alex was a remarkable man, a survivor of buchenwald who rebuilt his wife of to win -- his life to win ten emmys and in his retirement, countless hours educating school children and advocating for survivors. legislation is necessary to restore survivors' rights against global insurers who failed to honor policies they sold to holocaust victims. the supreme court in garamendi in the second circuit held that survivors' rights were preempted based upon an executive branch,
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quote, policy that holocaust survivors -- alone among all americans -- should be limited in their ability to recover from insurance policies. the basis of the policy was state department c press releass and congressional testimony. no treaty, no act of congress, no executive order with any preemptive effect. as the dissenters in garamendi said, this is wrong under the supremacy clause. only congress can exclude from all of this and now restore survivors' rights. the opponents make three major arguments. first, legal peace. they say the insurers were promised legal peace if they participated in icheck. this is not true. icheck itself was always understood to be voluntary unless the claimant accepted a payment, and thehe minutes show that. number two, the executive agreement with germany specifically f negates that argument, it states the united states does not suggest that its
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policy interests concerning the foundation in themselves provided independent basis for dismissal of claims. and number three, the clinton administration -- senator feinstein, i would like to make sure you hear what i'm going to say, because the clinton administration who negotiated that, when they went to court, they said expressly the agreement does b not preclude individuals from filing suit on their insurance policies in court, does not man that individual policyholders or beneficiaries bring their claim in icheck, and the clinton administration said that the united states has not undertaken a duty to achieve legal fees for german insurance companies against state litigation and regulations. the second major argument to opponents make is that legislation would undermine negotiations with germ and others for assistance to survivors. no one has ever explained specifically why they should be able to retain billions of
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dollars of holocaust profits they owe to jewish customers from contracts to induce germany, of all countries, to provide assistance for holocaust providers. the logic there and the morality is completely inverted. in addition, germany's ambassador explicitly rejected any such linkage in 2008. rhe wrote, quote: while we continue to oppose 1746 and any similar bills, germany has never threatened to respond by cutting benefits for survivors, and we have no intention to do so in the future. and whatever benefits the opponents claim to have created by destroying survivors' insurance rights, the big picture is awful. it is not disputed that half of all holocaust survivors live at or near poverty. after a decade of incremental home care increases, members of the senate select committee on aging made the statement that evidence before them proved, quote, that levels of home care funding by the claims conference
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would need only 25% of the -- meet only 25% of the current needs of impoverished survivors. that was in 2014 after a decade of doubling from germany all the time. and to make matters worse, emergency care services has not -- funding for that has not increased at all. one of the exhibits we gave you, and it's in the package that i sent around, is a chart that reasures what would be the need for an average survivor, 15 hours, 20 hours a week at $15 and what germany actually provided. the red represents the amount of unprovided care for destitute survivors,ed and it's in the billions every year for the past 15 years. so the regime of giving the insurance companies immunity in order to supposedly e provide all these benefits has resulted in tens of thousands of survivors suffering and dying without the care they need. finally, letan me just say thats far as the new york claims processing office is concerned, this is the exact same argument that was madeff in 2008 when the opponent9am defeated legislation
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sponsored by tom lantos, the only survivor to ever serve in congress. in the 40 years after that, the new york claims office settled six claims for $70,000. and they've never published any other information since then. the problem is, of course, that icheck itself was not an appropriate mechanism because it was flawed in many, many, many ways, and i hope you ask is me question about that because i see my time is running out. there's a lot of specifics you need to understand. and initiation i would submit that -- we provided a letter from harry rose, a child of two german survivors, who found the names on theo ichecklist of german companies, went to the holocaust processing office of new york, and the results are something that you need to see because it's not pretty. the bottom line is that holocaust survivors should not be second class citizen under u.s.e law, the company should nt be immune from having to pay the money they owe. and whether it's $2 billion or 25 billion -- which i believe is
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the correct number -- that money belongings to the victims, the families and the rest t can go o survivors in need, that would be a great thing for this congress to accomplish. oh, i'm sorry, can i add one thing? there are some jewish groups who have opposed the legislation. i'm authorized to announce that the anti-defamation league and the jewish federations of north america have said that they are no longer going to oppose this legislation. and that major groups including the simon rosenthal center, the 1939 society of los angeles, the usc -- [inaudible] foundation, the zionist organization of america and steven a. coazen have all submitted letters. it was chairman grassley last year, but they maintain support for what the survivors are trying to achieve. >> good morning, chairman graham, ranking member feinstein and members of the committee. thank you for the opportunity to appear before you today and
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share -- >> [inaudible] >> is that better? thank you for the opportunity to appear before you today and share my knowledge on the important issueni of holocaust-a insurance claims. as director of the holocaust claims processing office, the unit of the new york state department of financial services, i am pleased to be able to provide insight into our service. for 22 years the state of new york has been at the forefront of insuring a just resolution of unresolved claims for assets lost to nazi persecution, and in june 1997 -- [inaudible] claimants pay no fees for the hpo services, nor does the office take a percentage of the value of the assets recovered. our goal is to advocate for claimants by helping to alleviate any costs and bure accuratic hardships they might encounter in trying to pursue claims on their own.
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the office has insisted over 2400 individuals from 46 states, the district of columbia and 26 countries inic making claims for insurance policies. if to date, the combined total of offers extendedded to hcpo claimants amounted to more than $178 million; $34 million of which is compensation for insurance policies. in response to the complex nature of restitution claims, theon hcpo employs a four-step method. first, undertakes general historical research to corroborate and contextualize information specifically regarding the insurance industry in prewar europe, the results of which show that germany also had the most comprehensive postwar compensation program. in contrast poland, the country with the largest number of victims, played a relatively minor role in the industry. realistic expectations of what policy-specific information can be found in both archives and
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company records must take this backdrop into account. since 1998 hundreds of thousands of potential policyholder names from both company records and public archives have been published online. the office uses this information in conjunction with research and domestic and international public and private archives to obtain documentary evidence. this is proving critical to resolving claims. second, the hcpo determines where to file a claim, meaning what present-day company or process responsible for the policy in question. for claims for policies issued by companies still in existence, finding the appropriate successor is relatively straightforward. but for others determining the more complex. indeed, in many cases there is no present day successor. third, relying on relaxed standards of proof, claims are submitted to all available venues. under these commonly-accepted evidentiary standards which are not as stringent as those generallyy imposed by courts, a
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claim cannot be rejected on the grounds that the claimant lacks complete documentary evidence. the hcpo transferred thousands of claims to a variety of processes. in march 2007 with the closing of icheck, its member companies as well as members of the german insurance association reiterated their commitment to continue to review and process claims under icheck'sco relaxed standards of proof. inin addition, companies generay continue to apply icheck valuation standards although they are no longer obligated to do so since the closing of icheck. the hcpo continues to deal directly with insurance companies to successfully resolve outstanding claims. the fourth w and final step in e hcpo process involves evaluating decisions to insure that they adhere to d agreed-upon processg guidelines. like the missing we property we search for, no two claims are alike. a task greatly helped by
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increased archival and library cooperation and the companies' ccontinued willingness to reviw claims. the process of restitution can be difficult and distressing. however, the hcpo has successfully brought close crur toe victims and their heirs. the hcpo's approach shows that it is possible to obtain compensation for assets lost during the holocaust era through open and mutual cooperation and at no cost to claimants. in closing, permit me to suggest that as we strive to achieve our common goal to settle claims for holocaust-era looted assets as sensitively and as quickly as possible, it behooves us all to manage claimants' expectations and not raise an exaggerated sense of what might be accomplished through litigation. thank you again for the opportunity to discuss the hcpo. i would be happy to address any questions you may have. >> chairman graham, ranking member feinstein and members obviously committee -- of the committee, thank you for holding
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the hearing and for your continued interest in the welfare of survivors. i'm testifying in my personal capacity today and would ask that my full statement be made part of the record. providing justice f for holocaut survivors and families of victims and preserving the memory and lessons of the holocaust for o succeeding generations has been a central part of my life through four u.s. administrations and beyond in my voluntary negotiations for the jewish claim process. i've played a central role in the creation of the u.s. holocaust museum during the carter administration. in the clinton administration, i negotiated $8 billion of recoveries for swiss is and french bank accounts, slave-enforced laborers at german and austrian companies, restitution of nazi-looted art. i negotiated with over 40 countries the return of communal and real property, the payment insurance policies and most
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recentlye the deportation of jes on the french railway. in my work since with the claims conference, we've increased monthly pensions worldwide. when i started in 2009, there were 34 million euros. this coming year 500 million euros. we've now provided 24/7 home care coverage which didn't exist before. we've covered a new program for child survivors. we've dramatically increased pensions. none of this is enough, but it is dramatic. my penchant for holocaust justice and memory and my experience in negotiating in four administrations major international agreements leads me to say to you respectfully that any legislation similar to what was considered last year which would provide a cause of action against european insurance companies and u.s. courts for holocaust-era
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policies would have potentially catastrophic negativey effects. first, in unprecedented ways it would undermine legally-binding international executive agreements goingng back almost 0 years with german and austrian governments and with private companies.wi en indeed, with the german companies there were a thousand german companies who participated in the payment of 10 billion euros, $5 billion. these have been in place, again, for almost 20 years. inin return for these large payments from both germany and some $800 million from austria, the companies were given what we called legal peace. eethese agreements were reached with some of the toughest, most renowned class action lawyers all over the country who agreed to dismiss their suits in return
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for the payment of 10 billion deutsche marks, $5 billion in settlements and with$5 holocaust survivor groups as well. we did not remove the right to sue. we could not. what we did say and what we have done is that if suits are brought, contrary to these agreements the u.s. government would initiate a statement of interest saying that it had been and was and is in the national security interests of the united states to resolve claims in a non-litigation context. the u.s. supreme court in the garamendi case and judge michael mukasey -- later attorney general under president bush -- both anticipated that these were appropriate uses of presidential authority and, indeed, the
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generala case -- [inaudible] second, it would complicate future holocaust negotiations since the word of the u.s. government could not be trusted. and, believe me, there are still many things that need to be done in the holocaust area, art and many property issues as well. imagine howin the credibility of the united states would be affected when under the just act thathe you properly passed which requires the state department in november to give a report card on how all the countries have negotiated with 46 countries, is and we're judging them on whether they have met t their obligations. and here we would be withdrawing from international obligations that we reached. third, any legislation would be
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contrary to longstanding, bipartisan policy to resolve holocaust-related claims by non-litigation, negotiated claims processes without the costs of courts and lawyers is and with dramatically lower burdens of proof than any federal court would require. it would leave beneficiaries of holocaust-era insurance policies to a cruel fate of pursuing lengthy, costly, almost certainly fruitless litigation with claimants facing high standards of proof in federal courts and other legal defenses. instead of using the low levels of proof under the icheck process. fourth, it would undermine the work of the state insurance commissioners who in 1998 voluntarily took the lead in creating icheck along with european insurers, jewish organizations, the state of israel all of whom were members
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and the leadership of icheck -- and many of you know, i'm sure, senator graham, you must have worked with larry eagleberger. larry tirelessly worked as head of icheck for ten years. it was strongly supported by secretary of state madeleine albright, secretary of state colin powell thereafter and deputy secretary armitage in the bush administration. i can assure you, larry eagleberger is as tough as anyone possible. he would not have ever permitted european insurers to pull the wool over his eyes. by the time icheck closed its doors in 2007, its insurance companies had pate $306 -- paid $306 million to 48,000 victims using relaxed standards of proof lower than any u.s. court would demand. please understand, half of the claims did not even have the
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name of the insurance company because the documents didn't exist. they were able to match over 16,000 claims that had no names of insurance companies through a veryla tedious process. and when they couldn't find any evidence, they ended up making humanitarian payments as well. athere's no court anywhere that would accept this lower burden of proof. their work was overseen not just by larry e eagleberger, but by all the member organizations of icheck including esteemed individuals like the former bank governor of the state of israel, a holocaust survivor, who specifically involved himself in the valuation of insurance policies. all the holocaust groups, the american-jewish organizations, the american insurance commissioners closely reviewed the european insurance procedures and the handling of
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individual claims and authored their own report or on the -- >> mr. ambassador, mr. ambassador, you need to wrap up. >> fine. the claims deadline was extended six times. fifth and last, congress has held eight hearings -- this is the ninth. att each time it is decided not to go forward with legislation for many of the reasons i've mentioned. the legislation would also fly in the face of opposition from virtually every major american jewish organization and from major holocaust survivor organizations; the american gathering of jewish survivors, the world jewish federation of child survivors, the holocaust restitution committee and many more. i do have suggestions of what this committee could do constructively. require european insurers doing business here to submit periodic reports to the u.s. government on their claims processing post-icheck to make sure they're abiding by their promise to
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continue to resolve claims with thesee low standards of assurance. in addition, they could look at why, if any, claim were denied why those were done, and they could memorialize the 519,000 names of 5 potential holocaust survivors so that if any future claims can be brought, they can be brought under these lower standards, they can use anna's group, and they can recover under procedures that no court would ever allow to be done. thank you very t much. >> thank you. is it mr. webbing? is that right? okay. so if you look at the number -- the pot of money here, for lack of a better way of saying it, all thebe people have paid into the insurance system before the nazis destroyed this system is somewhere between $2 billion and $25 billion, is that what you're
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saying? >> [inaudible] well, first of all, for one thing, a lot of this money was from a company perspective paid out before the war because part of the expropriation that the nazis did -- >> how much was taken? >> what you have is estimates for the unpaid, essentially, the unpaid value of the assets. some between, i think you can legit mele say between $2-25. >> okay. can you say that the claims process that the ambassador just talked about, when you combine new york and this international system s has recovered less than $500 million, is that right this. >> i would boost that because the $2 billion is probably a present day number, i and that number is from ten-plus years ago. so if you adjust for the intervening time period, you probably get to around $700-800 million. >> okay. taking thehe most generous numbr of $2 billion, not 25, and
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bringing it to present day, the current system is basically recaptured -- has basically recaptured less than half. mr. dubbin, is that correct? is. >> that's the most generous interpretation. >> so, mr. ambassador, it's not working, from my point of view. if you believe there's up to $25 billion of uncompensated claims owed and the current system has generated $700 million, then somebody needs to look at something else. >> and i would add, mr. chairman, that when ms. rubin and mr. eizenstat talk about, make the paternalistic argument that they don't want to disappoint survivors ifs they lose in court, we respectfully disagree. thosey that survived auschwitz take leaders -- like leaders of the organization who represent thousands of survives around the country, they should not be treated like childrenou x they
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shouldn't be lectured to about disappointment. >> mr. eizenstat, what's your -- how do you respond to my observationing that whatever process we have in place, that the claims route that the money recovered is woefully inadd a adequate given the -- inadequate given the pote of money available? >> i disagree, respectfully. first of all -- >> what is the number? >> no one knows precisely, but let me give you this figure, okay? >> wait ae minute, wait a minut. you disagree with what mr. webel said, 2-25? >> no, that's the total sum. we don't know the number of jewish people who had insurance. >> no, what we know -- >> no one knows. we know the total european insurance market and, senator, please, germany had the largest percentage of insured people, insurance, 52% of the whole european market. jews were less than half of 1%.
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poland had 3.5 million jews is and almost no insurance. germany has paid on it own $80 billion since tend of the war -- since the end of the war. a significant part of that was for insurance policies not counted in these, insurance policies, bank as sets and the like. in the '50s and '60s, the dutch, the french and the germans had their own insurance payments. so when you accumulate all of those plus the icheck process, plus i what's happened post-icheck, then you've got a very substantial visual number. but the fact is no one can give you, including crs -- and they say that -- an accurate figure of what number of victims had insurance, how large those policies were. if we subject those claimants to a court proceed your and vitiate
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20 years of agreement -- >> i have to ask, but there's a disconnect here between the numbers he's giving me and i don't know what percentage of germany was jewish that paid into an insurance system. i don't know if there was no insurance in poland and go through every other nation where the nazi occupation people were denied not only their art, their houses, everything else, now we're talking about insurance. but i find it hard to believe it's $700 million. mr. dubbin. >> the $25 billion estimate is the estimate of the jewish policies. it's not all of germany. and he worked for icheck, he was the economist who went into the records of the -- >> how did he arrive at that number? >> there was an -- the jewish population was known, and based upon actual data, they had a propensity of jewish people to purchase insurance, and they applied that propepsty.
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that was unanimously accepted by members of the i icheck, all the researchers, the academics, all the people -- >> so wait a minute. and i don't mean to go over, but the icheck group evaluated the pot of money to be $25 billion. >> they evaluated the pot of money to be based upon 800,000 policies worth about $600 million at the end of the war. unpaid. >> right. >> for jews. >> right. >> and what mr.-- they never actually put a value on that. >> right. >> let's use a 30-year u.s. bond yield as a multiplier. very conservative and certainly not anything any insurance company would ever accept. based upon that in 2007 when icheck finished, that $600 million unpaid in 1938 would have been worth $17 billion. today, 2019, that's 25 billion. >> thank you. >> i just have to say we shouldn't be loose with the facts. icheck never accepted a $25 billion valuation. they never accepted.
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they did their own report. they commissioned their own report by mr. pomeroy who was the north dakota insurance commissioner -- >> we can figure it out. >> they got nowhere near that figure. >> we'll figure that out. senator feinstein. >> mr. dubbin, it's my understanding that even though icheck, the process closed, beneficiaries can still pursue claims through the new york state department of financial services. do you think of those that have done this? >> yes, i do. i canw give you one example, henry rose from miami. he's a child of two german survivors. he went on to the icheck web site in 2011 and saw the name of his mother and his grandparents as having had german policies. by 2011 icheck was closed so he went to new york processing office. the way those names appear pd on
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the icheck web site from germany was that the german insurance association -- germany got special permission to do their own thing in icheck, and instead of having the companies publish their own names, they allowed the german insurance association to filter them and publish them on the web t site. so the german insurance association is the one who knows how those names got on the web site. the first thing they did was commissioned research in germany into his family's wealth, that took four months. then they went to german insurance association who claimed they had no idea where the names came from. they were the ones who put the names there in the first place. there's no authority, there's no subpoenaro power, there's no compulsion. the companies can do what they nant. and mr. rose, whose parents -- his mother r confirmed while she hwas alive that they had insurance, yet there was, there's no way to force the companies to come forward and come clean. >> so the remedy to this is what? >> legislation allowing -- validating the state laws requiring the companies to
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publish the names which the garamendi case -- >> so there is no requirement --? >> no requirement.. >> -- that names have to be public -- >> it's all voluntary. and by the way, 25% of german names is all that was published, and less than 20% in eastern europe. the guy who did the research into the industry testified to that too. so even though there were names that were published and even though peopleve who found their families' names on that list were denied claims by icheck -- and i've got a long list of claimants that i can show you, including one of your constituents. although many escaped, the great grandparents owned a business, and they were betrayed. that policy never appearedded on the icheck web site, never. they had a researcher in the family who went and dugged it
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out and demanded they produce information and finally they admitted that, yes, there was a policy in the name of the great ygrandmother. that wasn't even published. so all of these so-called, you know, wonderful elements of icheck, it only resulted in a payment of 3% of the money because it had no -- it was con cheap chilly -- >> so what are you suggesting? >> legislation that would validate state laws requiring the publication of names, a new first of all causeal of action allowing survivors and heirs to bring a new claimant to court sort of modeled on the iranian terrorism model where, when congress -- when the courts get it wrong, congress can come in and fix it, and a ten-year period of time in order for the victims after getting access to the information to bring those claims. and believe me, to talk about long periods of time, when this bill passes and the companies know that they're going to have to pay e the attorneys' fees of the other side, pay tajes, 6% compounded interest, they're going to cooperate, and they're
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going tote settle, and it's goig to be a completely different world. the world today of immunity is one where the survivors just keep getting, you know, pushed around and disreasonned. >> well -- disrespected. >> i want to ask you to put the request of specifically what you're askingyo for in writing d send it to this committee so we might look at it. >> sure. and it's basically the bill that you cosponsored in 2011 with senator nelson and senator rubio with a couple of minor, minor changes. but i will -- >> thank you. >> that draft legislation is what we're pursuing. >> thank you. >> thank you. >> senator, may i respond to senator feinstein? >> yes, if -- >> since the conclusion of icheck, the german companies have paid 130 claims. or generalli has itself paid almost 500 worth $12 million. if the committee wishes, it certainly can require the publication of all the lists, it can have hearings about why
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individual cases were not resolved under the relaxed standards.s. but for goodness sakes, don't rip up an international -- >> that'd be for us to decide. >> yes, of course. i'm asking you not -- you have the right to do it, of course. >> yeah, we do. >> but you -- the supreme court has resolved it -- >> i'm very familiar with the facts. senator. >> yes, thank you, mr. chairman. mr. webel, what stepsps were tan to insure that the icheck's decisions were fairhe and unbiased. canun you talk about that proces is and how you arrived, how they arrived? >> i mean, i can talk about the valuation process and the steps that went into the sort of specifics of the economic numbers. in terms of actual claims processing, i would probably have to defer to some of the other members of the possible. >> okay. if you would talk a little bit about the process that you observed. >> sure.he basically, i mean, in terms of
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the overall economics, they commissioned a specific report led by insurance commissioner from north dakota pomeroy and a french insurance executive that basically walked through and made estimates for, essentially, all you would need to do to estimate essentially how much of the asset value of this insurance might be outstanding. that includes the presenting to the jewish population the amount of the insurance outstanding, the propensity for the jewish population to purchase, current values and so forth. and so they did not publish an official icheck number for this. when you talk about this range between approximately 2 and 2.5. the icheck numbers and the range that they put out, current day numbers was somewhere between 1.5-2 versus about 4-4.5. >> okay. >> in order to get to 25, basically what you're
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significantly doing is to some degree readjudicating the german compensation postwar. so you're revaluing, you're revaluing policies that were compensated in the german scheme postwar and saying essentially those policies were not enough. >> okay. so we have the north dakota insurance commissioner pomeroy and the french that were involved in thisnc process. what other stakeholders were involved in scrutinizing the -- >> yeah. this waske basically a report tt was done by the icheck commission, a subset of the icheck commission. >> okay, thank you. and do you believe that the icheck paid a fair amount to survivors and their policyholders? >> i really have no basis for that judgment. >> okay. f what improvements do you believe could be made to the current new york process? >> i'm not familiar enough with the new york t process. ice would probably defer to mr. dubbin for that. >> okay. mr. dubbin and thoughts, again, just going back to what you're recommending to congress? >> sure.
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i mean, my recommendation is that the company should come clean, and it should be a compulsory process because the voluntary process of icheck was a disaster. it was a disaster, and i can give you a lot of other examples. for example, they claimed that they had audits. well, all the audits did was to determine whether or not the companies did what they said they were going to do. and every single one was qualified with the following statement: our opinioning is not in any way a guarantee as to conduct of the insurer with respect to any particular insurance policyy or claim thereon at any time in any particular circumstance. mr. eizenstat talked about relaxed standards of proof. that did not occur. in fact, icheck imposed greater burdens on the survivors than the courts would. generalli was allowed to deny claims if they said those erlicies were not in their system in 1936 because they said they mechanized their system in 1936. now, but they acknowledge the
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policies had been sold. now, in court in the state of florida and most states where the policy is established, the burden is on the insurer to prove what happened to it. icheck flipped that burden and literally put the burden on the survivors to disprove an argument that the insurance companies were making that thicheck allowed them to make. and al letter lewis -- albert lewis wasow one of the appellate arbitrators, and he resigned because he said he was told to deny claim when people could not produce documentation. and so that's the antithe sis of liberal standards of proof. therefore, our recommendation is a law that forces then companies to produce, forces them to be accountable in the u.s. legal system. and, believe me, as i pointed before, it's not violating any areements. it's just giving survivors the rights they should have had all along. >> and so i understand survivors and their families will go through this, the new york process with the statefa of new york. then would it be reasonable then
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for other states to also, to go through other states, or your recommendation -- >> not at all. i mean, respectfully, what they did in new york is ineffective because they don't have any compulsion ability. given the best of intentions, they simply have to accept whatever the companies say, and that's a good example of what happened with mr. rose. i was w really fascinated to see what was going to happen when he made this claim. and you've got the documents here in these books. it was delays, delays, delays and excuses. and in the end, the gbd said we don't know where the names came from. and so eight months later mr. roses mom, f who was alive t the time, you know, was unable to validate to her that they were going to get compensated for that. but there were t policies with s mother's and grandparents' names on it, and the company -- you know, if the haw passed, the companies would have to publish that information, and then we could get to the bottom of it. >> so less evidence on who's processing and more emphasis on changing the process. >> of establishing legal
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requirements and accountability that, will there be actual accountability. >> okay. >> again, ms. rubin, no one's supervising her. the fact that there was a statement by the insurance commissioner in new york that this process of waiting for claims to come in and asking for them, you know, to be paid, you know, wasn't working. that was -- >> thank you for your input. thank you, mr. chair. >> mr. dubbin, the supreme court in that 2003 ruling that the clinton administration support for the commission created california effort to improve claims transparency. the dissent, however, emphasized that no clear declaration of pre-education existed -- pre-
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exemption existed. t'some argue we should be concerned about the supreme court's pre'emation in that -- pre-preefnlings -- >> anybody else on the panel, does nip else have something to add to the issue and whether the supreme court got it right or wrong? >> could i just add one thing? because we obtained, mr. mermelsteinan was provided documents, and one -- some of them were memoranda which also are included in this packet about how they should respond to the second circuit in response to generalli case. and the justices, you know, they're very intelligent, they're also very wry, and what he wryly observed at the time was even in cases in which the united states has filed a statement of interest pursuant
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to a foundation agreement, there is considering tension between the -- the express recognition in the foundation agreement that the agreement itself does not provide an independent basis for dismissal. and yet they supported generalli erther. >> sir, you asked others on the panel -- >> yes, go ahead. >> thank you, mr. chairman. first of all, it was not only the supreme court a by majority that said this was a proper use with of executive authority. it was also in a separate case by judge knew case is city, later attorney general under president bush, in the generalli case who said exactly the same thing. going back to s 1799 the u.s. has always had executive agreements to resolve claims, and these have always been upheld as an appropriate use of presidential authority. i testified many times before congress, like 12 times on these
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very agreements. they were supported by large majorityies, al d'amato and many others onot both sides of the aisle in the house and senate. we were applauded for negotiating these agreements. when going to court would have beenoi so indefensibly difficul. so the supreme court was right, judge mukasey was right, and going back to theou beginning of this republic presidents have the authority to negotiate these kinds of agreements. >> that's not really true, and let me tell you why. >> i'll listen to you and then i'll go on to my next question. >> in those days there was sovereign immunity, and so people couldn't sue those foreign governments. so the u.s. government then basically, you know, collected those claims and then it made executive agreements so the people could get some compensation. in the case with the iranian hostage situation, they said, you know, there was some congressional authority to do that and only the emergency of
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hostages out of iran really justified the, you know, assignment of claims, you know, by the u.s. government in that case. but the garamendi court said that what's missing here is congress, and congress has every right to come in and change this it disagrees with the outcome of that decision. that's the final line of that thse. >> okay. anyone who wants to comment on this point, data from the commission indicates the total distribution of 300 million, 31,000 claimants out of 48,000 who received payments were offered a one-time humanitarian payment of $1,000. should congress be satisfied or concerned with the measureses of justice and why? >> well, i can tell you from what mr. mermelstein said and my experience with i survivors, the receipt of a $1,000 check that said this is a humanitarian
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spayment because we think you have some kind of a story, that was an insult to holocaust survivors. basically, it was like calling them liars. and for the icheck defenders to now include those 34,000 $1,000 checks in the gross amount of, quote, compensation that icheck a misdirection. i mean, it's really a ruse because it paid 14,000 claims, and it paid 34,000 $1,000 humanitarian payments. those were not settlements on insurance policies. >> it's just not true. the claimants who received these payments did not complain. there's not been any mass complaint that they were underpaid. they were pleased to be paid, and most -- and more than half the cases, mr. chairman, they tonight even know the names of the insurances. and icheck, through very exhaustive research, was able to match up over 16,000 names. it's only the $1,000 payments came when there was no ability to name, when there was no
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documentation. >> is it correct that the antidefamation league has withdrawn their objection to thisra legislation? >> joe greenberg is here, mr. chairman, and he's been in contact with the president. he authorized me to say that, yes, they are not objecting to the legislation. >> that's news to us because they have signed on to the letter last year. >> i gotcha. senator hawley. >> thank you, mr. chairman. mr. tub bin, can you -- dubbin, can you just walk me through, what are the standard of proof that the commission and insurance companies generally require in order to prove a claim andui what you think about the appropriateness of those standards? >> you mean in the icheck process? >> right. >> well, according to the little bit of data that exists, and mostly what we have is people who were denied, we have lots of people. a survivor in the ss st. louis,
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his father told him before he died that he had insurance with allianz. he asked for that policy after the war and was told it had already been paid out. he applied to icheck, his dad's name was on the list and about ten of his aunts and uncles. they told him his father had already been paid out by the policy. now, and they didn't send him anych documents. after icheck closed, german embassy provided him with some information including the so-called repayment repurchase document it was dated november 9, 1938. that was the date his father was taken to buchenwald. that's the kind of treatment the survives got in icheck. >> sir, sir -- >> do you want to -- [inaudible] >> yes, thank you, sir. i just wanted to make a
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clarification. while the name of my office has process in it, we to not adjudicate claims. when we say process, we act as a facilitator and an advocate for claimants. we don't actually settle the claim ourselves or make decisions on any particular case. we act as a voice for claimants. we do research for them, we try to obtain as much documentation as possibleor as we can for substantiating their claims. we then them with genealogy research to help them, you know, explain their family connection to an insured, for example. lyand so i just wanted to clariy that aspect of our office. and if i may interject something about the relaxed standards of proof? companies don't require that you provide policy information. they will take a letter from 1934 that says i remember when you bought this policy, and they will investigate within their own records for any evidence of the policy, and they will make payments on policies when they
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don't have specific details of the s policy, just say a record that a policy was purchased. even when they don't have the date of pressure or the value of the -- date of purchase or the value of the purchase policy, they can still make the claims. and i'd be happy to submit additional information about what relaxed standards entails. >> thank you. mr. dubbin, i want to come back to you about private right of action. if a private right of action were to be created, would it be better to leave this to state law to determine or should there be ooh single national standard, in your view? >> thered should be a single national right of access, and the legislation that we're proposing would a provide that e rule decision would be either the state law, the forum, or a general federal common laws which is like what they're using in the iranian terror option of thee plaintiff. >> gotcha. okay. so you're comfortable though, you say the state law, those will vary, obviously -- you're okay with that?
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>> the general federal common law was more favorable, they would have the right to use that. but because of the garamendi case, there has to be a federal statute to reopen the right of access to counts. >> finally, mr. mermelstein, let me just ask you this: thank you for appearing here today, thank you for your advocacy. i'm justt wondering if you think there's anything else that you feel congress and this committee need to understand about the challenges thatll hold survivors and their descendants face in receiving their due compensation. >> [inaudible] diswhrb oh, how i feel about taking away the rights? >> yeah. anything you'd like to add that you think we should understand. >> not only me, all the people that i dealt with. and i deal with most of them. it hurt us then, and it still
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hurts us today. that my friend was a soldier in korea, yet he came home and he couldn't go to an american court. i passed the thing, but they didn't take me because i became a father. but took away our rights to go to an american court. and let me just add one thing. the gentleman mentioned that germany gave a big increase, so i want to tell the senator had something to do with that because i came to ileana ros-lehtinen, she worked with me since she just went to the state and told her that she has to do one more thing, pass a resolution in congress that germany is not doing what they promised that they would do. and she said how about the two
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senators that you know, you're going tobo talk to them? yeah. senator nelson was a senator yet then and senator rubio. so i talked to them. and the senator will tell you it was passed unanimous in both houses. and we got the biggest increase from germany then than we got in all these years. >> well, thank you all. we've just been informed the anti-defamation league still opposes the legislation, so the information provided is not correct.t. we just got an e-mail. we'll follow up on it. >> well, again, that's different than what they told mr. greenberg and what the president, mr. greenblatt, told mr. greenberg. >> we'llll find out about all that. i'll endbo on this, tell me abot the process of where the companies are not required to disclose? what's your biggest problem there? go over that again, mr. dubbin? >> well, they only published the names they wanted to.
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and so as a result -- >> it was a scrollen tear -- voluntary here's the names. >> right. >> what would you suggest we do to change that? >> value tate the state laws that require those companies to publish the names of the policyholders. in other words, reverse the garamendi decision. >> okay. the burden has been shifted in the claims process. explain that to me again? >> for example, with generalli claims, it was argued that its database in 1936 was complete and that any claim, any policy that wasn't on that database had been paid or lapsed or something like that. and so icheck accepted that as a basis for family claims. so if you, like the gentleman here from maryland, his family's name wasn't on the list in 1936, but there was definitely a policy. under state law if there's proof of a policy, the burden is on the insurer to prove lapse or payment. they didn't have to do that. >> give me an example of a case where they were saying the
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family had been paid. it was on the night of crystal knock? >> correct. that was a man from miami. he's a survivor of -- he was on the ss st. louis when they were sent back to europe. his parents and sister were sent to auschwitz and murdered. he knew he had an allianz policy, and he acknowledged there'd been a policy when he asked after the war. now, there was a token payment from germany, but it had nothing to do with, you know, the fact that -- >> the value -- >> exactly. so thenon he applied to icheck when icheck opened up, that was 15 or 20 years later. icheck said your dad was paid, but they didn't provide him with documents. do?, what could he even though there was an appellate process, he had no basisk to appeal because he had to take that at face value. we later got documents through the german embassy because the survivors organizations had been making a little trouble for
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people, andnd so the german embassy got the documents, and there's a so-called repayment document that says that on november 9, 1938, his dad cashed in the policy. well, he was taken to buchenwald that day. the odds that he was, you know, stopped on the way to buick pen wald to catch in his policy is preposterous. >> and the odds that the family kept temperature money are zero. >> zero. because even if that had happened, that money went straight to a block account, and jews were not able to access that money. >> yeah. thank you all very much. we'll take all of this under advisement and see what we can do. thank you very much. >> thank you so much. [inaudible conversations]
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