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Jewish Council Seeks Help in Probe of Alleged Embezzlement

May 19, 1988

FRANKFURT, West Germany (AP) _ A Jewish group asked a French bank Thursday for financial records to trace millions of dollars earmarked for Holocaust survivors that allegedly were embezzled by the group’s former leader.

Jewish officials said it was still not certain how much money late Central Jewish Council leader Werner Nachmann allegedly took nor where the funds went.

Hesse State radio, without citing sources, said that Nachmann may have embezzled up to $24 million, a much higher figure than previously reported. Some of the money appears to have gone to a fashion store Nachmann owned, the radio said.

The radio station also said ″higher-level officials″ moved to block a Karlsruhe Tax Office audit of Nachmann’s records in 1980. But the tax office’s director, Bernhard Schmitt, flatly denied the report.

″No audit of his (Nachmann’s) accounts was ever ordered, and could therefore not have been blocked,″ Schmitt said in an interview.

Heinz Galinski, who took over the council’s leadership after Nachmann’s death in January, was to meet with an aide to Chancellor Helmut Kohl Friday to discuss the incident.

Galinski said he and the Kohl assistant, Wolfgang Schaeuble, would seek to determine whether government officials should have better monitored the flow of money paid by West German for Holocaust survivors.

Galinski, in an interview, said the Jewish Council had asked the Karlsruhe branch of the Bank Societe Generale Alsacienne for full financial records of Nachmann’s transactions.

The French bank handled some of Nachmann’s accounts and an account belonging to the Jewish Council, according to Galinski.

Galinski said earlier this week that Nachmann appeared to have embezzled about $6 million since 1980.

The Nachmann family’s attorney, Peter Paepcke, said he believes Nachmann apparently took the money to help bolster his failing Karlsruhe-based textile business, but added that he had been unable to trace the funds.

The attorney filed for bankruptcy for Nachmann’s heirs and his business on March 30. The proceedings opened Thursday, Paepcke said.

Nachmann, president of the Jewish Council from 1965 until his death at age 62 in January, was in charge of disbursing the government funds to Holocaust survivors around the world.

About $236 million was allocated by the West German government in 1980 for Holocaust survivors who had not previously made reparations claims.

On Wednesday, Karlsruhe prosecutors said they would seek to determine whether other people may have been involved in the embezzling case.

Nachmann’s family fled Nazi Germany to France in 1938. He returned in 1945 and began working toward re-establishing Jewish communities in the country.

About 530,000 Jews lived in Germany when the Nazis took power in 1933. West Germany has about 30,000 Jewish residents today.

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