The JUST Act Report: Israel

Immovable property accounts for the lion’s share of unclaimed Holocaust-era property in Israel.  This is largely comprised of real estate that was owned by non-resident Jews who perished in the Holocaust.  In 2007, the Knesset passed a law establishing the non-governmental Company for Location and Restitution of Holocaust Victims’ Assets (“the Company”), whose mandate was to locate Holocaust victims’ assets in Israel, transfer the assets to the Company’s trust, identify the rightful property owners, and return those assets or their fair value to the rightful owners or heirs.  Further, the Company was charged with providing aid, medical assistance, and other care and welfare to Holocaust survivors, as well as to entities and agencies that assist them.

Between 2007 and 2017, the Company located assets with a total value of more than $500 million, including 679 real estate properties worth $230 million.  Of that $500 million in assets, the Company located heirs for nearly $200 million worth of assets.  In 2013, Company and Israeli government officials determined that the Company had “reached the point of balance between its ability to trace additional substantial assets and their diminishing value,” and the law establishing the Company was amended to close it down in 2017.

In 2017, responsibility for the remaining properties was transferred to Israel’s Office of the Custodian General, which falls under the Ministry of Justice.  The Custodian General received about 500 properties from the Company and is working to locate the heirs.  Since January 2018, the Custodian General located heirs for approximately 60 of the properties.  In 14 cases, the Custodian General determined that a property was heirless.  Those properties were sold, and the profits will be used to benefit Holocaust survivors.

Under Israeli law, the Custodian General has until 2023 to locate heirs for the remaining 400‑plus properties.  After 2023, the properties will be sold and the profits used to benefit Holocaust survivors.  If a claimant comes forward after 2023, he or she will still be eligible to receive a sum equivalent to the sale price of the property plus interest.  Israeli law guarantees that a rightful heir can make a claim in perpetuity.

The Custodian General has a team of 12 researchers working full-time to identify the rightful heirs of the remaining Holocaust-era real estate in its control.  These include historians and genealogists, some of whom speak German, Polish, or other European languages, who can evaluate archival records from Israel as well as countries where the Holocaust took place.  Claims are reviewed on a case-by-case basis, and evidentiary requirements will vary depending on how much historical information is available to researchers.  In many cases, genealogical information prepared by the Custodian General, along with original property ownership documents, is sufficient to prove a claim, even if a death certificate or other original documents from Europe are not available.  In some cases, the Custodian General has discovered the existence of an heir who had no idea he or she was the rightful owner of a Holocaust-era asset.

The Custodian General publishes ads in newspapers and magazines to reach Jewish community members in the United States, Europe, Latin America, and elsewhere.  When the Company was in operation, it had also posted to its website a list of nearly 7,000 original property owners who had a claim to some type of Holocaust-era property, along with a contact form via which that person’s heirs could submit a claim for the property.

Dormant Bank Accounts and Share Certificates

In recent years, as a result of a lawsuit brought by Holocaust survivors, several Israeli banks reached settlements with the Israeli government and transferred funds from dormant Holocaust-era bank accounts to the Ministry of Finance, according to contacts and press reports.  These include a $40 million transfer by Israel’s Bank Leumi in 2011, and approximately $5.6 million from other banks between 2009 and 2013.  The funds were earmarked for the provision of services to Holocaust survivors.  Many European Jews had deposited money in banks that existed prior to Israel’s founding, and many of these account holders died in the Holocaust.

In addition to dormant bank accounts, some people – including those with no direct connection to the Holocaust – still hold Mandate-era share certificates in the Jewish Colonial Trust (JCT), a precursor to the Anglo-Palestine Bank and later Bank Leumi.  The Custodian General honors those share certificates, which were originally sold in the early 1900s for about one British pound sterling, providing compensation for both the original share price as well as accrued dividends.  Most individual JCT shares are currently valued at approximately $555 dollars, according to the Company’s website.

While the vast majority of Nazi-looted art is in Europe, according to press reports, art dealers trafficked widely in Nazi-looted art after World War II.  Jewish or Israeli collectors may have unwittingly purchased some of those looted pieces, and some may now be in Israeli museums.  Pre-1948 art curators acting on behalf of the Jewish Agency, in an effort to preserve Jewish art, also brought pieces to Israel after the Holocaust.  The U.S. military also transferred thousands of additional Nazi-looted cultural items, which had clearly belonged to Jews, to the Jewish Cultural Reconstruction (JCR) and the Jewish Restitution Successor Organization (JRSO), which later shipped them to Israel.  While the Israeli government has information about the cultural property that the JCR and JRSO transferred, information about Nazi-looted art still requires significant provenance research.  The National Library of Israel has not yet marked every item it received from the JCR.

At least two dozen such pieces of art have been identified and marked for restitution in recent years, according to press reports, and experts believe there may be hundreds more pieces that have yet to be identified.  Many Israeli museums lack the training and funding to research the provenance of their collections, according to contacts and press reports.  Even if a piece can be identified as having been looted or stolen by the Nazis, it can sometimes be difficult to identify the rightful owner or his/her heirs.  Moreover, some museums may be hesitant to sell heirless art, even if the proceeds benefit Holocaust survivors, because of the belief that Nazi-looted art should remain in the hands of the Jewish people in Israel.  While the issue of looted art is not covered by Israeli law, the official position of the Israeli government is that property looted during the Holocaust should be returned to its previous owners or their heirs.

Some commentators have publicly criticized Israel for not doing more to identify and return Nazi-looted art.  These critics say Israel’s failure to do more to return looted art undermines efforts to encourage European governments to do the same.

Despite the challenges of identifying Nazi-looted art or cultural items and returning it to the rightful heirs, there have been recent non-governmental efforts in Israel to highlight the issue.  In October 2018, the Center of Organizations of Holocaust Survivors in Israel hosted a conference on the future of looted art.  One outcome of that conference was the Jerusalem Declaration on the Future of Looted Art, which calls for a just and fair solution that recognizes the previous Jewish ownership of heirless cultural assets.  The declaration calls for museums and galleries to display such art with explanations of Nazi looting, and suggests that unclaimed looted art should be temporarily loaned to and exhibited in museums in Israel and around the world.

Israel is home to a number of Holocaust museums.  These include Yad Vashem, the Chamber of the Holocaust, the Ghetto Fighters’ House Museum, and the Massuah International Institute for Holocaust Studies, which aims to bring young people from Israel and around the world into dialogue with the memory of the Holocaust.  There are also hundreds of small memorials throughout Israel honoring people or families who died in the Holocaust.  The Jewish National Fund (JNF), for example, planted six million trees in a “Martyr’s Forest” in 1951, according to the JNF website.

Each year, the International School for Holocaust Studies (ISHS) at Yad Vashem hosts more than 350,000 schoolchildren, university students, and educators.  The ISHS trains educators and develops tools to teach about the Holocaust, using a multi-disciplinary approach that is age‑appropriate.  The Israeli Ministry of Education has also created a comprehensive Holocaust education curriculum for students from kindergarten through high school.

Each year, Israel marks Yom HaShoah as a day of commemoration for the Jews who died in the Holocaust.  Yom HaShoah commemorations began in 1951, and the day became a national memorial day under Israeli law in 1959.  Every year on Yom HaShoah, an air raid siren sounds at 10:00 a.m., and the country’s Jewish populace observes two minutes of solemn reflection.  Israel also commemorates International Holocaust Remembrance Day annually on January 27.  Israel became a member of the International Holocaust Remembrance Alliance in 1998.

In the days leading up to Yom HaShoah, many Israelis refocus their efforts to remember the Holocaust and educate others about its horrors.  One highly successful program is “Zichron B’Salon” (Memory in the Living Room) in which Israelis host small groups of people in their homes to meet with Holocaust survivors in an intimate setting.