21 February 2008
A Tel Aviv court has sentenced an Israeli lawyer to 12 years in jail after finding him guilty of defrauding dozens of Holocaust survivors of German compensation money. The court also fined Yisrael Perry NIS 24 million (US$ 5.5 million). After six years of legal battles, Perry was convicted of theft, fraud, obstruction of justice and withholding vital information from his clients in order to deprive them of their money. He was found guilty of stealing a total of US$ 200 million via the so-called Organization for the Realization of the Social Security Treaty, a company established and controlled exclusively by Perry which had purported to help Holocaust survivors obtain pension rights from Germany's social insurance institute in the early 1990s. Perry embezzled millions in premiums his clients thought were being passed on to insurance companies. Dozens of Holocaust survivors and their descendents fell victim to the scam.
Perry set up his organization shortly after the treaty on German pensions came into effect in 1980, promising to represent the interests of Israelis dealing with the German government to ensure that they received the funds to which they were entitled. He simultaneously set up two other companies to provide loans to those who needed them in order to receive their pension rights. The terms of the loans left his clients with very little of the pensions, with the would-be beneficiaries unaware that these companies had also been set up by Perry or of the resulting conflict of interests. As part of the approval process for the loans, Perry required his clients to pay insurance premiums that he did not pass on to the insurance companies, but kept for himself.
