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Two funds aimed at providing relief for cash-strapped Holocaust survivors were raided for more than $42 million with the help of several people who were supposed to administer them, U.S. authorities said yesterday in New York.

U.S. Attorney Preet Bharara described a long-running scheme as he announced charges in federal court in Manhattan against 17 people, including the former director of the funds.

Bharara said six employees of the Conference on Jewish Material Claims Against Germany, which managed both funds, were among those charged. He said they created thousands of false applications and duped ineligible people into applying for assistance so that everyone could share the funds.

The allegations were first raised a year ago, as Claims Conference officials discovered that some of the applications for assistance appeared to be false.

Working with the Federal Bureau of Investigation and federal authorities in New York, they identified what they believe to be 658 fabricated requests for compensation from Germany totaling $24.5 million, and 5,000 requests for one-time payments totaling an additional $18 million.

In July the Claims Conference stopped providing money to individuals it identified as impersonators, and ordered them to return the money they had already received. Claims Conference officials said several dozen suspects have already returned the money they had received.

The suspects allegedly placed an advertisement in a Russian-language publication seeking people who had lived in Eastern Europe during the Holocaust, then used the personal details of individuals who respended for the scam. Most of the allegedly forged documents were found in a home in Brooklyn.

"If ever there was a cause that you would hope and expect would be immune from base greed and criminal fraud, it would be the Claims Conference, which every day assists thousands of poor and elderly victims of Nazi persecution," Bharara said. "Sadly, those victim funds were themselves victimized.."

Authorities named Semen Domnitser as the suspected ringleader of the operation, and said they believe he personally signed off on fraudulent applications from more than 4,000 people.

"Funds established and financed by the German government to aid Holocaust survivors were siphoned off by the greedy, and not paid out, as intended to the worthy," said the Assistant Director-in-Charge of the FBI's New York office, Janice K. Fedarcyk. "This was a brazen miscarriage of the compensation program."