sort of fund, or different assets which normally would have been transferred or returned to the German Government itself. Mr. BENNETT. I think it would be important, Mr. Chairman, to find out just why this claim was not paid, because it seems to me Mr. Rubin predicates his case primarily on the fact that this charitable organization was entitled or would have been entitled to receive their 80 percent, and they made a timely claim for it, and that through administrative delay they were denied their part. Mr. GROSS. We can pinpoint it by going to the files. As I say, I think at least a very substantial part of this so-called delay was occasioned by third-party adverse claims to the fund. But we can check that, if you like. Mr. KLEIN. Did at any time the Attorney General's Office recommend that this claim be paid? That is, your Office? Mr. GROSS. Recommended that it be paid? Mr. KLEIN. Did you not say that? Mr. RUBIN. My understanding was that the Office was finally prepared, just prior to the 1934 act, to make payment, but at that time the 1934 act was passed, and as a result of the default of Germany on its obligations, the bar, in effect, came down. If I may say so, Mr. Chairman, we have been in some correspondence with the Office of Alien Property as well as the Department of State in connection with this matter, and making an attempt to see whether it could be handled administratively in one way or another. While there has been some reference in some of the correspondence of which there is a considerable volume by now to some litigation in the courts in New York, it has not been my understanding that that litigation was so prolonged as to have prevented a return of this property while the Settlement of War Claims Act of 1928 was still in full force and effect. The facts as indicated in my statement, I think, are correct. They are correct, certainly, to the best of my knowledge and belief. They indicate that a considerable amount of the delay was due to perhaps the understandable error of the then Custodian in making an overpayment on estate taxes, and then the delays with which, I think, we are all familiar, of getting one's money back from the Treasury Department after an overpayment has been made. There were a variety of things of that sort which took place. Now, had it not been for that, and even if the delay were occasioned by litigation in New York, it would be entirely irrelevant to the merits of this claim, had it not been for delays here in the United States the Oelbermann Foundation, beyond any question of doubt, would have received back this 80 percent of its funds just as other German nationals did, and when I say "other German nationals," I speak of individuals and not merely charitable corporations or charitable organizations which have always been considered to be the object of special generosity on the part of the United States Government. For that last statement, I can cite the administration bills in connection with the proposals for return of World War II German property, which treat charitable organizations much more generously than they do ordinary individuals. Mr. BENNETT. What kind of a charitable organization is this Foundation? 81964-56-12 Mr. RUBIN. It operates a home for working girls in Cologne, Germany. It tries to provide facilities for young girls who have to work for their living and who do not have very much money to pay for lodging. Mr. KLEIN. Is it still in existence? Mr. RUBIN. It is still in existence. Mr. TOWNSEND. May I make a suggestion, Why do we not look up the administrative history of the claim, and see how it was handled, and bearing in mind that there are certain difficulties that are inherent in the situation because, as you know, the Office of Alien Property has been in and out of Justice a couple of times and it has been an independent agency for quite a long time. I do not know, and apparently nobody here knows, just what the administrative history of the handling of the claim was, and we are talking in the dark. We can look it up and file a statement on it and incorporate it in the record. Mr. BENNETT. That is a good idea. Mr. KLEIN. I think that my colleagues and I are impressed by the fact that if this claim was not paid through no fault of this organization and there is no other way for them to get their money, because of the act passed, and they cannot get it administratively, then the only way they can get it is by an act of Congress. Then, the next question is, of course, whether we want to amend this bill, or introduce a private bill and none of us-and I do not think Mr. Rubin doeswant to endanger the passage of this legislation in the closing days of this Congress by adding an amendment which will compel it to go back to the Senate again and then perhaps die in the shuffle at the end. Mr. BEAMER. I was going to suggest perhaps Mr. Townsend would like to give us a record of any other similar cases, because it is possible that there may be other cases similar to this Oelbermann Foundation case. Mr. Rubin said he did not know, but, of course, we do not either. I think that would shed some light upon it. Mr. TOWNSEND. It certainly would. We can check that, too, while we are checking the records. Mr. BENNETT. Will you tell us, Mr. Rubin, something more about this foundation. Is Mr. Avram an American citizen or a German national, or what? Mr. RUBIN. Dr. Avram is an American citizen and he is a member of the bar of the State of New York. Mr. BennetT. Is he an officer or director or official of this foundation? Mr. RUBIN. Not to my knowledge. He merely represents the foundation. He was, if I may speak about Dr. Avram, he was a distinguished Rumanian lawyer who fled from Rumania and made his way eventually to the United States, becoming an American citizen as soon as that was possible, and did an arduous job of going to an American law school at a fairly advanced age, and passed the New York bar examination and became a member of the bar of the State of New York, which he has been for the past 2 or 3 years, I believe. He has represented a number of clients, both foreign and domestic, in various matters. He has been an associate of mine, and I have been associated with him in a few matters generally involving claims questions. Mr. BENNETT. Do you know the people who operate this foundation? Mr. RUBIN. I do not know personally the people who operate the Oelbermann Foundation, but I know that it was established under the will of Mrs. Laura Oelbermann, whose properties were originally seized here, and I also have indications that Chancellor Adenauer and members of the Adenauer family have been personally interested in this foundation which is in Cologne, a city in which the Chancellor is, of course, very much interested. Mr. BENNETT. How large a foundation is it? Mr. RUBIN. I know the German Embassy has taken an interest in the matter. Mr. BENNETT. Do they approve this proposal that you are making? Mr. RUBIN. They have suggested to the Department of State that an amendment to S. 2226 or other legislation would in their opinion be desirable on behalf of this charitable organization. Mr. BENNETT. Is this a large foundation? I notice you say $50,000 would mean its success or failure, or essentially that. You say the future existence depends upon its recovering the $50,000 that we are talking about here. I take it from that that it is operating as a pretty small institution. Mr. RUBIN. My impression is that it was substantially larger than it presently is, but as a result of bombing destruction and other losses, as a result of World War I, its present operations are considerably reduced. But there is no question in my mind that the funds here will be used for the charitable purposes which I have described. Those charitable purposes are endorsed by, certainly, the German Government. I have never heard any opposition to this except on a technical basis. As Mr. Gross says, it may be the fact that the bill we are dealing with here does not technically deal with German vested property, but it does deal with vested property, and this property we are talking about here was vested property. While it is possible to draw your distinctions vertically or horizontally in any number of places, it seems to me that this is an appropriate amendment to suggest to this particular legislation. Mr. BENNETT. How much of the $50,000 would the foundation get, if this amendment were adopted? Mr. RUBIN. They would get all, but I think the contingent fee is 20 percent. Dr. AVRAM. As far as I know, that is correct. Mr. BENNETT. That is all. Mr. KLEIN. Thank you very much, Mr. Rubin. The committee will await the report from the Office of Alien Property, and then you can leave this in our hands. I just want to point out one thing, Mr. Rubin, and that is the possibility of an amendment to this bill, of any nature, not only your amendment, but any nature, or the possibility of it dragging over until after July sometime, possibly, when we are going to adjourn, which will mean that this legislation will fail. I think that if the report of the Attorney General is favorable, it may very well be that I will introduce a bill to take care of your own situation if we feel that might be a better way of handling it. Mr. BENNETT. There is one other thing. I think it would be well if Mr. Rubin would submit for the record a statement by the German Government that they recognize this foundation, and something about it. Mr. KLEIN. I think we can do that easier than he can, through the Department of State. Mr. RUBIN. I have a copy of the communications from the German Embassy to the Department of State, and if it suits the pleasure of the committee I would be glad to prepare a very brief statement including that communication from the German Embassy, and perhaps some of the letters from the Office of Alien Property which describe the history of this matter and the exact manner in which the funds arose. We do have the details, and perhaps I can lay my hands on them more easily than the Custodian can. Mr. BENNETT. I think it would be helpful. Mr. KLEIN. There is a representative of the State Department here, I think. Would you see if you can get a statement for the record in regard to the State Department's views on this? We received the views of the State Department on this bill, but not on this particular amendment. Thank you, Mr. Rubin. (The following additional information was later received from Mr. Rubin:) Hon. ARTHUR G. KLEIN, LANDIS, COHEN, RUBIN & SCHWARTZ, Chairman, Subcommittee on Commerce and Finance, Committee on Interstate and Foreign Commerce, DEAR MR. KLEIN: In connection with my testimony before the subcommittee headed by yourself on June 6, 1956, I was asked to submit certain information for the record concerning the Oelbermann Foundation. The request, as I understand it, was directed toward: (a) The question of the interest of the West German Government in this matter, and its support of the Oelbermann Foundation; and (b) The detailed background of the sums which remain due to the Oelbermann Foundation. 1. As to the interest of the Federal Republic of Germany, a copy of the note presented by the Embassy in Washington of the Federal Republic of Germany to the Department of State, under date of February 13, 1956, has been made available to me, and I enclose herewith, marked "Annex A," a copy of that note. In this same connection, a question was raised by Congressman Bennett as to the nature of the work of the Oelbermann Foundation. I enclose herewith, marked "Annex B," a copy of a translation of a certification, dated Cologne, February 7, 1955, signed by the German authorities. This certification describes the establishment of the foundation in 1930, the purposes of the foundation, the difficulties encountered by the foundation, and the objectives and present work of the foundation. I can, of course, provide you with a photostatic copy of the original of this document, should it be desired. The basic purposes and nature of the foundation are also described, as you will notice, in the German Embassy's note of February 13, 1956. 2. With respect to the manner in which the funds here involved arose, I enclose herewith, marked "Annex C," a copy of a letter addressed by Mr. Arthur R. Schor, Chief, Claims Section, Office of Alien Property, to the Embassy of the Federal Republic of Germany, under date of January 16, 1956. You will note that the third full paragraph of that letter has been substantially incorporated in my statement presented on June 6, in describing the manner in which these funds arose. In particular, I may draw your attention to the fact that the substantial amount of over $28,000 out of the $49,608.06 which is here involved, represents a "refund of an overpayment of estate tax by this Office"-that is, the Office of Alien Property. For purposes of completeness, I also enclose in this connection, marked "Annex D" a copy of the letter of December 14, 1955, of the Office of Alien Property which is referred to in that Office's letter of January 16, 1956. I believe that amendment to S. 2226 would be feasible and would not delay passage of S. 2226. I have no reason to believe that such amendment would not be acceptable to conferees for the Senate. The matter of an amendment was, in fact, discussed with the staff of the Senate Judiciary Committee, but was raised with that staff at such a late date that action by that committee was difficult or impossible, and in fact no action, either adverse or favorable, was taken by the Senate Judiciary Committee and no hearings at all were held on the Oelbermann matter or cases similar to it. It is my understanding that the Department of State has already written on this matter to the Senate Judiciary Committee and that it will shortly be communicating with you. I should, of course, be much interested in such communications as may be received by your committee from the Departments of State and of Justice. I trust that the above will complete the record of your committee, and that favorable action will be possible. In view of this expressed interest in the matter, I am taking the liberty of sending a copy of this letter to Congressman Bennett of Michigan. In addition, I am furnishing a copy to Col. Dallas S. Townsend, Assistant Attorney General and Director of the Office of Alien Property, as well as to the Department of State. Sincerely yours, ANNEX A SEYMOUR J. RUBIN. The Embassy of the Federal Republic of Germany presents its compliments to the Department of State and has the honor to submit the following: During World War I the Alien Property Custodian vested certain property owned by Mrs. Laura Oelbermann-War Claim 185, World War I, Trust 6545. The assets were held, in part, in her name and in part in the name of the Deutsche Bank. The Emil and Laura Oebermann Foundation, a charitable foundation created under the last will and testament of Mrs. Oelbermann succeeded to all of these assets. Under an executive allowance of October 11, 1930, War Claim 185, originally filed by Mrs. Laura Oelbermann, was allowed for the return of 80 percent of the aggregate value of property seized in the name of Mrs. Oelbermann. The assets thus returned to the Oelbermann Foundation amount to $404,051.78 while the amount of $101,012.94 was retained as the 20 percent of the aggregate value in accordance with the provisions of the Settlement of War Claims Act of 1928. However, the Alien Property, for reasons unknown, did not return the property which was seized in the name of the German bank, although the Alien Property Custodian, as is stated by the Office of Alien Property, recognized that Mrs. Oelbermann was the owner of this property. The claim filed by the Oelbermann Foundation for a return of 80 percent of the property did include these assets. The aggregate value of the latter assets as credited to the claimant's account amount to $49,608,06 principal cash and section 23 income in the amount of $305,480.10. Before the return of all of the 80 percent of the assets could be made to the Oelbermann Foundation, all payments were suspended under Public Resolution 53 of June 27, 1934. Thus the Oelbermann Foundation, though unquestionably being entitled to a full return of 80 percent of all of the assets, did not receive its share, the return of which was provided for by the Settlement of War Claims Act of 1928. The apparent delay in the processing of the claim for a return of this property was not due to a fault or any omission imputable on the part of the foundation. The Embassy wishes to point out that the Emil and Laura Oelbermann Foundation is a charitable organization in Cologne, Germany. Attested by German authorities it still provides, inter alia, a home for impoverished working girls and women. Though having lost nearly all of its assets during World War II the foundation is trying to continue its charitable activities as best it can. Any relief granted to this foundation by returning to it the full 80 percent of the property to which it is entitled to seems in the opinion of this Embassy fully justified and deserved. Such relief could be made by means of an appropriate amendment to bill S. 2226 which at present, it is understood, is being studied by the Department of Justice. Pertinent proposals have been submitted by Mr. David A. Avram and Mr. Seymour J. Rubin, counsels for the Oelbermann Foundation to the Honorable Olin D. Johnston, chairman, Subcommittee on Trading With the Enemy Act. The bill S. 2226 is intended to dispose of the last assets still remaining from those seized during the First World War and it provides that an amount of about $500,000 which, according to the explanatory statement of the Department of Justice "cannot be paid to proper claimants" shall be transferred "to the Treasury for the benefit of the United States" so that the administration of World War I enemy property be, after so many years, eventually terminated. The Embassy wishes to inform the Department of State that it is in full conformity with the proposals set forth by the counsels of the Oelbermann Foundation and who suggest that bill S. 2226 be amended as to include appropriate relief |