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By Dafna Linzer
Associated Press Writer
Wednesday, May 7, 1997 5:13 pm EDT


JERUSALEM (AP) -- Swiss banks may not be the only ones holding the missing assets of Holocaust victims: Some of the money may be in banks in Israel, according to a study published in an Israeli newspaper Wednesday.

Yossi Katz, a geography professor at Bar-Ilan University near Tel Aviv, wrote in Haaretz that German Jews deposited huge sums in banks here before World War II, and that the fate of the accounts remains unclear.

The report comes after a year in which Jewish groups and the U.S. Congress spearheaded a campaign against Swiss banks, accusing them of hiding up to $7 billion in unclaimed deposits of Jews who died at the hands of the Nazis.

Avraham Burg, the head of the quasi-governmental Jewish Agency and a leader of that campaign, said he would pursue Katz's allegations and expected that recovering such assets in Israel would be a much smoother process.

``I don't have the full information yet, but ... we will find a solution in a matter of weeks, not years,'' Burg told The Associated Press.

Katz wrote that the deposits made by Jews who lived in Germany and Nazi-occupied countries were frozen by British authorities in Mandatory Palestine under the so-called ``Trading with Enemy Order.'' Also frozen were assets in Palestine owned by Jews who lived in territory controlled by Nazi Germany.

Although he did not know the exact sum involved, Katz cited a 1946 study showing deposits in Palestine banks frozen under the act totaling 2.1 million pounds sterling; not accounting for interest, that now equals 44 million pounds, or $70 million.

Katz said that in 1949, Israel's government investigated but failed to confirm a claim that there were ``many millions of pounds'' in such assets in the Anglo-Palestine Company -- a Jewish-owned bank which later became Bank Leumi, currently Israel's second-largest financial institution.

``We don't know anything about these funds. We have never heard about them,'' said Bank Leumi spokeswoman Ricki Karmi. She said the bank had never received any inquiries on the issue.

There was no immediate comment from Israeli or British authorities.

Katz wrote that an unknown number of deposits were handed by the banks back to heirs of the depositors, and another unknown sum was taken over by the state.

``If unclaimed deposits of Holocaust victims were transferred to state coffers -- this was just,'' Katz wrote. But he added: ``We can only hope the state made an effort to locate surviving depositors of the legal heirs.''

Katz was not available for further comment.

© Copyright 1997 The Associated Press

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