26 October 2023

The monetization of recovered Jewish assets

by Marc Masurovsky

The idea is not new and evolved at the end of WWII, when Allied forces and local resistance and partisan units stumbled on mountains of looted Jewish property, consisting of household goods, decorative objects (including furniture and textiles), musical instruments, libraries, works of art (paintings, works on paper, sculpture, etc.), precious stones and jewelry, precious metals, and financial instruments.

These recoveries across Central and Western Europe created an urgent need to identify who the despoiled owners were, find out if they were alive, if family members and relatives could be identified and located to claim the property. This part of the story is well-known as it involves civilian and military efforts to oversee the collection, identification, and repatriation of this found property with a view to its restitution to rightful owners. These procedures were mostly carried out in zones of Europe not occupied or dominated by Soviet military and civilian authorities.

The burdensome aspect of the mission as outlined above soon proved to be too much for the agencies responsible for overseeing this massive task of identification, cataloguing and shipping of recovered Jewish property. In order to make this problem go away, why not sell it all off? The question was reasonable in light of the chaos and confusion reigning in recently-liberated European countries, the desire of survivors to get on with their lives, and the need for governments to rehabilitate their destroyed nations and stimulate the economy by whatever means possible.

If one were to sell off this property, who would administer the process? Who would receive the funds? In what capacity? The answer was fairly simple: if the property was known to have come from Jewish owners, whether or not they could be identified, then Jewish organizations would oversee the sale of these assets and redistribute the proceeds to those who needed the funds most—survivors and their families who were dispossessed of everything that they owned.

The monetization of looted Jewish property recovered by Allied forces started in earnest in mid-1946 after the Paris Reparations Conference where Jewish organizations and agencies would oversee the disposition of recovered Jewish property for the benefit of surviving Jewish communities and their members. It was one thing to sell household goods, clothes, linens, furniture, musical instruments with no apparent artistic value, books and jewelry. But what about works of art and artistic objects with market value that belonged to collectors, dealers and businesses steeped in the art world of the interwar years? Should they be treated as bulk items regardless of who owned them and what importance or value they held? For efficiency’s sake, it was cost-effective to presume the owners dead, which eliminated the onerous and time-consuming task of actually finding them so they could collect their recovered property.

Governments got in on the act, especially in Western Europe—the Netherlands, Belgium, and France—where public sales were held from the late 1940s to the mid-1950s during which more than 100,000 works of art and objects were sold off, a number of which were traceable to victims of Nazi persecution. Local government officials sometimes concocted elaborate schemes by which to divert thousands of works of art from Allied-run depots under the pretext that their owners had not been identified, label them as “heirless property” and sell them through a network of auction houses and businesses in Europe and the United States, the proceeds of which would benefit the organizations and individuals overseeing this effort as well as local public agencies and the victims’ heirs and relatives. The architect of one such a scheme, denounced by the US Department of State, was Dr. Philip Auerbach, a Bavarian official whose portfolio included reparations and restitution of looted Jewish property.

Since then, the physical restitution of individual art objects to their rightful owners has coexisted somewhat uncomfortably with the pressure exerted by Jewish groups to treat these objects as “wholesale items” to be disposed of expeditiously for the benefit of Holocaust survivors and their kin.

Over time, this duality in treatment of recovered Jewish property looted by the Nazis has shaped the cross-generational debate on restitution of looted art vs. reparations. The end result of this duality has been a general indifference across Jewish communities towards repeated efforts by individuals and entities to recover their looted cultural property once it was identified in a particular location. Since the 1950s, the absence of support and lack of empathy towards individual claimants seeking the return of their looted art has been nothing short of astounding.

One can only speculate that unsuccessful claims filed against current possessors of looted Jewish cultural property might have had more positive outcomes had Jewish groups and communities lent their active and vocal support to these claimants as part of a general movement to seek justice and closure for crimes committed against Jews during the Nazi era.