In view of these considerations, it is respectfully submitted to the subcommittee that serious consideration be given to redrafting proposed eligibility requirements under any claims program which would afford relief to U.S. nationals who suffered property losses as a result of World War II. The importance of the passage of such legislation cannot be overemphasized. The passage of time makes the administration of such a claims program progressively difficult and, necessarily, more expensive to administer. The time has come for specific action. This duty, this responsibility, this privilege by the elected representatives of U.S. nationals should be exercised forthwith in providing suitable legislation to accomplish the relief sought by such a program. NEW YORK, N.Y., July 8, 1959. Re proposed legislation to establish a claims program for U.S. nationals whose property was confiscated or damaged as a result of World War II Hon. OLIN D. JOHNSTON, Chairman, Senate Judiciary Committee, Trading With the Enemy Act Subcommittee, U.S. Senate, Washington, D.C. MY DEAR SENATOR JOHNSTON: This is in further respect to the hearings being held by your committee relative to the return of enemy assets and the establishment of a claims program designed to provide a means of compensation to U.S. nationals whose property was damaged or otherwise affected as a result of World War II. By your leave, the undersigned has previously submitted a statement concerning his views on proposed legislation presently pending before your committee. I would appreciate the inclusion of the following additional observations concerning such programs in the record of the committee's proceedings. It is well recognized that the question of whether or not to return the assets of German nationals sequestered and subsequently vested by the Department of Justice is a most provocative one. I would not undertake to attempt to add any additional thoughts to either side of this question. It would appear that a matter of primary importance is the American claimants' problem and the manner and means of relief to such claimants. All of the allies in World War II, with the exception of the United States, have made some provision for their nationals, to compensate them for losses. It is not altogether complimentary to the Congress or this Government that there has been such a needless delay in providing for such a program. In view of the above, it is suggested that the Congress undertake immediately the establishment of a program to provide for the filing, classification, and preliminary investigation of claims by U.S. nationals for property losses in the areas generally accepted as having been involved in wartime action. The manner of providing for a fund to compensate these claimants is a matter that may very well be undertaken in the future when the difficult problem concerning the return of German assets has been resolved. As you know, the receipt, investigation, and development of these claims is difficult. Questions of nationality, decedent estate law, and indirect and beneficial ownership of corporate interests are a few of the complicated problems that must be considered. Acquiring a suitable staff by the Government to administer these claims is no small problem, inasmuch as the great majority of the potential claimants usually file their claims without the services of an attorney, thus placing an additional burden upon the Government in the development and completion of the claim. As I have stated before, to permit the disbanding of the Foreign Claims Settlement Commission would not only cause a tremendous delay in retooling for administering such a new program at a later date, but would release seasoned and experienced attorneys in this field to other endeavors which would make it almost impossible to establish such an efficient and qualified staff as is presently maintained by the Foreign Claims Settlement Commission. In view of the above, it is respectfully submitted and strongly urged that the Senate, together with the House of Representatives, provide, during this session, suitable legislation to permit the receipt and filing of the above-described type of claims to correct an already delayed program to protect American interests. This legislation is asking for nothing less than American citizens deserve and a delay in effecting such legislation is, in effect, giving them something less than this Government properly owes its citizens. Having been associ ated with the Government in this particular field, I immodestly suggest to you some experience. For whatever value that may have in this recommendation, I urge immediate action by the Senate. Respectfully, HENRY J. CLAY. CONTINENTAL CAN CO., INC., Hon. OLIN D. JOHNSON, Senator of South Carolina, DEAR SENATOR JOHNSON: On Thursday, June 18, 1959, the Judiciary Subcommittee on Trading With the Enemy Act will convene for the purpose of considering proposed amendments and bills concerning vested assets and war damage claims of American citizens. Mr. Otto E. Schimbke, with whom you have corresponded as recently as June 8, 1959, of 240 E. 76th Street, New York 21, N.Y., has, in answer to your correspondence, developed for your consideration the enclosed proposed amendment to S. 672. This amendment fulfills the serious deficiency in S. 672 in which no proviso for recovery of intangible properties such as accounts receivable has been made. As you know Mr. Schimbke's previous correspondence, he inherited a considerable sum from his uncle in Germany in 1940. This inheritance accrued to Mr. Schimbke as an American citizen and was placed by a German probate court in the Deutsche Bank for him. Before Mr. Schimbke could obtain the funds the Nazi government blocked them and he has been unable to recover his inheritance since that time. I feel certain there are a great many citizens of this country who similarly find themselves the innocent victims of the Nazi regime. The Legislature of this country is created for a singular purpose: the economic, just and representative operation of governmental machinery. There apparently is no real remedy for the recovery of such appropriated assets as inheritances confiscated by the Nazi government and rightfully the property of U.S. nationals. Incorporation of the enclosed amendment would create the necessary remedy and would increase the value of your proposed legislation. Your efforts to incorporate the enclosed amendment into S. 672 will be greatly appreciated. Please incorporate into the record of your subcommittee hearings this letter and the enclosed proposed amendment. We sincerely appreciate your efforts with regard to the enclosed proposed amendment. DUNCAN I. MACCALMAN, AMENDMENT TO BILL S. 672 IN THE SENATE OF THE UNITED STATES, MAY 28, 1959 Proposed amendment to sections 202 and 204 of the above is respectfully submitted for consideration of the subcommittee. Section 202 amended: "(d) loss of or damage to personal estates and inheritances injured or destroyed during the period beginning September 1, 1939, and ending December 11, 1941, as a result of occupation of territories mentioned under (a) above of section 202 by the Nazi German Government. But only if during this period a foreign probate court instructed or ordered deposit of said estates and inheritances at a bank or like institution in the name of the legal heir who was a U.S. national at the time of deposit." Section 204 amended: add, after line 20 and before line 21 "or, if such property constituted an inheritance placed in deposit at a bank of a foreign country by action of a valid probate court of such foreign country in the name of the legal heir who was a U.S. national at such time of deposit." NEW YORK CITY, June 1, 1959. STATEMENT AND RECORD EVIDENCE The war damage claims against Germany by Messrs. Otto E. Schimbke, New York City, and Ernst Schimbke, Milwaukee, Wis., both American citizens, are herewith submitted for study. The purpose in writing this report is to present the matter accurately but concisely for the hearings of testimony by the Sub committee on Trading With the Enemy Act of the Senate Committee on the Judiciary in connection with the proposed bills by the Senate, S. 672 and S. 744, to amend the War Claims Act of 1948. In 1940, my brother Ernst and I, American citizens since 1935, inherited from Germany the total sum of RM100,558.13 in equal shares, which was deposited for us at the Deutsche Bank in Breslau, Germany, by the German probate court of that city, April 1941. This became immediately a preferred blocked account; that is to say, we were prohibited to make any transactions. In 1941 the above reichsmark total represented a dollar value of about $44,000, according to the official foreign-exchange quotation of August 1, 1939, with 40.1 cents to 1 reichsmark. In accordance with Cordell Hull's reciprocal agreement between our country and Germany of December 16, 1938, revised April 12, 1939, in regard to inheritances, arrangements were made and completed in April 1941 by our American lawyer, Frederick Wirth, Jr., in Berlin to transfer this dollar amount to the United States. The Nazi government, however, delayed action for no good reason, and our combined efforts were finally stopped by the political events that followed. As early as June 17, 1941, we notified our State Department, explaining this condition and asking their advice. Similar correspondence was continued until April 1942 with both the Treasury Department and the Department of State. Neither was able at that time to give constructive advice as to how to protect our accounts abroad. Our lawyer, Frederick Wirth, Jr., has given us in his last letter of July 22, 1941, to which a financial statement was added, an account of his untiring efforts and of his final attempts to protect our interest. A copy of this letter is attached. Mr. Wirth was highly regarded as the American lawyer for the American colony in Berlin. His untimely death in October 1941, caused by his imprisonment in a Nazi concentration camp, left us without legal support. After the war, in 1946, correspondence with the State Department was taken up again without receiving concrete answers. Finally, during the summer of 1947, we submitted through an attorney two separate legal claims to the Department of State for our funds of 1941 in Germany. A note in acknowledgment of receipt was our only answer. Our attorney continued his efforts for us until February 1950 without making any progress. In the meantime we were successful in straightening out the records of our accounts of 1941 with the bank in Germany, which had moved several times, finally settling in Hannover. According to their records our accounts were found as Mr. Wirth had left them in 1941. However, through the following years up to 1954 no official bank statements were issued to us, nor were we informed accurately of the coming changes through the revaluation of the German currency. Answers to our questions were given with reservations. Then, at the end of 1954, we received the first bank statements of the new revaluated currency, resulting in an almost total writeoff of our old accounts, a credit of about $900 each in place of the 1941 amount of $22,000 each as previously mentioned. In a letter written March 5, 1955, to the directors of the Deutsche Bank we protested against this highhanded and one-sided procedure. A copy of this letter is likewise attached. Up to this time our hands were still tied and we had absolutely no control over our accounts. Their reply was evasive; one of their answers was: "You are still better off than others." The signing of the London Debt Agreement of 1948 by the United States was their trump card and a convenient excuse for the bank to use in writing off their debts. A letter to Chancellor Adenauer in 1956 was answered very politely but had the same negative result, also using the U.S. signature of 1948 at London as the main excuse. Only a few years ago our deposits were liberalized. Since these accounts have been freed, we have never made any withdrawals or transactions of any kind. At the time they were established in 1941, the probate court deposited in our name mostly bonds with an annual yield of 4 percent. In view of the fact that these accounts lay dormant for years in Germany and that many opportunities for reinvestment in this country went by unused, we believe the annual interest rate of 4 percent for our accounts should represent a normal rate of a business transaction. With this in mind, and disregarding the devaluation of our dollar since 1941, these prewar deposits would today, with 4 percent compound interest, represent the dollar value of over $89,100 as the combined total. It is our intention to claim this amount as war damage against Germany resulting from World War II. In contrast, the same German bank has revalu ated our accounts since 1955, in their new currency of the deutsche mark, with only about $2,000 or $1,000 for each of us as their final transaction. These are the facts of our case. We are grateful for this opportunity of bringing it to your attention. OTTO E. SCHIMBKE. STATEMENT OF REPRESENTATIVE GLENN CUNNINGHAM Mr. Chairman and members of the subcommittee, I am pleased to have this opportunity to present my views to the subcommittee. As the author of a bill, H.R. 2986, to amend the Trading With the Enemy and War Claims Acts, I know that the problem you face is not an easy one. I believe it is time for Congress to act in regard to seized property and war claims. I believe there is a logical connection between the two subjects, and for that reason my bill deals with both. Basically, the question in regard to seized property, or vested assets as they are euphemistically known, is a simple one. To my mind it is merely a question of whether this Nation condones expropriation. I do not believe anyone will say the people or the Government of the United States wants anything to do with such a policy. Let me cite the words of Mr. Val J. Peter, a distinguished citizen of Omaha and the largest publisher of German-language papers in this country. Mr. Peter has been active in the rehabilitation of postwar Germany, for which he has received the highest citation which the West German Government can give to a noncitizen. He has also been honored by his church for this outstanding work. Mr. Peter said in a statement on this subject, "Straight thinking leads us to the real parties in interest in this legislation. They are the Americans who wish to remain free. They are the Americans who have or hope to acquire property. They are especially the Americans who own the $30 billion of American investments in foreign lands. They include the individual American owners of houses and buildings in Europe and South America; the American shareholders in the great oil, manufacturing, and commercial corporations who have oil wells, plants, and offices in the Middle East, in Venezuela, in Mexico, in Guatemala, in Africa, in Europe, and everywhere that Americans have property interests." It is, of course, well known to the members of this subcommittee that the seized property belonged not to Nazi Germany or the Japanese Emperor but to individuals in Germany and Japan. Wherever it is located in this country, it is indistinguishable from the private property of American citizens. Our Government has never condoned expropriation. It deplored the seizure of the Suez Canal and other private property of foreign nationals by Nasser in Egypt. In the words of the late Secretary of State John Foster Dulles, "I would think that, in an era when we expect (to have) the American interests abroad, American capital investments abroad, it is wise for us to adhere ourselves strenuously to the highest standards of conduct in relation to those matters. That puts us in a better position to call upon others to apply the same standards." As a nation the United States demanded no reparations from Germany or Japan following World War II. We received none. There are some who would use the proceeds from this seized property as reparations. But the clear answer to such a suggested policy is that such an action would actually be collecting reparations from some 40,000 citizens rather than from the whole nations, when we have agreed not even to take reparations. Let us always remember that the seized property is not property which belonged to the defeated Governments of Germany and Japan but to citizens of those countries who happened to have such property in the United States when the war began. I dwell at greater length on seized property than on the subject of the payment of war claims because it is the more controversial and less understood issue. I do not believe there is much agitation to refuse payment of war claims to American citizens. The two problems are naturally tied together since they resulted from the same tragedy-World War II. As the subcommittee members examine this problem more, I believe and hope that they will find that return of seized property and payment of war claims are two long overdue actions which this Nation must take to protect its own citizens who have investments abroad and to be consistent in our policies in regard to the sanctity of private property. WASHINGTON, D.C., June 18, 1959. Hon. OLIN D. JOHNSTON, MY DEAR MR. CHAIRMAN: In your notice of public hearings of May 18, 1959, you request that those who have testified on previous hearings in relation to the subject matter of S. 105, S. 531, S. 664, S. 672, S. 744, and S. 1103 conserve the time and expense of your committee by simply incorporating such previous testimony by reference at your hearing on June 18, 1959. I am pleased to fulfill your request by this letter. I appeared on behalf of the Association for the Return of Japanese Seized Assets of Tokyo, Japan, on previous hearings respecting the subject matter of the above bills as follows: (1) Before your subcommittee on July 1 and 2, 1954, on S. 3422, 83d Congress, 2d session (see pp. 64 to 69 of committee hearing record), and filed a statement. (2) Before the House Committee on Foreign Affairs, July 1 and 11, 1955, on House Joint Resolutions 264, 265, 268, and 272, 84th Congress, 1st session (see p. 95 of hearing record), and filed a statement. (3) Before your subcommittee in April 1956. (See report of hearings on S. 854, S. 995, S. 1405, S. 2227, S. 3507, and S. 3114 and S. 3115.) You will find my testimony on pages 425 and 431, inclusive. Also filed a statement. (4) In addition to the above, I filed a letter with you dated April 23, 1958, asking you to incorporate in the record of your then hearings my previous testimony on bills on the same subject matter. This you did, and by referring to those hearings you will find my testimony. That letter expressed support for your full-return bill, S. 600, then under hearing by your subcommittee. The above testimony, (1) to (4), inclusive, contains my complete views on the subject matter of your present full-return bill, S. 672 (as amended). This bill, as the ones previously introduced by you, amends the Trading With the Enemy Act by providing for the full restitution of vested assets or indemnity therefor by abrogating ab initio confiscation under the White amendment. Pursuant to your request in your notice of May 18, 1959, I respectfully ask you to reincorporate all my previous testimony as recited above, (1) to (4), inclusive, and also this letter as my testimony on your subcommittee's hearings on June 18, 1959, in support of S. 672 (as amended). I make no comment on the bills set forth in your notice of public hearings, except S. 672 (as amended), as my client's interest is basically in S. 672. The Association for the Return of Japanese Seized Assets of Tokyo, Japan, which I represent and for whom I appear, is an especially constituted group of about 85 percent (in aggregate principal amount, not in number of claims) of all Japanese private claimants (not including the Japanese Government or any of its claims) seeking the return of or indemnity for their assets seized in the United States by the U.S. Government under the Trading With the Enemy Act. These claims are estimated to amount to approximately $65 million, net. The Japanese Embassy in Washington has advised the U.S. State Department of the official position of the Japanese Government. That position is in support of the full return of seized Japanese assets. I refer you to the aide memoire submitted by the Japanese Embassy in Washington to the State Department which are part of my testimony by the authority of the Japanese Embassy. These aide memoire are set forth textually in your record of hearings, 84th Congress, 1955-56, pages 430–431. I fully concur in the arguments and conclusions contained in your subcommittee's Report No. 120, 85th Congress, 1st session. Frankly, there is no more that can be said on the subject than is contained in that report. The comprehensive hearings by both House and Senate committees on several bills for the full return of seized assets have discussed and disposed of all contentions, pro and con. Each committee, after hearings, has supported full return. You have done likewise by again legislatively formalizing full return in your S. 672, as amended. Your committee has stood steadfast in favor of full return every time it has expressed itself since it recorded its initial position in 1954. On the other hand, the executive department of the U.S. Government under this administration has been throwing one obstacle after another across the path of restitution in an effort to achieve its objective of avoiding restitution of confiscated property without being driven into a position of subscribing to or condoning the confiscation of private property. The record points definitely |