[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]




 
                    REVIEW OF THE REPATRIATION OF
               HOLOCAUST ART ASSETS IN THE UNITED STATES

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                       DOMESTIC AND INTERNATIONAL
                 MONETARY POLICY, TRADE, AND TECHNOLOGY

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 27, 2006

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 109-113


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                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                    MICHAEL G. OXLEY, Ohio, Chairman

JAMES A. LEACH, Iowa                 BARNEY FRANK, Massachusetts
RICHARD H. BAKER, Louisiana          PAUL E. KANJORSKI, Pennsylvania
DEBORAH PRYCE, Ohio                  MAXINE WATERS, California
SPENCER BACHUS, Alabama              CAROLYN B. MALONEY, New York
MICHAEL N. CASTLE, Delaware          LUIS V. GUTIERREZ, Illinois
EDWARD R. ROYCE, California          NYDIA M. VELAZQUEZ, New York
FRANK D. LUCAS, Oklahoma             MELVIN L. WATT, North Carolina
ROBERT W. NEY, Ohio                  GARY L. ACKERMAN, New York
SUE W. KELLY, New York, Vice Chair   DARLENE HOOLEY, Oregon
RON PAUL, Texas                      JULIA CARSON, Indiana
PAUL E. GILLMOR, Ohio                BRAD SHERMAN, California
JIM RYUN, Kansas                     GREGORY W. MEEKS, New York
STEVEN C. LaTOURETTE, Ohio           BARBARA LEE, California
DONALD A. MANZULLO, Illinois         DENNIS MOORE, Kansas
WALTER B. JONES, Jr., North          MICHAEL E. CAPUANO, Massachusetts
    Carolina                         HAROLD E. FORD, Jr., Tennessee
JUDY BIGGERT, Illinois               RUBEN HINOJOSA, Texas
CHRISTOPHER SHAYS, Connecticut       JOSEPH CROWLEY, New York
VITO FOSSELLA, New York              WM. LACY CLAY, Missouri
GARY G. MILLER, California           STEVE ISRAEL, New York
PATRICK J. TIBERI, Ohio              CAROLYN McCARTHY, New York
MARK R. KENNEDY, Minnesota           JOE BACA, California
TOM FEENEY, Florida                  JIM MATHESON, Utah
JEB HENSARLING, Texas                STEPHEN F. LYNCH, Massachusetts
SCOTT GARRETT, New Jersey            BRAD MILLER, North Carolina
GINNY BROWN-WAITE, Florida           DAVID SCOTT, Georgia
J. GRESHAM BARRETT, South Carolina   ARTUR DAVIS, Alabama
KATHERINE HARRIS, Florida            AL GREEN, Texas
RICK RENZI, Arizona                  EMANUEL CLEAVER, Missouri
JIM GERLACH, Pennsylvania            MELISSA L. BEAN, Illinois
STEVAN PEARCE, New Mexico            DEBBIE WASSERMAN SCHULTZ, Florida
RANDY NEUGEBAUER, Texas              GWEN MOORE, Wisconsin,
TOM PRICE, Georgia                    
MICHAEL G. FITZPATRICK,              BERNARD SANDERS, Vermont
    Pennsylvania
GEOFF DAVIS, Kentucky
PATRICK T. McHENRY, North Carolina
CAMPBELL, JOHN, California

                 Robert U. Foster, III, Staff Director
Subcommittee on Domestic and International Monetary Policy, Trade, and 
                               Technology

                       DEBORAH PRYCE, Ohio, Chair

JUDY BIGGERT, Illinois, Vice Chair   CAROLYN B. MALONEY, New York
JAMES A. LEACH, Iowa                 BERNARD SANDERS, Vermont
MICHAEL N. CASTLE, Delaware          MELVIN L. WATT, North Carolina
FRANK D. LUCAS, Oklahoma             MAXINE WATERS, California
RON PAUL, Texas                      BARBARA LEE, California
STEVEN C. LaTOURETTE, Ohio           PAUL E. KANJORSKI, Pennsylvania
DONALD A. MANZULLO, Illinois         BRAD SHERMAN, California
MARK R. KENNEDY, Minnesota           LUIS V. GUTIERREZ, Illinois
KATHERINE HARRIS, Florida            MELISSA L. BEAN, Illinois
JIM GERLACH, Pennsylvania            DEBBIE WASSERMAN SCHULTZ, Florida
RANDY NEUGEBAUER, Texas              GWEN MOORE, Wisconsin
TOM PRICE, Georgia                   JOSEPH CROWLEY, New York
PATRICK T. McHENRY, North Carolina   BARNEY FRANK, Massachusetts
MICHAEL G. OXLEY, Ohio


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    July 27, 2006................................................     1
Appendix:
    July 27, 2006................................................    39

                               WITNESSES
                        Thursday, July 27, 2006

Able, Edward H., Jr., President and CEO, American Association of 
  Museums........................................................    15
Cuno, James, President and Director, Art Institute of Chicago, on 
  behalf of the Association of Art Museum Directors..............    19
Edelson, Gilbert S., Administrative Vice President and Counsel, 
  Art Dealers Association of America.............................    17
Eizenstat, Stuart E., former Commissioner, Presidential Advisory 
  Commission on Holocaust Assets in the U.S., Covington & Burling    10
Lillie, Catherine A., Director, Holocaust Claims Processing 
  Office, New York State Banking Department......................    26
Rub, Timothy M., Director, Cleveland Museum of Art...............    23
Taylor, Gideon, Executive Vice President, Conference on Jewish 
  Material Claims Against Germany, Inc...........................    13

                                APPENDIX

Prepared statements:
    Able, Edward H., Jr..........................................    40
    Cuno, James..................................................    61
    Edelson, Gilbert S...........................................    94
    Eizenstat, Stuart E..........................................   104
    Lillie, Catherine A..........................................   125
    Rub, Timothy M...............................................   145
    Taylor, Gideon...............................................   149

              Additional Material Submitted for the Record

Hon. Shelley Berkley:
    Copies of pictures drawn by Deena Babbott at Auschwitz.......   209
Hon. Carolyn B. Maloney:
    New York Times article.......................................   214
    Responses to questions submitted to Gilbert S. Edelson.......   217
Hon. Debbie Wasserman Schultz:
    Responses to questions submitted to Gideon Taylor............   221


                       REVIEW OF THE REPATRIATION
                       OF HOLOCAUST ART ASSETS IN
                           THE UNITED STATES

                              ----------                              


                        Thursday, July 27, 2006

             U.S. House of Representatives,
                       Subcommittee on Domestic and
                     International Monetary Policy,
                             Trade, and Technology,
                           Committee on Financial Services,
                                                   Washington, D.C.
    The subcommittee met, pursuant to notice, at 10:00 a.m., in 
room 2128, Rayburn House Office Building, Hon. Deborah Pryce 
[chairwoman of the subcommittee] presiding.
    Present: Representatives Pryce, Leach, Kennedy, Maloney, 
Sherman, Wasserman-Schultz, and Frank.
    Also present: Representatives Kelly, Israel, and Berkley.
    Chairwoman Pryce. The Subcommittee on Domestic and 
International Monetary Policy, Trade, and Technology will come 
to order. Without objection, all members' opening statements 
will be made a part of the record.
    Mr. Frank. Madam Chairwoman?
    Chairwoman Pryce. Yes.
    Mr. Frank. Could I ask unanimous consent to have 
participation by one Member who is on the Full Committee, but 
not on the subcommittee, and one Member who is not on the 
committee, both of whom have a great interest in and knowledge 
of this subject, the gentleman from New York, Mr. Israel, and 
the gentlewoman from Nevada, Ms. Berkley.
    Chairwoman Pryce. Without objection, so ordered.
    Mr. Frank. Thank you.
    We will begin by thanking all of you who are here at this 
hearing to review the Repatriation of Holocaust Art Assets in 
the United States.
    I would like to thank Ranking Member Frank and Ranking 
Member Maloney for their work on the hearing, and for bringing 
to the subcommittee's attention the need to review this very 
important issue.
    I would also like to recognize the efforts of Mr. Leach 
over the years in keeping the focus on this, and he will be 
presiding later on in the morning.
    In 1993, and continuing through the second world war, 
countless pieces of art were looted throughout Europe. After 
being seized by the Nazis, some of the art made its way to the 
United States, funneled into American collections through 
various undetectable methods. In addition, some art remained in 
Europe, arriving in the United States several years after they 
were stolen.
    This committee held a series of hearings, led by then-
Chairman Leach, from 1997 until 2000, to discuss the progress 
of returning the looted property to the victims of the 
Holocaust.
    At those hearings, witnesses from various organizations 
such as the American Jewish Committee, the Department of the 
Treasury, and museum representatives testified on the process 
of searching for the art and the difficulties in returning it.
    Although much progress was determined to have been made at 
that point, little attention since those hearings has been 
given to the restitution of the Holocaust artwork and other 
properties.
    It is my hope that this hearing can bring us up-to-date on 
efforts made by museums, and examine issues involving the ease 
of transporting art across international borders, such as the 
lack of public records documenting original ownership, the 
difficulty of tracing our transactions over many decades, and 
the lack of a central authority to arbitrate the claims for 
artwork.
    The struggles of the Jewish people affected by the 
Holocaust continue to this day, as survivors and their families 
struggle with governments and museums to recapture their 
heritage and their culture.
    Art is very personal, and each piece that is returned is a 
way to bring what was lost in those years back to them.
    So much of their lives, families, and homes were destroyed 
in the war that returning this art allows them to throw off the 
vestiges of the Holocaust in some small way. Each piece of art 
is a symbol of hope, a freeing of the spirit, and a healing of 
the soul.
    Many survivors spend years working to get their property 
returned, dogged by foreign governments and museums who will 
try to wait them out until they resign in defeat or pass from 
this world.
    The efforts of the U.S. museums who have such a rich and 
treasured history of support by the Jewish people has been 
inspirational.
    I commend the yeoman's work of the Museum Associations, the 
Conference on Jewish Claims, and the--New York to set up its 
own claims office.
    Although American museums hold but a small percentage of 
art that would qualify, they work tirelessly, using vital time 
and resources to research the problems of the art in their 
collections and build a searchable database.
    I appreciate the witnesses being here with us today, 
discussing this important issue, and I look forward to your 
testimony.
    Chairwoman Pryce. The ranking member of the Full Committee, 
Mr. Frank, is recognized.
    Mr. Frank. Thank you, Madam Chairwoman. I appreciate your 
having this hearing, and I want to again note the work that the 
former chairman of the Full Committee, the gentleman from Iowa, 
who joins us today, has done on this.
    I am very pleased to be having this hearing, and I do want 
to say at the outset that I think we should make it clear to 
everyone that this is not, in my mind, and I hope in the minds 
of our colleagues, anything adversarial, and certainly not 
prosecutorial.
    There are times when people on Congressional committees 
regard witnesses as opponents or potentially uncooperative. I 
think, as a result, in part, of some of the urging that members 
of this committee did under the gentleman from Iowa's 
leadership, but also because of the goodwill of people here, 
that we have made progress in working together.
    I was pleased in reading the summary that just came out of 
the Claims Conference, dated just a couple of days ago. 
Basically, what they said is, in summary, there has been some 
progress, but there is still a lot to do, and they acknowledge 
that, in principle, there was broad agreement here, and we need 
to work to keep it up, and I am pleased that is the spirit.
    Something uniquely terrible in human history happened 60 
years ago and more, and we are still dealing with the 
consequences of that, not just of the lives lost but of the 
lives scarred, and those of us who are Jewish, particularly, 
feel scarred, also, indelibly by this experience. So, we come 
together to do what we can, not to undo what happened--that 
would be ridiculous to even talk about, but to the extent that 
it is humanly possible to mitigate the terrible effects, and I 
think it is important to recognize that yes, we are dealing 
with as emotional a subject as has existed in human history, 
and anyone who does not deeply feel this emotion is flawed, and 
our job is to make sure that the deep emotions we feel--that 
all of those things are kept in context and that they do not 
become reasons that we turn on each other, and the people here 
engaged in this are not each other's opponents.
    We are, I hope, people who are going to be working together 
on this small part of the task of addressing on an ongoing 
basis the terrible history of the Holocaust.
    So, I appreciate that sentiment.
    I want to acknowledge that the gentleman from New York, Mr. 
Israel, who is here, who has joined us, has had a particular 
interest in this, and as a member of our committee, the 
Committee on Financial Services, has been one of the ones 
taking the lead.
    I know our colleague, Ms. Berkley, has a particularly 
relevant situation in her own district with regard to an 
individual who was so tragically involved in this.
    Others who are here, the gentlewoman from New York, Ms. 
Maloney, and the gentleman from California, Mr. Sherman, have 
had an ongoing interest.
    So, I think this is a chance for Congress to be at its 
constructive best, to help be a catalyst to get people of good 
will together to work on a task which is both intellectually 
challenging and emotionally wrenching, and I hope we will all 
be able to go forward in that spirit.
    Thank you, Madam Chairwoman.
    Chairwoman Pryce. Thank you, Mr. Frank.
    Mr. Leach?
    Mr. Leach. Thank you, very much.
    First, I want to commend you for holding this hearing, and 
for your thoughtful opening statement. Also, Mr. Frank's words, 
I think, were as wise as any I have heard in this committee.
    In the late 1990's, this committee undertook a task of 
reviewing history, which is a very unusual thing for any 
Congressional committee. We worked closely with the Clinton 
Administration and particularly with one extraordinary figure 
in that Administration, who is with us today, Stuart Eizenstat, 
and I do not know of anyone on any issue who dedicated more 
effort, with greater professionalism, than Mr. Eizenstat did at 
that time.
    We all know of the depth of the Holocaust, as Mr. Frank has 
indicated.
    The committee attempted to undertake the examination, not 
just of the largest mass murder in history, but also the 
greatest mass theft in history. We looked at the dimensions of 
the holocaust from a mass theft dimension, which is our 
committee's jurisdiction, and we began with Swiss and other 
bank accounts. We looked at issues of gold, life insurance, and 
the whole spectrum of issues, of which, in one sense, art is a 
subset, and maybe even a footnote, but it is not a small 
footnote. Art is part of culture. Preceding the Holocaust, we 
had international law that suggests as much. One of the great 
quotations comes from a sculpturist named Emmerich de Vattel 
who wrote in the Law of Nations in the 18th century, ``For 
whatever cause a country is ravaged, we ought to spare those 
edifices which do honor the human society and do not contribute 
to increase the enemy's strength, and it is to call oneself an 
enemy to mankind to deprive people of monuments of art,'' and I 
think that is part of the aspect of why art is important. We 
all know there were the Nuremberg trials, which held, 
symbolically, a very few people accountable for genocide.
    These Congressional hearings have been duplicated and quite 
possibly precipitated by this committee's action in a dozen 
other countries in Europe and elsewhere. Each of these hearings 
has raised the notion of accountability, and the precept that 
there is not a statute of limitations on genocide. There are 
also monetary implications: there was a multi-billion-dollar 
recompense that Stuart Eizenstat negotiated. The settlement may 
be minuscule compared to the losses, but it is symbolic and 
profoundly significant. I will just conclude with this: WWII 
caused the greatest displacement of art in history. The notion 
that avarice might have played a small role in the mass 
genocide has to be looked at as more than a monetary issue. 
Genocide and theft go hand in hand, and that is why this 
committee entered this field. It is also why I think the 
Clinton Administration should be commended most highly for its 
effort to end this all by the end of the 20th century, which it 
largely succeeded in doing. But we are looking at elements that 
go beyond that, which is why this hearing is today.
    Thank you.
    Chairwoman Pryce. Our ranking member, my good friend, the 
gentlelady from New York.
    Mrs. Maloney. I would like to thank Deborah Pryce, the 
chairwoman and my good friend, for calling this incredibly 
important hearing.
     I also want to publicly congratulate Stuart Eizenstat for 
his commitment and really effective work with the Swiss bank 
accounts, with the art, with so many areas, and thank him for 
the support that he gave me with the Nazi War Crimes Disclosure 
Act, which has now been turned into a book, and is probably the 
biggest opening of records during that period for scholars, and 
I was proud to have authored it and passed it.
    I also particularly want to mention that one of my 
constituents, Catherine Lillie, is here from New York. 
Catherine is the director of the Holocaust Claims Processing 
Office of the New York State Banking Department, and she is 
representing Diana Taylor, our banking commissioner, and for 10 
years, they have been assisting claimants, and do a very, very 
fine job.
    In the interest of time, I am going to place my comments in 
the record, but I do want to know that the Claims Conference 
noted that about a third of the museums did not respond to the 
survey, and those that did did not provide complete 
information, which is discouraging, and we need to work on 
that, but I am proud of one of the institutions that I 
represent, the Metropolitan Museum of Art, which was cited in a 
New York Times article, and I would like permission to place it 
in the record.
    Not only do we have to work to make museums and 
institutions comply, but we should also applaud those that have 
transparency and have obeyed the law and have responded to it 
and have worked hard on it.
    Chairman Leach, you played a very vital role in this, in 
creating this legislation in 1998, the Presidential Advisory 
Committee on Holocaust Assets, and I am indebted to you, as are 
many of my constituents, some of whom are Holocaust survivors.
    I often associate my comments with the distinguished 
ranking member of this Committee on Financial Services, Barney 
Frank, but today, I particularly would like to associate my 
feelings and support of his comments and be associated with 
them.
    Again, we have several panelists here. I thank the 
chairwoman for responding to the minority's request for 
representatives on this panel, and I request permission to 
place my long statement in the record, but I am really anxious 
to hear what our panel has to say today. Thank you for being 
here on this important issue.
    I yield back.
    Chairwoman Pryce. Without objection.
    We will recognize members for opening statements, and 
realize that your full statements can be submitted for the 
record, and because we have such a large panel, just ask you to 
be brief, if possible.
    Mr. Sherman.
    Mr. Sherman. Thank you for holding these hearings. They are 
important.
    I served with our distinguished witness, Stuart Eizenstat, 
on the Presidential Advisory Commission on Holocaust Assets in 
the United States, and as others have said, his tremendous work 
on this shows a real dedication.
    With 600,000 pieces of artwork stolen by the Nazis and 
their collaborators, obviously stolen art during the Holocaust 
is a very important problem, but an even greater problem are 
the other assets stolen during the Holocaust, during World War 
II, and even during World War I and the Armenian genocide that 
followed.
    We should recognize that in terms of a family portfolio, 
even in Europe last century, art would have been, for most 
families, a small percentage of their total assets, and that 
art, unlike almost everything else that you would invest in, is 
not centrally recorded. There are bad records or no records as 
to who owns all but the most valuable paintings.
    So, to put a value for restitution we would be able to 
achieve even if we worked diligently is modest compared to the 
total value of all the assets stolen in the Holocaust in World 
War II and the Armenian genocide.
    We are the Financial Services Committee, and I hope that we 
will focus on financial institutions, as well as brokerage 
accounts, bank accounts, and insurance policies. Right now, we 
have seen some restitution from the banks, but I have been very 
concerned about life insurance companies who have said that 
they sold policies to Armenians in the 1800's or the first 
decade of the last century and no one has made a claim, so they 
do not have to pay, or they sold policies in Poland to gentiles 
and Jews in the 1930's, and no one has made a claim, and they 
have not heard from the families, so they do not owe any money.
    I have introduced legislation, and I hope that we can move 
forward to hearings and markup on legislation that would 
require every insurance company doing business in this country 
and its European affiliates to simply post on a central 
Internet site a list of insurance policies, life insurance 
policies, where the insured is over 100 years old, where it is 
likely that the insured perished in the great tragedies of 
Europe and west Asia of the last century, and where families 
could come forward and show that they are the next of kin.
    The same steps should be taken with regard to bank accounts 
and brokerage accounts.
    I think it is important that we have these hearings on 
artwork, but the records are available, the power is in this 
committee.
    Every one of those major European companies wants to do 
business through affiliates here in the United States, and it 
is about time that we protect American consumers from companies 
so rapacious that they would sell policies and then hide behind 
the Holocaust so that they do not have to pay.
    Chairwoman Pryce. The gentleman's time has expired.
    I ask unanimous consent that Ms. Kelly be permitted to 
deliver an opening statement.
    No objection.
    So ordered.
    The gentlelady is recognized.
    Ms. Kelly. Thank you very much, Chairwoman Pryce, for 
allowing me to come to the hearing. Your commitment to ensuring 
that the victims of Nazi tyranny can reclaim the possessions 
that were stolen from them so long ago is really to be 
commended.
    As all of our witnesses know, the Nazi leadership had a 
unique relationship with the artistic world.
    Their hatred of modernity and the work of Jewish artists 
and writers did not stop them from illegally acquiring some of 
the largest art collections in the world, not only for resale 
but for personal display in such places as Hermann Goering's 
Carin Hall and Hitler's planned Nazi Art Museum in Linsk.
    Specific orders were issued to military and paramilitary 
forces entering occupied territories to seize, survey, and 
transfer collections of art and music to the Third Reich. This 
pillage, unseen since the fall of the Roman Empire, stripped 
tens of thousands of Jewish families of their possessions.
    Many have not been recovered and are still in the hands of 
private collectors and art museums worldwide.
    This committee has an important responsibility to ensure 
that not only do we return this art to its rightful owners and 
their heirs but that we do more to stop the smuggling of art, 
and especially the use of art as a means of moving value 
between nations.
    Thanks to the diligent work of Chairman Oxley and others on 
the financial offenses against terrorists using our banking 
system, we are stronger than we have ever been. Unfortunately, 
terrorists and money launderers have responded and are 
increasingly using the smuggling of cash, gold, and diamonds.
    Of particular interest to this subcommittee will be the 
fact that they are also using the movement of higher value 
goods such as art to move terrorist money. Items of high value 
and high density store a value that has a ready market 
worldwide.
    Numerous reports exist that money launderers are using the 
art world as a safe way to do business. I would ask each of the 
witnesses from the art and curatorial industries to discuss 
what procedures they have in place to detect money laundering 
in the sale and purchase of art.
    Again, I compliment you on holding this important hearing, 
and thank you for allowing me to sit in.
    Chairwoman Pryce. The gentleman from New York, Mr. Israel, 
is recognized.
    Once again, members can put their entire statements in the 
record, and please be brief.
    Mr. Israel. Thank you, Madam Chairwoman. That is exactly 
what I intend to do, and to repay you for the courtesy of 
allowing me to sit in on this hearing, although I am not a 
member of the subcommittee--the reason I asked to participate 
in the hearing is because this issue, for me, is personal.
    Before my election to Congress, I founded and organized the 
Institute on the Holocaust and the Law, which explored the role 
of judges, lawmakers, lawyers, and law schools in advancing the 
Holocaust.
    Prevailing up to recent times was that the Holocaust was an 
act of lawlessness.
    It was not an act of lawlessness, it was an act of law, and 
it was a collective act of law and decrees and decisions 
organized, created, and codified in order to discriminate, 
annihilate, and confiscate, and that involved not just 
lawmakers but art dealers, museums, businesses, and insurance 
companies.
    Throughout my experience with the Institute on the 
Holocaust and the Law, I often asked myself, what would I have 
done then if I were in a position of power to help?
    Well, there is nothing that I could do about what happened 
then. This venue gives me an opportunity to do something now.
    This is one of those lingering issues that still requires 
justice and still requires an aggressive response by the U.S. 
Congress and the Administration, and that is why I have asked 
to participate in this hearing. Again, I want to thank the 
chairwoman and our ranking member, Mr. Frank, for their 
support.
    I was pleased to join the letter requesting this hearing, 
and I look forward to hearing the views of our panelists.
    Thank you, Madam Chairwoman.
    Chairwoman Pryce. Thank you. We welcome your participation.
    Ms. Wasserman-Schultz, do you have a statement?
    All right.
    Mr. Kennedy?
    Okay.
    Ms. Berkley?
    Ms. Berkley. Thank you, Madam Chairwoman, and I appreciate 
the courtesy that you and Mr. Frank have extended me to allow 
me to participate.
    When we talk about this issue as being very personal and 
emotional, I certainly believe we can all agree on that. I want 
to share with you very briefly a story that is very personal to 
me.
    I have been in Congress now for 8 years.
    During my first year, I received a visit from a woman whose 
family lives in my Congressional district, and this is her 
story.
    She is a Czechoslovakian Jew.
    In February of 1943, this woman, at the age of 20, was 
shipped to Auschwitz, along with her mother and 3,600 other 
Czechoslovakian Jews.
    By the time the war was over, there were only 22 
Czechoslovakian Jews left, and Deena Babbott and her mother 
were 2 of the 22 that managed to survive.
    The way she managed to survive is that Deena Babbott, at 
the age of 20, was a very talented artist, and she had painted 
a Disney character or a few of the characters on the barrack 
walls of the children's barrack at Auschwitz.
    Josef Mengele saw her art, and he asked her, told her, 
ordered her to start drawing pictures of the gypsy inmates. 
What he would do--the reason he could not take photos of them 
is because he could not capture in the photos of those times 
the skin tone of the gypsies, and he wanted Deena Babbott to do 
this.
    What he would do is point out gypsy inmates at Auschwitz 
and have her draw them.
    When she completed the drawing, he would have the gypsy 
killed.
    Now, Deena drew--there are seven of her drawings that 
remain.
    When she was liberated, obviously she and her mother left 
Auschwitz rather quickly, like everybody else. She did not take 
her art with her.
    It was not hers at the time, although she had created it, 
to take with her.
    Many years later, in the 1970's, Deena Babbott was 
contacted by the Polish Government.
    They had discovered her art in a broom closet at Auschwitz, 
and they asked her to come and authenticate the art. She was 
under the impression that she was going to Poland to reclaim 
her art.
    She is absolutely convinced that the only thing that kept 
her and her mother alive was the fact that Mengele thought she 
was of some value. It is these pictures that saved her life.
    The Polish Government has refused to give Deena Babbott her 
artwork back.
    Now, when I was part of the delegation that Mr. Israel and 
I, I guess, were a part of that, that represented Congress at 
the 60th anniversary of the liberation of Auschwitz, we, in 
fact, saw Mrs. Babbott's art, and what they told me--there are 
seven pictures remaining, and I've got them here, if you're 
interested. I would like to submit them for the record.
    I think she is entitled to her art back.
    Now, she has agreed to compromise with the Polish 
Government and only take three of the seven, at her selection, 
and we still cannot get them.
    I have gotten a resolution from Congress saying that this 
art is her artwork.
    We have put something in the Authorization Act saying that 
the Polish Government ought to return this art. I am at my 
wit's end, and I think this woman is entitled to her art as 
much as any family that lost their art and had it confiscated. 
There is nothing more personal than something that was created 
by her hand.
    Chairwoman Pryce. The gentlelady's time has expired.
    Ms. Berkley. I would appreciate any guidance you could give 
me to make this happen for this woman before she passes away.
    Thank you very much.
    Chairwoman Pryce. Thank you.
    Now, the reason we are here is to hear from you, and I 
would like to introduce our panel at this time, and we will 
start to my left, and that is the order in which you will 
testify.
    Mr. Stuart Eizenstat is a former commissioner for the 
Presidential Advisory Commission on Holocaust Assets in the 
United States, and we have already heard much about your good 
work, sir.
    Mr. Gideon Taylor is the executive vice president for the 
Conference on Jewish Material Claims Against Germany.
    Welcome.
    Mr. Edward Able is the president and CEP of the American 
Association of Museums.
    Mr. Able, welcome.
    Mr. Gilbert Edelson is the administrative vice president 
and counsel at the Art Dealers Association of America.
    Mr. Jim Cuno is the president and director of the Art 
Institute of Chicago. He is here today on behalf of the 
Association of Art Museum Directors.
    Mr. Timothy Rub is the director of the Cleveland Art Museum 
in the great State of Ohio.
    Our final witness, Catherine Lillie, is the director the 
Holocaust Claims Processing Office in the State of New York 
Banking Department.
    Mr. Frank. Madam Chairwoman, I have to leave, but I just 
wanted to commend the majority and minority, and particularly 
our staffs, who do all this work, for putting together really a 
first-rate panel.
    I am just impressed, as you read off the names, of how well 
we have represented that spectrum. It is always a pleasure to 
have Mr. Eizenstat, who has contributed so much, but to all of 
you, I am grateful for your being here, and I think we have 
really achieved what we would like to, which is a very balanced 
and thoughtful panel, and while I have to leave, I want to 
express my appreciation to all of them for joining us.
    Chairwoman Pryce. Thank you, Ranking Member Frank.
    Without objection, all of your written testimonies will be 
made a part of the record.
    Each of you will be recognized for 5 minutes for a summary 
of your testimony, and we will begin with Stuart Eizenstat.

    STATEMENT OF STUART E. EIZENSTAT, FORMER COMMISSIONER, 
  PRESIDENTIAL ADVISORY COMMISSION ON HOLOCAUST ASSETS IN THE 
                   U.S., COVINGTON & BURLING

    Mr. Eizenstat. I want to thank the leadership of the 
committee for holding these hearings and the Claims Conference 
for championing them.
    The hearings will bring renewed attention to the 
restitution of art looted by the Nazis during World War II, 
which, after a burst of activity in the late 1990's, has lost 
momentum and threatens to fall off the pages of history, 
particularly abroad, where most nations lack the continued 
commitment shown by the American Association of Museums.
    At a time when almost all other Holocaust-related 
restitution and compensation matters have been completed, or 
are nearing completion, Holocaust-era art recovery remains a 
major unresolved challenge.
    There is a certain art restitution fatigue that has set in, 
particularly in many foreign countries, and I hope these 
hearings will change that process.
    Our work on art restitution in the Clinton Administration 
was part and parcel of our negotiations over the recovery of 
bank accounts, property, insurance, and slave-enforced labor 
compensation.
    While the looting of artworks is as old as war, like the 
Holocaust itself, the efficiency, brutality, and scale of the 
Nazi art theft was unprecedented. As many as 600,000 paintings 
were stolen, of which 100,000 are still missing some 60 years 
later.
    There was nothing casual about this massive plunder; it was 
well organized.
    Hitler viewed the amassing of art as a necessary project in 
his creation of an Aryan master race, and the cultural 
centerpiece of his Thousand Year Reich was to be a Fuhrermuseum 
in Linz, Austria, where he was raised.
    In my lengthy written statement, I have provided, as I was 
asked by the committee, a history of how the issue of art 
restitution, long forgotten for decades, suddenly thrust itself 
on the world's agenda. Suffice it to say here they were doing 
the work of four academics, a barred college seminar in 1995, 
the adoption of principles of art restitution by the American 
Association of Museum and Museum Directors, under the part of 
Chairman Leach at the 1999 hearings, our work in the Clinton 
Administration, leading to the adoption by 44 countries of the 
Washington principles of art at the 1998 Washington conference 
on Holocaust-era assets, which, in effect, internationalized 
the AAM principles.
    Congressman Leach was part of our team. He presided over 
the art portion of that conference, and deserves our unwavering 
thanks.
    I also want to thank Ed O'Donnell and John Becker of the 
State Department's Holocaust Era Assets Office for their 
continuing interest.
    These Washington principles, Madam Chairwoman, changed the 
way in which the art world did business. They required museums, 
governments, auction houses, and others to cooperate in tracing 
looted art through stringent provenance research to put the 
results in an accessible form, to be lenient in accepting 
claims, and to adopt a system of conflict resolution to avoid 
protracted litigation.
    I'll spend the bulk of my testimony, as I did in my written 
testimony, on developments abroad, but let me say the 
following, in a paragraph or two, at home.
    Under the leadership of the AAM and the AAMD, many American 
museums and virtually all major American museums have 
demonstrated a real commitment to implementing our Washington 
principles, as well as their own. They have created, for 
example, a Nazi era provenance information Internet portal, a 
tremendously important, searchable central registry, so people 
can go to one place that will then connect to over 150 museums.
    There are now 18,000 objects from 151 participating museums 
on that portal, but as the Claims Conference survey indicates, 
there is still much work to be done, with half of the AAM 
membership not yet participating and with a potential universe 
of at least 140,000 covered objects.
    I also want to applaud the work of the New York State 
Holocaust Claims Processing Office, created by Governor Pataki, 
which has led to the return of 12 pieces of art. I want to note 
that litigation since the U.S. Supreme Court case of Maria 
Aldman is another potential avenue.
    In the United States, the focus should be on art dealers, 
since it is in the commercial art market where most Holocaust-
era art is sold.
    Art auction houses like Christy's and Sotheby's, which have 
to publish their catalogs and they have public auctions, have 
done a commendable job of implementing the Washington 
principles, with dedicated full-time experts at Sotheby's and 
Christy's on the restitution effort.
    I am pleased to learn from Mr. Gil Edelson that the Art 
Dealers Association of America has, contrary to my 
understanding in my written statement, adopted principles and 
best practices for the art dealers.
    I would say to you, Gil, that this is a well-kept secret, 
and I hope that it will be published. I have relied on some of 
the best experts in the world who are unaware of this.
    I think it is a tremendously important thing that you have 
done, and I would only ask that you make more public use of it 
and implement it thoroughly. So, I congratulate you on the fact 
that you did, and I hope that they will be better published.
    Let me make the following concrete suggestions for the 
Congress in the U.S. area:
    First, encourage all American museums that belong to the 
AAM to complete and regularly update their databases and to 
have all 140,000 covered objects on the central portal within 3 
years.
    Second, encourage American museums who litigate cases to do 
so on the merits rather than on technical defenses like the 
statute of limitations.
    Third, encourage the Art Dealers Association to give the 
widest publication and the broadest implementation to the 
guidelines which, again, I am pleased, Gil, to learn this 
morning that you have published in 1998, and importantly, to 
pass bipartisan legislation to create a federally funded memory 
foundation.
    There is a bill pending to do this, to assist U.S. citizens 
in pursuing Holocaust-era claims, including for art, as the New 
York State office is doing.
    And suggestions for abroad:
    While American museums still have additional work to do, 
their progress is light years ahead of other countries abroad, 
who are signatories to the Washington principles.
    There are bright spots, like Austria and the Netherlands, 
but the vast majority have done no provenance research at all, 
or only on a limited basis, and have large quantities of looted 
art or cultural property in Europe that is unidentified.
    Where countries have published databases abroad of 
potential Holocaust looted art, it is in inaccessible 
languages, lacks the detail necessary for each identification, 
and is not based on any comprehensive provenance standards.
    There is no international centralized database like the one 
the U.S. museums have created.
    Only four countries have national processes for resolving 
claims, and most, including the U.K., Italy, Hungary, and 
Poland, have absolutely no restitution laws, so that even if 
art is identified, there is no realistic way to have it 
returned, as well as strict time limits on claims.
    I have detailed the status, Madam Chairwoman, and members 
of the committee, of implementation of the Washington 
principles on a country-by-country basis in my testimony. 
Suffice it to say here that the real focus should be on a few 
key countries which have the largest quantity of Holocaust 
looted artworks: Russia, Germany, France, Hungary, Poland, the 
Czech Republic, and Switzerland.
    Russia, for example, has refused to follow through on their 
commitments or to follow their own law, which is actually, on 
its face, a positive law for restitution. German museums have 
ignored repeated pleas from the German Government at the 
federal, provincial, and municipal levels to do basic 
provenance research. Where it has been done by a few museums, 
it has been a great treasure trove of identifying art.
    Some of my recommendations for what I would ask you to do 
for the countries abroad:
    One, convene an international conference in 2007 for the 44 
countries who signed the Washington principles to encourage 
foreign governments to implement the principles by doing 
serious provenance research based on internationally accepted 
standards to publish an accessible database, to work 
cooperatively with claimants, and to avoid using technical 
defenses to block claims.
    Second, for the Executive Branch, at senior levels, to work 
bilaterally with Russia, Germany, in particularly, but also 
with France, Poland, Hungary, and Switzerland, to make progress 
and open up their archives.
    Third, to work to create an international Internet art 
restitution portal managed by a neutral intergovernmental body 
into which all nations, museums, art dealers, and auction 
houses could place their provenance research. This would be the 
single most effective step, Madam Chairwoman, for restitution 
abroad.
    And finally, to urge foreign governments to develop 
transparent procedures to handle claims fairly, justly, and on 
the merits, without technical defenses.
    In conclusion, if the U.S. Government and this Congress 
does not take the lead, as Chairman Leach did before, and as we 
did in the Clinton Administration, then, indeed, art 
restitution abroad will revert to the dormant status it had 50 
years ago, and art fatigue will continue.
    [The prepared statement of Mr. Eizenstat can be found on 
page 104 of the appendix.]
    Chairwoman Pryce. I really thank you for your testimony, 
and we will read it in its entirety, and we will continue on 
with Mr. Gideon.
    Thank you.

     STATEMENT OF GIDEON TAYLOR, EXECUTIVE VICE PRESIDENT, 
   CONFERENCE ON JEWISH MATERIAL CLAIMS AGAINST GERMANY, INC.

    Mr. Taylor. Thank you, Chairwoman Pryce, and members of the 
subcommittee.
    Art is about family, it is about memory, and it is about 
history.
    It is about the history of paintings and drawings and 
sculptures, but more importantly, it is about the history of 
people.
    For many, it is the last tangible connection with a past 
that was destroyed and with a family that was lost.
    The looting of art by the Nazis was a systematic, 
widespread, unrelenting extension of their racial theories. The 
Jews who were to be exterminated in body were also to be 
plundered of all their assets.
    During the past decade, this committee has established 
itself as a leading force in the attempt to secure a measure of 
justice for Holocaust victims and their heirs.
    On their behalf, we applaud your continuous efforts. 
Without information regarding looted artworks, survivors and 
their heirs will not know where to look, and the last 
opportunity we will have to right a historic injustice will be 
gone.
    The average age of Holocaust survivors is over age 80. The 
generation of the survivors is slipping away, and with them 
will go the personal recollections and memories that may help 
connect a family with its past.
    The report of the Presidential Advisory Commission, as well 
as other experts, have described how, despite efforts to 
prevent it, some looted art made its way to the United States 
during and after the war.
    The Washington Conference on Holocaust Era Assets, 
initiated by Deputy Secretary Eizenstat and hosted by the State 
Department, at which the Claims Conference participated, 
established a set of international principles. The common 
thread that runs through those international commitments is the 
need, firstly, to identify looted art; secondly, to publicize 
such items; and thirdly, to resolve the issue of its return in 
an expeditious, just, and fair manner.
    Guidelines were adopted by the American Association for 
Museums.
    We applaud the AAM and the AAMD for undertaking this major 
effort.
    In an important development, a special Web site was 
established by the AAM to provide a searchable registry of 
objects.
    Seven years have now elapsed since the Washington 
conference. In order to obtain an overview of what has been 
achieved, in February 2006, the Claims Conference sent a survey 
to 332 art museums throughout the United States. All responses 
were made publicly available on a Web site.
    In general, while some museums had made excellent progress, 
others had lagged behind. We welcome the progress that has been 
made, and look forward to the rapid completion of this task.
    In many cases, looted art is in the hands of private 
individuals, and often, the only time it is known to the 
general public is when it changes hands.
    We also, at last, learned today of guidelines for art 
dealers on these issues, and would urge that they be made 
publicly and widely available so the claimants will be aware of 
their contents.
    We also would request that procedures regarding how 
provenance research is done, in what way and in what manner, be 
adopted by the appropriate organizations of dealers and also be 
made publicly and widely available.
    When dealers learn that an object may have been looted, we 
believe that there should be an obligation, rather than a 
discretion, as included in the guidelines presented today, to 
inform the appropriate authorities. This would be the most 
effective step to ensure that looted items do not become part 
of the U.S. art market.
    In addition, although purchases often involve client 
confidentiality issues, we believe that the restitution of 
looted art raises sufficient moral questions that, for this 
small group of transactions, records of previous and 
prospective purchases and sales should be fully and completely 
accessible to claimants.
    In light of the unique concerns related to Holocaust-era 
restitution issues, we believe that ways to deal with claims 
need to be found outside of the courts, and perhaps through a 
central panel system, especially given the age of the 
claimants.
    The Claims Conference is also creating a limited database 
on looted items based on Nazi records. This will certainly not 
obviate the need for provenance research from museums and art 
dealers, but we believe that it can be a significant additional 
component of the steps to be taken when provenance of artwork 
is researched.
    In conclusion, while there has been significant progress, 
there is clearly more to do.
    Since the Washington conference, a number of other 
countries have been dealing with the Holocaust-era looted art, 
as we have heard.
    The progress in this area varies greatly from country to 
country, but generally has been disappointing. We urge greater 
efforts in this area.
    The United States has in the past, and can in the future, 
show leadership in this field.
    In view of its distinguished role in reviewing these issues 
in the past, we respectfully urge this committee to take the 
following steps in the future:
    First, to maintain its oversight of the progress in the 
United States in carrying out the agreed national and 
international principles; second, to strongly encourage the 
private art community in the United States to implement these 
principles with regard to provenance research and handling of 
claims; and finally, to encourage the U.S. Government to make a 
renewed effort regarding this issue in its discussions with 
governments in Europe and around the world.
    We also believe that an international conference on this 
subject would be tremendously important.
    We thank this committee for its efforts in the past, and 
request your involvement in the future.
    Thank you.
    [The prepared statement of Mr. Taylor can be found on page 
149 of the appendix.]
    Chairwoman Pryce. Thank you very much for your testimony.
    Mr. Able.

 STATEMENT OF EDWARD H. ABLE, JR., PRESIDENT AND CEO, AMERICAN 
                     ASSOCIATION OF MUSEUMS

    Mr. Able. Chairwoman Pryce, Representative Maloney, and 
members of the subcommittee, I'm Ed Able, president and CEO of 
the American Association of Museums. The topic of today's 
hearing is one that is complex and difficult to distill into a 
5-minute presentation, but as you indicated, Madam Chairwoman, 
my entire statement and many attached documents are at your 
disposal.
    First, I would like to be clear that we share with the 
Claims Conference a strong passion for, and commitment to, 
correcting the injustices to the victims of the Holocaust. The 
museum community has taken thoughtful and aggressive steps 
befitting the seriousness with which we take this issue.
    Briefly, today, there are four key areas that I would like 
to focus on in my oral testimony. At the end of the statement, 
I will respond to two additional questions raised in your 
invitation.
    First, guidelines for museums.
    After extensive consultation with the museum field, legal 
experts, and the President's Advisory Commission on Holocaust 
Assets, AAM published its guidelines in the fall of 1999, and 
amended them in the spring of 2001.
    This document and the Association of Art Museum Directors 
report in spring 1998 represent the standards for the museum 
community.
    Second, technical information and training.
    It is very important to understand that, in 1999, there 
were very few museum professionals trained in the highly 
specialized and unusual research skills necessary to conduct 
Nazi-era provenance research, and few people with the 
experience and language skills required to investigate recently 
opened archives and other information sources.
    AAM commissioned three of the world's leading experts to 
write a 300-page state-of-the-art how-to manual which 
immediately became the ``bible'' for the field.
    AAM also embarked on a multi-year training program designed 
to spread technical information throughout the field.
    We have conducted seminars at the National Archives, 
convened an international research colloquium, presented 
education sessions at all of our annual membership meetings, 
and launched an online discussion forum for museum 
professionals conducting provenance research.
    Third, let us talk about research.
    It is expensive.
    For objects with no prior indication of Nazi looting, the 
costs range anywhere from $40 to $60 per hour, and the time 
needed to document just one object can vary enormously, from a 
week to a year, and if initial research suggests an object has 
a history that may include unlawful appropriation by the Nazis, 
time and expense can double or triple.
    One museum spent $20,000 plus travel and expenses over the 
course of 2 years to have a researcher resolve the history of 
just three paintings.
    Fourth, sharing the results with the public.
    Parallel with our training efforts and technical 
information, AAM fulfilled the museum community's commitment to 
create a central, searchable, online database for publicly 
sharing collections information and provenance research.
    In September 2003, AAM publicly launched the Nazi-era 
provenance Internet portal, which has been broadly reported in 
the media.
    The portal now includes more than 150 participating museums 
that have collectively registered more than 18,000 objects from 
their collections that meet the definition of covered objects, 
a comprehensive and objective definition recommended by the 
claimants' advocates. That is, any object that may have changed 
hands in continental Europe between 1932 and 1946 under any 
circumstances.
    Thus, finding an object on the portal simply means that it 
may have been in continental Europe between 1932 and 1946, and 
may have changed hands one or more times.
    It is important to have a clear understanding of this 
definition, which is easily misunderstood and can 
unintentionally taint thousands of objects as, ``Nazi loot.''
    To illustrate, I will offer an example.
    A photographer working in Paris in 1934 takes a picture and 
makes 20 prints.
    He sells those prints to 20 customers, one of which is a 
U.S. museum.
    Even though the photo has an ironclad provenance and no 
taint of looting, it is, and always will be, a ``covered 
object.''
    The willingness of museums to work with this broad 
definition for covered objects is a testament to our commitment 
to public transparency.
    So, how many potentially looted objects are located in U.S. 
museums?
    Prior to the 1970's, the entire art trade was conducted on 
a centuries-old tradition of handshake deals and little or no 
paperwork, resulting in enormous provenance gaps. However, 
after several years of intensive activity by the museum field, 
I can state with confidence, not many.
    After 8 years of museum research and more than 100,000 
searches through the portal, there have been 22 public 
settlements concerning Nazi-era looting claims for works of art 
found in American museums, and six pending cases.
    Our greatest concern for completing provenance research is 
financial resources, particularly for small and medium-size 
museums.
    AAM encourages Congress to consider appropriating 
additional funding to the Institute of Museum and Library 
Services aimed specifically at provenance research.
    Finally, with respect to the claims process, experience 
with previously settled cases clearly demonstrates that direct 
respectful engagement between museums and claimants leads to 
the most rapid settlement of meritorious claims with the least 
cost to all, and there is, in our view, no better system.
    I thank you for your attention, and I am happy to respond 
to any questions during the colloquy.
    [The prepared statement of Mr. Able can be found on page 40 
of the appendix.]
    Mr. Leach. [presiding] Thank you, Mr. Able.
    Mr. Edelson.

STATEMENT OF GILBERT S. EDELSON, ADMINISTRATIVE VICE PRESIDENT 
        AND COUNSEL, ART DEALERS ASSOCIATION OF AMERICA

    Mr. Edelson. I thank the committee for its invitation to 
appear this morning, and I hope that my testimony will be 
helpful to you.
    I have submitted written testimony which I suggest be made 
part of the record.
    We deal today with a very serious problem, a serious and 
difficult problem, the looting of art during the Nazi era, one 
of the most horrible periods in the history of mankind. For 
many years, we did not face this problem, but in the 1990's, as 
a result of the efforts of some really outstanding people, one 
of whom, Stuart Eizenstat, is seated here today, we began to 
deal with the problem with the seriousness and intensity that 
was previously lacking.
    This committee held hearings in 1998 on the subject. The 
hearings were chaired by Congressman Leach, who won the respect 
of the art community for his deep and sympathetic knowledge.
    I was one of the witnesses then.
    Now, as I understand it, we are dealing with a follow-up to 
those hearings.
    The ADAA is a not-for-profit organization of dealers in 
works of the fine arts--paintings, sculpture, and works on 
paper.
    It is selective in its membership; it has 165 members 
across the country.
    We are, and have been, concerned about the problem of art 
looted during the Nazi period.
    Shortly after the committee's hearings in 1998, the 
association, after consulting with its members, issued its 
guidelines regarding art looted during the Nazi era. They were, 
we thought, publicized and made widely available, but not 
everybody was interested, and it appears that memories are 
short.
    Having heard the testimony this morning, I think we will 
re-issue the guidelines, and we will send copies to Christy's 
and Sotheby's, the auction houses, who have become very 
important dealers through their private transactions, and we 
hope that the guidelines would cover the auction houses, as 
well.
    The guidelines are recommendations. They set a standard for 
professional behavior, but they are really based on common 
sense. I have attached a copy of the guidelines to my written 
testimony so that you will have them in full. In summary, they 
deal with two situations; what a dealer should do with respect 
to consignments and sales, and what a dealer should do with 
respect to claims of ownership that may be asserted in 
connection with objects they have for sale or may have sold.
    The guidelines say that, when the Nazi-era provenance is 
incomplete, the dealer should do the necessary research. The 
problem here, of course, is that the necessary research is time 
consuming and could be very expensive.
    If there is sufficient evidence of looting, the dealer 
should not acquire the work or offer it for sale, and should 
notify the seller.
    Depending on the facts, additional steps may be necessary, 
such as notifying others of the dealer's findings.
    All claims of ownership should be handled promptly and with 
seriousness and respect.
    If the work is presently being offered for sale, it should 
be withdrawn until the claim is resolved. If the dealer has 
sold the work in the past, the dealer should make available 
such records as will serve to clarify issues of ownership.
    Finally, when reasonable and practical, dealers should seek 
equitable methods other than litigation to resolve claims. This 
makes good sense.
    Litigation, I can tell you from my personal experience, is 
time consuming and can be very costly. There are alternative 
methods of dispute resolutions, such as mediation, which I 
strongly recommend. I have mediated several disputes in this 
area, and the results have been more than satisfactory.
    I believe that dealers have been careful in what they offer 
for sale.
    I know at least one litigation involving an ADAA member, 
now retired, who sold a work many years ago that was now 
claimed to have been looted.
    Although the dealer was advised that he had a number of 
solid defenses, he settled the matter promptly and 
satisfactorily.
    I can also testify that I have personal knowledge of a 
number of situations where dealers declined to sell works, not 
because they knew that the works were looted but because they 
were not certain that the works were not looted, because there 
were unanswered questions about the works.
    No responsible dealer wants to sell a looted work. First, 
it is not the right thing to do; and second, it is not good 
business. You do not want to sell a possible problem to someone 
who is spending a great deal of money, especially in an 
industry where people love to talk.
    As I have said, many problems of provenance will never be 
solved. We may never know for sure.
    For the reasons I have set forth in my written testimony, 
many works have gaps in their chains of title. Provenance 
research, as I have said, is difficult, and all too frequently, 
it is unrewarding, but it is the only tool we have.
    Finally, there are no records to quantify the number of 
looted works that have been sold in this country over the 
years.
    There are not even any Census Bureau figures on how much 
art is sold every year.
    The Census Bureau does not gather information in this 
field, although it does in other industries.
    Whatever we may guess, the problem exists. ADAA's position 
is simple and straightforward: Looted art should be returned to 
its rightful owners, and dealers should cooperate, to the 
extent possible, in these efforts.
    Thank you.
    [The prepared statement of Mr. Edelson can be found on page 
94 of the appendix.]
    Mr. Leach. Thank you very much, Mr. Edelson.
    Before turning to Mr. Cuno, let me place on the record that 
I am personally very indebted to Mr. Cuno for his museum's 
generosity in lending America's Gustav Klimt--that is, the 
Grant Wood's American Gothic--to a museum here in Washington. 
Your museum has led the country in the area that we are 
discussing today in terms of the provenance research on 
Holocaust-era work. It has also led the country in generosity, 
and I am very appreciative to the Art Institute of Chicago.
    Mr. Cuno.

STATEMENT OF JAMES CUNO, PRESIDENT AND DIRECTOR, ART INSTITUTE 
    OF CHICAGO, ON BEHALF OF THE ASSOCIATION OF ART MUSEUM 
                           DIRECTORS

    Mr. Cuno. Thank you, Congressman.
    My name is Jim Cuno, and I am president and director of the 
Art Institute of Chicago. I testify today on behalf of the 
Association of Art Museum Directors, where I served as 
president of the board in 2000 and 2001, and on behalf of the 
Art Institute, where I have been president and director since 
2004.
    I thank the committee for holding these hearings. It is 
important that Congress and the American people have periodic 
updates on the work U.S. art museums are doing to research the 
provenance records of works of art in our collection, 
especially those which may have been looted during World War II 
and not restituted to their rightful owners.
    It is my understanding that today's hearing is the second 
such hearing since the committee's initial hearing under then-
Chairman Congressman Leach 8 years ago. In addition, AAMD 
testified before the Washington Conference on Holocaust Era 
Assets in 1998.
    I am a child of a 30-year career U.S. Air Force officer. My 
father served in World War II, the Korean War, and the Vietnam 
War. He was taken prisoner during the Korean War, and for the 
greater part of a year, we did not know if he was alive or 
dead.
    I am aware of the physical and psychological trauma of 
warfare, and like everyone, I deplore the circumstances during 
World War II that resulted in the unjust deaths of millions of 
people and the illegal taking of their personal property.
    All of us want to resolve any and all legitimate claims 
against U.S. art museums regarding the possible existence 
within our collections of works of art looted during World War 
II and not restituted to their rightful owners. To that end, we 
have been diligently researching our collections since and even 
before this committee first met on the subject in 1998.
    AAMD, which has approximately 170 members and was founded 
in 1916, has been a consistent champion of the highest 
standards for art museums, standards that enable art museums to 
bring important works of art to the public we serve.
    Since 1973, AAMD has included in its professional practices 
in art museums the admonition that museums must not acquire 
works that have been stolen or removed in violation of a treaty 
or convention to which the United States is a party.
    In 1998, AAMD published its much-praised report of the AAMD 
task force on spoliation of art during the Nazi World War II 
era, which gives specific guidance regarding provenance 
research and how to handle claims. I was pleased to have served 
on the committee that drafted those guidelines.
    As early as 1999, 100 percent of the AAMD members who had 
collections that could include Nazi stolen art reported that 
they had begun in-depth research required by the AAMD report.
    That research is now available on each museum's Web site, 
which, in turn, is linked to the AAM portal.
    Of all of the art museums in the United States, 
approximately half have no permanent collection or have 
collections of only contemporary art. By definition, these 
hundreds of art museums cannot have Nazi-era looted art in 
their possession.
    Thirty percent of the AAMD's 170 member museums fall into 
this category.
    The 120 AAMD member museums that may have Nazi-era looted 
art in their collections have collections comprising 18 million 
works of art, many thousands of which were acquired before 
World War II.
    Unlike eastern and western Europe, the United States was 
never a repository for any of the 200,000 works of art 
recovered after the war. Any Nazi-era looted art that may be in 
U.S. art museums is there as a result of second-, third-, or 
even fourth-generation good-faith transactions.
    I mention this only to remind us of the scale of the 
potential problem in this country.
    The likelihood of there being problems in U.S. art museums 
is relatively low.
    Nevertheless, the amount of research to be undertaken on 
the tens of thousands of works of art that, by definition, may 
have Nazi-era provenance problems is significant, requiring 
large allocations of staff time and money, allocations U.S. art 
museums have made, and will make, until the job is finished.
    Of the tens of thousands of potential problems in U.S. art 
museums' collections, only 22 claims have resulted in 
settlements of the restitution of works of arts from U.S. art 
museums since 1998, some of these at the initiative of the 
museums themselves, others in response to claims on works of 
arts by their rightful owners, and I refer to Appendix A in my 
written testimony.
    In the most recent case of restituted art, the Kimbell Art 
Museum in Fort Worth, Texas, returned its only painting by the 
celebrated and important English landscape painter, Joseph 
Mallord William Turner to the heirs of a legitimate owner.
    The Kimbell, which purchased the painting in 1966, was 
contacted by one of the heirs in September 2005, after the 
heirs' decade-long search to restore to his family works of art 
that had been part of a forced sale. After reviewing the 
documentation of the heirs and conducting its own research, the 
Kimbell Art Museum determined that the painting had been part 
of a forced sale and that the heirs did represent the 
legitimate owner.
    On May 17, 2006, the Kimbell agreed to restore the painting 
to the heirs, who have since taken physical possession of it.
    In another case in 2002, the Detroit Institute of Art had a 
painting shipped from a dealer in London for further study 
pending acquisition.
    In researching the work, the museum suspected that it may 
have been looted during the Nazi era and not restituted to its 
rightful owner.
    The museum contacted the London dealer. After 18 months of 
intensive examination of archives in several countries, it was 
determined that the work had, indeed, been looted by the Nazis.
    Incurring substantial legal fees for a painting it did not 
own, the museum continued its efforts to locate the heirs of 
the original owner. It eventually found the owner, who then 
sold the painting to the museum for full market value.
    Let me now testify quickly on behalf of the Art Institute 
of Chicago, if only as further illustration of how U.S. art 
museums are addressing this important issue.
    Our permanent collection includes some 250,000 works of art 
in 10 curatorial departments.
    Our efforts focused especially on Holocaust-era provenance 
questions began with a survey of our collection in 1997, even 
before the AAM issued its guidelines and before the AAMD report 
and the Washington conference principles of 1998.
    Our 1997 survey sought to determine the number of 
paintings, sculptures, and drawings in our collection that were 
created before 1946 and acquired by the museum after 1932.
    Our survey thus exceeded the expectations established in 
the AAM and AAMD guidelines, which suggested that the initial 
focus of research should be European paintings and Judaica.
    At present, based on our current database search 
capabilities, we estimate that our collection includes 7,481 
works of art made before 1946 and acquired by the museum after 
1932.
    Our curatorial staff has analyzed whether, in addition to 
being made before 1946 and acquired by the museum after 1932, 
the work of art underwent a change of ownership between 1932 
and 1946, and was or might reasonably have been thought to have 
been in continental Europe between those dates.
    This is the definition of a covered object, as you know 
very well.
    Although our research is constantly ongoing, our curatorial 
staff has determined that 2,832 of the 7,481 works of art fall 
within this definition.
    All of the objects of the provenance research project pages 
of our Web site are accessible through the AAM's Nazi-era 
provenance Internet portal.
    Nearly 2,000 of the 2,832 works of art in our collection 
that meet the terms of our inquiry will be posted in full on 
our Web site, together with all of their provenance information 
in which we are confident, this September, in a much improved 
searchable database, and I refer again to my written testimony 
which has pages from the Web site, so you can see exactly how 
that is.
    In addition to providing information about our collection, 
our Web site contains information on provenance bibliography to 
help guide people in their own research in their own 
collections or other museums in their research.
    Provenance research is an integral part of the work of the 
Art Institute of Chicago's staff and all curatorial 
departments.
    Such research is performed on a daily basis. In addition to 
ongoing research efforts in the departments, we maintain an 
inter-departmental provenance committee comprising curators, 
researchers, library staff, and other staff with relevant 
skills and knowledge that meets to share information and focus 
efforts specifically on Nazi-era provenance research.
    Funding for provenance research comes from our operating 
budget, department funds, gifts from individual donors, and 
grants for projects that include provenance research as a 
fundamental, but not sole, piece of the project. All together, 
since 1998, we have spent well over half-a-million dollars 
researching our provenance records, not to mention the annual 
operating funds we use for the salaries of permanent 
professional staff, including conservatives, curators, 
registrars, photographers, Web masters, and lawyers, who spend 
a part of each year on this project.
    We have hired long-term researchers and project 
researchers.
    We have sent them to Europe to consult archives, and we 
have purchased copies of archival materials.
    The Art Institute strives to resolve claims of ownership in 
an equitable, appropriate, and mutually agreeable manner. We 
are pleased that, in those cases that have arisen to date, the 
Art Institute has resolved the claims amicably. There have been 
only two, and I refer again to my written testimony, to the 
particulars of those instances.
    Like many museums and art museums in the United States, our 
institute has received a letter from the Claims Conference 
inviting us to participate in the survey.
    The letter was dated February 27, 2006, and instructed us 
to answer 24 detailed questions and to return the survey by 
April 14th, 7 weeks later. We responded with a detailed five-
page letter answering, we believe, the survey's questions in 
full.
    In conclusion, let me say that the U.S. art museums will 
continue to respond to claims made against works in their 
collection, as they have done in the past.
    We will continue to work diligently to provide as much 
provenance information on our Web sites as soon as it becomes 
available.
    By continuing to link our Web sites to the AAM portal, 
potential claimants may go to one source for information, but 
again, I stress that, after more than 8 years of intensive 
investigation, we have been able to verify very few claims.
    I do not expect that to change dramatically, for the 
reasons that I have mentioned. There are few Holocaust looted 
works of art in American museums, but even one such work is one 
too many.
    U.S. art museums will continue to do everything we can to 
restore that work to its rightful owner.
    Thank you again for holding this important hearing, and 
thank you for allowing me to submit this testimony and my 
written testimony.
    [The prepared statement of Mr. Cuno can be found on page 61 
of the appendix.]
    Mr. Leach. Thank you, Mr. Cuno.
    Mr. Rub.

 STATEMENT OF TIMOTHY M. RUB, DIRECTOR, CLEVELAND MUSEUM OF ART

    Mr. Rub. Thank you, and good morning.
    I am Timothy Rub, the director of the Cleveland Museum of 
Art, and I speak to you today on behalf of the Association of 
Art Museum Directors and the trustees of the Cleveland Museum 
of Art. I would like to express our thanks for this opportunity 
you've given me to share with you the significant efforts that 
American museums have undertaken since the subcommittee first 
held hearings on this important subject in February 1998, but 
before I do, I should pause and encourage this group, following 
on the Congressman's suggestion, to see the Grant Wood 
exhibition nearby, and to see the greatest Grant Wood 
collections in Ohio, Daughters of the Revolution, in the 
collection of the Cincinnati Art Museum. It is a wonderful 
picture.
    Over the past 8 years, a considerable amount of progress 
has been made by the many museums whose collections might have 
included works that were illegally appropriated during the 
Holocaust.
    Even though provenance research is time consuming and 
costly, the several institutions I have had the privilege to 
lead during this period, the Cleveland Museum of Art today, and 
before this, the Cincinnati Art Museum, and the Hood Museum of 
Art at Dartmouth College, as well as the members of the AAMD, 
all have made a firm commitment to undertake this work and to 
make the results of their research available to the public.
    In doing so, we have complied with the guidelines 
articulated in the AAMD's June 1998 report on the spoliation of 
art during the Nazi World War II era.
    Notably, in terms of the work that has been done thus far, 
we have focused our initial efforts on our collections of 
European paintings.
    American museums embraced this responsibility and acted 
upon it quickly and with great resolve, in my opinion. For 
example, the AAMD surveyed its members in 1999, and determined 
that 100 percent of those whose collections included art that 
might have been looted during the Holocaust period had, in 
fact, completed or were in the process of undertaking 
provenance research. Furthermore, in that survey, 100 percent 
of AAMD members indicated that access to their provenance 
records was open.
    While we consider provenance research to be critically 
important, and have made a broad commitment to undertake this 
work, it is vital for you, the members of the subcommittee, to 
understand how complicated and labor intensive such research 
can be.
    It requires a detailed review of primary and secondary 
documents, often scattered in many different places throughout 
the world, and in many instances where such documents do not 
exist or cannot be found, substantial inferential analysis. In 
many cases, we have not been able to fill all the gaps, and 
must recognize that we may never be able to do so.
    Others can help, and for this reason, the posting of 
provenance records on our Web sites and on the portal 
maintained by the AAM is an essential tool.
    It is also important for the members of the subcommittee to 
understand that a gap in the provenance of a work of art during 
the Holocaust period does not mean that this work was seized 
illegally by the Nazis or was the subject of a forced sale and 
not restituted.
    Rather, a gap in provenance indicates that we have been 
unable to find documentation or other evidence that allows us 
to determine the ownership of a particular work of art during a 
certain period of time. In other words, this means, quite 
literally, the absence of information on an object, not the 
presence of information that gives rise to or may constitute a 
justification for a claim that it was illegally taken and not 
restituted.
    Given the extensive research that has been done by American 
museums, without, it should not go unremarked, any appreciable 
public funding, the number of claims received by American 
museums, as my colleagues have mentioned, has been very small. 
To date, only 22 works have been restituted by American museums 
because they were looted by the Nazis and not returned to their 
rightful owners after the war.
    For those who claim that hundreds or even thousands of 
spoliated works remain in the collections of American museums, 
the work done during the last decade, as a statistical point, 
simply indicates otherwise.
    In this regard, I would not suggest that the extensive 
efforts that have been undertaken to research the provenance of 
Holocaust-era works has been inappropriate or that they should 
be curtailed, but our experience indicates the magnitude of 
this problem does not match the sometimes often strongly 
emotional appeal made on occasion by those who seek to recover 
art that is believed to have been lost and not restituted.
    Furthermore--and I think this is the important point--it 
confirms that the course taken by American museums, who hold 
their collections in trust for the benefit of the public, is 
fair and designed to achieve the best possible outcomes for 
both our institutions and those who may have valid claims on 
works of art that were confiscated or illegally taken from them 
or their families during the Holocaust.
    Finally, some critics have questioned the wisdom of 
continuing the Federal immunity that is granted or accorded to 
works of art that are in the United States on loan to American 
museums, and whether such a protection should apply when there 
might be a Holocaust issue.
    Please note the emphasis I have placed on the possibility 
of a Holocaust-related issue, such as a gap, as opposed to an 
outstanding claim that may be valid but is, as yet, unresolved.
    If this issue comes before the subcommittee in the future, 
I urge you to continue to support the Federal immunity program.
    The immunity program is a time-honored and valuable 
instrument that enables American museums to present to the 
public great works of art from around the world. Absent such 
protection, many foreign-owned works might not be made 
available to American museums because of the fear that such 
works will become encumbered with litigation in the United 
States courts, and here I should add that we have all agreed--
we, the American museum community--that we must carefully 
evaluate all loan requests to make sure that we are not 
requesting illegally confiscated or Holocaust-era art, and this 
is a part of the immunity process, as well.
    When museums apply for immunity for loans, they are 
required to address Holocaust issues as part of the application 
process. I should also add in this regard that the very fact of 
exhibiting a painting with a gap in its provenance can, in 
fact, help the process of restitution, because the public 
presentation of this work in the United States can bring to the 
attention of a claimant its existence or make available 
information that an individual would need in order to make a 
claim.
    Let me conclude by stating once again that the 8 years 
since the subcommittee's first hearings on this subject have 
witnessed significant progress in the development of a broader 
knowledge of provenance information that has now been made 
available to potential claimants and the public at large.
    While this work is not yet complete, research regarding 
most of the works of art that may be at issue has certainly 
been undertaken, and America, as many of my colleagues have 
said, can be very proud of the leadership role that its art 
museums have played in this effort.
    Thank you.
    [The prepared statement of Mr. Rub can be found on page 145 
of the appendix.]
    Mr. Leach. Thank you, Mr. Rub.
    Ms. Lillie.

 STATEMENT OF CATHERINE A. LILLIE, DIRECTOR, HOLOCAUST CLAIMS 
      PROCESSING OFFICE, NEW YORK STATE BANKING DEPARTMENT

    Ms. Lillie. Thank you.
    Good morning, Mr. Chairman, Ranking Member Maloney, and 
members of the subcommittee. Thank you for this opportunity to 
testify before you today on Holocaust-era asset restitution.
    The New York State Banking Department has 10 years of 
hands-on experience working with, and advocating on behalf of, 
claimants seeking the return of assets lost, looted, or stolen 
during the Holocaust.
    The Banking Department's involvement in these issues goes 
back to 1996, when the world finally began to pay attention to 
the fate of assets deposited in Swiss financial institutions.
    Governor Pataki, at the urging of then-Superintendent Neil 
Levin, encouraged the Banking Department to use its influence, 
expertise, and international reach to rationally resolve these 
emotionally charged and politically complex estates.
    The department has been actively committed ever since, 
first with our investigation into the war-time activities of 
the Swiss banks' New York agencies and then by establishing the 
Holocaust Claims Processing Office as a separate and unique 
division.
    Our involvement was extended further still with the 
establishment of the International Commission on Holocaust 
Insurance Claims, also a legacy of the late Neil Levin, and 
ultimately, the department took on the task of assisting 
claimants in their quest for works of art lost, looted, or 
stolen during the Holocaust.
    The HCPO has a long tradition of quality and substance. It 
remains the only government agency in the world to offer 
Holocaust survivors or the heirs of Holocaust victims and 
survivors assistance with a vast array of multinational claims 
processes.
    To date, the HCPO has received approximately 5,000 claims 
from 48 States and 37 countries, and has secured the return of 
more than $55 million to claimants, as well as 13 works of art.
    The knowledge and assistance of the HCPO staff have 
alleviated burdens and costs often incurred by claimants who 
attempt to navigate the diversity of international claims 
processes by themselves.
    Our successes are a direct result of the importance 
attached to, and attention paid by, the HCPO to individualized 
analysis.
    Many of the claimants we work with have lost everything and 
everyone, resulting in the need for archival and genealogical 
research to confirm family relationships and to uncover details 
regarding the fate of many original owners. All of our services 
are provided free of charge.
    The HCPO has, over the past decade, worked directly and 
intimately with almost all restitution and compensation 
processes in existence today.
    As a result, we have close working relationships with 
archival and historical commissions, financial institutions, 
trade associations, and our colleagues in federal, state, and 
local governments in Europe.
    At the same time, many claims processes have sought the 
HCPO's advice.
    Put another way, almost all paths to restitution and/or 
compensation for Holocaust-era assets have converged at the 
HCPO at one point or another.
    Throughout, the HCPO has had a single purpose: to resolve 
claims as promptly as possible, and in a sensitive manner, 
given the singularity of the events that preceded them.
    The passage of time, the ravages of war, the lack of 
documentation that you heard about, and the mortality of 
claimants make this a complex task.
    The HCPO owes its success to a dedicated team of 
multilingual and multi-talented professionals. Possessing a 
broad and long traditional legal, historical, economic, and 
linguistic skill set, coupled with the ability to communicate 
with, and conduct research in, a vast number of European 
government and private offices, the HCPO staff research, 
investigate, and secure documentation, building upon the 
foundation provided by claimants.
    Let there be no mistake about it. Even claims with 
documentation are a time-consuming task, and the paucity of 
published records often complicates matters further. For 
significant works of art, the odds of there being academic 
publications which serve as vital tools in our research efforts 
are high, but the Nazis did not limit their spoliation to 
museum-quality pieces. Ordinary middle-class collections, 
second-tier painters, decorative arts, tapestries, and 
antiquities, as well as Judaica, were looted. In some of these 
areas, the art historical literature is anything but deep.
    To complicate matters further, information, much like the 
objects themselves, have often ended up scattered all across 
the globe.
    Claimants seeking the return of such low monetary value but 
high emotional and spiritual value items face daunting hurdles, 
given the lack of historical significance, not to mention the 
enormous logistical and legal challenges. The HCPO, earlier 
this year, successfully completed the return of a Torah cover 
from the Jewish Museum in Vienna. The obvious inestimable 
emotional value is without question, but without the HCPO, 
where would claimants have gone for help, given its limited 
monetary value?
    Overall, art claimants, as you have heard, are piecemeal 
work, which unlike financial assets such as bank accounts or 
insurance policies, do not lend themselves to wholesale 
centralized settlements.
    Instead, given the individualized nature of these cases, 
they must be painstakingly resolved painting by painting, 
object by object, and Torah cover by Torah cover.
    The publication of provenance information is critically 
important to our endeavors, as is the ease of access to such 
information.
    As we work piece together each claims complex mosaic, 
accessibility is paramount.
    The AAM's Web portal is an excellent illustration of what 
is possible.
    While far from perfect, it is a major step in the right 
direction, currently allowing 151 museums to make their 
provenance research available via a single point of entry, with 
more museums joining all the time, as evidenced by the Claims 
Conference's recent report.
    There remains, of course, a significant difference between 
the work done by museums and public collections and such 
information as is available for private collections in the art 
market as a whole.
    The issue becomes trickier once claimants locate items in 
private collections or, indeed, in the market.
    Sale rooms have learned much in the past decade, and 
certainly, the large auction houses have dedicated staff who 
have worked well with the HCPO and our claimants to determine 
whether items submitted to auctions have a problematic 
provenance.
    Smaller sale rooms both in the United States and Europe 
still need encouragement and education.
    Not all are as willing to pull lots from sales when 
questions arise. Few of them are sensitive to the labor-
intensive, and therefore time-consuming, research these cases 
require. As a result, the HCPO still finds more resistance to 
clarifying title in these contexts than we would like to see.
    So, continued education of active market participants 
remains a critical piece in all this if buyers and sellers are 
to understand and ultimately accept that transactions conducted 
in seemingly good faith many years ago may nonetheless be 
questionable.
    In closing, I would like to share the following thought.
    We have a unique challenge in a complex market, but we also 
have the potential to help so many. If we are to achieve our 
mission, we must encourage open, transparent cooperation both 
internally and in the larger universe of Holocaust-era 
restitution and compensation programs. Cross-functional and 
interagency dialogue between such claims processes encourages 
new perspectives, expands and enhances coalitions, fosters 
partnerships, and ensures a more comprehensive approach.
    By finding creative solutions and mechanisms, agencies can 
work together to streamline the prolonged claims processes for 
claimants, many of whom are in their 80's and 90's, and for 
whom time is a disappearing luxury.
    Finally, let me return briefly to the Torah cover I 
mentioned earlier.
    Marpe Lanefesch, the name of the congregation that was in 
effect the Torah cover's birthplace, translates to ``the 
healing of the soul.''
    How better to summarize what I think our collective intent 
is: the attempt by a few people committed to doing what is 
right, rather than what is easy, to repair, to the extent 
possible, a lasting rend in the fabric of life.
    Thank you.
    [The prepared statement of Ms. Lillie can be found on page 
125 of the appendix.]
    Mr. Leach. Thank you very much, Ms. Lillie, and thank you 
all for extraordinary testimony.
    I want to begin briefly with Mr. Eizenstat. Stuart, your 
testimony was extraordinary and comprehensive. As principally a 
lawyer, I think you symbolize the best ``lawyer'' approach in 
terms of not only the law, but in the legal way of thinking. 
One of the interesting legal issues that exists, as you note 
the problems in Europe, is the difference between the 
Napoleonic codes and the common law on the issue of theft. That 
is, in common law countries like ours and Great Britain, if a 
thief sells an item to a party and the party sells that item to 
a third party, if the original owner has a claim, that owner 
can make a claim directly to the current owner, whereas under 
the Napoleonic codes, if there was a good faith process at any 
point, the original owner only has a claim against the thief. 
This means that, theoretically, if you have a piece of art with 
dubious provenance, you would rather sell it in Europe than in 
the United States. Thus, it is very difficult to return stolen 
art in Napoleonic code countries unless there is will. What you 
have suggested is that several countries have exhibited will 
and others have not. Could you comment on this?
    Mr. Eizenstat. Mr. Chairman, this is really an excellent 
point, and you are quite correct about the difference in the 
legal structures. We tried to overcome that with the Washington 
principles, but as you will remember, in the late hours of 
negotiation, only partially, because in order to get over 40 
countries to ascribe to the principles, which were based on the 
AAMD principles, with some modifications, we needed to put in 
language that assured countries that they could apply their 
only law. It is the only way we could get that done.
    But the principles are there, and they are meant, and some 
of them say very clearly, to facilitate claims resolution, to 
have non-litigable ways to do so, and a number of countries--
for example, Austria has passed a specific law recognizing that 
the Napoleonic issue--that Holocaust looted art should be 
treated differently, and they passed a law which has permitted 
hundreds and hundreds of pieces to be returned.
    The Netherlands has done the same.
    Russia, theoretically, has done the same, but it has not 
applied it.
    So, what we need to do is to get countries to apply special 
restitution laws for this area, so that you do not have the 
kind of complication that you have just indicated. One of the 
advantages of trying to get an international conference 
together and to at least encourage, Mr. Chairman, Mrs. Maloney, 
the publication of lists as the portal has done in the United 
States, is at least we will know what the universe is.
    Once we know what the universe is, then even with the 
Napoleonic problem, we can facilitate settlements, we can 
facilitate monetary recoveries, which are not precluded by the 
Napoleonic code.
    We can facilitate arbitrated or mediated solutions, but we 
can't do any of those if we do not have the basic raw data, and 
because so few countries have published, even in Germany, 
anything like what the AMD museums have done, we do not have 
the basis to apply settlements that could be done outside of 
the strictures of the Napoleonic code.
    Mr. Leach. Let me just ask one follow-on question.
    It appears that Russia, in many regards, is the great 
laggard, not so much in law but in the classic instance have 
not wanting to publish what it has, and one has a sense that 
part of it relates to this issue.
    Most of it may relate to issues itself in museums. Powerful 
people walk away with great art. Do you have a sense of this 
problem?
    Mr. Eizenstat. Yes.
    Let me explain, if I may, as best I can, the Russian 
situation.
    Of course there is a broader picture in Russia of the rule 
of law which we have seen trampled on in recent years in a 
whole range of areas.
    They were the only delegation in the 1998 Washington 
conference that participated separately in the closing news 
conference. The Russian legislation was once vetoed, but 
ultimately legislation was signed that separated two types of 
art.
    One was what they call trophy art, which was art that the 
Red Army took, after the war or in the closing days of the war, 
from German museums and public institutions as what they viewed 
as compensation for their massive loss of life and property 
from the German invasion.
    The law that President Putin signed makes it clear they 
will never return that, but they also made it clear in that 
legislation that art which was taken by the Red Army from the 
Germans, which, in turn, was taken from Jews or Jewish 
institutions or for racial reasons should be returned--and they 
committed themselves to publish the provenance of their major 
museums, and they have a claims process.
    There has been a very small amount of publication of their 
provenance by a very few museums, not the major ones, the 
Hermitage and others, and there is basically no claims process.
    This is a very key matter where a good bilateral 
discussion, let alone an international conference, could bring 
the Russians, as they did in 1998, to come up to international 
standards.
    I think there is no question but that the Russians have the 
greatest treasure trove of looted art, and if we assure them 
that no one is trying to get their--that we are focusing on art 
taken from Holocaust victims and we put enough political muscle 
behind it at senior enough level, perhaps we can make progress.
    Mr. Leach. Thank you.
    Ms. Maloney.
    Mrs. Maloney. Thank you.
    I thank all of you for your testimony.
    I would like to ask Mr. Edelson--you mentioned that we 
should focus a little bit on the dealers.
    How can dealers best be encouraged to make their records 
available to bona fide researchers, claimants, and claimant 
representatives?
    Mr. Edelson. So far as I know, ma'am, dealers do make their 
records available.
    I can tell you now that I was speaking to one dealer the 
other day who said that he had opened his records to the 
Metropolitan Museum, for example, who was doing some research 
in provenance, and I have not, myself, had a complaint from 
anyone that a dealer has not cooperated.
    Now, it does not mean, necessarily, that all dealers are 
cooperating.
    I hope they are, and we urge them to do so.
    Mrs. Maloney. I would like to ask Ms. Lillie the same 
question.
    Have you, in your work with your office, reached out to art 
dealers and gotten their cooperation, or do you think they 
should be part of the central registry?
    Ms. Lillie. We have had, I think, examples of just about 
every form of cooperation you can imagine, which ranges from 
very productive to almost none at all, and that is true not 
just in the United States but across Europe, as well. Your 
question, whether we would like to see a more centralized venue 
for this, is one that resonates very deeply with me.
    The portal, where we worked extensively with Mr. Able and 
his organization in terms of technical assistance, the sort of 
information that ought to be put up that would be helpful to 
claimants and researchers but also finding common denominators 
between and amongst museums and the information they have has 
been very, very helpful. There is a single point of entry. It 
is a starting point. Even if we do not find specific paintings, 
we often find information held within museum records that will 
lead us to other sources of information.
    If we could work with Mr. Edelson on finding some sort of 
central venue for dealers, as well, that would be superb. One 
of the difficulties, of course, is, as he mentioned, would 
owners be willing to share that information? From my vantage 
point, the more transparency we have in the market, the better 
and more efficienct marketplace it would surely be.
    Mrs. Maloney. Mr. Cuno and Mr. Rub, thank you for your 
leadership and the work of your museums.
    What can we do to accelerate the speed of provenance 
research and publication of such research while the present 
generation of Holocaust survivors is still with us? Obviously, 
the sense of urgency is, simply put, not our friend, and when 
you lose the last living memories of these items, then where 
will we go, and I just want to ask the question--the reports 
that came out--they said many of the museums had cooperated, 
but others had not, and they mentioned some very prominent 
museums that had not cooperated.
    What is the enforcement or the incentive for museums to 
cooperate?
    They cited some, such as your own, that have done 
remarkable work, but they cited others who did not fill out the 
survey, would not respond, said they did not have the time or 
finances to respond.
    Mr. Cuno. I am afraid my answer to the first question will 
not necessarily be satisfactory, because the answer has got to 
be assistance with funding, and funding not necessarily to 
individual museums in their research but to the creation of 
centralized databases such as we have begun to undertake but 
could use additional resources to perpetuate or to deepen.
    To step back just one second to the question about the 
dealers, I do not know the extent to which this is possible, 
but it would be greatly advantageous to the work of museums and 
museum researchers, not just on the question of Holocaust-era 
provenance research but generally in provenance research, if 
there were a way, when dealers go out of business, for example, 
that those records would not necessarily disappear.
    It has been one of the obstacles that we face in our 
research, not just in this country but among European art 
dealers, is when they do go out of business, there is no 
perpetuation, necessarily, of the records that they had, and 
so, we lose track of those records, and the loss is sometimes 
insurmountable.
    To your question about what it is that museums can do, and 
also to your question about why it is that some museums have 
not responded to the survey, I do think it is a matter of time 
and money, and we have competing calls on our time and money, 
as you can well understand, as every institution, and that is 
with regard to the education that we do in our cities, where we 
are ultimately and increasingly responsible for the arts 
education and some of the civic education of our citizens.
    So, we could use some assistance in that regard, perhaps on 
an individual basis but certainly in a collective basis, to 
provide the resources that we need to advance our research, and 
to work cooperatively with our colleagues outside of museums.
    To the question about why some museums did not return the 
survey, I cannot speak for them.
    Mrs. Maloney. Do you feel like there is a difference 
between a large museum and a small museum?
    Mr. Cuno. A very big difference.
    My quick count of the list of museums that did not 
respond--out of the 108 listed that did not respond, only 26 of 
them belong to the AAMD, and to belong to the AAMD, you have to 
have a budget of at least $2 million for 2 years.
    It is the minority of museums that have the significant 
resources to apply toward research.
    Of the museums on the list of 108 that did not respond, 
many have budgets less than $2 million, and many of those 
museums, 19 of them, to my count, are small community college 
or small college museums.
    So, it is very difficult for those museums to marshall the 
resources, financial and human resources to respond to the 
complicated questions asked in the survey. The assistance would 
have to be material, I am afraid.
    Mr. Able. Jim, may I add something to that?
    Mrs. Maloney, if you look at the chart, it does not mean 
that all these museums are not cooperating in the work. It 
means they did not respond to the survey.
    There is a chart in the report of 25 major museums, and it 
is pointed out that five did not respond. Well, they did not 
respond to the survey, and that is regrettable, but four of 
them are registered and have registered, collectively, 621 
objects on the portal.
    So, I think that there needs to be some clarification of 
some of the statements in the report as to the accuracy, that 
they can be somewhat misleading.
    Mr. Rub. Let me add that I--I should say I think it is 
unfortunate that some of our colleagues or fellow institutions 
did not respond to the survey. However, I do not think that 
lack of response should be taken for--taken in any way to mean 
that they are not, as Ed mentioned a moment ago, participating 
actively in this kind of work, particularly if they have 
collections that include covered objects.
    It should also be pointed out that it is not entirely clear 
to me, at least, whether or not many of these institutions on 
the list that did not respond actually have covered objects in 
their collections.
    We have a number of members of the AAMD, and there are many 
more institutions that are not, that either collect 
contemporary art, and so do not work in this field and never 
have collected in this field, or collect American art or some 
other types of objects that would not fall under the heading of 
covered object, as well.
    I would also like to come back to points that my colleague, 
Jim Cuno, made a moment ago, and that is the enormity of the 
task that is facing many of these institutions in terms of how 
to fund this work on an ongoing basis.
    I have been, as I mentioned in my testimony, at three 
institutions during the past 8 years that have decided to 
undertake this work, and in each case, it was a formidable 
challenge to find the time and the human resources to do this 
on an ongoing basis.
    In each case, we did, but we had to carve the funds to do 
that out of existing work, and it is a complicated issue to 
deal with during a time of diminishing resources for support of 
museums in general.
    Mrs. Maloney. Thank you.
    Mr. Taylor. Our only request with the survey was that we 
felt it was important that museums, even if they have no 
covered objects, would simply answer that, and many did. Many 
who had no covered objects or where it was not applicable very 
kindly wrote back, and all of those answers are publicly 
available on the Web site for people to see.
    So, we would just respectfully urge museums, even if their 
answer is that it does not apply to them, or only to a certain 
extent, to do so, and maybe my colleagues will assist, so that 
there is a public record of museums reporting what they have 
done. The survey does include, also, some larger museums, some 
of whom are AAM accredited that did not respond.
    We welcome responses so that the public can check and look 
and see what museums are doing, and we just urge them to report 
that for the benefit of the public.
    Mr. Leach. Mrs. Wasserman-Schultz.
    Ms. Wasserman-Schultz. Thank you, Mr. Chairman.
    Welcome to all of you, and I appreciate the opportunity to 
listen to your testimony today.
    I have questions far beyond the 5-minute time allotment 
that I have.
    So, Mr. Taylor, specifically, I would request that, if you 
can, come and make an appointment with me so that we can spend 
some expanded time talking about issues that go beyond just the 
topic that we are covering here today.
    I would surely appreciate it.
    Mr. Eizenstat, when you have an opportunity to do that, if 
you would be willing to do so, as well, I would surely 
appreciate it.
    I represent a district in south Florida that is home to one 
of the largest, if not the largest, survivor population in the 
country, and it is a rapidly aging population, one in which 
even child survivors are now well into their 70's, and some 
older than that, and there are not many more years left, 
obviously, that we are going to be able to do anything for them 
to either improve the quality of life or achieve restitution 
for them in material ways.
    I am wondering, particularly at the Claims Conference, Mr. 
Taylor, to what degree you've already recovered art, and to 
what degree--well, let me back up for a second.
    I know that you already hold title to a large inventory of 
property in Germany, and there was not a great deal of 
understanding as to what that is, what is in your--what is in 
the Claims Conference's possession, the value of it, and I know 
a lot of that is land parcels and buildings, but what I am 
wondering is if any of those holdings are outstanding claims 
that include art and cultural property.
    Additionally, how much in compensation has the Claims 
Conference received to date from the German authorities for 
artwork and cultural objects, and if you could elaborate on 
that, I would appreciate it.
    Mr. Taylor. Firstly, when we recover buildings and 
properties, we sell those properties and then allocate those 
funds primarily for social programs for Holocaust survivors, 
and for programs of Holocaust education. That is regarding our 
allocations program, and it is a long and complicated issue. I 
would be very happy to meet with you and look forward to that 
opportunity.
    Regarding art, we have tried to pursue art claims in the 
former East Germany, where the Claims Conference has a special 
status.
    We have had limited success. I think it is probably less 
than about half-a-dozen so far, but there are about 80 claims 
pending.
    Of the handful that we have received, those have been 
recovered and turned over to heirs, and we have worked with the 
heirs of those to return those.
    We filed about 80 claims which cover some hundreds of 
objects, maybe up to about 1,000 objects, but it is about 80 
claims.
    There is a list of them posted on our Web site, where there 
is a full listing of the individual claims. When we meet, I can 
certainly point out where that is. Most claimants have come 
forward, and we are assisting and working with them on those 
art claims in the former East Germany, but there are, I should 
say, also a number of claimants in Germany who have filed 
claims directly. We have given some indirect assistance, but 
those are filed directly, particularly for the former West 
Germany, where the deadlines have expired, but efforts still 
continue to recover items of looted art.
    Ms. Wasserman-Schultz. I can appreciate your testimony 
about the creation of the databases that you currently hold 
about stolen artwork, because obviously, access to that 
information is important.
    Does the Claims Conference publish a similar database of 
real estate property in Germany, listing things like property 
parcels, Jewish families who originally owned them? What kind 
of identification have you been able to surmise, and what about 
looted property?
    Is there no property that you hold title to? How quickly do 
you sell it? I am just not really knowledgeable about that 
process.
    Mr. Taylor. There were certain items that we had recovered, 
and there was a period for dealing with this issue, and there 
was a publication of a database which related to these items, 
and there was a period for dealing with this issue. So, yes, 
there was a publication.
    Ms. Wasserman-Schultz. Is that still available?
    Mr. Taylor. It is not.
    The period for claiming for those particular items has 
expired, but it was available, and there were claims, and there 
was a claims period after publication.
    Ms. Wasserman-Schultz. What happened to the property that 
was not claimed?
    Mr. Taylor. The Claims Conference uses those funds 
recovered from items that are not claimed largely for programs 
of home care, social assistance, and other programs, 
particularly for programs for needy Holocaust survivors, 
including some in your district. In over 60 countries around 
the world, we operate programs providing assistance to 
Holocaust survivors: food packages; home care; shelter; social 
care; and various forms of assistance.
    Ms. Wasserman-Schultz. How many voting members of the 
Claims Conference board are survivor groups?
    Mr. Taylor. There are three organizations of survivor 
groups but there are many Holocaust survivors on the board of 
the Claims Conference, a very significant number of Holocaust 
survivors.
    I do not have the specific number.
    Ms. Wasserman-Schultz. Three groups out of how many?
    Mr. Taylor. Twenty-four groups, but the other groups are 
Jewish organizations, many of whom have Holocaust survivors and 
are represented on the Claims Conference by Holocaust 
survivors.
    Ms. Wasserman-Schultz. Mr. Chairman, I have a number of 
other questions, and I do not want to take up the committee's 
time, because they are not quite as relevant to the topics at 
hand, but I would like them answered, and if I could ask 
unanimous consent to submit those questions for the record, I 
ask that the panelists answer them in written form.
    Mr. Leach. Without objection, they will be submitted for 
the record and transmitted.
    Ms. Wasserman-Schultz. Thank you, very much.
    Mr. Leach. Thank you for your contribution.
    Let me thank you all.
    It is apparent that the United States leads in this effort.
    Yet, it may be the case that there is some art fatigue. 
More can be done. Each of you represented here have contributed 
impressively to the effort, and so, the committee is very 
appreciative of your efforts.
    I might just suggest, because I do not know how significant 
this is, but to Mr. Cuno, who heads what, in effect, is an 
accrediting body, as I understand it--you head an accrediting 
body of museums?
    Mr. Cuno. Yes. No, I do not head the--I headed for one time 
the AAMD. Accrediting of museums is done through AAM.
    Mr. Leach. Oh, I am sorry, through AAM.
    Mr. Able, I do not know how significant in the 
accreditation the attention to the Holocaust art issue is, but 
I would hope that you would put it front and center. Is that a 
credible request, or is it a request that has already been--
    Mr. Able. Accreditation deals with that issue, Congressman, 
but in a wider view and way.
    Accredited museums are required to demonstrate that they 
are taking every step to ensure that any item in their 
collection is legally held. If they had an item that was 
illegally appropriated by the Nazis, that would be covered in 
that area.
    So, it actually captures a much wider--and it is very 
carefully looked at by the accrediting visiting evaluators, in 
their self-study of the institution itself, and then carefully 
reviewed by the accreditation commission when the accreditation 
review is done on its regular basis.
    Mr. Leach. I appreciate that very much.
    I think the only footnote would be that there is theft and 
then there is Holocaust theft, and so, to raise this to 
particular significance, I think, would be good social policy.
    Mr. Able. Actually, that was done much earlier, back in the 
late 1990s, when we passed our guidelines.
    It has been extensively discussed at the commission 
meetings and with all the site evaluators.
    Mr. Leach. Well, I appreciate you being well ahead of the 
committee.
    Mr. Eizenstat.
    Mr. Eizenstat. I just wanted to make a concluding remark.
    I first want to thank you for your continuing interest, and 
Mrs. Maloney for her continuing interest, the chairwoman for 
having the hearing, but you know, we all have a limited amount 
of time and resources. The question is where you devote to it, 
and for sure, American museums can be encouraged to do more, 
but they have made a huge step forward with this portal.
    We ought to get as many to contribute as possible, but they 
really have done a tremendous job.
    The real focus, Mr. Chairman, Mrs. Maloney, really needs to 
be abroad.
    That is where the real problem is. That is where most of 
the art is that is potentially looted. That is not going to 
happen unless Congress focuses attention on it and encourages 
senior people in the Administration to make this an issue they 
care about. The art issue has not gotten a huge amount of 
attention, to say the least, from the Administration.
    It has sort of fallen off the radar screen. There are a lot 
of other issues, anti-Semitism and so forth, they have done a 
very good job with, but now with the art that we are concerned 
with.
    The bulk of it, is going to be in a few countries abroad, 
and I would just urge the committee to be creative in focusing 
attention there and focusing the attention of the Executive 
Branch on pursuing that. In particular, again, an international 
conference is a way of elevating it. It is an action-forcing 
device. If countries knew they had to come and report on their 
progress, you would see a lot more action coming.
    Mr. Leach. I appreciate that very much. I agree. I would 
just add to that, because of the steps that you in this panel 
have taken, the United States is in a much better position to 
lead. That is, if the American museums had not been as 
attentive, I do not think we could stand on a very solid basis, 
and so, your efforts have made our country's position, I think, 
far more credible than would otherwise be the case.
    With that, let me thank you all very much, and I am 
personally very impressed with each of your statements and with 
your commitment. The committee is adjourned.
    [Whereupon, at 11:58 a.m., the subcommittee was adjourned.]


                            A P P E N D I X



                             July 27, 2006


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