Brooklyn woman pleads guilty to $57M fraud targeting WWII victims

October 12, 2012 From U.S Attorney's Office, Manhattan

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Valendina Romashova, aka “Tina Rome,” pled guilty on Wednesday in Manhattan federal court to conspiring to defraud programs administered by the Conference on Jewish Material Claims Against Germany, which was established to aid the survivors of Nazi persecution, out of more than $57 million.

Romashova was arrested in November 2010 as part of an ongoing investigation that has resulted in charges against a total of 31 participants, 10 of whom were former Claims Conference employees, including a former director. She pled guilty before U.S. District Judge Thomas P. Griesa.

Manhattan U.S. Attorney Preet Bharara said, “Valentina Romashova abused her position at a law firm, taking the firm’s clients and turning them into the instruments of a cynical fraud. Her theft of funds intended to compensate the victims of unspeakable crimes has now earned her the conviction she deserves.”

According to the complaint filed in Manhattan federal court, the Claims Conference supervises and administers several funds that make reparation payments to victims of the Nazis, including the Hardship Fund and the Article 2 Fund, both of which are funded by the German government.

Applications for disbursements through these funds are processed by employees of the Claims Conference’s office in Manhattan, and the employees are supposed to confirm that the applicants meet the specific criteria for payments under the funds.

As part of the charged scheme, a web of individuals systematically defrauded the Article 2 Fund and Hardship Fund programs for more than a decade. The Claims Conference first suspected the fraud in December 2009 and immediately reported their suspicions to law enforcement, which conducted a wide-reaching investigation.

Members of the conspiracy submitted fraudulent applications for the Hardship Fund for people who were not eligible, including many who were born after World War II. Some members of the conspiracy recruited other individuals to provide identification documents, such as passports and birth certificates, which were then fraudulently altered and submitted to corrupt insiders at the Claims Conference, who then processed those applications.

When the applicants received their compensation checks, they kept a portion of the money and passed the rest back up the chain.

From the investigation to date, the Claims Conference has determined that at least 3,839 Hardship Fund applications appear to be fraudulent. These applications resulted in a loss to the Hardship Fund of approximately $12.3 million.

The Article 2 Fund makes monthly payments of approximately $400 to survivors of Nazi persecution who make less than $16,000 per year, and either (1) lived in hiding or under a false identity for at least 18 months; (2) lived in a Jewish ghetto for 18 months; or (3) were incarcerated for six months in a concentration camp or a forced labor camp.

The fraud involved doctored identification documents in which the applicant’s date and place of birth had been changed. The fraud also involved more sophisticated deception, including altering documents that the Claims Conference obtained from outside sources to verify a person’s persecution by the Nazis.

The Claims Conference has determined that at least 1,112 Article 2 Fund cases it processed have been determined to be fraudulent. Those cases have resulted in a loss to the Claims Conference of approximately $45 million.

Romashova worked at a law firm in Brooklyn that advertised in Russian-language newspapers that it could assist people with applying for compensation from the Claims Conference.

Romashova, 65, faces a maximum sentence of 20 years in prison. She is scheduled to be sentenced by Judge Griesa on Feb. 21, 2013.