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[House Report 110-820]
[From the U.S. Government Publishing Office]

110th Congress                                            Rept. 110-820
                        HOUSE OF REPRESENTATIVES
 2d Session                                                      Part 1

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

 
             HOLOCAUST INSURANCE ACCOUNTABILITY ACT OF 2008

                                _______
                                

                 August 1, 2008.--Ordered to be printed

                                _______
                                

 Mr. Frank of Massachusetts, from the Committee on Financial Services, 
                        submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 1746]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Financial Services, to whom was referred the 
bill (H.R. 1746) to require disclosure of Holocaust-era 
policies by insurers and establish a federal cause of action 
for claims arising out of a covered policy, having considered 
the same, report favorably thereon with amendments and 
recommend that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................     5
Background and Need for Legislation..............................     5
Hearings.........................................................     9
Committee Consideration..........................................     9
Committee Votes..................................................     9
Committee Oversight Findings.....................................    10
Performance Goals and Objectives.................................    10
New Budget Authority, Entitlement Authority, and Tax Expenditures    10
Committee Cost Estimate..........................................    10
Congressional Budget Office Estimate.............................    10
Federal Mandates Statement.......................................    12
Advisory Committee Statement.....................................    12
Constitutional Authority Statement...............................    12
Applicability to Legislative Branch..............................    12
Earmark Identification...........................................    12
Section-by-Section Analysis of the Legislation...................    12
Additional Views.................................................    15

                               Amendment

  The amendments are as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Holocaust Insurance Accountability Act 
of 2008''.

SEC. 2. FINDINGS.

  Congress finds the following:
          (1) The Holocaust was one of the most heinous crimes in 
        history, causing the suffering of millions of people through 
        torture and other violence, including the murder of 6,000,000 
        Jews and millions of others, the destruction of families and 
        communities, and the theft of their assets.
          (2) After World War II, many Holocaust survivors and heirs of 
        Holocaust victims presenting claims to insurance companies 
        lacked policy information and vital records needed to satisfy 
        the burden of proof required to bring an insurance claim 
        because such documentation was confiscated by the Nazis or lost 
        in the devastation of World War II.
          (3) Following the end of the Cold War, efforts to address 
        open issues concerning restitution and compensation to the 
        victims of Nazi persecution were renewed. International talks 
        involving the United States, Germany, Austria, France, Israel, 
        and other nations occurred and agreements were reached to 
        enable restitution for a variety of claims, including claims 
        based on Holocaust-era insurance policies.
          (4) In response to the unique difficulties faced by those 
        seeking to bring claims based on Holocaust-era insurance 
        policies, Insurance Commissioners of the several States, the 
        National Association of Insurance Commissioners (NAIC), major 
        Jewish organizations and various European insurance companies 
        established the International Commission on Holocaust Era 
        Insurance Claims to provide a forum in which claimants could 
        bring claims based on Holocaust-era insurance policies.
          (5) In recognition of the preeminence of the States in 
        protecting consumers in the insurance marketplace, Congress and 
        the executive branch have a limited role in facilitating and 
        assisting the Holocaust-era insurance restitution efforts of 
        the several States as embodied principally in the ICHEIC 
        process.
          (6) After ICHEIC and its partner entities paid approximately 
        $300 million to more than 47,000 claimants and approximately 
        $200 million to Holocaust-related humanitarian organizations, 
        ICHEIC formally concluded its operation in March 2007.
          (7) Experts agree that, by the conclusion of the ICHEIC 
        process, claims based on a substantial portion of Holocaust-era 
        insurance policies issued to Holocaust victims in Western 
        Europe had been addressed.
          (8) Due to the political and economic conditions in Eastern 
        Europe until the end of the Cold War, compensation efforts 
        there have been more limited. The ICHEIC process did provide 
        compensation for policies issued by the Eastern European 
        branches and subsidiaries of Western European companies as well 
        as for policies issued by nationalized or liquidated Eastern 
        European insurers, drawing from ICHEIC's humanitarian funds. 
        However, the Eastern European companies and countries did not 
        participate in ICHEIC or any of the related compensation 
        processes. Now that the nations of Eastern Europe have joined 
        the community of free and modern nations, it is imperative that 
        the nations of Eastern Europe proactively seek to identify and 
        provide restitution for Holocaust-era insurance policies issued 
        within their borders.
          (9) All insurers that participated in ICHEIC are now willing 
        to address all inquiries made by Holocaust victims and victims' 
        heirs, check their archives, and settle legitimate claims based 
        on relaxed standards of proof. To facilitate the ongoing 
        monitoring of claims based on Holocaust-era insurance policies, 
        the Insurance Commissioners of the several States have agreed 
        to coordinate their Holocaust-era insurance restitution efforts 
        through the NAIC and the Holocaust Claims Processing Office. 
        Similarly, entities that worked in partnership with ICHEIC have 
        agreed to maintain their claims processing facilities and 
        cooperate with the HCPO in the resolution of Holocaust-era 
        insurance claims.
          (10) It has been the policy of the executive branch to 
        support the resolution of Holocaust-era insurance claims 
        through an alternative to litigation. To that end, the 
        executive branch has filed statements of interest in court 
        seeking the dismissal of cases involving claims for non-payment 
        of Holocaust-era insurance policies where there have been 
        independent legal grounds to support such dismissal.
          (11) This Act does not endorse any State law cause of action 
        and does not alter any applicable law, legal precedent or 
        principle in effect at the time of its enactment that may be 
        applicable to the resolution of Holocaust-era insurance claims. 
        Nor does this Act alter the binding effect of any class action 
        settlement involving Holocaust-era insurance claims.

SEC. 3. INSURER RESPONSE TO INQUIRIES ABOUT COVERED POLICIES.

  (a) Requirement.--
          (1) In general.--Subject to paragraph (2), an insurer 
        receiving a written inquiry from an eligible person regarding a 
        covered policy for which the person may be a beneficiary 
        shall--
                  (A) not later than 90 days after such insurer 
                receives such written inquiry, acknowledge the inquiry 
                in writing and indicate whether such insurer is in 
                possession of information specifically relating to such 
                covered policy;
                  (B) within a reasonable period of time, provide to 
                such eligible person all information in the possession 
                of such insurer regarding whether such person is a 
                potential beneficiary of such policy; and
                  (C) immediately notify the Holocaust Claims 
                Processing Office in writing of the inquiry and provide 
                a copy of all acknowledgments and information provided 
                to such eligible person under subparagraph (A) or (B) 
                to the HCPO.
          (2) Termination of requirement.--An insurer receiving a 
        written inquiry under paragraph (1) is not required to comply 
        with the requirements of such paragraph for any written inquiry 
        received on or after the date that is 10 years after the date 
        of the enactment of this Act.
  (b) Agreements With European Countries.--
          (1) Agreements.--The Secretary of State shall seek to enter 
        into an agreement with each European country with which no 
        appropriate agreement exists to facilitate the response 
        requirements of subsection (a).
          (2) Report.--Not later than 180 days after the date of the 
        enactment of this Act, and annually thereafter, the Secretary 
        of State shall submit to Congress a report on efforts to carry 
        out this subsection.

SEC. 4. MONITORING BY THE HOLOCAUST CLAIMS PROCESSING OFFICE.

  The Secretary of the Treasury is authorized and encouraged to enter 
into an agreement with the Holocaust Claims Processing Office to 
provide for--
          (1) the HCPO to monitor compliance with the requirements of 
        section 3(a);
          (2) the HCPO to notify the Secretary of the Treasury of the 
        identity of any insurer that the HCPO is aware of that is not 
        in compliance with the requirements of section 3(a) not later 
        than 30 days after the failure of such insurer to comply with 
        such requirements;
          (3) the HCPO to annually notify the Committee on Financial 
        Services of the House of Representatives, the Committee on 
        Banking, Housing, and Urban Affairs of the Senate, the 
        Secretary of the Treasury, and the Secretary of State of the 
        identity of each insurer that fails to comply with the 
        requirements of section 3(a);
          (4) subject to appropriations, the transfer to the HCPO of 
        amounts equal to the amounts received by the Government under 
        section 5 for use in carrying out paragraphs (1) and (2); and
          (5) the issuance of such guidelines and regulations as are 
        necessary to carry out this section and sections 3 and 5(a).

SEC. 5. PENALTY.

  (a) In General.--The Secretary of the Treasury shall assess a civil 
penalty of not less than $5,000 for each day that an insurer fails to 
comply with the requirements of section 3(a) for an inquiry referred to 
in such section, as determined by the Secretary after consideration of 
information provided by the Holocaust Claims Processing Office. Each 
failure to comply with the requirements of section 3(a) for an inquiry 
under such section shall be considered a separate offense.
  (b) Alternative Assessment.--If an insurer based outside of the 
United States is assessed a penalty under subsection (a) and refuses to 
pay such penalty and the Secretary is unable to collect such penalty 
from such insurer, the Secretary may seek to attach a lien on any 
payment (including the remittance of a dividend or management fee) to 
such insurer from a subsidiary of such insurer that is domiciled in the 
United States if--
          (1)(A) such insurer owns substantially all of the voting 
        shares of such subsidiary; or
          (B) there is substantial overlap of membership of the board 
        of directors and executive officers of such insurer and such 
        subsidiary;
          (2) the Secretary notifies such insurer, such subsidiary, and 
        the appropriate State regulator of such subsidiary of the 
        intent of the Secretary to attach a lien to such remittance; 
        and
          (3) the Secretary provides such insurer and such subsidiary a 
        reasonable opportunity to contest the attachment of the lien.
  (c) Regulations.--The Secretary shall issue regulations to carry out 
subsection (b).

SEC. 6. FEDERAL CAUSES OF ACTION.

  (a) Federal Cause of Action.--
          (1) In general.--There shall exist a Federal cause of action 
        for any claim arising out of or related to a covered policy 
        against any insurer.
          (2) Standing.--A claim under paragraph (1) may be brought by 
        an eligible person.
          (3) Statute of limitations.--Any action brought under this 
        Act shall be filed not later than 10 years after the effective 
        date of this Act.
  (b) Right to Opt Out of Class Action Proceedings.--
          (1) Sense of congress.--It is the sense of Congress that 
        claimants have the right to opt out of new or ongoing class 
        action proceedings relating to claims based on Holocaust-era 
        insurance policies in accordance with Rule 23 of the Federal 
        Rules of Civil Procedure.
          (2) Clarification.--Nothing in this Act shall be construed to 
        affect any class action settlement agreement, or releases given 
        therein, made before the date of the enactment of this Act.

SEC. 7. LIMITATION ON FEDERAL CAUSE OF ACTION AND REQUIREMENT TO 
                    RESPOND TO INQUIRY.

  (a) In General.--No cause of action shall exist for a claim against 
an insurer relating to, and an insurer is not required to comply with 
the requirements of section 3(a) for a written inquiry regarding, a 
covered policy for which--
          (1) payment has been made or release has been granted;
          (2) payment has been received or denied under the process of 
        the International Commission on Holocaust Era Insurance Claims, 
        any similar process that was conducted in partnership with 
        ICHEIC, any government sponsored Holocaust claims process, the 
        Holocaust Claims Processing Office, or any process for the 
        resolution of Holocaust-era insurance claims established 
        pursuant to a class action settlement; or
          (3) the claimant previously filed an action against such 
        insurer.
  (b) Clarification of Applicability.--Subsection (a) shall not apply 
to a claim for which a humanitarian payment has been received from 
ICHEIC and that is being asserted--
          (1) against an insurer that did not participate in ICHEIC; or
          (2) based on information not reasonably available before the 
        conclusion of the ICHEIC process.

SEC. 8. EUROPEAN BANK FOR RECONSTRUCTION AND DEVELOPMENT.

  (a) In General.--The Secretary of the Treasury shall instruct the 
United States Executive Director at the European Bank for 
Reconstruction and Development to use the voice and vote of the United 
States to create and advocate the policies of the Bank to encourage 
Eastern European countries to engage in and pursue restitution programs 
in compliance with this Act.
  (b) Report.--Not later than one year after the date of the enactment 
of this Act, and three years thereafter, the Secretary of the Treasury 
shall submit to Congress a report on the progress of carrying out 
subsection (a).

SEC. 9. DEFINITIONS.

  In this Act:
          (1) Commissioner of insurance.--The term ``commissioner of 
        insurance'' means the highest ranking officer of a State 
        responsible for regulating insurance.
          (2) Covered policy.--The term ``covered policy'' means any 
        insurance policy that was--
                  (A) in effect at any time after January 30, 1933, and 
                before December 31, 1945; and
                  (B) issued to a policyholder or named a beneficiary 
                who was deprived of their life, suffered damage to 
                their mental or physical health, suffered loss or 
                deprivation of financial or other assets, or suffered 
                any other loss or damage to their property as a result 
                of racial, religious, political, or ideological 
                persecution by organs of the National Socialist 
                Government of Germany or by other Governmental 
                authorities or entities controlled by such Governmental 
                authorities in the territories occupied by the National 
                Socialist Government of Germany or its European allies 
                during the period described in subparagraph (A).
          (3) Eligible person.--The term ``eligible person'' means a 
        person who purchased a covered policy, a beneficiary of such 
        person with respect to such policy, an heir of such person or 
        such beneficiary with respect to such policy, or an assignee of 
        such person, such beneficiary, or such heir with respect to 
        such policy.
          (4) Holocaust claims processing office; hcpo.--The terms 
        ``Holocaust Claims Processing Office'' and ``HCPO'' mean the 
        Holocaust Claims Processing Office of the New York State 
        Banking Department.
          (5) International commission on holocaust era insurance 
        claims; icheic.--The terms ``International Commission on 
        Holocaust Era Insurance Claims'' and ``ICHEIC'' mean the 
        International Commission on Holocaust Era Insurance Claims 
        established through the memorandum of understanding and 
        bilateral or multilateral agreements between the Commission, 
        relevant foreign governments, and the following insurers and 
        their successors in interest:
                  (A) The Dutch Association of Insurers and the members 
                of the Association.
                  (B) AXA SA together with its subsidiaries (the AXA 
                Group).
                  (C) Assicurazioni Generali S.P.A.
                  (D) Zurich Life Insurance Company and its affiliates.
                  (E) Allianz SE.
                  (F) Winterthur Swiss Insurance Company together with 
                its subsidiaries (the Winterthur Group).
                  (G) All insurers participating in the process of the 
                Commission through bilateral or multilateral 
                agreements.
          (6) Insurer.--The term ``insurer'' means any person engaged 
        in the business of insurance in interstate or foreign commerce, 
        if the person issued a covered policy, or a successor in 
        interest to such person.

  Amend the title so as to read:

      A bill to further facilitate payment of Holocaust-era 
insurance claims.

                          PURPOSE AND SUMMARY

    H.R. 1746, the Holocaust Insurance Accountability Act of 
2008, is intended to build on prior Holocaust-era insurance 
restitution efforts and further facilitate payment of 
Holocaust-era insurance claims not previously addressed by the 
courts or by other Holocaust restitution programs. H.R. 1746 
requires that insurance companies respond within 90 days to any 
new inquiry received from any potential beneficiary of any 
Holocaust-era insurance policy. Compliance with this reporting 
requirement will be monitored by the New York State Holocaust 
Claims Processing Office (HCPO) and enforced through civil 
penalties assessed by the Secretary of the Treasury acting on 
information provided by the HCPO. H.R. 1746 also creates a 
Federal cause of action for claimants who have not previously 
brought a claim in court, or filed claims through the 
International Commission on Holocaust Era Insurance Claims 
(ICHEIC), or through another Holocaust restitution program. 
Finally, the bill requires the U.S. representative to the 
European Bank for Reconstruction and Development to encourage 
Eastern European countries to participate in the Holocaust-era 
insurance restitution programs.

                  BACKGROUND AND NEED FOR LEGISLATION

    Following the Second World War many Western European 
countries passed laws and created programs to provide 
restitution for property confiscated from victims of the 
Holocaust. While unpaid or confiscated insurance policies were 
included in these post-war restitution efforts, the difficulty 
of accessing records and in some instances, the destruction of 
these records as a result of war, made it difficult for 
Holocaust victims and their heirs to file claims without highly 
specific information regarding the policy. Moreover, the 
country where the policy was purchased also created an often 
insurmountable barrier for those wishing to file claims. 
Countries like Poland, Hungary and Czechoslovakia, which became 
part of the Soviet Bloc after 1945 nationalized and liquidated 
private insurance companies and imposed restrictions on who 
could receive payments on policies. Although some of the West 
European companies that operated in Central and Eastern 
European markets still exist today, many of the companies that 
sold insurance in these countries have no present-day 
successors.
    Despite these difficulties, during the 1990s, Jewish 
organizations, Holocaust survivors, and the U.S. and Israeli 
governments renewed their efforts to obtain compensation for 
survivors who had not participated in previous post-war 
restitution programs. In the mid-to-late 1990s class-action 
lawsuits against Swiss, German, Austrian, Italian, and French 
companies brought widespread international attention to the 
issue of looted Holocaust-era assets, including unpaid 
insurance policies. The Clinton Administration took the lead in 
facilitating broad compensation agreements with the governments 
of Germany, Austria, and France. Although efforts focused 
largely on property restitution and compensating victims of 
forced and slave labor, each of these agreements also had an 
insurance-related component.
    Concurrent with these intergovernmental negotiations, and 
in response to increasing claims against European insurance 
companies operating in the United States, the National 
Association of Insurance Commissioners (NAIC) formed a Working 
Group on Holocaust Insurance Claims to reach out to Holocaust 
victims and their heirs to better determine the scope of the 
problem, and to initiate a dialogue with European insurers 
about how to resolve the issue of unpaid claims. In August 1998 
the NAIC, several European insurers, the Conference of Jewish 
Material Claims against Germany (Claims Conference), the World 
Jewish Restitution Organization (WJRO), and the State of Israel 
signed a Memorandum of Understanding (MOU) establishing the 
International Commission on Holocaust Era Insurance Claims 
(ICHEIC). The MOU tasked ICHEIC with identifying relevant 
Holocaust-era insurance policies issued between 1920 and 1945, 
reaching out to potential claimants and encouraging them to 
participate in the ICHEIC process, and assisting Holocaust 
victims and their heirs in resolving claims. Members of 
ICHEIC--chaired by former U.S. Secretary of State Lawrence 
Eagleburger--agreed that ICHEIC's claims process would adhere 
to the following principles: (i) Claimants would not be charged 
to file a claim and no ICHEIC funds were used to pay attorneys' 
fees; (ii) ICHEIC would evaluate claims based on relaxed 
standards of proof--given that a significant number of 
potential claimants did not possess policy documentation, 
claimants would not be required to name a specific insurance 
company or provide documentation of an insurance policy; and 
(iii) ICHEIC and participating insurance companies would 
conduct archival research in order to establish a database of 
potential policyholders against which to match submitted 
claims.
    Before embarking on its tasks, ICHEIC commissioned a report 
to estimate the volume and value of Holocaust-era policies that 
remained unpaid at the end of the 20th century. Prepared under 
the supervision of then-North Dakota Insurance Commissioner 
Glenn Pomeroy and European insurance expert, Philippe Ferras, 
the Pomeroy-Ferras Report remains the only widely accepted 
source of baseline data relevant to Holocaust-era insurance 
restitution.\1\ Based on information contained in the Pomeroy-
Ferras Report and other sources, experts supportive of H.R. 
1746 estimate the largest possible universe of policies 
relevant to Holocaust-era insurance restitution to be 
approximately 800,000 policies.\2\ Acknowledging the 
significantly more developed insurance marketplace that existed 
in pre-war Western Europe, the Pomeroy-Ferras Report further 
determined that 80 percent of policies relevant to Holocaust-
era insurance restitution had been issued to policyholders in 
Western Europe. Given the successful restitution programs that 
existed in post-war Western Europe, the Pomeroy-Ferras Report 
was able to conclude that approximately 70 percent of policies 
relevant to Holocaust-era insurance restitution issued in 
Western Europe had been addressed before the creation of 
ICHEIC. In contrast, Pomeroy-Ferras also determined that, of 
the 20 percent of policies relevant to Holocaust-era insurance 
restitution that were issued in Eastern Europe, only 10 percent 
of policies had been addressed before the creation of ICHEIC. 
Therefore, while the Pomeroy-Ferras Report represented the 
beginning point for the ICHEIC process, it made clear that 
ICHEIC and subsequent Holocaust-era insurance restitution 
efforts would be wrapping up Holocaust-era insurance 
restitution in Western Europe but only beginning Holocaust-era 
insurance restitution in Eastern Europe.
---------------------------------------------------------------------------
    \1\The Pomeroy-Ferras Report is available online at: http://
www.icheic.org/pdf/Pomeroy-Ferras%20Report.pdf.
    \2\See, Sidney Zabludoff, ``The International Commission of [sic.] 
Holocaust-Era Insurance Claims: Excellent Concept but Inept 
Implementation,'' Jewish Political Studies Review, Spring 2005.
---------------------------------------------------------------------------
    ICHEIC received approximately $550 million from 
participating insurers. Of this, $350 million was secured from 
German companies through a 2000 executive agreement between the 
United States and Germany. A further $100 million came from the 
Italian insurer Assicurazioni Generali, S.p.A., and the 
remaining $100 million was contributed by the various 
individual insurance companies and national insurance 
associations that participated in the ICHEIC process. In 
addition to five insurers on ICHEIC's board, ICHEIC secured the 
participation of more than 75 other companies through bilateral 
agreements with the German, Dutch, Austrian, and Belgian 
insurance associations.
    It is important to note that participation of the German 
insurance association, and indeed the participation of all the 
insurers that participated in ICHEIC as well as the Austrian 
General Settlement Fund, was conditioned on explicit or tacit 
assurances of ``legal peace'' provided by the Clinton 
Administration and maintained by the Bush Administration. Under 
these assurances of ``legal peace,'' the Clinton and Bush 
administrations have agreed to intervene on behalf of ICHEIC 
participants that are sued in U.S. courts. This cooperation, 
which is ongoing, was a key feature of the ICHEIC process and 
fundamental to its success in resolving claims, according to 
the testimony of former Deputy Treasury Secretary Eizenstat who 
served as chief negotiator for Holocaust matters for the 
Clinton Administration.\3\
---------------------------------------------------------------------------
    \3\See, testimony of Stuart Eizenstat before the House Committee on 
Financial Services, during a hearing entitled ``The Holocaust Insurance 
Accountability Act of 2007 (H.R. 1746): Holocaust Era Insurance 
Restitution After ICHEIC, The International Commission on Holocaust Era 
Insurance Claims,'' February 7, 2008. Pp. 31-32.
---------------------------------------------------------------------------
    ICHEIC's claims process opened in early 2000 and closed in 
March 2007. In total, ICHEIC facilitated the payment of 
approximately $300 million to approximately 48,000 claimants. 
While some 43,000 claims received no payment from ICHEIC, those 
claims were often determined to have been honored under 
previous compensation agreements, or were determined to fall 
short of the relaxed standards of proof established by ICHEIC. 
In addition to the funds paid to individual claimants, ICHEIC 
paid approximately $200 million to a ``humanitarian fund'' 
overseen by the Claims Conference. Prior to ICHEIC's closure, 
its participating insurance companies, including members of the 
German and Dutch insurance associations, agreed that they will 
continue to accept and honor claims based on ICHEIC's relaxed 
standards of proof.
    For almost a decade Congress has been actively aware of the 
issues surrounding Holocaust-era insurance restitution. In 
February 2000, the Financial Services Committee addressed the 
topic in a hearing entitled ``Restitution of Holocaust 
Assets.'' Likewise, hearings before the House Committee on 
Government Reform between 2001 and 2003 highlighted the ICHEIC 
process. Also, legislation proposed in the 107th, 108th, and 
109th Congresses mirrors some provisions of H.R. 1746, as 
introduced. Opposed by successive U.S. Administrations, the 
House declined to act on legislation relating to Holocaust-era 
insurance restitution while the ICHEIC process remained 
actively underway. Congress's authority to act in the field of 
Holocaust-era insurance restitution and its failure to do so 
previously were noted by the Supreme Court when it upheld 
ICHEIC as the then-exclusive national approach to Holocaust-era 
insurance restitution in American Ins. Assn. v. Garamendi, 539 
U.S. 396 (2003), at 429.
    When ICHEIC concluded its period of active operation in 
March 2007, Congress again turned its attention to the issue of 
Holocaust-era insurance restitution. Seeking both to endorse 
the successes of prior Holocaust-era insurance restitution 
efforts and to correct their shortcomings where deemed 
necessary, three areas emerged where Congress could facilitate 
the resolution of previously unresolved Holocaust-era insurance 
claims. The first of these areas of concern relates to the 
accessibility of information regarding Holocaust-era insurance 
policies. ICHEIC published more than 500,000 names of potential 
Holocaust-era policyholders on their website. Recognizing that 
this was a comprehensive, but not complete, effort, H.R. 1746 
creates the first ever Federal mandate requiring insurers to 
respond to requests for information regarding Holocaust-era 
insurance policies.
    Second, H.R. 1746 provides a right of access to the Federal 
courts to individuals with previously unaddressed Holocaust-era 
insurance claims. The Federal cause of action created in H.R. 
1746 applies only prospectively and thereby expressly protects 
the finality of claims addressed by previous judicial 
decisions, settlements, and Holocaust restitution efforts. 
However, the creation of the Federal cause of action also 
expressly allows access to U.S. Courts for Holocaust-era 
insurance claims not filed prior to the bill's enactment.
    Finally, through H.R. 1746 Congress both takes note of and 
seeks to begin to address the broader issue of the restitution 
of Holocaust-era assets in Eastern Europe.

                                HEARINGS

    On February 7, 2008, the House Committee on Financial 
Services held a hearing entitled, ``The Holocaust Insurance 
Accountability Act of 2007 (H.R. 1746): Holocaust Era Insurance 
Restitution After ICHEIC, the International Commission on 
Holocaust Era Insurance Claims.'' The following witnesses 
testified:
    Witness List:
          Panel One
                   Ambassador J. Christian Kennedy, 
                Special Envoy for Holocaust Issues, U.S. 
                Department of State
                   Dr. Michael Kurtz, Assistant 
                Archivist for Records Services, National 
                Archives and Records Administration
          Panel Two
                   Mr. Stuart Eizenstat, Former Special 
                Representative of the President & Secretary of 
                State on Holocaust-Era Issues
                   Mr. Sam Dubbin, Esq., Attorney, 
                Miami, Florida
                   Ms. Diane Koken, Former Vice-
                Chairman, ICHEIC; Former Pennsylvania Insurance 
                Commissioner
                   Mr. Sidney Zabludoff, Former 
                Consultant, Conference on Jewish Material 
                Claims Against Germany, Inc.
                   Mr. Roman Kent, Chairman, American 
                Gathering of Jewish Holocaust Survivors
                   Mr. Israel Arbeiter, President, 
                American Association of Jewish Holocaust 
                Survivors of Greater Boston

                        COMMITTEE CONSIDERATION

    The Committee on Financial Services met in open session on 
June 25, 2008, and ordered reported H.R. 1746, Holocaust 
Insurance Accountability Act of 2007, as amended, to the House 
with a favorable recommendation by a voice vote.

                            COMMITTEE VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. No 
record votes were taken in conjunction with the consideration 
of this legislation. A motion by Mr. Frank to report the bill, 
as amended, to the House with a favorable recommendation was 
agreed to by a voice vote. During the consideration of the 
bill, the following amendments were considered:
    An amendment in the nature of a substitute, by Mr. Frank, 
No. 1, was agreed to, as amended, by voice vote.
    An amendment to the amendment in the nature of a substitute 
by Mr. Sherman, No. 1a, regarding domestic subsidiaries, was 
agreed to, as modified, by voice vote.
    An amendment en bloc to the amendment in the nature of a 
substitute by Mr. Sherman, No. 1b, regarding Holocaust 
insurance registry and civil penalties, was not agreed to by 
voice vote.

                      COMMITTEE OVERSIGHT FINDINGS

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee held a hearing and made 
findings that are reflected in this report.

                    PERFORMANCE GOALS AND OBJECTIVES

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee establishes the 
following performance related goals and objectives for this 
legislation:
    H.R. 1746 is intended to build on prior Holocaust-era 
insurance restitution efforts and further facilitate payment of 
Holocaust-era insurance claims not previously addressed by the 
courts or by other Holocaust restitution programs.

   NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX EXPENDITURES

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                        COMMITTEE COST ESTIMATE

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  CONGRESSIONAL BUDGET OFFICE ESTIMATE

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:
                                                     July 29, 2008.
Hon. Barney Frank,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 1746, the 
Holocaust Insurance Accountability Act of 2008.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                                   Peter R. Orszag.
    Enclosure.

H.R. 1746--Holocaust Insurance Accountability Act of 2008

    H.R. 1746 would require insurance companies to respond to 
inquiries about the existence of Holocaust-era insurance 
policies. The legislation would require the Department of the 
Treasury to enter into an agreement with the New York State 
Holocaust Claims Processing Office (HCPO) to monitor company 
responses and report to the Treasury and the Congress on 
compliance with the proposed federal requirement. Failure to 
comply with individual inquiries would subject insurers to 
civil penalties. In addition, the legislation would require the 
Departments of State and the Treasury to seek agreements with 
European countries to facilitate responses from insurers in 
Europe. Based on information from the Departments of State and 
the Treasury, CBO estimates that implementing H.R. 1746 would 
cost about $500,000 annually, assuming appropriation of the 
necessary amounts.
    Enacting H.R. 1746 could affect federal revenues because 
the bill would impose new civil penalties on insurance 
companies if they fail to respond to inquiries. Collections of 
civil penalties are recorded in the budget as revenues. Subject 
to appropriation, those penalties could be spent by HCPO. CBO 
expects that any additional revenues would not be significant 
because of the small number of fines likely to be collected.
    H.R. 1746 would impose private-sector mandates, as defined 
in the Unfunded Mandates Reform Act (UMRA), on certain 
insurers. The bill would require an insurer, after receiving a 
written inquiry from a potential beneficiary of such a policy, 
to: Acknowledge that inquiry in writing, indicating whether the 
insurer has information specifically related to a covered 
policy as defined in the bill; provide to each person making 
such an inquiry any information regarding whether that person 
is a potential beneficiary; and immediately notify the 
Holocaust Claims Processing Office in writing of each inquiry 
and provide a copy of all acknowledgments and information to 
persons making such inquiries. Based on information from the 
insurance industry, CBO expects that the cost to U.S. firms of 
complying with the mandates would fall below the annual 
threshold for private-sector mandates ($136 million in 2008, 
adjusted annually for inflation).
    H.R. 1746 contains no intergovernmental mandates as defined 
in UMRA and would not affect the budgets of state, local, or 
tribal governments.
    On February 6, 2008, CBO transmitted a cost estimate for 
H.R. 1746 as ordered reported by the House Committee on Foreign 
Affairs on October 23, 2007. Both bills address Holocaust-era 
insurance policies but have different provisions. The version 
of H.R. 1746 reported by the House Committee on Foreign Affairs 
would create a Holocaust Insurance Registry through the 
National Archives and Records Administration, while the version 
reported by the House Committee on Financial Services would 
require insurance companies to respond to individual inquiries 
about Holocaust-era insurance policies. CBO's cost estimates 
reflect those differences. H.R. 1746 as ordered reported by the 
House Committee on Foreign Affairs contains a private-sector 
mandate in that it would require insurers to electronically 
file certain information about Holocaust-era policies with the 
Secretary of Commerce. CBO determined that the cost of 
complying with that mandate would fall below the UMRA's annual 
threshold.
    The CBO staff contacts for this estimate are Matthew 
Pickford (for federal costs) and Paige Piper/Bach (for the 
private-sector impact). This estimate was approved by Theresa 
Gullo, Deputy Assistant Director for Budget Analysis.

                       FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional Authority of Congress to enact this legislation 
is provided by Article 1, section 8, clause 1 (relating to the 
general welfare of the United States) and clause 3 (relating to 
the power to regulate interstate commerce).

                  APPLICABILITY TO LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

                         EARMARK IDENTIFICATION

    H.R. 1746 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

             SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title

    This section designates the short title of the bill as the 
``Holocaust Insurance Accountability Act of 2008.''

Section 2. Findings

    Section 2 sets out a brief history of Holocaust-era 
insurance restitution, provides findings for this legislation 
and clarifies Congress's intent that this legislation apply 
prospectively while leaving intact judicial decisions, 
settlements and Holocaust restitution efforts.

Section 3. Insurer response to inquiries about covered policies

    Section 3 requires insurers to respond to requests for 
information regarding Holocaust-era insurance policies within 
90 days of receiving the request and to indicate whether the 
insurer has information regarding the request. Section 3 also 
requires insurers to notify the New York State Holocaust Claims 
Processing Office of all inquires made under this section. This 
requirement expires 10 years after enactment. Section 3 also 
requires the Secretary of State to seek to enter into 
agreements with certain European countries to facilitate 
requests under this section.

Section 4. Monitoring by the Holocaust Claims Processing Office

    Recognizing the ongoing importance of the States in 
consumer protection in the insurance marketplace, H.R. 1746's 
reporting requirement is monitored by the States, acting 
through the New York State Holocaust Claims Processing Office. 
Section 4 provides that the Holocaust Claims Processing Office 
will monitor the provision of information required under 
Section 3 and periodically inform the Congress, the Secretary 
of State and the Secretary of the Treasury of insurers who have 
failed to comply with Section 3.

Section 5. Penalty

    Section 5 provides that there will be a $5,000 per day 
penalty for any insurer who fails to comply with Section 3. 
Each failure to comply with Section 3 shall be considered a 
separate offense. Enforcement of the Section 3 reporting 
requirement is the responsibility of the Secretary of the 
Treasury. To prevent foreign insurers who have assets in the 
U.S. from ignoring the reporting requirement, Section 5 permits 
the Secretary to collect unpaid civil penalties assessed under 
this section by placing liens on transfers to a non-compliant 
foreign insurer from its U.S. subsidiaries.

Section 6. Federal cause of action

    Section 6 creates a Federal cause of action with a ten-year 
statute of limitations for any claim arising out of a 
Holocaust-era insurance policy. In addition, Section 6 
expresses the sense of Congress that claimants maintain the 
right to opt out of relevant new class action proceedings.

Section 7. Limitations on the cause of action

    Section 7 provides that the cause of action will not apply 
to covered insurance policies for which the claimant has 
previously filed a claim in court, with ICHEIC or with any of 
ICHEIC's partner entities, or for which a payment has been made 
or release has been granted. Claimants who received certain 
humanitarian payments under ICHEIC may bring an action against 
any non-ICHEIC company. In addition, claimants who have not 
submitted a claim to ICHEIC or a similar entity that worked 
with ICHEIC, may bring an action against any ICHEIC 
participating company or non-ICHEIC company.

Section 8. European Bank for Reconstruction and Development

    Section 8 requires that the European Bank for 
Reconstruction and Development encourage Eastern European 
countries to engage in and pursue Holocaust-era insurance 
restitution programs in compliance with this Act.

Section 9. Definitions

    Section 9 defines the following terms:
          (1) Commissioner of insurance.
          (2) Covered policy.--Any insurance policy that was in 
        effect between January 30, 1933 and December 31, 1945 
        and was issued to a Holocaust victim or survivor.
          (3) Eligible person.--A person who purchased a 
        covered policy, a beneficiary, an heir, or an assignee 
        of such person.
          (4) Holocaust claims processing office; hcpo.
          (5) International commission on holocaust era 
        insurance claims; icheic.--The Commission established 
        through the memorandum of understanding and bilateral 
        or multilateral agreements between the Commission, 
        relevant foreign governments, and the following 
        insurers and their successors in interest:
                  (A) The Dutch Association of Insurers and its 
                members.
                  (B) The AXA Group.
                  (C) Generali.
                  (D) Zurich.
                  (E) Allianz.
                  (F) Winterthur.
                  (G) All insurers participating in the process 
                of the Commission through bilateral or 
                multilateral agreements.
          (6) Insurer.--Any person engaged in the business of 
        insurance in interstate or foreign commerce, if the 
        person issued a covered policy, or a successor in 
        interest to such person.

                            ADDITIONAL VIEWS

    H.R. 1746 reflects another difficult chapter in the tragic 
and disturbing history of the Holocaust, which lingers on in 
our collective conscience to this day.
    There is broad agreement among all parties involved that we 
must encourage the fair and just resolution of all insurance 
claims that remain unsettled from the Holocaust era to the 
maximum extent possible, even with the long-standing problem of 
having such little evidence and documentation so many years 
after the fact.
    While we were able to work toward a greater consensus on 
many features of H.R. 1746, we remain concerned by the 
provisions in Section 6 and Section 7 that create a new Federal 
cause of action with a ten-year statute of limitations. These 
unwarranted provisions open the door for new lawsuits against 
companies that cooperated in the International Commission on 
Holocaust Era Insurance Claims (ICHEIC) process, or a similar 
claims resolution process, and are now cooperating through the 
New York State Holocaust Claims Processing Office (HCPO) 
process.
    We are concerned that these provisions could turn a 
cooperative process into a confrontational one in which false 
hopes might be raised and lengthy litigation efforts could 
delay resolution and waste precious resources.
    The companies that participated in the ICHEIC process--
which was sanctioned by state insurance regulators, the World 
Jewish Congress, and the governments of Israel and the United 
States--and that are continuing to cooperate through the HCPO 
process, should not be subject to lawsuits by new claimants 
unless they fail to cooperate.
    We commend the chief proponent of this legislation, 
Representative Ros-Lehtinen of Florida, on her determination to 
highlight the issue of outstanding insurance claims and to 
encourage the full and fair restitution of Holocaust survivors 
and their families.
    We also thank the Chairman of the Committee on Financial 
Services for his diligence in working with all interested 
parties to forge a greater consensus on an important and 
sensitive issue.

                                   Spencer Bachus.
                                   Ron Paul.
                                   Shelley Moore Capito.
                                   Christopher Shays.

                                  
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