(6) By adding at the end of the joint resolution as so amended the following new sections:

"SEC. 10. (a) Within sixty days after his appointment the Commissioner shall give public notice by publication in the Federal Register of the time when and the limit of time within which claims may be filed, which limit shall not be more than ninety days after such publication.

"(b) The Commissioner may in his discretion enter an award with respect to one or more items deemed to have been clearly established in an individual claim while deferring consideration and action on other items of the same claim.

"(c) The Commission shall, as soon as possible, certify to the Secretary of the Treasury copies of the awards made.

"(d) There shall be deducted from the amount of each payment made as reimbursement for the expenses incurred by the United States, an amount equal to 3 per centum of such payment. All amounts so deducted shall be covered into the Treasury to the credit of miscellaneous receipts.

"SEC. 11. (a) The claims allowed by the Commissioner shall be paid in the following order:

"(1) Claims which originally accrued wholly or partly in favor of an American national against a Russian national, on which claims a judgment lien or a warrant of attachment had been obtained prior to November 16, 1933, in a court of the United States or of a State of the United States against such Russian national, who prior to its nationalization by the Soviet Government owned or was entitled to property, moneys, credits, or choses in action in the United States which has or have been collected or recovered by the United States under the Litvinov Assignment, shall be first paid up to the amount of the funds realized by the United States from such collection. In the event that such funds are insufficient to make payment in full of these claims, payment thereof shall be prorated and paid up to the amount of such funds.

"(2) After the payments provided for in paragraph (1) all other allowed claims including the balance of any claims allowed and unpaid under paragraph (1) shall be paid out of any funds collected by the United States under the Litvinov Assignment.

"(3) The balance remaining after the payment of the claims provided for in paragraphs (1) and (2) shall then be paid into the general fund of the United States Treasury. All payments shall be without prejudice to the claims of the United States against the Soviet Government.

"(b) Nothing herein contained shall be construed as an assumption by the United States of any liability to any claimant beyond the extent provided for herein.

“(c) Any claims based on bonds of the Soviet Government or prior governments of Russia or the nationals thereof acquired by claimants for less than their face value shall be allowed by the Commissioner only to the extent of the actual consideration paid therefor.

"(d) The Secretary of the Treasury is authorized and directed to pay, in the order of priority set forth in subsection (a) of this section, an amount not exceeding the principal of each award, plus accrued interest on such awards as bear interest, upon receipt of duly certified copies of the awards made by the Commissioner. The certification by the Commissioner shall include a statement of the total amount of all claims filed with him in each classification.

"SEC. 12. All payments authorized under section 11 of this Act shall be disbursed from funds heretofore or hereafter collected by the United States pursuant to, the Litvinov Assignment, which funds are hereby permanently appropriated for the making of the payments authorized by this Act.

"SEC. 13. For the purposes of this Act—

"(1) The terms 'Soviet Government' and the 'Government of the Union of Soviet Socialist Republics,' include the Union of Soviet Socialist Republics, any of its present or former constituent republics, or political subdivisions, and governments prior to the Union of Soviet Socialist Republics, of all or any part of the former Empire of Russia.

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"(2) The term 'American national' includes any citizen of the United States. '(3) The term 'Russian national' includes any individual who, at any time after the 1st day of August 1914, was a citizen of the Union of Soviet Socialist Republics or of any prior governments of Russia and any partnership, corporation, or business association organized under the laws, decrees, ordinances, or acts of the former Empire of Russia or any governments successor thereto, and

subsequently nationalized or dissolved or whose assets were taken over by the Soviet Government or which was merged with any other corporation or organization by the Soviet Government.

"(4) The term 'Litvinov Assignment' includes the letter dated November 16, 1933, written by Maxim Litvinov to President Roosevelt, wherein the Soviet Government assigned to the United States amounts admitted or found to be due it as the successor of prior governments of Russia or otherwise, for the purpose of partial settlement of the claims of American nationals which arose by reason of the nationalization decrees and other decrees and acts of the Soviet Government resulting in the taking of property of American nationals and of Russian nationals who were indebted to American nationals, and the repudiation of state debts and obligations of prior governments of Russia, and the letter dated November 16, 1933, from President Roosevelt to Maxim Litvinov, accepting such assignment, and letters written by Serge Ughet, assigning certain amounts and accounts to the United States for the same purpose."

Mr. FULTON. We will take Mr. Multer, from New York, as our first witness.

STATEMENT OF HON. ABRAHAM J. MULTER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK

Mr. MULTER. Mr. Chairman and Congressman Morano, I appreciate the opportunity of appearing before you this morning. I want to extend the regrets of Congressman Kearney and Congressman Keogh for their inability to be with us this morning. Congressman Kearney is confined to bed. I have delivered to the chairman a statement on his behalf which he prepared and which he would like to have made a part of the record.

(The material referred to is as follows:)

STATEMENT OF HON. BERNARD W. KEARNEY, MEMBER OF CONGRESS, 32D DISTRICT OF NEW YORK, IN SUPPORT OF HOUSE JOINT RESOLUTION 130

Mr. Chairman and members of the Subcommittee on European Affairs of the House Foreign Affairs Committee, permit me to thank you for the opportunity of appearing here today in support of my resolution House Joint Resolution 130, to amend the joint resolution entitled "Joint resolution to provide for the adjudication by a Commissioner of Claims of American nationals against the Government of the Union of Soviet Socialist Republics," approved August 4, 1939. A similar resolution was introduced by our late and distinguished colleague, Representative William T. Byrne, of New York. After his death a similar resolution was introduced in the last Congress by our distinguished colleague from New York, Mr. Keogh, who has again introduced a similar resolution in this Congress, which bears number House Joint Resolution 49. It is my information that in the last Congress the subcommittee, under the chairmanship of the distinguished ranking minority member of this committee, Congressman Gordon, conducted hearings and approved the principle of the Keogh resolution. Unfortunately, it was done too late in the session to get action by the full committee.

The Departments of State, Justice, and Treasury reported on these resolutions in the last Congress, and have done so again in this Congress, always approving the principle of the resolutions.

My resolution differs somewhat from the Keogh resolution because I have incorporated into my resolution most of the recommendations of the Departments. The resolution seeks to implement and effectuate the purposes of Public Resolution 36, enacted in 1939. The principle laid down in that resolution, and which is carried forward in my resolution has been approved by the United States Supreme Court. The moneys affected by these resolutions are in the main the property of various persons who have claims thereto, and our Government is merely holding the bulk of that money for the benefit and account of those persons, subject to a commissioner being appointed under Public Resolution 36 of 46968-542

1939, to determine the claims and order distribution to the rightful claimants. The entire cost of administration and distribution is to be charged to the fund. The fund now aggregates in excess of $9 million, of which, however, about $1.5 million represents postal moneys due the United States Government. Those moneys, of course, should be covered into the United States Treasury, and there is no objection to an amendment to my resolution to so provide.

The delay in appointing a commissioner and taking proof of claims, and making distribution accordingly, has been at the request of the various executive departments. They have previously asserted that until all of the funds had been collected, no attempt at distribution should be made.

Now that all the departments are in agreement that no further funds are outstanding that can be collected, a commissioner should be appointed pursuant to this law, and the claims adjudicated, and payment made accordingly.

I am sure the committee will find that the various technical provisions of my resolution are in accord with existing law.

I respectfully urge an early favorable report on House Joint Resolution 130. Mr. MULTER. Congressman Keogh is attending for himself and myself our caucus this morning, and I have undertaken to appear here for him.

Congressman Keogh has authorized me to say to this committee that he is in full accord with House Joint Resolution 130, that he humbly states he thinks that is a better resolution than his own, because House Joint Resolution 130 has incorporated into it most of the recommendations of the Departments of State, Treasury, and Justice as set forth in the reports which they have submitted on his resolution.

Mr. Keogh submitted a similar resolution in the last Congress. This subcommittee under the then chairmanship of Congressman Gordon did conduct hearings and approved the bill, but unfortunately it could not be acted on by the full committee because it came too late in the session.

Mr. FULTON. Could you outline to the committee briefly what the chief issues are here?

Mr. MULTER. Yes. This resolution seeks to amend Public Resolution 36 of 1939 as enacted by the 76th Congress, and which set forth the principle that moneys which were then being collected and since have been collected to the fullest extent possible by the Department of Justice for the United States Government should be collected and when collected distributed to those persons who could prove their right to them as claimants.

The moneys that were collected were in the main moneys on deposit in American banks and with insurance companies that had offices in the United States but were banks and corporations and insurance companies that had been organized originally under Imperial Russian law and were so-called Russian corporations.

When the Soviet Revolution occurred, ousting the Kerenski government which had taken over after the first revolution, the Soviet Government proceeded to nationalize and confiscate, if you please, the assets of various Russian corporations, banks, insurance companies, and the like. Many of those companies had moneys on deposit in the United States. For years American claimants litigated through our American courts their right to those funds, and in most instances were successful.

But in 1933, Soviet Russia was recognized by our Government. As part of that recognition a so-called agreement or exchange of letters took place between our President and Litvinov, acting for the Soviet

Russian Government, providing, among other things, for the assignment to the United States Government for purposes of collection of various funds which then were still in the United States Government and which had previously belonged to these nationalized Russian companies.

Mr. MORANO. May I ask, Mr. Chairman, what exactly was that provision in the recognition

Mr. MULTER. As part of the recognition of Soviet Russia President Roosevelt exchanged letters with Litvinov acting for the Soviet Gov

ernment.

Mr. FULTON. That is known technically as the Litvinov assignment?

Mr. MULTER. Yes. Those documents are referred to as the Litvinov assignment, sometimes referred to as the Litvinov agreement. Mr. MORANO. What I want to know specifically is: What was the provision having to do with these claims in that exchange of letters? Mr. MULTER. You mean, what claims were assigned?

Mr. MORANO. What provisions were made for the adjudication of those claims, if any?

Mr. MULTER. The agreement unfortunately was silent on the subject except to say that the United States Government would then collect all this money which was being claimed by Soviet Russia because of its nationalization and confiscation decrees, and that the United States Government would hold them for the payment of claims of American nationals and such other claims as thereafter might be asserted and pending a final adjudication or adjustment between the two Governments of the claims of one against the other.

Soviet Russia made claims to various funds that were here belonging to the prior governments, to the Kerenski government and the Imperial Russian Government. We are not concerned with those claims here. The United States had claims against the Russian Government. We are not concerned with those claims here.

After the Litvinov assignment or agreement was entered into, the United States Department of Justice then proceeded to collect these moneys. The cases went to the United States Supreme Court which held that the United States Government was to collect these moneys for the benefit of claimants who could subsequently establish their right to the funds.

Mr. FULTON. Let me interrupt. On the Litvinov assignment, it was an agreement which was entered into on November 16, 1933, and was actually preparatory to an overall settlement that might have been reached between the Governments. It really meant that the money that was in these banks or in the hands of the United States Government could be held by the United States Government for disposition. That might have been a disposition to its own nationals or to claims on it or to the United States Treasury. So at the present time the funds have continued to be collected and are now held in a separate account.

Mr. MORANO. Can a non-United States national establish a claim? Mr. FULTON. We have to go back a little bit. The joint resolution which was passed in 1939 called for a Commissioner to be set up to pass on claims according to the law. He was given $25,000 authorization for administrative expenses but no appropriation was

ever given to him and no Commissioner was ever appointed. Therefore, at the present time there now exists a 1939 act under which a Commissioner can be appointed with a $25,000 limit on his expenses. Mr. MORANO. An annual limit?

Mr. MULTER. Yes.

Mr. FULTON. And a 2-year period in which, after his appointment, to decide on the claims. We are now coming up with two resolutions which would amend the 1939 act and implement it, putting it into force.

House Joint Resolution 130 would allow, for example, $100,000 a year for expenses. Neither the method of the proving of the claims nor the priority of the claims has yet been set. So that we are now talking about appointing a Commissioner who will receive the power to make regulations for the proving of claims, hear claims, hear the evidence, allow claims, and then it will have to be the Congress that determines how the money shall be paid to the claimants by other legislation than this.

Mr. MORANO. In other words, all we do here in this bill is to reenact the legislation of 1939 and implement it

Mr. FULTON. We are supplementing the 1929 litigation by amendment and implementing it so that action will be taken to take the first steps for the proving of claims under a Commission.

Mr. MORANO. How much money is involved in these claims? How much money does the United States have in escrow

Mr. FULTON. Will you hold that question? We have approximately $9 million, but we have Mr. Ben Brown, Assistant Secretary, Department of State, who will give us the details.

Mr. MULTER. May I supplement what the chairman has so well stated, that the United States Supreme Court in the Pink case (315 U. S. 203) laid down this rule which confirms what I have said, "The United States has adopted a policy of holding all amounts realized under the assignment for the benefit in whole or in part of American private claimants against Russia."

There are other cases but I won't take the time to quote them. Mr. Samson Selig, who is thoroughly familiar with all this litigation has prepared a fine brief on the subject which has been submitted to the committee. He will also testify here this morning.

To continue with reference to the resolution, however, you might ask why hasn't anything been done since 1939 when the Congress first enacted the resolution in the 76th Congress.

The executive department very properly took the position that there was no point in appointing this Commissioner who must complete his work in 2 years when it might take well over 2 years, as it did, to collect the funds. All the funds now have been collected. I think the Department will tell you that they have no hope of collecting any more money. The time is ripe now to supplement and implement this prior resolution so that the Commissioner can be appointed, can get a staff, take his claims, hear the proof, and then direct payment in accordance with the principles of law which are so familiar to us, and particularly in that connection that requires that American nationals have first claim against these funds, and then other claimants can come in

Mr. MORANO. Naturalized or otherwise?