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Usually, a person pays for pension insurance over the course of his working life, however, as mentioned, the German national insurance gave the new insureds (of which all the Israeli enrollees were such) the right to purchase the insurance rights by means of a retroactive payment, and for this purpose a one-off payment was required to cover the monthly premiums retroactively, for the years 1956-80 ("the investment"). Some 9,000 enrollees chose to avail themselves of the financing services offered them by the Organization for the Implementation of the Social Security Treaty. Advocate Israel Perry obtained the financing to provide loans for the enrollees from a German bank (the BHF). The bank granted the financing at significantly lower interest than what was customary in the German credit market - not to mention the Israeli. The German bank made its loan conditional upon two securities: - An irrevocable standing order from the borrower to repay the loan out of the pension that he would receive
- Special insurance arrangements enabling discharge of the loan immediately upon the demise of the borrower-insured. This arrangement was particularly important to the inheritors, who were thereby freed from being burdened with an unforeseen debt.
Since the BHF is a wholesale bank that does not provide loans to small customers (which is the reason for the low interest) the loans were provided by two companies whose establishment was brought about by Advocate Israel Perry for the purpose of financing the German pension: BGF and BGA. All the enrollees who chose the financing scheme offered them by the Organization for the Implementation of the Treaty, after signing documents, investing nothing (other than what they chose), and taking no risk upon either themselves or their survivors, started to receive, every month, a free part of the pension to the tune of between DM 100 and DM 1,000, according to each client's personal data (on average about DM 450).
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