FBI investigators on Tuesday arrested 17 people in New York in connection with a $42.5 million organized fraud against a compensation fund for Holocaust victims.

The U.S. Attorney's Office is charging the 17, who include six current and former staff members of the Conference on Jewish Material Claims Against Germany Claims Conference, which issues payments to Jewish Holocaust victims, with making false financial claims using false documents.

"We are outraged that individuals would steal money intended for survivors of history's worst crime to enrich themselves," said Conference chairman Julius Berman. "It is an affront to human decency."

The scheme was discovered late last year when Conference officials noticed that several claimants had falsified information to receive pensions from the Hardship Fund, set up by the German government to make one-time payments of $3,600 to Jewish victims of Nazism who emigrated from Soviet bloc countries.

In July 2010, the Claims Conference suspended 202 pensions with a total value of $7 million. Since then, it has unscovered suspected fraud in another 456 pensions worth an additional $24.5 million. It also suspects false claims in 4,957 one-time payments under the Hardship Fund, with a total value of $18 million,.

The Claims Conference said that no Holocaust victims were deprived of any funds because of the crime, and pledged full cooperation to help authorities bring the fraudsters to justice.