The issue was quite charged as the American rabbis were in disagreement of which Holocaust victims should be evacuated first with the limited funds available. R. Silver and his associates wanted to use the funds in Europe where execution of Jews was immediate, R. Aaron Kotler wanted to help the Yeshiva pupils in Shanghai, whose danger was not imminent yet quite real.

From 1933 to 1941, Shanghai accepted over 30,000 Jewish refugees coming from war torn Europe who found out that they could enter the free port of Shanghai without visas. The city contained 25,000 Jewish refugees when the Japanese closed Shanghai to further immigration and after the outbreak of the Pacific war in December 1941. In July 1942, Colonel Josef Meisinger of the Gestapo arrived in Shanghai and put forth the “Final Solution in Shanghai” to Japanese authorities. Although the plan was not put into effect due to various reasons, the Japanese proclaimed “The Designated Area for Stateless Refugees”, in the Hongkew district, ordering all Jews who had arrived since 1937 to move into the area within a month. With the outbreak of the Pacific war the position of all Jews became desperate. Most of them were kept in semi-internment under miserable conditions, subject to the whim of the Japanese occupation forces. They had great difficulty in finding employment and most of their property was confiscated under one pretext or another. The Jews remained within the confined area in a perilous position for nearly four years, threatened by execution. In the above ghetto famous Yeshivot flourished with many students studying torah for long hours.

Substantial aid was given locally, especially by Sir Victor Sassoon, Horace Kadoorie, and Paul Komor. Additional funds came from abroad. Almost all of them left Shanghai after World War II, largely with American help, for Israel, the United States, or other parts of the world.