Investigations revealed that Swiss banks contained hundreds of millions of dollars in cash and valuables of Holocaust victims who had hidden their assets from the Nazis. Swiss banks admitted to holding the accounts, which led to shock, outrage, and an international scandal that forced the banks and the Swiss government into reparations.
Switzerland was a neutral nation during World War II, so it was common practice for European Jews to open accounts with Swiss banks. In 1994, Elan Steinberg, the executive director of the World Jewish Congress (WJC), charged that Swiss banks still held between ten and twenty thousand dormant accounts containing the assets of Jewish victims of the Nazi Holocaust. Twenty thousand far exceeded the number of accounts the banks had admitted to in the past.
On May 2, 1996, a memorandum of understanding announced by the
Thomas Borer, a Swiss diplomat and chairman of Switzerland’s own investigating commission, established in December, 1996, announced that the Swiss government would release all information it had on unclaimed bank accounts belonging to Holocaust victims. The revelation brought Switzerland great embarrassment, and the United States issued swift condemnation. The U.S. Senate introduced a bill requiring the U.S. government to divest its $300 million in investments in Swiss companies and to cease doing business with Switzerland until reparations were made. A commission headed by Stuart Eizenstat, the U.S. undersecretary of commerce for international trade, castigated Switzerland for not taking action in the case and also blamed the U.S. government for not insisting the Swiss take action.
The Eizenstat commission’s May, 1997, report noted that the Swiss received $400 million in gold (worth ten times as much by 1997 standards) from Germany during the war, gold that was deposited with Union Banque Suisse (Union Bank of Switzerland, or UBS) or sent to other countries to pay for war materials. The report denounced the Swiss for their complicity with Germany, denounced their attitudes toward victims of Nazi oppression during the war, and claimed that Switzerland’s dealings in German gold prolonged the conflict. The Swiss argued, in turn, that they should be judged on their present actions in trying to compensate the victims and not for what they did or did not do before and during World War II.
Further information on the banking scandal had come to light on January 8, 1997, when Christophe Meili, working as a security guard at UBS, came across during his rounds two carts filled with “very old documents and books” that were scheduled for shredding, including two thick books, with “1945-1965” marked on their covers. Meili testified at a later hearing (May 6) before the U.S. Senate that he returned to the room because he remembered press reports concerning bank documents and records from World War II. He believed the items set for the shredder belonged in the national archives and that it would have been illegal had they been destroyed. As he found out the following day when he returned to the shredding room, most already had been destroyed. He also testified that he did not want harm to come to either the Jews or the Swiss, who certainly would be blamed for the illegal shredding. Meili brought what he could of the remaining documents to the Israeli Cultural Association, who handed them over to the police.
Meili was treated as a pariah in Switzerland. He was fired from his job and unable to find new employment. He was threatened by an anonymous caller who said he would kidnap his children and that he could collect the ransom money “from the Jews.” Meili complained that the Swiss police would not investigate the case and asked for political asylum in the United States. The WJC offered him employment. Meile also has received awards from Jewish organizations as well as aid to help with his legal fees.
The ICEP, in its final report of December 6, 1999, found no proof that the banks were acting together to destroy account records nor was there proof of a concerted effort to use the funds from these dormant accounts for illicit purposes. The commission did conclude, however, that some individual banks were unethical in handling the dormant accounts.
A plan to give billions of Swiss francs to victims of the Holocaust as a humanitarian measure was presented before the Swiss parliament, but Borer stated that the continued public accusations against Switzerland hindered passage of the measure because many Swiss believed the country was being treated unfairly. Switzerland cherished its strict neutrality during World War II, and allegations that it abetted Nazi dictator Adolf Hitler remained a critical concern for the country. The Swiss eventually agreed to some reparations from the government.
On February 26, the SBA announced the establishment of a $67 million humanitarian fund by the banks, and on March 5, Switzerland’s president,
Moshe
The Union Bank of Switzerland, Swiss Bank Corp., and Credit Suisse admitted to having thousands of dormant accounts from the time before and during World War II, accounts that totaled $200 million. The Central Bank of Switzerland, which received most of the Nazi gold, did not participate in the banks’ humanitarian fund. The humanitarian fund and SFS, the Swiss government foundation, helped repair some of the damage Switzerland incurred for denying its role in keeping the dormant accounts secret.
At the end of 1998, more than 100,000 Holocaust survivors in Eastern Europe received from five hundred to twelve hundred dollars each. Payments were then made to survivors in Western Europe in February, 1999. An agreement was reached in March to reimburse $1.25 billion to American and Israeli victims for their economic losses. The banks, however, refused to admit liability.
German companies also charged with exploiting Holocaust victims looked at the Swiss model to settle their own lawsuits. In July, 1998,
-
Braillard, Philippe. Switzerland and the Crisis of Dormant Assets and Nazi Gold. New York: Kegan Paul International, 2000. An analysis of the dormant accounts scandal by an economist, with emphasis on the scandal’s effect on Switzerland as a nation. -
Eizenstat, Stuart. Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II. New York: PublicAffairs, 2003. An account by an American official and diplomat about efforts to raise funds for reparations from various governments, including Switzerland. -
Vincent, Isabel. Hitler’s Silent Partners: Swiss Banks and Nazi Gold and the Pursuit of Justice. New York: William Morrow, 1997. An award-winning Canadian journalist examines the Swiss accounts scandal, starting with the case of a Holocaust survivor in Canada and her efforts for reparations. -
Ziegler, Jean. The Swiss, the Gold, and the Dead. New York: Harcourt Brace, 1998. An account by a Swiss sociologist, who lays much blame on the greed of the Swiss banks for cooperating with the Nazis and covering up the story.
Banque Oustric et Cie Failure Prompts French Inquiry
French Prime Minister Pierre Laval Wants Germany to Win World War II
French War Hero Pétain Is Convicted of Nazi Collaboration
Play Accuses Pope Pius XII of Complicity in the Holocaust
Italian Justice Minister Resigns Because of Crime Connection
Banco Ambrosiano Collapses Amid Criminal Accusations