Repeat after me: bank accounts, bank accounts, bank accounts. In the mid-1990s,
Jewish organizations and a handful of lawyers – some savvy, some less so –
demanded the return of Naziera Jewish accounts in Swiss banks. The accounts had
become dormant because the Jewish depositors did not survive the Holocaust, or
because crucial documents did not survive, leaving families unable to prove
their rights to the accounts.
The claims against the Swiss banks fostered
an environment in the US that, decades after the Holocaust, generated other
Nazi-era claims, including for insurance policies that European companies had
failed to honor, as well as compensation for slave and forced labor. There also
were claims for artworks that had been looted or displaced in Europe between
1933 and 1945.
These were material claims with strong moral underpinnings
– the idea that survivors and heirs should recover what was taken from
be compensated for damages done to them during the Nazi era.
class-action lawsuit against the major Swiss banks was filed in US
in Brooklyn in 1996. A $1.25 billion settlement was announced in 1998
District Judge Edward R. Korman.
Under the terms of the settlement, the
Swiss banks UBS and Credit Suisse seemed to fall on their proverbial
accepting virtually all liabilities for the wartime behavior of
national bank, as well Swiss private banks. The two banks insisted on a
settlement” – a kitchen sink of claims in which the common factor was
or grievance against Switzerland or a Swiss enterprise. This compelled
the $1.25 billion into five classes.
These classes were claimants for
bank accounts (the depositors); two classes of slave laborers (those who
performed slave labor for Swiss corporations, or those who were in
facilities that were financed by the Swiss); a class of refugees who
excluded or deported from Switzerland, or mistreated in Switzerland
their ethnic or religious origin. Finally, there was the “looted assets”
which referred to Nazi victims whose looted property was fenced through
That UBS and Credit Suisse were willing to bear all the weight
of Switzerland’s Nazi-era history was their prerogative. It made for an
situation. As Korman noted, “The claims of those other [non-bank]
any legal merit.”
However, the fundamentals of the case did not change:
the lawsuit against the two banks was a restitution case to recover bank
IN AN ORDER issued on June 16, with the unwieldy name
“Memorandum & Order Approving Adjustment of Presumptive Values Used
Claims Resolution Process and Authorizing Additional Payments for
Assets Class Plausible Undocumented Awards,” Korman signaled that the
banks case is nearly at an end all these years later.
The judge has
managed to keep the settlement on track. No easy task for claims for
that are more than 60 years old, and that originated in a foreign nation
institutions’ assets have been absorbed and reabsorbed by changes in
ownership and organization.
According to court documents, some $581
million has been allocated to nearly 18,000 owners of Holocaust-era
accounts. In addition, compensation has been paid to nearly 200,000
laborers and their heirs, and more than 4,100 survivors or heirs
so-called refugee funds from the settlement.
The court faced daunting
forensic accounting problems in assessing and adjusting the current
bank accounts. But these problems seemed to pale against efforts by some
organizations, lawyers and the State of Israel to ignore depositors’
rights – their claims to their family accounts – and to treat the Swiss
even in advance of the settlement announcement, as a Jewish slush fund.
on, many survivors cruelly were led to believe that they would benefit
lawsuit, even if their families had no connection to Switzerland or its
In 1997, Switzerland itself created a humanitarian fund, separate from
case, to aid needy survivors. Many viewed that Swiss money as an
not a generous gesture, feeding the notion that the Swiss banks lawsuit
The settlement’s “looted assets” class, not well
understood by some and exploited by others, created additional problems.
theory, it would have required a mechanism to determine whether
among more than a million potential claimants, had been looted and
passed through Switzerland. Such a mechanism would have been
expensive and an administrative nightmare.
Korman’s alternative remedy
was to craft a system to benefit the neediest survivors who, in this
instance, wouldn’t have been eligible for payments under the Swiss banks
settlement. The humanitarian aspects were not negotiated under the
the original parties to the suit did not advocate for the interests of
survivors. Nonetheless, the judge was within his judicial discretion
settlement provided $205 million to help some 231,000 needy survivors,
in the former Soviet Union, obtain food, medical care, winter relief and
Now, as Korman seeks to wrap up the claims for the
Swiss banks lawsuit that began in 1996, there has been the continuing
from the State of Israel and survivors in the US to delay the
They seek more funds for a select group of the needy. They
question the increases in the adjusted value of bank account awards, as
depositor should be compelled to relinquish a percentage of his bank
help Nazi victims in Israel or Florida. They also suggested that victims
former Soviet Union receive a disproportionate share of the funds
the needy, as if humanitarian funds should be allocated on the basis of
geography rather than hunger.
Korman, whose decisions were upheld by a US
appellate court, did a noble service to the needy.
But this compassionate
aid should not distort the essential purpose of the Swiss banks
lawsuit was a restitution case about bank accounts, bank accounts, bank
accounts. It was a claim with legal and moral legitimacy. But when the
Israel and survivors’ groups in the US demanded more cash for their own
purposes, they did not simply stall the conclusion of the Swiss banks
settlement. Instead, they ran roughshod over individual property rights
undermined the moral basis of every Jewish claim: that victims are
recover the property stolen from them.