US court ruling on dormant accounts payments welcomed

New York judge, Edward Korman, finally approves settlement sum. Keystone / AFP Photo

The Swiss government, bankers and representatives of Jewish organisations have welcomed Wednesday's approval by a US judge, Edward Korman, of the terms of a $1.25 billion (SFr2 billion) settlement between Swiss banks and Holocaust survivors.

The long-awaited accord will compensate survivors or relatives of Holocaust victims for funds blocked in Switzerland since the Nazi era.

Switzerland’s two main banks, UBS and Credit Suisse, who agreed to the terms with the lawyers for plaintiffs in August 1998, said in a joint statement: “The verdict reached by the US district judge, Korman, has cleared the way for the settlement to be made.”

The banks added: “We hope that those Holocaust survivors or their heirs with an entitlement to the monies from the fund will receive the amounts they are due as soon as possible.”

The settlement means that the money could soon be disbursed among about 600,000 claimants. But it is not clear when the distribution plan will be finalised.

The Swiss government also greeted Korman’s decision by saying the ruling “represents a decisive step towards formal closure of the relevant judicial proceedings against the two Swiss banks in the US.”

The government also said that the settlement “provides for a complete legal and material resolution of Second World War related issues for the Swiss economy as well as Swiss public entities.”

Switzerland’s main Jewish organisation, the Federation of Jewish Communities, echoed the sentiments of the government. Its general secretary, Martin Rosenfeld, said: “It’s been long awaited on our part.”

“The chapter seems to be closed,” said Sigi Feigel, honorary president of the federation.

In his ruling, Korman gave the banks and claimants a week to resolve the remaining outstanding points of the agreement, but said it would then take effect.

Korman said: “I have no quarrel with this settlement. I do not say it is fair, because fairness is a relative term. No amount of money can possibly be fair under these circumstances.”

The claimants said they or their relatives deposited the funds in Swiss banks as a safe haven during the wartime era, but were unable to retrieve the money and other goods after the war.

The Volcker commission, investigating the issue of dormant accounts, concluded last year that up to 54,000 may have been opened in Swiss banks by Holocaust victims. It cleared the banks of systematically destroying the records of victims’ accounts, but said there was evidence of “deceitful actions by some banks”.

swissinfo with agencies