NEW YORK (Aug. 17)
The $1.25 billion settlement agreed to by Switzerland’s leading banks has created a momentum that will likely lead to additional agreements to settle Holocaust-era claims against European companies and governments.
In the wake of last week’s agreement, officials with the World Jewish Congress believe that the focus will now shift to several different fronts:
European insurance firms, which face survivors’ claims for unpaid policies dating back to World War II;
German banks that dealt in gold stripped from Holocaust victims on their way to the gas chambers; and
Artworks looted by the Nazis from Jewish families during the war years.
In addition, according to Israel Singer, the WJC’s secretary-general, there are some 15 European countries that have not yet begun negotiating with Jewish officials in an effort to confront their wartime past.
The settlement, hailed as a historic milestone by survivors and Jewish leaders in the United States and abroad, had almost immediate repercussions among other companies facing survivors’ suits.
Days after the Aug. 12 settlement was reached, a leading Italian insurance company, Assicurazioni Generali, was poised to pay at least $65 million to settle the claims against it.
According to Elan Steinberg, the WJC’s executive director, Generali will, in the coming days, create one fund to settle the claims of Holocaust victims and their heirs and another fund, similar to a humanitarian fund established last year in Switzerland, to help Holocaust victims.
Generali was one of 16 European insurers targeted in a class-action lawsuit filed last year in New York on behalf of more than 20,000 people who claim the firms never paid out on policies that were opened by Jews before World War II.
The claimants are seeking $16 billion in restitution from the insurers.
European insurers have confronted mounting pressures from U.S. state officials, who have threatened action against their American subsidiaries if they do not make good on unpaid policies from the Holocaust era.
Meanwhile, Switzerland’s largest insurance company, Zurich Allied, said it signed a memorandum of understanding with U.S. regulators to establish a committee to find and compensate Holocaust survivors and their heirs for policies dating back to World War II.
The $1.25 billion settlement, which involved Switzerland’s two leading commercial banks, United Bank of Switzerland and Credit Suisse, put an end to all claims against the two banks — as well as against the Swiss National Bank, which bought gold from the Nazis worth tens of billions of dollars in today’s currency, the Swiss government, other Swiss banks and Swiss industry.
The only groups not affected by the settlement are Swiss insurance companies, which may explain the action taken by Zurich officials.
Repercussions from the Swiss banks’ settlement are also being felt in Germany.
Steinberg of the WJC said he believes that a number of German banks will reach settlements within a short period of time.
The leader of Germany’s Jewish community, Ignatz Bubis, made a similar prediction. Bubis said he was confident that two of the country’s largest private banks would soon settle an $18 billion class-action suit filed by U.S. Holocaust survivors.
The class-action suit against Deutsche Bank and Dresdner Bank accuses them of knowingly trading in gold stripped from Jews on their way to Nazi death camps.
Commentators in the German media have called on the banks to follow the example of their Swiss counterparts.
A Munich lawyer who filed the $18 billion suit, Michael Witti, said this week he plans to take similar action against Germany’s third largest bank, Commerzbank, after information surfaced indicating that it, too, traded in gold taken from concentration camp victims.
Witti also said he plans to file claims against several German companies – – including BMW, Siemens, Daimler-Benz and Krupp — that are accused of profiting from Nazi slave labor.
Meanwhile, the United States and 38 other nations have launched a drive to identify art stolen from Holocaust victims and to compensate their heirs.
Jewish groups and representatives from more than 30 countries recently convened at the U.S. State Department to plan for a second international conference on Holocaust-era assets, slated for the fall.
The Washington conference — a follow-up to last year’s London conference on Nazi gold — is intended to focus on looted artworks, insurance policies and other assets.
Meanwhile, exactly when Holocaust survivors will receive payments from the Swiss banks settlement remains unclear.
The settlement had been mediated by federal Judge Edward Korman, who was considering whether to hear a $20 billion lawsuit brought against the banks by tens of thousands of survivors.
In addition to protecting the banks against that lawsuit, the settlement also ends the threat of potentially harmful sanctions against Swiss banks that state and city financial officials across the United States had said they would impose if no settlement were reached.
The Swiss banks’ initial disbursement of $250 million should come within 30 days after Korman gives his preliminary approval to last week’s agreement, Steinberg said.
But it could take far longer before any survivors see those funds.
In the coming weeks, the World Jewish Restitution Organization — which is headed by WJC President Edgar Bronfman and includes the Jewish Agency for Israel and other international Jewish groups — will work with the American Jewish Joint Distribution Committee to come up with a distribution plan, Steinberg said.
He said that the WJRO will seek to have all proceeds of the settlement go to survivors. “We are opposing any payment of contingency fees to lawyers from these funds,” he said.
He added that he hopes a final agreement can be reached with the banks within 90 days. Once all the parties sign on to that agreement, Korman will put his signature on the court order mandating payments from the settlement fund.
The banks will also pay $333 million each year during the next three years.
“The funds will be used for the benefit of tens of thousands of Holocaust survivors worldwide,” said Steinberg, who estimated the total worldwide survivor population at between 500,000 to 600,000.
It remains unclear whether UBS and Credit Suisse will be alone in shouldering the $1.25 billion payment.
Swiss National Bank officials are expected to meet in the coming days to decide whether to contribute to the payment — a move that requires governmental approval.
The settlement is separate from the payments being made from a $185 million Swiss humanitarian fund that was set up last year by Swiss banks for the benefit of Holocaust survivors.
Survivors in Eastern Europe — Jews and non-Jews — have already begun receiving distributions from that fund.
On Monday, New York Gov. George Pataki joined Jewish officials to announce how Holocaust survivors in the United States can apply for payments from the fund.
Some $31.4 million from the $185 million in the fund is slated to be divided among qualified applicants in the United States some time after Nov. 30.
The toll-free number for those seeking to apply for monies from the fund is (800) 549-6864.
Steinberg said that anyone seeking to apply for payments from the humanitarian fund should not be concerned that they will be ineligible to participate in the proceeds from last week’s settlement.
“It is not our intention that the two funds will conflict,” he said.