The judge overseeing the $1.25 billion Swiss bank settlement with Holocaust survivors and their heirs approved the deal Wednesday: nearly two years after an agreement was reached.
The action by Brooklyn Federal Judge Edward Korman set in motion a series of events that could eventually see the bulk of the money disbursed beginning early next year.
Under terms of the settlement, victims or heirs of bank depositors who can prove their claims are to be paid even if the settlement is appealed.
Elan Steinberg, executive director of the World Jewish Congress, said several million dollars already has been paid to a total of 3,100 claimants following the banks’ publication of the names of 5,500 dormant account holders. The banks have agreed to publish sometime in the future the names of another 26,000 dormant account holders.
Within 30 days after the judge approves the settlement, Judah Gribetz, the special master appointed to recommend how to allocate and distribute the settlement, must file his report. Hearings are to be held before the judge issues a final ruling sometime in the fall. But along the way, appeals may be filed against the proposed allocation and distribution plan and against Korman’s final settlement itself.
"An appeal would be devastating to the victims," said Edward Fagan, who filed the first class-action suit by survivors against the Swiss banks. "Once you file an appeal, you basically interfere with the ability of the court to quickly distribute the money. Anyone who files an appeal is doing so not necessarily out of a sense of moral or global justice but out of selfish reasons."
"I would hope there would be no appeals," he added, "but I believe there will be."
An appeal could delay distribution by months. Fagan noted that a settlement of a claim against two Austrian banks that was finalized by the court in January has been blocked because a California survivor appealed on the grounds it would cheat him out of money that he believes is rightfully his. The 2nd Circuit Court of Appeals last month heard arguments in the case.
It is said that 10 percent of the roughly 600,000 Holocaust survivors die each year.
The two-year delay in presenting Korman with a final settlement of the Swiss banks’ case stemmed from refinements sought by all sides. Survivors wanted to ensure that the settlement did not preclude their right to sue for Swiss insurance claims that have gone unpaid and for looted artwork that found its way into the hands of Swiss bankers.
They also wanted the banks to adhere to the recommendation of an outside group of auditors who said the banks should publish all 4.2 million Holocaust-era accounts.
Steinberg said the banks balked at that and that survivors’ representatives agreed to cut the figure in half. Also at issue, he said, was whether the banks would pay for the work of the claims process tribunal that would resolve disputed claims, and whether the tribunal would have full access to bank records.
Access to bank records is crucial, Steinberg said, because "a person may have documentation of his father’s bank account, but because it was opened by a lawyer or another intermediary, it might not" be readily apparent. Only if the claims tribunal had access to bank records could a complete evaluation be made, he said.
One of the survivors awaiting the Swiss bank settlement is Ilse Loeb, 75, of Monroe Township, N.J., who said other banks and companies are also now attempting to resolve their own claims.
She said that just this week, a bank in Austria offered to pay her $100 after discovering that her father had his business account in a bank whose records it obtained after the war. But the Nazis looted the account, she said, and the Austrian Postal Savings Bank had no idea how much was in it. And because Austrian Postal was not the legal successor of her father’s bank, it was offering the money as a "gesture."
In addition, Loeb said, she recently received a $140 offer from an Austrian insurance company that has refused to honor her father’s policy, even though she has a copy of it. She said the company claimed that the Nazis looted its assets and that therefore it owed her nothing.
Loeb said she is considering accepting the $100 bank offer but has refused the insurance offer.
"It’s made me very upset to hear all of this again: after 62 years," she said bitterly.