International Business: SWITZERLAND
FROM THE NAZIS TO SWITZERLAND: A PAPER TRAIL'S UGLY END?
Britain confirms that the Swiss stashed gold looted by Nazis
It is one of the most troubling questions to linger on from World War II: Did Switzerland profit from the abandoned bank deposits--and stolen gold--of Jews murdered by the Nazis? On Sept. 10, a key aspect of the issue became clearer: Britain's Foreign Office issued a report confirming that Germany looted more than $550 million in gold--now worth over $6 billion--from German-occupied countries and stashed most of it in Switzerland.
That could turn out to be a nightmare for the Swiss government and banking community. "The latest evidence is mind-boggling," says World Jewish Congress Secretary General Israel Singer. The paper trail, he says, leads straight to Switzerland, where top Nazis deposited gold and valuables from throughout Europe. "Until a few months ago, all we were going on was hearsay about trains arriving in Switzerland with looted gold...and now we have the documents to prove it," says Singer.
The Swiss, however, took the British report in stride. A brief statement said the subject had been raised at its regular Wednesday Cabinet meeting on Sept. 11, "but no discussion took place because there is a basic agreement that there should be [Swiss government] action on the matter in the future." A spokesperson for the Swiss Bankers Assn., Sylvia Mattile, said that the London revelations concern gold "which was apparently in the Swiss National Bank" and not privately held banks. A spokesman for the national bank deferred to a government spokesman, who says it is "difficult" to say whether the claims made in London are accurate. Mattile noted that allegations concerning abandoned Jewish assets in Swiss banks--another nagging issue for the Swiss--were being explored by a commission headed by former U.S. Federal Reserve Chairman Paul A. Volcker.
Although WJC officials say that not all of the gold involved was robbed from Jews, the British report is further emotionally charged since some of the gold may well have come from the teeth of Jews who perished in the gas chambers of Auschwitz. The exact origins of all the gold, however, may never be known. Much of the looted gold was melted down into ingots marked as coming from Germany's prewar gold reserves.
Also troubling are the possible postwar actions of the Allies. According to a recently declassified document from the National Archives in Washington, the Swiss and the Allies agreed to split up some $280 million of this gold, with $60 million going to Britain, the U.S., and other allies, and $220 million retained by the Swiss. Greville Janner, a Labor MP who spearheaded the campaign in Britain to get the documents released, argues that it would be "immoral, and I hope, illegal" for Switzerland to retain the gold since it was partly obtained from concentration camp prisoners.
A MYSTERY. With many of the pieces of the puzzle now starting to fall into place, the actual physical location of the gold is still a mystery. Though deposited in Switzerland, some of the gold was sold to Portugal, Spain, Romania, Sweden, and Turkey, according to one U.S. document. "We are now concentrating our efforts on trying to find out just what happened to the gold," says Singer. But that is a far from simple task, a problem that has beset the hunt for Jewish deposits that, Holocaust survivors and Jewish officials maintain, are still held in Swiss banks. The Bankers Assn. announced in February that it had located 38.7 million Swiss francs in 775 dormant accounts from the war period. But Jewish organizations rejected the figure, saying that it was meaningless.
The Volcker committee, representing Jewish organizations and the Swiss banks, is due to convene in mid-October to discuss outstanding claims. One of its first tasks will be to hire auditors to carry out an independent search. "This will become a transparent process which will obtain the available information and give the banks the opportunity to pay back every Swiss franc as they have promised," says WJC President Edgar M. Bronfman. And the gold? "I don't think the latest revelations from London will have any effect on the Volcker commission because it addresses a completely different subject," says Mattile. Perhaps. But they surely demonstrate that the Swiss banking community has a long way to go before it shakes off the lingering ghosts of World War II.By Neal Sandler in Jerusalem, John Parry in Geneva, and Julie Flynn in London