Sanctions Urged for Swiss Banks
Sanctions Urged for Swiss Banks
Jul. 02, 1998
NEW YORK (AP) _ A commission representing hundreds of U.S. finance officials has cleared the way for sanctions against Swiss banks suspected of holding the assets of Holocaust victims.
Alan Hevesi, chairman of the commission, said negotiations between the banks and Holocaust survivors seeking their families' assets ``reached a total stone-like impasse.'' The group decided Wednesday to lift its moratorium on sanctions against Swiss banks.
California will become the first state to impose sanctions. Treasurer Matt Fong, who oversees $32 billion in state funds, said California will not seek new contracts with U.S. subsidiaries of Swiss banks.
New York state, which with California has the largest pension funds linked to Swiss banks, was to decide today how and when its sanctions will be imposed, said Hevesi, the comptroller of New York City.
Hevesi said he hopes U.S. officials will allow a measured process of sanctions to give negotiators time to resolve the issues. That didn't mollify Swiss banking officials.
``The Swiss banks are outraged,'' said Ulrich Pfister, a spokesman for the Credit Suisse Group in Zurich. ``Sanctions are unjustified and counterproductive. We will will study all measures we can take against them.''
Tens of thousands of Holocaust victims deposited money in Swiss banks as the Nazis gained power in Europe. But victims' relatives say bank officials stonewalled survivors and their heirs after World War II, claiming they could not find accounts or demanding nonexistent death certificates before giving funds to relatives of those who died in concentration camps.
Three Swiss banks made a take-it-or-leave-it offer of $600 million last month. It was rejected by Jewish leaders as being far less than the dormant wartime assets Holocaust victims say the banks stole from their families.
Melvyn Weiss, lawyer for more than 31,000 plaintiffs in a class-action against Swiss banks, said Jewish groups have proposed a $1.5 billion settlement that would cover claims against all Swiss banks as well as the Swiss government.
``We tried to get the Swiss government involved and bring peace between these people. And the Swiss government, instead of being proactive in helping to put this behind us, has been a negative influence,'' Weiss said.
He and other lawyers representing class-action plaintiffs said their clients are now likely to turn to a lawsuit pending in federal court in Brooklyn against the Swiss banks. Last year the banks filed a motion asking a judge to dismiss the charges, but no decision has been made.
Hevesi heads a group that represents about 800 financial officers of state and municipal governments around the United States. The moratorium on sanctions had been in effect since last December.
Robert O'Brien, managing director of Credit Suisse in New York, spoke on behalf of his bank and the United Bank of Switzerland, a recent merger of the New York branches of the Swiss Bank Corp. and Union Bank of Switzerland.
``Our two organizations have done the right thing,'' he said. ``There's no basis for taking action. We are still very actively concerned about maintaining a dialogue.''
He noted that the Swiss banks have publicly apologized for any wrongdoing, and that they have started a humanitarian fund with an initial contribution of $70 million for the immediate needs of Holocaust victims.
He said the banks have also opened their books for full accounting to an independent commission headed by former Federal Reserve head Paul Volcker, who is searching bank files to determine the amount of unclaimed funds.