Swiss Banks Let World Peek Into Vaults for Victims' Money
On July 23 the names on accounts of Nazi Holocaust victims will be made public
Switzerland's banks, famous for their secrecy, are letting the world look at their ledgers, at least in part.Skip to next paragraph
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For the first time ever, on July 23 banks will publicize worldwide the names on Holocaust-era bank accounts. The move is meant to speed the return of unclaimed money to its rightful owners.
Buffeted by continuing charges that they are holding onto assets that belong to Jewish victims of Nazi death camps in World War II, Swiss banks plan to circulate on the Internet and in newspapers in some 20 countries the names listed on bank accounts dormant since 1945.
This wholesale disclosure will sweep aside Switzerland's vaunted bank-secrecy laws, at least for these disputed accounts.
"It is absolutely an unprecedented step," says Daniel Zuberbuehler, spokesman for the Swiss Federal Banking Commission. "These are specific historic circumstances that allow us to sidestep the secrecy rules."
Bank-secrecy laws are meant to protect depositors. But "if the customer does not know where the funds are, you are not protecting him," Mr. Zuberbuehler says. Previously, only names on dormant passbook accounts have been published on a case-by-case basis in Swiss newspapers.
In the case of the Holocaust victims' accounts, previous efforts by Swiss banks to uncover and release money have been paltry, turning up only a small fraction of the billions of dollars Jewish groups believe are stashed in Swiss vaults.
In an effort to end the controversy, the Swiss Banking Association says the names will be published simultaneously in Switzerland and the United States, as well as other countries. Spokeswoman Sylvie Matile says the list of countries is still being decided upon.
But it is likely that many beneficiaries will be in Eastern Europe, in the former Soviet Union, and in Israel, where it is estimated that about 600,000 Nazi-era survivors and their families reside. Many of these people are impoverished.
Claims to bank accounts or assets in vaults are to be resolved by an independent panel, the composition of which has yet to be announced. This panel marks the first time the Swiss have allowed an outside body to decide such claims.
A second list of unclaimed accounts will appear Oct. 20.
Claims must be filed in six months, and lodged with the accounting firm of ATAG Ernst & Young in Basel, Switzerland, which will provide information to claimants and prepare files for the claims-settlement panel.
Ms. Matile says the banks would be happy to find owners of the inactive accounts because of "the paperwork and responsibility of keeping accounts for more than 50 years."
Yet the banks agreed to lift the veil of bank secrecy only after prompting by the Swiss Federal Banking Commission and the international committee investigating dormant Swiss bank accounts, headed by former US Federal Reserve chairman Paul Volcker.
The two-year controversy over the Nazi-era accounts has seriously damaged Switzerland's banking image. Business has been lost, and there has been a threat of an international boycott. Also, several multimillion-dollar class-action suits have been filed in US courts against Swiss banks by Jewish victims.
In an attempt at reform, several Swiss legislators have introduced measures to pry open the secrecy that surrounds bank accounts. Currently, no federal law exists on this matter. But there are already differences over proposals for broader legislation. The Swiss bankers group said it would not favor following the example of New York State, where the names of account holders must be published if there is no activity after five years.
"This is too short because many customers have long relationships with banks," Matile says. Federal regulator Zuberbuehler said even 10 years might be too short.