by Bower, Tom
Dilatoriness on heirless assets suited Feldmann. The Jewish question had once again become uncomfortable. Researchers of Nazi history working in archives in Berlin had in 1954 discovered the documents dealing with Rothmund’s demand that a “J” be stamped in the passport of German Jews to help Swiss police identify those whose entry was banned. The revelation, publicized in Switzerland by SIG, shocked many Swiss. Silently, all the individual files stored in Feldmann’s ministry concerning the refugees forcibly returned to occupied Europe and the Gestapo were destroyed. Removing the traces of history suited Feldmann, but the unremitting questions from Tel Aviv continued to disturb him until the sudden and alarming appearance of Samuel Tolkowsky, the Israeli ambassador, in Feldmann’s office on March 28, 1955. Seven years after its creation, Israel was no longer just a desolate refuge for escapees from Eastern Europe’s ghettos. Supported by the United States, the Israelis had proved themselves economically, politically and militarily against the surrounding Arab states. Tolkowsky, personifying that brand of aggressive self-confidence, now stood in the minister’s office reciting the recent revelations by Rothmund and accusing the Ministry of Justice and the Police of the murder of thousands of Jews. Now, thundered the ambassador, Switzerland was constantly replying to charges of injustice relating to the heirless assets with nothing better than “It’s being checked” or “It’s being worked on.” But there were no results, and Tolkowsky wanted results.
“We must solve this problem energetically,” Feldmann told his officials after his unwelcome visitor had departed. “This dilatory reaction by the Bankers Association is embarrassing both the government and, particularly, the ministry.” Unwilling to risk further trouble in Switzerland or with Israeli’s mentors in Washington, Feldmann ordered action: “It is vital energetically to ‘put pressure’ on the Bankers Association and demand from them a response to proposals.” To some it might have seemed that the bankers faced real pressure. “Each delay,” Feldmann wrote to Oetterli, “risks creating doubts about Switzerland’s intentions and places Switzerland in a delicate situation toward Israel.”
But the bankers had heard it all before. Banking secrecy had become elevated to the status of a weapon in the war against communism. Defense of the bankers’ interests had become a litany of euphemistic phrases referring to the “extremely exaggerated” amounts, the “so-called heirless assets” and the “casualties of war.” Jews were never mentioned.
Oetterli’s strategy was to minimize the problem. After a detailed search, he told Feldmann, the total of Polish heirless assets in Switzerland’s banks had been established at SF22,300. “The exchange of letters,” wrote Oetterli in his brutal style, “which churned up so much dirt, has proven to be unrealistic and is reminiscent of American suspicions that Nazi loot was hidden here.” Remembering the original estimate by Rudolph Speich, the banker involved in the 1949 negotiations, that the two million dead Polish Jews would have deposited at least SF2 million in Switzerland, Oetterli knew that the communist government would not be pleased by his announcement that the Swiss had found just one-hundredth of the money. Since Zehnder had insistently told the bankers that “the agreement with Poland cannot be sabotaged. Our signature must be honored,” the only feasible tactic, implied Oetterli, was to delay, conceal and deceive. “We’ve told [the Poles] that the investigation is not yet completed,” he informed Zehnder. The bankers were once again dictating the government’s policy.
Individual ministers and officials of the Swiss government were confounded by the bankers’ audacity. But, since Feldmann had accepted the banks’ assurance that the heirless assets were “small sums,” the chance that a law would be passed to uncover the truth had again diminished. Over the following year, the bankers relaxed.
A chance meeting and a passing remark by Max Oetterli in May 1956 prompted Feldmann yet again to review his attitude. During a conversation with a Department of Justice official, Oetterli mentioned the bankers’ willingness to provide more precise information. Oetterli had not suffered a dramatic conversion. Rather, he was confronted with an embarrassing report from the Compensation Office. Marked “secret,” this report had suggested that German heirless assets worth at least SF10 million existed in Switzerland. What was more worrying for Oetterli was that the Compensation Office detailed its inability to handle dozens of inquiries every year from Germans looking for their inheritance who, like the Compensation Office, were stonewalled by the banks. Unable to ignore that revelation, Feldmann had urged an informal approach to the Bankers Association to encourage it to conduct a proper census. Grateful that Oetterli had not responded violently, the minister implored the banker to comply. Otherwise a law could not be delayed for much longer.
Oetterli and Diggelmann well understood how to play the minister. By the end of a meeting on June 4, 1956, Feldmann was willing to say precisely what the bankers required. There would be no law, he announced, if the bankers’ census revealed “a clear picture” that the property involved was “small” and “irrelevant.” His benchmark for inaction was SF4 million to SF5 million. The bankers departed satisfied that the government, relying on their census, would not introduce a law if they reported that the heirless assets were worth less than SF4 million.
In their headquarters in Basel, Oetterli and the association’s lawyers composed the questionnaire to be sent to their members. Just two words, judiciously placed within their long letter, nullified the questionnaire’s purpose. Bankers were asked whether they “knew” or had “assumed” that any of their clients had been murdered by the Nazis. Allowing the bankers the discretion to decide whether indisputable facts were “known” or whether they cared to “assume” a client was dead merely because of his or her silence could have only one result.
Three months later, Oetterli supplied Feldmann with the results. Three banks had declared that they “knew” a client was dead. Those assets amounted to SF36,580. Twenty-one banks had “assumed” that clients were dead. Those assets were valued at SF825,832. Oetterli delighted in offering his conclusions: “The importance of the ‘so-called heirless assets’ is not as great as the opposition always tries to allege.” Since the amount was less than SF4 million, Oetterli asked Feldman to “confirm in writing” that the government would “drop” the proposed law.
The minister was not quite convinced. Too many authenticated complaints aroused his officials’ unease. A letter from Dr. Lothar Dessauer, a Swiss trustee who was a lawyer specializing in Jewish claims, was particularly bewildering. A Polish client, explained Dessauer, who had fled to Britain, had in 1956 written to her Swiss bank requesting her deposited savings. The bank had replied, “Your money has been transferred to the Polish government.” Since no money had been yet paid to Poland, wrote Dessauer, he was puzzled. Officials in the Political Department were not puzzled. The bank’s dishonesty was patent, although it would be later excused by the department as a “misunderstanding.” To forestall future complaints and to silence the critics, Feldmann suggested to his officials a solution. SIG, he proposed, should be offered “a sum of money” to be used for the Nazis’ victims. His “solution” evoked only mirth. Buying off the Jews with a lump sum without admitting any responsibility was universally rejected as “absurd.” Either there was an injustice and legislation was necessary, or there was no substance to the complaint. “It would look as if the country was paying out ‘silence money,’” noted one official, “so that the banks can keep money that does not belong to them.” Hans Streuli, the minister of finance, agreed: “It would be a paradox if the country actually paid for private interests to enrich themselves from money entrusted to them.” Feldmann retreated, hoping he might return to a state of inactivity. It was left to Bindschedler to catch the mood. The Ministry of Justice, he carped, “has simply capitulated to the banks.” Oetterli, the lawyer knew, enjoyed considerable access to politicians, and his influence was substantial. Indeed, soon after, Oetterli visited Petitpierre, who afterward noted approvingly that the banker “hoped that
there was no question of a new law.”
The Polish government was less easily placated. In 1958, new trade negotiations with Poland were under way and the past tactic of politely stalling inquiries from Warsaw about the amount of heirless assets was no longer straightforward. The Bankers Association’s latest census had revealed that the Polish heirless assets in the banks amounted to just SF17,550, while the insurance companies reported SF849. That disclosure, admitted the Political Department with marked understatement, would be “a disappointment” to the Poles. “We can hardly say that since 1949 most of the Polish clients have shown signs of life,” Robert Kohli, the new chief of the Political Department, was told. Yet this was precisely what the bankers were urging the government to believe. In the midst of the 1956 revolt in Poland, many anticommunists had escaped to the West and some, according to Oetterli, had contacted their banks for the first time in twenty years. Whether that was credible was beyond Kohli’s judgment. To avoid embarrassment, the department’s officials had initially wanted the Bankers Association to explain the small amounts to the Poles, but Kohli opted for silence. “Delay telling anything to the Poles,” the Swiss embassy in Warsaw was instructed. Pondering the matter, Kohli decided in 1958 that when the truth was finally revealed the Swiss negotiators should blame the Poles for their own high expectations: “Switzerland has always been skeptical of the Polish estimate of the deposits.” Israel, on Petitpierre’s direction, was to be treated with similar slyness.
The Israeli ambassador’s occasional request to assist the Swiss government irritated the Political Department, already concerned because of speculation in Israel that the heirless assets could be worth $500 million. His latest inquiry, with Israel emboldened by victory in the Suez war, sounded more vigorous than before. Consistent with the Swiss paradox, the greater the threat, the more stubborn was Petitpierre’s reaction.
Still believing the banks’ assurances that the heirless assets did not exceed SF1 million, Petitpierre approved their demand for protection. “We will not allow Israel any involvement or discussion in this question,” he insisted. “We just do not know how much money is at stake.” On Petitpierre’s initiative, in reply to the ambassador’s query whether a census would be ordered to discover the heirless assets, the Federal Council repudiated the interference of a foreign government: “The Swiss Confederation has assumed no obligation to take any definite steps in this matter.”
Too many Swiss, however, had become uneasy about the banks’ conduct. Fourteen years after the war, anger about the Nazi era had grown rather than waned. Gradually, ignorance and prejudice about those years were yielding to unpalatable revelations. West German prosecutors were, for the first time, seeking to remedy the Allies’ failure to investigate more than a handful of the Nazi war criminals. Their first major success in 1959—a trial in Ulm of former SS officers stationed in Auschwitz—caused a major shock in all German communities, including Switzerland. The authenticity of the evidence presented by Germans prosecuting Germans for their crimes against the Jews was unchallengeable, shedding a new light on the Nazi period. The previous year, the public expression of “deep disappointment” by Heinrich von Brentano, West Germany’s foreign minister, after the U.S. government’s refusal to return Germany’s property, thereby allegedly causing “unjust and inhuman suffering,” had aroused sympathy in Switzerland. But, in light of the Ulm trial, the raw statistics—that West Germans including former Nazis had received DM90 billion compensation for their wartime suffering while the victims of Nazism had received only DM5 billion—reflected a merciless degree of self-interest. As the facts about the Holocaust—heard for the first time by most Swiss—unfolded, Dr. Harald Huber, who was a prominent Swiss lawyer from St. Gall and a social democrat member of parliament, became uneasy about Swiss banks’ retaining money deposited by the victims of Auschwitz.
Motivated neither by affection for Jews nor by dislike of the banks, Huber contacted Friedrich Wahlen, the new and popular minister of justice and the police, in March 1959 to recount a disturbing conversation. “A specialist banker, a member of a long-established Swiss family,” Huber wrote, “told me that, on the basis of his experience across the industry, he knows that lying in the banks there are assets worth hundreds of millions belonging to the missing people.” The letter was a bombshell. Huber, as Wahlen knew, was neither a fantasist nor a sensationalist. On the contrary, he was a respected politician and staid lawyer who would become the president of Switzerland’s federal court. Huber’s estimate of “hundreds of millions” of francs was the first time any Swiss had mentioned a sum that was not “small,” and the source—who appeared to be interested only in truth and justice—could not be dismissed as lacking credibility. More pertinently, Huber was actually accusing the banks of deliberate fraud.
According to Huber’s informant, many of the accounts containing the “hundreds of millions” of francs deposited by murdered Jews had been closed by bank employees aware of the circumstances—particularly the fact that no outsider knew the details about these accounts. Unmonitored, explained Huber’s informant, the funds had been transferred to specially created corporations. “The banks,” he wrote, “are naturally interested in using those interest-free assets as long as possible, even if they do not contemplate appropriating the money for themselves.” Although that was legally tolerable, the banker also disclosed that unscrupulous employees were transferring the deposits of dormant accounts into other, unsupervised accounts from which the money could disappear. Thefts, Huber added, were not unusual: “My banking informant is aware of that happening.” Huber did not mention his personal suspicion of a fiduciary who had accepted money from two Jews who had not reappeared since the war. The fiduciary’s denials of the allegations were unconvincing, but—as was usual in these cases—Huber lacked specific proof.
Huber hoped that the minister would be more inclined to respond to the damaging allegations than Markus Feldmann had been. (Feldmann had since died of a heart attack in his office.) “I assume that this information, which confirms my own suspicions, will interest you.” In the restrained language that is beloved of lawyers but nevertheless can reveal their excitement, he concluded, “It is clear that the banks, in order to deny the need for special legislation, are deliberately minimizing the amount of money involved. For me, the special law is obviously vital.”
Four years earlier, Huber had asked the government for a law to compel the banks to reveal any heirless assets, but the government, wary of “misunderstandings” and “criticism” and fearful of arousing controversy and international speculation about “unquantifiable” millions in Switzerland, had dithered over a reply. But maintaining the silence demanded by the banks had become difficult. Not only was Switzerland increasingly vulnerable to external pressure from Israel, but the publication of a damning book by Carl Ludwig, a Swiss historian, commissioned after Rothmund’s exposure in 1954 and describing the country’s wartime treatment of the Jews, had stirred some consciences. To reduce the sense of guilt, an unidentified government propagandist shone a spotlight on the activities of Carl Lutz, the Swiss vice-consul in Budapest in 1944, to glorify a brave Swiss patriot who had saved thousands of Jews. Even Lutz had been surprised by the sudden attention. Over the past thirteen years, he had been not so much ignored as criticized on the ground that saving Jews had been unneutral behavior. Overnight he was hauled from obscurity and transformed into a hero, to end what Feldmann had called “the masochistic wallowing in one’s own guilt.” Feldmann’s carping irony had been influenced by a confidential report from Rothmund. In unrepentant tones, the retired police chief justified his wartime policies. The responsibility for Switzerland’s policies toward the Jews, wrote Rothmund, must be borne by Switzerland’s Jews. It was their fear that anti-Semitism would be aroused by the impending flood of foreign Jews that compelled him to introduce the restrictions at the Jews’ request. The fate of the Jewish refugees, he insisted, was the responsibility of the Jews themselves. It was an argument tha
t appealed to Feldmann and other Swiss who suspected that the search through the Berlin archives was motivated by malicious revenge—an unwise tactic, Feldmann had thought, because Switzerland’s Jewish leaders had certainly not protested against Rothmund’s policies. Using Lutz as a diversion had been effective—only Huber was not so easily placated. Convinced that the heirless assets amounted to “much more” than the one million francs suggested by the banks, he told Wahlen, “We must end this uncertainty and remove the danger that the money will remain in the hands of people who are not entitled to keep it.”
The existing law, Huber told the minister, was seriously flawed. Either a frustrated administrator of a fund did not know whether his client and the client’s heirs were alive, or dishonest trustees were encouraged to keep quiet, hoping that the owner was dead and that the heirs would fail to find the funds before the statute of limitations annulled the inheritance. Huber’s solution was to order the compulsory registration of all dormant accounts and to simplify the procedures for heirs to prove a death and their claims. Any unclaimed or heirless assets, he proposed, would be transferred to a special fund.