Nazi Gold
Page 36
The WJC needed an emotive issue to link the Holocaust and Switzerland. Documents arriving from Washington mentioned the looted gold and the Washington Accord, about which Singer and Steinberg had known nothing. But they did know that, among the catalog of horrors, few images were more searing than the methodical extraction in the extermination camps of gold dental fillings from the mouths of Jewish corpses dragged from the gas chambers. Bags of gold fillings, it had been established at the Nuremberg trials, had been delivered by the SS to the Reichsbank in Berlin. Under Emil Puhl’s supervision, the fillings had been smelted and had reappeared as anonymous gold ingots. There was every reason to believe that those ingots, and others manufactured from wedding rings wrenched from the fingers of corpses, had been delivered to the National Bank in Bern.
Neither Steinberg nor Singer understood the complexities of the negotiations in 1946 in Washington, but both grasped the American negotiators’ complaint about British betrayal. Since the Europeans were showing more interest in the story than U.S. newspapers, they judged that the waves caused by accusations leveled in London might rebound across the Atlantic.
The maneuver was delegated to Greville Janner, a vice president of the WJC and, most important, a Labor member of parliament with a guaranteed platform for winning international publicity. At the end of a dedicated political career, Janner was credited, as a moderate spokesman for Jewish causes, for his active sponsorship of the bitterly contested War Crimes Act, which had finally, in 1991, allowed the prosecution of alleged Nazi war criminals living in Britain. Janner’s lack of knowledge about the Washington Accord did not hinder his widely published and broadcast allegations in July 1996.
Janner claimed that government documents, recently declassified in Washington, proved that a secret deal had been hatched in 1946 between the Allies and Switzerland allowing the Swiss to return only a fraction of the looted gold. In particular, Janner accused the British government and MI6, the foreign intelligence service, of conspiring to deprive the survivors of uncalculated millions of pounds owed from the gold stolen from victims of the Holocaust.
Malcolm Rifkind, the British Foreign Secretary, who was Jewish, was understandably baffled and turned to his officials for advice. The politician was let down by the low caliber of those employed by the British government. Instead of looking in the government’s own volumes of published agreements or referring to published textbooks, Rifkind rapidly uttered a public denial that the government possessed any information whatsoever—an odd statement, considering that the text of the Washington Accord had been published as a government document in 1946. “We have not heard of the allegations that British intelligence knew of the documents concerning holdings by Swiss banks of seized funds,” he said. “None of the intelligence agencies is aware of having such information.” Rifkind’s promise to launch a serious investigation gave unconditional credibility to Janner’s allegations. The hare, to the glee of the World Jewish Congress, was running.
Thanks to researchers in Washington, Janner was provided with another tasty accusation. A 1945 report from Lisbon suggested that the painting Salome by Titian, stolen from a Jew, had been smuggled into Britain and deposited in the vault of the National Westminster Bank. In broadcasts across Britain and other countries, the Labor politician demanded an immediate search and the painting’s surrender. Overnight, the World Jewish Congress was rewarded with massive publicity. Headlines reporting that Switzerland faced a “£15 billion Nazi art scandal” and sensational accounts of German deposits of looted Jewish property in Switzerland worth between $22.3 billion and $106.4 billion filled London’s most respected newspapers. Janner spoke eloquently of Switzerland as an “Aladdin’s cave of art stolen by the Nazis” and encouraged reports about Switzerland’s criminal pact with Hitler. Steinberg was thrilled; the dam was weakening. One more push and the American media might embrace the campaign. No one imagined that a sloppy Foreign Office historian would provide the “eye-catching figure” to rouse Newsweek and Time and rattle the Swiss.
After proper reflection, Foreign Office officials had realized that Janner’s allegations about secrecy were incorrect. Ninety-one government files, all declassified more than twenty years earlier and available to the public in the British archives, told the true story. With unusual speed, the Foreign Office, anxious to create an image of openness, intended to publish a report absolving the British of any role in the nonexistent conspiracy. After rapid research in the archives, the Foreign Office’s historian, absorbing the current hostility toward Switzerland, sought to explain and justify the Allies’ frustrations in 1946. Fortunately for the new crusaders in the United States, the historian misunderstood the Washington discussions about gold, particularly Alfred Hirs’s quip that the Allies would ruin his bank if they demanded SF500 million.
Entitled “Nazi Gold: Information from the British Archives” the twenty-three-page report, published on September 10 and praised by The Times as “a crisp and well-compiled historical survey,” was an innocuous publication with one “bombshell.” After correctly stating that the Allies “had no clear idea” of the exact amount of looted gold “held in Swiss banks,” the historian stated that the Americans estimated the amount to be $200 million. He then added, “M. Hirs let slip during a meeting of the gold committee the figure of $500 million.” In simple terms, dollars had erroneously replaced Swiss francs, quadrupling Hirs’s alleged estimate of the looted gold. In fact, even perfunctory reading of the American transcript showed that Hirs had denied that any looted gold was stored in the Bern bank. He was referring only to the enormousness of the Allies’ demand.
Understandably, the media relied on the Foreign Office’s own calculations. If $500 million of Nazi gold was stored in Switzerland in 1946 and only $58 million had been repaid under the Washington Accord, then, it was reasoned, Switzerland had profited by $450 million. With inflation, the horde was worth $4 billion and, according to the Financial Times, “could still be in the Swiss banks.” After the story had crossed the Atlantic, the front page of the Washington Post reported that Switzerland “still holds 90%” of the gold—worth “$6 billion”—“right down to the gold fillings of Holocaust victims that were melted down into bullion.” The British government, claimed the Post, “has accused the Swiss of refusing to relinquish a cache of billions of dollars of looted gold.” With a twist, the British and Americans were also guilty. Five tons of “Nazi gold” were still stored in the vaults of the Bank of England and two tons in the U.S. Federal Reserve, possibly also manufactured from dental fillings.
The interpretation was neat and sensational—but it was totally untrue. Nevertheless, the World Jewish Congress had finally succeeded in winning attention from the mass media. “This is the greatest robbery in the history of mankind,” said Steinberg, as Rifkind acknowledged the possibility that the gold in the British vaults should, as Janner demanded, be redistributed to families of Holocaust victims.
Switzerland’s reputation was plummeting. Unaccustomed to making fast decisions, Flavio Cotti, the foreign minister, admitted that the issue was causing “serious harm to Switzerland’s image,” and even conceded that the accord could be renegotiated if “new facts arise.” Struggling to limit the damage, he told a crowded press conference on September 16, 1996, “Switzerland never intended taking gold from the Nazis and keeping it for itself.” Switzerland’s total earnings from the gold trade, the National Bank announced, was a mere SF20 million. The only event that day that stilled the rising furor was the Swiss parliament’s debate about amending the banking secrecy laws.
George Krayer and the other members of the Bankers Association were appalled. Rather than controlling events, the government was reeling. “This matter,” the association wrote to the government, “should not be constantly thrown into the political arena on the basis of tragic cases, suppositions and documents which in some cases are highly suspect.” The bankers asked for “more time to clarify what actually needs to be investigated.” One statistic was to
rmenting the association. While its survey published in February 1996 had reported that SF38 million ($32 million) had been found in the dormant accounts, not all belonging to Holocaust victims, Steinberg was reported to be telling journalists that the Swiss were concealing between $7 billion and $20 billion of property belonging to the Jews. Misreading the situation, Robert Studer, the chairman of the Union Bank, caustically dismissed those claims. “The amounts we’re really talking about are peanuts,” he scoffed tactlessly, walking straight into D’Amato’s trap.
“Switzerland is blatantly profiting from the Holocaust,” D’Amato offered as a succinct soundbite. “How can one have confidence in the Swiss authorities when they have only taken action under pressure from public opinion?” Tirelessly driving his staff to hunt for new angles to cultivate the right publicity, he relished the fight against an unequal opponent whose spokesman could only bleat that the senator was exploiting Switzerland’s discomfort to win votes. American-style democracy was alien to the Swiss, and the experience was becoming more unpleasant. By early October, Gregg Rickman had found six new victims and a new grievance to spur on the senator’s campaign.
Slipping into the crowded conference room in the New York federal court building on October 16 for the second round of hearings, D’Amato was beaming. Six witnesses, all victims of the Holocaust and Swiss banks, were waiting to tell the world of the misery and humiliation they had suffered. D’Amato was also carrying, tucked inside his folder, the sheet of paper prepared by Rickman as the surprise revelation.
The senator’s introductory remarks set the agenda: “We’re very concerned that Swiss citizens and corporations blatantly benefited from the Holocaust while the interests of the survivors were totally ignored.… We want to know where all the hundreds of millions of dollars of assets that the Nazis deposited in Swiss banks went.… It’s time for justice. Time to get the truth.” In the background, Roger Witten and Mark Cohen, the Bankers Association lobbyists, squirmed. The Swiss journalists scribbled furiously, accurately guessing their readers’ reaction. The witnesses nodded. The senator was speaking their thoughts.
In broken English, her voice choking, Estelle Sapir, a small, withered survivor, was the first victim to speak. Describing her quest to find her father’s account, she told D’Amato that the employees of the Swiss banks had been “rude and arrogant.” “Yes,” nodded the senator, “If you look at the age of those who are being further victimized, it seems to me that they [the Swiss banks] would like to stall this until there is no memory left of the survivors.” Pausing for the cameras, he added, “Switzerland is playing the old game of delay.”
D’Amato now moved to the revelation, which required careful explanation: Switzerland had signed secret agreements with Poland and Hungary to make use of the heirless assets. “Imagine that,” said the Brooklyn-accented senator, “Polish Jews had their assets taken over and paid over to the Swiss. Just unconscionable … These assets were looted from victims of the Holocaust.” By the end of the ninety-minute hearing, the senator had secured a satisfactory slice of TV air-time and column inches. “A fraud was committed on those people,” he told the journalists gathered around, “and it continues today.” In the midst of the journalists’ scrimmage, the politician repeated his single-line message. In Bern, it was 7 P.M.—too late to find Flavio Cotti and ask for his reply.
The following day, the Swiss foreign minister was visibly angry. D’Amato’s allegation about the agreement with Poland, he told inquirers, was “totally without foundation.” Sure of his facts, D’Amato dispatched a letter to Bern. “The Swiss government,” he wrote, “was actually part of the conspiracy with the communist government of Poland. This dishonesty and deception by any government would be offensive against the background of one of the saddest chapters in human history. It is especially disturbing given Switzerland’s reputation for neutrality and compassion.” Once again Cotti rebutted the claim as “totally without foundation.” In parliament, the minister fumed, “What has been said about Switzerland, especially in the foreign media … has been shattering, on the very edge of intolerable.” Accusations of Swiss profiteering, he nevertheless conceded, “have gravely undermined our self-esteem and our sense of our own moral value.”
Hours later, helped by Peter Hug, a Swiss historian, Cotti’s officials were led to the evidence of the secret Polish pact stored neatly on the open shelves of the Swiss national archives. “Jewish money,” the Foreign Ministry spokesman sheepishly admitted, “was used to compensate Swiss citizens.” Besieged in Washington, a Swiss embassy spokesman snapped that the spokesman in Bern “was misquoted.” Events, revelations and admissions were multiplying too fast for officials accustomed to a sedate pace. One telephone call to Bern clarified the contradictions. Switzerland, it was admitted at the embassy in Washington, “bought the goodwill of the Polish regime” but “the agreement was not carried out.” Facing both ways, the Swiss now sought to explain the deal in a different manner. Switzerland’s citizens had been compensated not by the Swiss government but by the Polish government. In Bern, the government announced the creation of a task force led by Peter Hug to investigate Switzerland’s agreements with Eastern Europe. Switzerland’s establishment was reeling.
By the end of October 1996, five different investigations were either proposed or under way to dissect Switzerland’s past. Besides Hug’s, there was a proposed historians’ commission to examine Switzerland’s entire archives concerning the Nazi and post-Nazi era. That was expected to report in five years.
The third probe was being conducted by Hanspeter Häni, the Bankers Association’s ombudsman. Häni had received claims, as Weber had in 1963, accompanied by a fee of SF100 ($80), which were passed to banks for reply. After eight months he revealed that, despite 2,229 inquiries and 1,055 investigations, not a single dormant account had been reported. But, faced with intensifying pressure, he suddenly announced the discovery of eleven accounts worth SF1.6 million. However, only five were linked to Nazi victims, and their total deposits amounted to SF11,000 ($8,750). “A cruel farce perpetuated on Holocaust survivors by the Swiss banking industry,” scoffed the World Jewish Congress. “He’s Swiss,” carped D’Amato. “How do you expect that he’s independent?” The fees Häni had received from Jewish claimants exceeded the few dollars his inquiries had discovered.
The fourth proposed investigation to audit Switzerland’s banks, under Paul Volcker, the former chairman of the U.S. Federal Reserve, as yet showed no sign of life. Although the terms of the proposed Swiss legislation to compel banks to disclose their secrets had been broadened to include the “fate of assets which reached Switzerland as a result of National Socialist rule,” the representatives of the banks and the Jews had still not agreed on their terms of inquiry. The banks had so astutely prevented a proper investigation in 1962 that every precaution to avoid an exhaustive investigation thirty-five years later required attention. “I’d be disappointed if we don’t narrow the difference,” said Volcker, resisting attacks by D’Amato—who was questioning Volcker’s independence because his committee’s expenses were paid by the Swiss banks.
The fifth investigation was under the command of Thomas Borer, an ambitious, self-confident thirty-nine-year-old international lawyer, a former counselor for legal affairs in Washington, who ranked number four in the Swiss Foreign Ministry. Borer’s task force was to supervise the country’s investigation of the fate of the “assets of the Nazis’ victims.” As a Swiss traditionalist, Borer had adopted an unexceptional attitude. D’Amato, Borer said, was “unfairly rushing to judgment” against Switzerland.
To irritate the Swiss even more, D’Amato offered more venom. The Swiss, he told reporters, “are trapped in the facts of their predecessors’ actions and defend themselves with new denials, half-truths and distortions. They continue to compound the horrible things they did years ago by accusing others of misstatements.” To overcome the delays, he suggested that the government also establish a “truth commission” similar to S
outh Africa’s. For the racially aware Swiss, it was the ultimate insult. “Comparing Switzerland to South Africa is absurd,” said the fair-haired Borer. “His charges that we want to delay the investigations,” expostulated Cotti, “or that we are not credible because we are Swiss, are insulting and utterly unacceptable.”
Pleas of innocence encouraged a switch to a more sophisticated attack. In New York and Washington, enterprising lawyers organized two class actions against the Union Bank of Switzerland, Crédit Suisse and the Swiss Bank Corporation, claiming damages of over $20 billion. Class actions—unknown in Europe—are used in the United States as battering rams against giant corporations to win vast damages for large groups of individuals. The claims alleged that the banks had refused to return money deposited by Jews and that a colossal amount of wealth stolen by Nazis from Jews, deposited in Swiss banks, should be transferred to the survivors. The quality of proof provided in the two claims was decidedly unimpressive, but the nuisance value was enormous. If the judge allowed one composite case to be heard, the three banks would be immersed in a lengthy saga to defend their wartime relationship with the Nazis. To terrorize the banks further, the Washington case, organized by Martin Mendelsohn of the Simon Wiesenthal Centre, had retained Michael Hausfeld. As proof of his status as the United States’ leading advocate in class actions, Hausfeld had just won a $178 million settlement from Texaco in a race discrimination case. The Swiss Bankers Association finally understood the gravity of the threat. To reinforce the propaganda value, one of the law firms produced another victim to demonstrate Swiss dishonesty.
Speaking at her home in Brooklyn with a strong Central European accent, Gizella Weisshaus, a Hasidic Jew, described her fate in the summer of 1944 when, aged fourteen, she was arrested with her parents and six younger brothers and sisters in Sighet, Romania. While the family was forced to remain in the house, her father was held at the rail station awaiting the journey to Auschwitz. By paying his guard a hefty bribe, her father had been allowed to return home and bid farewell to his family. In the midst of a hurried and strained conversation, Gizella Weisshaus’s father whispered that some money was hidden in the house and that there was more deposited in a Swiss bank. The father returned to the station and was never seen again. Shortly afterward, the whole family was shipped to Auschwitz. At the railhead inside the camp, an SS officer, jerking his thumb, ordered Gizella Weisshaus’s mother and the six younger children to go in one direction, while, ignoring the mother’s screams for her child, Gizella was ordered to join another group. No one realized that it was a decision of life and death; while Weisshaus would survive, her mother and her six siblings would be gassed within hours. More than fifty of her relatives would be murdered by the end of the war. Having survived, Weisshaus had returned to her home to discover, as her father had disclosed, $1,500 in dollar bills and some gold hidden in the roof. Shortly afterward, she married and emigrated to the United States.