by Bower, Tom
With a smile, Borer concluded his testimony, adding one correction. All the Swiss, he told D’Amato, had opposed Nazism. Content with his performance, Borer left the committee room and returned to Switzerland.
The effect of the hearings upon Switzerland’s tiny Jewish population had been profound. Always beleaguered by ingrained anti-Semitism among a considerable section of the population, Switzerland’s Jews were experiencing the realization of their worst fears. Overt hatred of Jews had reemerged, and Switzerland’s Jews were fearful. Before the war, Heinrich Rothmund, the wartime police chief, had before the war praised Switzerland’s Jews for helping to “prevent the Jewification of Switzerland.” In consequence of their timidity, only 7,000 Jews had found refuge in Switzerland in 1942; yet because of external pressure, there were 28,512 Jewish refugees by 1945. The statistics proved that Jews could escape the Third Reich but had been barred by the Swiss government, by the Allies, and even by Swiss Jews from finding sanctuary. In 1997, Switzerland’s Jews were critical and even ashamed of the wartime weakness of Saly Meyer, their representative, but there was no rush by their current leaders to adopt a more confrontational attitude. Yet the evidence of Swiss perfidy was increasing.
On the eve of the Volcker Commission’s pilot audits at the beginning of June 1997, the Swiss banks, which had agreed to temporarily waive the bank secrecy laws, announced their discovery of more than 1,000 new dormant accounts containing $40 million that “might have belonged to Holocaust victims.” The accounts had been opened by non-Swiss during the wartime era and were found among 20,000 other newly discovered dormant accounts. Only the pressure of Volcker’s audit had compelled these new admissions. Other embarrassments seemed inevitable, but they might come too late to help the dwindling number of impoverished survivors of the Holocaust.
Pressure from Washington and New York compelled the Swiss to review their timetable. Discreetly but determinedly, Eizenstat convinced Borer that his public and private sympathy should not be mistaken for a lack of commitment. The Clinton administration, he told Borer, was determined to secure justice.
If Borer harbored any doubts about action or any hopes of inaction, they evaporated when three state legislatures—New York, New Jersey, and California—initiated laws penalizing the operations of the three major Swiss banks in America. In New York City, UBS was deliberately excluded by the city’s comptroller from participating in underwriting a bond issue, as punishment for its behavior regarding Christoph Meili and the dormant accounts. Although the sanction was lifted in December 1997 after frantic Swiss lobbying, the threat of its reimposition startled Swiss banks still sanguine about the strength of American public opinion.
Outraged and fearing discrimination, Borer and the Swiss banks hastened the first payments from the humanitarian fund to the impoverished Holocaust survivors in Latvia. Five hundred dollars for each survivor—only half what had been originally promised—was pitiful, but the gesture showed a commitment that other countries would be expected to copy.
Time, Israel Singer of the World Jewish Congress believed, was short as always. Not only was the survivors’ need urgent, but the opportunity to pressure the Swiss and the other nations could be increased if the issue could be debated at a special international conference. There were few recent precedents for historic discussions among governments concerning events half a century earlier, but the widespread sympathy and even outrage shared among politicians and the public across the world as the revelations about the “greatest theft in history” emerged could, he believed, be exploited. The opportunity offered itself on May 1 in London, when a landslide election victory was won by the Labour Party, committed to a “moral” foreign policy. Greville Janner, the WJC’s representative in London, naturally enjoyed good relations with the new foreign secretary, Robin Cook. For a new government anxious to prove its commitment to exposing past iniquities, Janner’s proposal that a special conference of all interested governments be summoned to meet in London to establish the true fate of all the Nazi gold was a risk-free opportunity with potential benefit.
Forty-one nations were represented at the opening of the conference in London on December 2, 1997. Lancaster House, an ornate building near Buckingham Palace that had been the venue for dozens of negotiations between Britain and its former colonies to dissolve the empire, gave the conference exceptional credibility. Quiet negotiations and exhortations during the previous weeks by Foreign Office officials and Eizenstat persuaded other reluctant governments not to risk opprobrium by ignoring the fate of the Holocaust’s victims. Each nation was asked to present a report to the conference describing the Nazis’ theft of its gold, and to make proposals for opening its archives concerning the Nazis’ plunder—and the aftermath—for immediate scrutiny.
To many, during the preceding days, it appeared that the character of the conference would fail to rise much above a historians’ seminar influenced by a reopening of old hostilities. By the end of the first day, the cynics were proved partially wrong. The British—masters of ceremony—had contrived the opening hour to bestow solemnity and historic purpose on the representatives. Motivated by Robin Cook to “avoid the second tragedy of those who survived the Nazis being left to live out their days in poverty,” the conference was presented with unexpected revelations.
Launching a new Holocaust fund based upon the remaining 5.5 tons of Nazi gold (worth $78 million) still held in London and New York—336 tons having been recovered—Cook announced a British donation of £1 million. Eizenstat pledged $4 million, rising to $25 million in the following three years. Cook appealed to those countries due to receive a share of the gold in the final allotment negotiated by the Tripartite Gold Commission to donate their share to this fund. His appeal for unanimity had, on the eve of the conference, been torpedoed by France. Citing its domestic arrangements to help French Jews, the French government had already refused to contribute its 2.2 tons of gold to the pool; this was consistent, many people murmured, with France’s inglorious failure to protect Jewish interests over the past century. To France’s good fortune, however, its refusal was overshadowed by an unexpected revelation published by Switzerland’s international commission of historians.
In a twenty-three page study, the Bergier group presented the fullest account of Switzerland’s gold transactions with the Nazis. To Borer’s embarrassment, the newly released records revealed further dishonesty on the part of the Swiss.
The historians’ new study of the Reichsbank’s archives revealed that Nazi Germany had, after 1933, accumulated under several guises $434.2 million from a variety of sources, including $33.8 million of Czech reserves, approved by the British government in 1938. After September 1939, the Reichsbank seized $475 million in gold from the central banks of occupied Europe, including Italy. At the end of the war, $295 million of that gold was recovered in Germany.
Switzerland, reported the historians, accepted 76 percent of all gold transferred abroad by the Reichsbank—279 tons, worth $389.2 million—and, contrary to previous denials in Bern, $61.2 million of that gold was bought by three private Swiss banks.
SBC had bought $36.6 million, Bank Leu (now part of Crèdit Suisse) took $12 million, and UBS took $8.5 million. Four German banks and metal brokers also benefitted equally from $14.2 million of looted gold: the Dresdener and Deutsche banks, and Degusa and Sponholz. Emotionally, the historians’ most pertinent claim was to have identified the records proving that the Nazis had plundered and confiscated gold with $146 million from private individuals. That admission was accompanied by an unprecedented apology from the Swiss national bank: “The SNB finds it difficult to understand why its management at the time did not sufficiently take into account the moral and political implications of their strategy.” Measures to prevent the acquisition of looted gold, including victims’ gold, admitted the bank, had been “altogether too half-hearted.”
That revelation was tempered by the controversial assertion that only $2.5 million of gold could be identified indispu
tably as “victim gold” passing through the “Melmer” account. The remaining $143.5 million was categorized in the records as belonging to private individuals, and it clearly included confiscations from non-Jews. Pertinently, an unofficial analysis of other Reichsbank records suggested that the Melmer gold was possibly sold to the Deutsche and Dresdener banks for smelting and was not sold to Switzerland. Yet the report stated, “A part of the Melmer gold was resmelted by the Prussian Mint and taken abroad.” The historians explicitly acknowledged that Switzerland’s national bank had, albeit innocently, bought “victim gold” from the Reichsbank.
The possibility that victim gold had been deliberately mixed with the monetary gold seized by the Allies in 1945 became apparent in a British submission to the conference. Sir John Anderson, the last Conservative chancellor of the Exchequer—just before Churchill’s government lost the election—had proposed that victim and monetary gold be mixed. That proposition was attacked by Eddie Playfair. “It will seem nothing less than banditry to them,” wrote Playfair, whose objections about the idea’s immorality of the idea were accepted. Yet, according to the British, their moral argument was subsequently overruled by France and the United States.
The Bank of England, in a separate submission, confirmed that in the testing and preparation of the recovered Nazi gold for postwar use, the original identity of the bars had been “lost.” The only clue to the origin of “a small quantity” (134 kilograms) of “gold coins, medals, and tokens” recovered in Germany was also destroyed when they were smelted into ingots.
In its submission, the Federal Reserve bank of New York disclosed that in February 1952, it had received from Germany seventeen boxes of miscellaneous gold bars, coins, and smaller gold pieces known as “chips” or “buttons.” Officially, the origin was unknown, and the gold was dispatched to be smelted into forty-three bars. Forty-five years later, it appeared that the Federal Reserve had wrongly appropriated “victim gold” for restitution to the central banks.
The submission by the Bank for International Settlements admitted that “it cannot be ruled out” that of the 13.5 tons of gold received from the Reichsbank during the war, some “nonmonetary” gold might have been included in a quarter (3.4 tons) of those deposits.”
Casting aside his earlier caution, Edgar Bronfman denounced the minimization of the amount of “victim gold” discovered in 1945 as “inaccurate” and demanded that the TGC’s archives be published—despite the opposition of Britain and France. He argued that the records would reveal that the genuine amount of “victim gold” would amount to “many tons,” possibly as much as sixty tons, worth over $700 million. Switzerland, continued Bronfman, still owed international Jewry between $2 billion and $3 billion of looted property deposited in Switzerland. It was an opening gambit to secure a final settlement with Switzerland rumored to be targeted at about $800 million. It was also the price of terminating the class action suits in the American courts against Switzerland’s banks and insurance companies.
A newly discovered telegram increased the pressure on Switzerland. In this telegram, written in 1944, an American intelligence report stated that Switzerland and Japan had agreed that Allied money, paid to Switzerland for the care of POWs held by the Japanese, would be used to repay Japanese debts to Swiss businesses. Stung by the latest accusation, Cotti, the Swiss foreign minister, denied the allegation, insisted that Switzerland’s neutrality had not been abused, and cited his country’s assumption of “wide-ranging humanitarian tasks.”
Borer rejected Bronfman’s demand as lacking any “objective basis.” The $200 million Holocaust fund, he insisted, was the limit of Switzerland’s contribution. Rejecting any notion of renegotiating the 1946 Washington Accord, Borer snapped out a well-rehearsed riposte: “You might as well ask the Dutch and the Indians to get together and decide if a fair price was paid in skins and glass beads for Manhattan island.” Legally Borer’s protest was valid. But his insistence that Switzerland had acted honorably to restore stolen property was disingenuous. “Almost six hundred people,” he boasted, had sought restitution of their stolen property in Switzerland after the war. That raw official figure confirmed the criticism of Switzerland and highlighted that other countries, including France and Russia, had deliberately obstructed the return of stolen property. The conference had provoked the disclosure of serious dishonesty.
In Czechoslovakia, it was revealed, the government was deliberately continuing to deny Jews any restitution of their property. That property had been plundered both by the Nazis and by Czech collaborators and anti-Semites after 1939. Thereafter, some was seized after 1948 by the Communists. Claims by surviving Jews after the collapse of Communism in 1989 had been ignored or denied on the ground that the claimants lacked documentary evidence of title and confiscation. Yet Czech government archives contained thousands of administrative files dating from 1939 concerning the plunder of Jewish property. Access to those files was still denied to Jews.
Israeli banks had also, it was disclosed, refused to release lists of dormant accounts of Jews. These accounts, opened by European Jews, had been frozen during the war by the British. After 1948, the Israeli bankers had refused to publish lists to enable claims by heirs. Asserting banking secrecy, the Israeli government had failed fifty years later to persuade the banks to adopt the same policy forced upon the Swiss.
The British had also been accused of perfidious treatment of bank deposits held in Britain by enemy aliens. These deposits had been frozen by order of the government after 1939, and the government’s policy had been to use enemy property to compensate British citizens owed money by those enemy nations. After 1945, surviving Jews, former “enemy aliens,” arrived in London to claim their deposits or inheritances. To their surprise, despite their ordeal, they continued to be categorized as enemy aliens and were denied their assets. Under pressure, Whitehall officials had agreed that Jews who could prove that they had lost their liberty during the was should be entitled to reclaim their assets. But proving “loss of liberty” to the satisfaction of officials in London still unwilling to understand the realities of the Holocaust had been too difficult for some survivors. Among the most notorious refusals to release assets involved a claim by an heir whose mother had committed suicide to avoid deportation to the death camps. That woman, decided the British official, had clearly not lost her liberty.
The recent discovery of those archives in London—although some of this information had been released during the 1970s—had aroused fury in Israel. The British government had organized an internal review but, to avoid embarrassment, delayed publishing the report before the London conference. Its conclusion—that the policy was justified but its implementation was occasionally “insensitive” was best left until long after the conference.
Among others criticized were the Croatian representatives, for daring to suggest that their nation had fought “the Nazi invaders on a massive scale.” In fact, the Croatian Ustache government, collaborating with the Nazis, had committed appalling atrocities. While Croatian representatives responded forcefully to critical attacks from Jewish groups, the Vatican representatives, urged to open their archives, refused to comment. One recently released American intelligence document suggested that Ustache gold had been deposited in Rome to avoid seizure. Eizenstat had visited the Vatican, but his attempts to prize open the archives had been unsuccessful. No one doubted that the Holy See preferred to avoid the embarrassing confirmation of its wartime collaboration with the Nazis, the Ustache, and other European fascists.
Suddenly, governments that had successfully parried the criticisms, accusations, and demands of Holocaust survivors and international Jewry were compelled to listen to claims buried for fifty years. None of the 240 delegates could openly ignore Eizenstat’s reproach: “We must not enter a new century without completing the business of this century. We have a collective responsibility to leave this century having spared no effort to establish the truth and to do justice.” The agreement to reconvene the
conference in Washington for a second round in 1998—an election year in the United States—gave even pessimists some hope.
SOURCES
The principal sources for this book were the American, Swiss, British and French national archives, and archives of the American Jewish Committee (AJC) and the American Joint Distribution Committee (AJDC). I also interviewed about forty people.
American archive sources are identified by RG; the British archives sources are the Foreign Office (FO), Treasury (T) and War Office (WO); references to documents from the Swiss archives start with the letter E; the remainder are from the French archives.
CHAPTER 1: CONFRONTATION AND TEARS
1At the head. E 4110 (A) 1973/85, Bd 1.
6“the completely impossible.” RG 59 1950–4 Box 1013 254.0041/7–1150.
CHAPTER 2: THE SEEDS OF CRIME
20Some eyewitnesses, such. Alfred Haesler, The Lifeboat Is Full (Funk & Wagnalls, 1969), p. 77.
21“overrun with Jews.” Ibid., pp. 8, 10.
By 1942, just. Ibid., p. 19.
Unscrupulous Swiss businessmen. RG 131 Foreign Funds Control, Safehaven Report 159, October 30, 1945.
Weissmann’s only comfort. RG 58, 1945–9 Box 4202 April 17, 1946.
“We must protect.” Haesler, Lifeboat, p. 9.
22“His report on.” Ibid., p. 110.
24“Jewish dollars.” Jacques Picard, Die Schweiz und die Juden (Chronos, 1994), p. 416.
Even Jews born. Ibid., p. 67 28
28“We have fulfilled.” Haesler, Lifeboat, p. 160.
28a “wild story.” Tom Bower, Blind Eye to Murder (Little Brown, 1996), p. 34.