Secrets of the Swiss bankers

The cloistered Swiss banking industry has belatedly and reluctantly agreed to unlock two of its most disturbing secrets. One is its handling of accounts opened by European Jews who were later killed during the Holocaust. The other is the expedient relationship it cultivated with Nazi Germany.

A lingering mystery of the Nazi era is what happened to the gold, money and other valuables deposited in Swiss banks by Jews throughout Europe who were fearful their assets would be seized by Germany. No one is certain how many such Swiss accounts were opened or how much they were worth. But there is no doubt that at the end of the war, Swiss banks were left with numerous unclaimed deposits made by Jews who died in the Holocaust.

There is also little question that Switzerland, fearful of Nazi conquest, made its banks available for the safekeeping of tons of gold looted from European governments by the Nazis as they marched across the continent. Much of that gold was never returned after the war. The banks claimed that most of it had been transferred out of Switzerland by the time the war ended in 1945.

For decades, the Swiss banking industry arrogantly thwarted inquiries about its role during the Nazi period, and effectively discouraged the relatives of Holocaust victims from searching for long-dormant accounts. The Swiss stonewall has now broken down under intense pressure from Jewish organizations and the unearthing of documentary records that show the shameful extent of Swiss banking cooperation with the Nazis. Faced with a mounting wave of negative publicity and the prospect of lost business, Swiss bankers are opening their archives and vaults to outside investigation.

International pressure must be maintained to assure that the banks do not slip back into their accustomed secrecy. U.S. Senator Alfonse D'Amato performed a valuable service earlier this year by steering the Senate Banking Committee to the issue and holding hearings on the dormant accounts. The British government pressed the matter with a report this month that the Swiss could be holding US$6 billion worth of gold stolen by the Nazis.

The Swiss government is now moving to relax bank secrecy laws, at least in this case, to allow a full investigation into Nazi gold deposits. The Swiss bankers, for their part, are now working with the World Jewish Congress to examine the dormant accounts of Holocaust victims.

The bankers and the World Jewish Congress have formed a commission to conduct a comprehensive, independent audit in hopes of locating accounts and ultimately making the assets available to relatives who can establish a legitimate claim. The commission is headed by Paul Volcker, the former chairman of the Federal Reserve Board.

The search will not be easy and the amount of gold and other assets may prove smaller than imagined. But in a matter of historical accountability like this, monetary value is less important than honesty and openness. This is a reckoning long overdue.

-- The New York Times