Passions Flare at Swiss Banks Hearing

By Nathaniel Popper

Published May 07, 2004, issue of May 07, 2004.

BROOKLYN —Even before the hearing opened here into the distribution of unclaimed funds from the $1.25 billion Swiss bank settlement, a confrontation erupted.

A group of elderly men stood outside the courthouse with signs around their necks that said “Mathausen” and “Dachau,” in English and Russian. An older woman approached them and asked, in fluent but accented English, if a man wearing an “Auschwitz” sign had actually been at the camp. The men, who spoke little English, shrugged and smiled nervously.

“You people were not at Auschwitz,” the woman said, her voice rising. “I was, and you should not be making advertisement as if you were.”

A white-haired man on the periphery displaying a sign in Russian approached the woman, evidently hurt by her words. “I was in Dachau,” he said in halting English, and pulled out a red passbook to prove his credentials. The woman stalked away without acknowledging him.

U.S. District Judge Edward Korman had invited survivors and others to come to court on April 29 and air their views on a plan that would devote unclaimed funds to helping needy survivors, mostly in the former Soviet Union. The plan, made public last month, has evoked angry protests from survivors in America and Israel who say their own needs are being overlooked. It quickly became clear, however, that the anger and hurt were much deeper, and a great deal older.

As it turned out, the group of men and the woman had come for the same thing. They all wanted a greater share of the Swiss bank money directed to survivors living in America. But with no actual residents of the former Soviet Union in attendance, some American protesters directed their anger at the nearest equivalent, Russian-speaking survivors in Brooklyn.

The scene outside the courthouse was merely a taste of the anger and confusion that spilled out in Korman’s courtroom. The hearing was the first formal public opportunity since the Swiss settlement was signed in 1998 for survivors to express their pent-up discontent with the way the case has proceeded.

The Swiss bank case is a class-action lawsuit brought by Holocaust survivors who claimed the banks had prevented them from reclaiming their bank accounts after the war. The $1.25 billion settlement included $800 million in depositor funds, plus smaller sums for others hurt by the Swiss banks, including former slave laborers for Nazi firms that deposited profits in Swiss banks. While the slave labor and other funds have been distributed, more than $600 million in bank deposits remains unclaimed.

Early in the 10-hour hearing, several speakers urged that the money be kept untouched until all account holders have had an opportunity to come forward. “Eight hundred million is sacred money,” said Greta Bier, one of the original plaintiffs in the case, who won back her father’s money. “Nobody has a right to it.”

Most of the testimony, however, was directed against the judge’s plan for distributing any funds that ultimately remain unclaimed. Korman has ruled in the past that unassigned funds be used to provide humanitarian aid to the neediest survivors. Under a formula he adopted in 2000, some 75% of the humanitarian aid is reserved for destitute survivors in the former Soviet Union. The court-appointed special master advising on the issue of unclaimed funds, former New York deputy mayor Judah Gribetz, recommended last month that Korman follow the same formula for the undeposited funds. For that, Gribetz became a lightning rod for survivor anger.

Allowing only a single five-minute break during the grueling testimony, the judge attempted to keep the discussion focused narrowly on which survivors are most in need of emergency aid. But the questions bled easily into raw emotional appeals and painful discussions, including one about the definition of who may be considered a survivor.

During the hearing, it becameclear that Korman was leaning toward following Gribetz’s reasoning. He evinced skepticism toward the testimony of American and Israeli representatives, notably questioning the lack of useful statistics in the presentations by American survivors claiming urgent need in the United States.

The judge’s questioning prompted angry retorts. “There isn’t anything we do that meets with your approval,” said David Schaecter, president of Holocaust Survivors Foundation – USA, a Florida-based group that has led the protests against the distribution formula.

The hearing showed just how many groups have felt under-represented in the distribution formula as it now stands. One of those claimants, the Israeli government, was represented by a Cabinet minister, Natan Sharansky, the former Soviet dissident, who testified via video phone. Israel has asked that 48% of the remaining funds be devoted to survivor needs in Israel, based on a disputed demographic estimate. Gribetz dismissed the Israeli request, and Sharansky is seeking to have Gribetz overruled.

Other advocates at the lectern spoke for homosexual victims, called for funding of Holocaust remembrance and research programs, and described poverty among Romani survivors in Eastern Europe.

The emotions on display in the courtroom suggested that the Swiss bank case has, for many survivor activists, become a stand-in for the frustrations and failures of the entire 50-year reparations process. Korman himself referred to the larger history of reparations by repeatedly noting that survivors in the former Soviet Union, cut off from the West for decades, have received barely 0.8% of the $54 billion paid to Nazi victims by Germany and Austria since 1954.

The survivors in the former Soviet Union had little public support in the courtroom. After a representative of the American Jewish Joint Distribution Committee from Belarus spoke through a translator about extreme levels of need in her country, a smattering of boos came from elderly American survivors in the court.

The most dramatic testimony of the day came from Thane Rosenbaum, a novelist, Fordham University law professor and child of survivors, who questioned the morality of sending so much of the money to the former Soviet Union.

“While it is true that many if these Russians experienced terrible hardships after the Holocaust, they were fortunate to be in the Soviet Union,” Rosenbaum argued.

Korman shot back that Rosenbaum’s standards would exclude resources from going to Russian immigrants in America, who account for most of the urgent need even according to the accounting of American groups.

“We decided early on that we could not calculate the degree of suffering of each individual,” Korman added. “The test is not suffering but need.”

According to some survivors Korman’s focus on immediate need and numbers has made him callous.

“I don’t have statistics, I have stories. Sad, bloody, bitter stories,” 75-year-old Malka Moskowitz said outside the courtroom. As she described her medical expenses and recalled her brother’s bloody death, it was plain that her anger was older than the Swiss bank case — but that she lacked any other outlet for it.



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