Credit Suisse hid its extensive ties to the Nazi regime

Senator Chuck Grassley warned the Swiss bankers, "G-d isn't neutral in this fight" (Photo: AP Images)

The ongoing Senate Judiciary Committee inquiry into a Swiss bank’s ties to Nazi Germany has brought to light hundreds more accounts than were revealed in a $1.25 billion settlement with Holocaust survivors in 1999.

Credit Suisse, a now-defunct institution that was swallowed up by Swiss competitor UBS in 2023, has been shown to have hidden its extensive ties to the Nazi regime, which included support for the “ratlines” that allowed war criminals to escape to Argentina after the war.

All of this was divulged last week in testimony before the committee by Neil Barofsky, a lawyer hired by Credit Suisse in 2021 to investigate the bank’s own role in the Holocaust, after the Simon Wiesenthal Center charged that Credit Suisse was concealing the truth. Credit Suisse then fired Barofsky in 2022, which drew the ire of the Senate Judiciary Committee, led by Republican chair Senator Chuck Grassley of Iowa and ranking Democrat Senator Sheldon Whitehouse of Rhode Island.

It is a comforting sign that even in a polarized Congress, both parties agree that organizations tainted by Nazi ties should pay for their misdeeds.

Attorney Neil Barofsky was reinstated as the lead investigator into Credit Suisse’s Nazi ties after UBS acquired the bank, largely thanks to the intervention of Senators Grassley and Whitehouse. In taking over Credit Suisse’s assets, UBS also acquired the legal headache of its former rival’s troubling Nazi past. Although UBS officials insist they want to see justice served, they have taken actions that appear to thwart the ongoing investigation.

Neil Barofsky testified before the committee last Tuesday that his inquiry has uncovered some 890 accounts at Credit Suisse tied to Nazi officials, including “628 individuals and 262 legal entities.” That total is far higher than the 100 or so accounts that formed the basis of the $1.25 billion settlement in 1999. The probe has also found that Credit Suisse gave assistance to the smuggling network known as “ratlines” that spirited wanted Nazis out of Europe after the war to Argentina.

Now Barofsky says he needs access to 150 key documents held by UBS related to the 1999 settlement. He says the documents contain information about specific account holders targeted in his investigation. But UBS is refusing to turn them over, on the grounds that releasing them would make UBS the target of new litigation.

Bankrolled

Last week, Senate Judiciary Committee chairman Senator Chuck Grassley cast UBS’s actions in stark terms. “UBS’s recent conduct… sabotages its own efforts to show accountability,” he said. “I strongly urge you to find a way to make peace before it’s too late to repair the damage you’ve done.”

His warning also included a jab at Switzerland’s refusal to enter the war: “G-d isn’t neutral in this fight.”

Rabbi Abraham Cooper, associate dean of SWC, accused UBS of “actively blocking important aspects” of the effort to provide a full telling of Credit Suisse’s Nazi-linked activity.

Yet throughout the two-hour hearing, the UBS side of the story left listeners wondering if they were talking about the same question.

Robert Karofsky, president of UBS Americas, insisted that his bank’s “priority is to complete this review.”

Both he and UBS counsel Barbara Levi condemned the “deeply troubling picture” of Credit Suisse’s past actions and pointed to millions of documents already made available to investigators. The only reason they have kept the remaining documents under wraps is fear of future legal action by SWC.

UBS’s claims of good faith are hardly unfounded, a point that highlights the narrow disagreement in this latest chapter in a long saga. In fact, Neil Barofsky acknowledged that until this recent dispute, the bank’s conduct regarding his work had been “picture perfect.”

In the 1990s, a set of revelations about the scale of Nazi money in Swiss banks led to investigations, court cases, and ultimately negotiations with the World Jewish Congress (WJC). In 1999, they agreed to a $1.25 billion restitution payment.

Mrs. Levi said that the settlement was intended “to provide final closure” with the knowledge that “not all information was on the table.”

“The majority of [the payment] was to cover the unknown,” she said.

In 2020, SWC presented findings indicating that Credit Suisse held a far larger number of Nazi-linked accounts than previously known. The bank engaged Neil Barofsky, a former federal prosecutor, to serve as an independent ombudsman for an internal investigation. Yet in 2022, the bank fired him — about which Senator Grassley drily remarked that he had done “too good a job.”

Credit Suisse refused to release Mr. Barofsky’s report, which was only brought to light after a subpoena from the Senate Budget Committee, the work of Senators Grassley and Whitehouse.

The next year, Credit Suisse was acquired by UBS, which rehired Mr. Barofsky and encouraged him to continue the investigation. But when he asked for the 150 missing documents, UBS stonewalled him.

At issue is the ongoing litigation between UBS and SWC, which wants to reopen the 1999 settlement. UBS sought a court order to “reassert” terms of the 1999 agreement, but SWC says that would impede its ability to research and speak publicly about Holocaust-related issues.

Greasing the Ratlines

UBS may have much to fear from a reopening of the settlement. Last year, WJC president Ronald Lauder said the parties to the 1999 agreement “negotiated blind” and that UBS might be liable for billions more.

Senator John Kennedy (R–LA) speculated at last week’s Judiciary Committee hearing that all of UBS’s posturing was a cover for its position that it is “not paying a penny more.”

Mr. Barofsky, for his part, said his investigative team “has zero interest in litigation documents.” However, a search of the files using Nazi names and terms yielded several hits, indicating they likely hold pertinent information.

“I don’t know what’s in those documents,” he told the committee. “We’re looking for needles in one of the world’s largest haystacks.”

Mr. Barofsky’s preliminary findings already painted a more nefarious picture of Credit Suisse’s Nazi intersection. In addition to uncovering the hundreds of additional Nazi accounts, his team’s work revealed underreporting of Jewish asset transfers reaching “millions of Swiss francs as well as hundreds of thousands of dollars in US bonds.” They also found that Credit Suisse was landlord to four accounts for the wartime German Foreign Office, responsible for deporting Jews from occupied countries and seizing their assets.

Barofsky’s investigators also discovered an SS account holding 4.6 million francs, managed by war criminal Leo Volk, convicted at the Nuremberg trials.

If that weren’t enough, Barofsky also released findings on accounts used to fund the Argentine Immigration Office (AIO), a Bern-based ratline for smuggling Nazis from Europe to South America. These revelations were aided by a trove of Argentinian documents recently declassified by President Javier Milei.

AIO was funded through a one-million-franc (17 million in present rates) transfer made by the government of Argentinian leader Juan Peron. AIO’s offices were leased from Credit Suisse and the Argentine officials who ran it maintained several accounts at the bank. Those funds were presumably used to cover Nazis’ travel expenses, purchase false documents, and to cover bribes to get them over borders or out of arrest.

AIO facilitated the escapes of rocket designer Hans Kleiner, Nazi racial theorist Oswald Menghin, and Walter Deckert, a chemist who developed Zyklon B gas, used in the gas chambers. Kleiner and his wife were among those aided by an AIO financed bribe after they were arrested.

Mr. Barofsky’s final report is expected in six months.

SWC’s Rabbi Cooper emphasized the importance of including all known information and details of the Holocaust financing.

“It’s about our last chance to learn the full truth,” he said. “Genocide is not only an ideological cry, it is an economic one… [which] can only take place… with access to banks.”

(Originally featured in Mishpacha, Issue 1099)