Marlene Bethlehem, a long-serving member of the Jewish Affairs editorial board, has held numerous Jewish communal leadership positions in South Africa, including as National Chairman of the SA Jewish Board of Deputies. She is a former Deputy Chairperson of the Cultural Religious and Linguistic Commission and was recently re-elected President of the Memorial Foundation for Jewish Culture.

Background: In 1995, the World Jewish Congress instituted a lawsuit to retrieve deposits made into Swiss banks by victims of Nazism prior to and during World War II. In 1998, a settlement was reached, which as of 2015, had seen $1.28 billion USD disbursed for 457 100 claimants. Then SAJBD Chairman Marlene Bethlehem represented the South African Jewish community in the discussions and here shares her thoughts and recollections of that time - Editor.

In January 1997, as chairman of the SA Jewish Board of Deputies, I was sent to London to take part in one of the most important meetings of the post-Holocaust era. After eighteen months of tortuous and often secret negotiations that occasionally flared up into much bitterness, the Swiss government had finally agreed to the establishment of a “Holocaust Memorial Fund”, the purpose of which would be to compensate Holocaust victims and their families and ensure that there was full transparency regarding these distributions. The money would be distributed through an organization set up during the London meeting that I was privileged to attend.

Only the previous year, a high ranking Swiss official had rejected talk of a Holocaust compensation fund as “extortion and blackmail” by Jewish groups, mainly the World Jewish Congress (WJC). Edgar Bronfman, the President of the WJC, had put millions of dollars into researching evidence after the opening of World War II archives. The official who made the ugly remarks later apologized to Bronfman.[1]

This major shift showed Switzerland's concern that adverse publicity concerning both its gold trading with Nazi Germany during the war and its obstructive post-war attitude towards claims on dormant Jewish owned bank accounts would seriously damage its banking industry. Banking officials in Zurich said it represented the first time that Swiss commercial banks had offered their own money in connection with the long running efforts by Jewish groups to seek compensation related to Switzerland's financial relationship with Germany. A statement by the three banks Credit Suisse, the Swiss Bank Corporation and the Union Bank of Switzerland expressed the hope that the initiative would “clear the way for the Swiss Government, their financial organizations and the Jewish organizations to work together to find a just and equitable solution”.

After the lengthy discussions referred to above, an initial offer of 32 million Swiss francs was made. This offer, of course, was ludicrous. At one of the most important meetings during the negotiations Alan Heversey, Financial Director of New York City threatened to pull funds out of the Swiss banks. In response to those claiming this would cause unemployment in New York due to the many that would lose their jobs, he replied that such people would be absorbed by the American banks into which he would place all the New York funds.

Until January 1997 the Swiss government had resisted the idea of a Holocaust compensation fund.

The final amount agreed to was 284 million Swiss francs (almost $185 million USD), financed by donations from the three Swiss banks, other Swiss companies and the Swiss National Bank. The agreement stated that the fund would be used to “support persons in need who were persecuted for reasons of their race, religion, political views or otherwise were victims of the Holocaust”. This included non-Jewish victims such as Gypsies, people persecuted for political beliefs, homosexuals and Jehovah Witnesses.

The Swiss have now shown a willingness to “face their past" said Edgar Bronfman at a joint news conference with Swiss Foreign Minister Flávio Cotti in New York. Cotti stated, “We must answer questions openly”. Those questions dealt with the nature of Switzerland's wartime ties to the Nazis.

Until January 1997 the Swiss government had resisted the idea of a Holocaust compensation fund, being prepared only to use only dormant accounts left by victims for such a purpose. This idea was an outrage to the Jewish world. However, after a security guard discovered officials shredding archives at the Union Bank of Switzerland, on 23 January the government finally announced that it would take the lead in setting up the fund.[2] The decision taken at the London conference was firstly to allocate money to survivors of the Former Soviet Union, who had suffered under both Nazism and Communism. These would receive extra funds relative to survivors in the rest of the world. Part of the agreement, however, was that survivors had to prove that they were needy. I was completely taken aback by this announcement and argued vociferously that all survivors of the Shoah were ‘needy’. The authorities in Israel subsequently determined that anyone with less than 6000 shekels a month to live on was considered needy.

As chairman of the South African fund I decided to adopt this amount in Rands, i.e. R6000.This, however, was refused by the Swiss banks and hence I was compelled, with the help of my vice chairman the late Harry Schwarz, to conduct a South African cost of living assessment. Harry's own family had been turned away from Switzerland when they tried to enter in 1939. Fortunately, they managed to get to England, thereafter making their way to South Africa. In the course of a thorough and exacting investigation that took many months, during which time we held discussions with the Association of Holocaust Survivors chaired by Don Krause, we found that there were 39 local survivors who qualified for this financial assistance. The payments were based on how much each country was allocated from the fund, and the amount was paltry in the extreme. Each South African survivor received a once-off payment of R3400, something I can easily attest to as, with the help of SAJBD Financial Director Harry Chaitowitz, I was required to write out and sign every cheque.

Harry Schwarz (1924-2010)

Harry Schwarz (1924-2010)

As I have mentioned on numerous occasions over the ensuing years, whenever I am asked to speak about this compensation fund, I always stress that these delicate negotiations were never about the money. Rather, they were about compelling the Swiss, who while ostensibly neutral, had served as Germany's banker to the world, to confront their history. It was a question not of money, but of moral justice. Harry Schwarz and I were later invited to the Swiss Embassy in Pretoria, where the Ambassador offered us an apology on behalf of the Swiss government.

Further evidence of Swiss involvement was to follow.

The next vital international conference that I attended was held in London in December 1997 and concerned Nazi looted gold. Representatives of 41 nations participated, including France, the UK and the US, three of the allied countries that fought Nazi Germany. The conference was called in the wake of the Meili investigation that exposed the cover-up of Swiss banks participation in laundering Nazi assets. It was the idea of the US Undersecretary of Commerce Stuart Eizenstadt, and was supported by British Foreign Secretary Robin Cook and the incoming Blair government.

The gold looted by the Nazis did not just come from central banks, but from individuals who died in concentration camps. The Nazis not only confiscated personal gold assets such as jewellery, but harvested gold from the teeth of their victims. It is generally believed that Germany had gone through its own gold reserves by the start of World War II, and gold possessed and sold by the Germans after 1939 was war booty. Neutral countries, including Portugal, Switzerland and Sweden, were used to sell looted gold.

A United States study undertaken three years earlier thanked the WJC and criticized Switzerland for banking gold during and after World War II presenting gruesome evidence that that some gold the Nazis sold to the Swiss had been taken from Holocaust victims.

“The Swiss were handling vast sums of looted gold” in trading with the Third Reich, said the long-awaited report, compiled by Stuart Eizenstat. The study further found that at least a small portion of the gold that entered Switzerland included “non-monetary gold” from civilians in occupied countries and from concentration camp victims. It became very clear that the bullion banked in Switzerland included some of the jewellery and even gold dentures were sold or smelted into gold ingots.

“This is about justice, not only for material but also moral restitution”.

Eizenstat recommended an international conference on the flow of Nazi assets after the war. Britain's Labour government offered to host such a conference and Switzerland agreed.

Robin Cook arranged for the meeting to be held in the “Moses Room” in the House of Lords, a magnificent venue with a mural taking up an entire wall showing Moses carrying the tablets down from Mount Sinai. I was there, together with then WJC Chairman, the late Mendel Kaplan. This historic international conference aimed at providing a measure of justice to Holocaust survivors. Addressing delegates from 42 nations, WJC President Bronfman, declared “we are not here talking about gold or other material assets. We are here in a resolute desire to make clear the truth, to ensure that history is written correctly or else we shall lose it. This is about justice, not only for material but also moral restitution”.

 Mendel Kaplan (1936-2009)

Mendel Kaplan (1936-2009)

Eizenstat, who headed the American delegation, urged the nations present to act within two years to bring closure to all issues related to the fate of Jewish assets lost during the World War II, saying “We must not enter a new century without completing this unfinished business”.

I sat in awe as these distinguished leaders addressed the conference. Over the following three days, we listened to documents detailing each country's response to Nazi Germany's systematic plundering of European banks and Holocaust victims' assets. Few nations emerged unblemished.

What we heard on the third day of the conference, as presented by Rabbi Henry Sobel from Sao Paulo, Brazil, shocked us all and the details will remain etched in my consciousness forever. Rabbi Sobel had accompanied the head of a bank in Rio de Janeiro to open safety deposit boxes of Germans who had fled to Brazil. This instruction had been given to all banks by the Brazilian government. In one box they found the following: $4000 USD, three false passports and a white envelope. Rabbi Sobel hesitated before continuing so as to wipe his tears away. The envelope contained gold dentures, which he held up for all to see. The Jewish world had always suspected this atrocity but here was the proof, smuggled to Brazil.

One of the tangible results of the conference was that the US and UK announced the creation of a new international compensation fund in recognition of debts owed to Holocaust victims. All 42 countries present, with the exception of the Vatican, agreed with this proposal.

At the close of the conference, Jewish officials praised all the countries that had participated reserving their criticism for Switzerland and the Vatican delegations, who had attended as observers rather than participants. Documents from the American archives contained charges that the Vatican played a significant role in handling looted gold. The Vatican delegation responded by saying their archives were sealed for 100 years.

Looking back on the two conferences that I was privileged to attend, I realize that I was at the coal face of not only Holocaust history but of events as vitally important for their symbolic value as for their concrete achievements.

[1] Born to first generation immigrants to Canada, Bronfman worked for the family distilled beverage firm Seagrams, later becoming its CEO. In 1981, he was elected President of the WJC, an international federation of Jewish communities formed in Geneva in 1936 in order to act as “the diplomatic arm of the Jewish people”.

[2] The security guard later lost his job and was forced to leave Switzerland.

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