Friday, August 21, 1998 Published at 17:20 GMT 18:20 UK
Swiss banks dodge sanctions in Holocaust deal
Jewish gold: stolen by the Nazis, stashed in Swiss bank vaults
Swiss banks have agreed to compensate Jewish victims of the Nazi holocaust - narrowly avoiding sanctions from some US states.
Three of the country's leading banks struck a deal with representatives of Holocaust survivors whose stolen money and assets ended up in Switzerland's vaults during the Second World War.
The deal with the World Jewish Congress will lead to a major programme of compensation as the banks finally hand over secret records of war-time accounts.
The agreement came as some US states prepared to bring sanctions against the Union Bank of Switzerland, the Swiss Bank Corporation and Credit Swisse in an effort to force them to pay up.
"[The banks] have clearly committed to engage in a process with the hope of a settlement," he said.
The Nazis stashed millions of US dollars worth of assets, gold and bonds belonging to Europe's Jews in Swiss bank accounts during the war.
That wealth has remained hidden for 50 years but Jewish groups say the banks acted immorally by using the cash to build up their own assets.
A question mark still hangs over looted art works, insurance bonds and other assets such as estates.
Jewish groups have lodged claims totalling £20 billion against the banks. The two sides meet again on April 24 to negotiate the final amount to be paid out.
Claims will go through a "rough justice fund" which will mediate between Jewish groups and the banks. The fund will be merged with another $200m (£120m) fund aimed at needy Holocaust survivors.
A US judge will then use the commission's findings to administer agreements struck through the justice fund.
In a joint statement, the banks said they wanted to reach "an honourable and moral conclusion through a global resolution of Holocaust-era issues directly related to our banks."
Israel Singer, secretary general of the World Jewish Congress, said he did not expect an immediate transfer of assets.
California state Treasurer Matt Fong, a key figure in the dispute, said the banks had only recognised their responsibility under the threat of sanctions.
"There was little progress until we held the Swiss banks accountable and applied pressure," Mr Fong said. "The pressure brought the banks to the table, committing [them] to a global settlement."