The Disturbing Failures of the Swiss Bank Settlement

Writer James Smalhout, writing on Barrons.com website, shares background and a personal family perspective on the failings of the 1998 Swiss Bank ("Holocaust Assets Litigation") settlement. Smalhout points out inadequacies & inconsistencies in the court-supervised claims process, and is incredulous about the large amount -- well over a quarter billion dollars -- of settlement funds still undistributed to victims and heirs over a decade after the settlement between the banks and claimant lawyers was signed.

Smalhout sees the actual claimants as effectively voiceless -- locked out of the process. And his essay raises questions anew about the motives and legitimacy of those who led the campaign against the banks. It is unlikely, though, that his call for enlarging the settlement to more closely reflect the true extent of the theft by the Swiss banks will be heeded.

The real battle is over the use of the remaining settlement funds. That decision remains in the hands of U.S. District Court Judge Edward Korman in Brooklyn, and has turned into a disturbing and murky spectacle. Grassroots survivors seeking the immediate distribution of funds to address urgent medical and welfare needs of poor survivors living in the U.S., Israel and other countries are pitted against Jewish organizations with their own priorities and revenue needs, not all of which are in the best interests of needy survivors. Korman and his advisors have lately floated an idea designed largely to skirt the conflict over the remaining settlement pie -- recalculating awards and enlarging payments to claimants. It seems more like a political solution than anything else. The soaring rhetoric about Justice we heard back in 1998 feels like a distant, corrupted echo today.