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See http://www.swissbankclaims.com/pdfs_eng/Schoenberg_E_RandolENG_0076_075.pdf

Holocaust survivors ask why justice has taken so long

The epic litigation between Holocaust survivors and the Swiss banks that allegedly blocked them from their accounts will reach what could be its final public hearing at a Brooklyn court today, almost eight years after the first lawsuit was filed there.

Survivors from New York and Israel are planning a protest outside the hearing, a stark contrast to the joy of August 1998 when they flocked to the courthouse to celebrate the news that UBS and Credit Suisse would pay $1.25bn (698m) to settle the claims against them.

The change of mood demonstrates the bitterness that has built up as Judge Edward Korman and a team of lawyers and historians have grappled with the impossible task of doing justice almost 60 years after the second world war.

To date, just $593.5m has been paid out. The rest is earning interest in a court-controlled bank account.

Two questions cause bitter disagreement. Why has the pay-out taken so long, and what should be done with any money left over?

The problem lies in matching claimants to accounts for which little or no documentation remains. The bulk of the settlement - $800m - was set for account-holders, as their case was stronger than those of others, such as victims whose goods were looted and possibly laundered through Swiss banks. Plaintiff lawyers criticised this figure when it was set by the court, saying it was unlikely so much could be matched to claimants.

Their doubts appear confirmed. The tribunal under Paul Volcker, former Federal Reserve chairman, to adjudicate claims to the accounts has disbursed only $154.4m, to fewer than 2,000 of the 33,496 claims.

In March, Judge Korman accused the banks of "frivolous and offensive objections" to the distribution process, and of "systematically" destroying documents, to make it harder for survivors and their heirs to reclaim their money.

He concluded: "The truth appears to be that the banks fear the embarrassment that will come from further access to accounts, deeper probing into their history, and further successful claims by Nazi victims and their heirs."

The banks reply that they have complied with the conditions set by the court.

In 2000, the judge accepted that the banks would publish the names of only 21,000 accounts identified by Mr Volcker as "probably" belonging to Nazi victims, without publishing a further 15,000 accounts "possibly" linked to the Holocaust.

The banks say the number of "probable" and "possible" accounts was reached using implausible assumptions, and publishing more names would create false hopes and further delays.

The banks have unlikely backing from Leo Rechter, head of the National Association of Child Holocaust Survivors, who said it had been "stupid" for the court to agree to publish so few names.

He said: "Now all of a sudden they realise that they will not be able to distribute all the money, and so they are blaming the Swiss. But the Swiss have stuck to the bargain the court accepted."

Mr Rechter, with other survivors' organisations, says the judge should admit that less than $800m will be found, and start distributing the residue to needy survivors now.

However, new research by the tribunal suggests $600m more could still be matched to claimants - a finding that could ironically enrage survivors, as it implies there might be no residue.

Others argue that it would be wrong to touch the money until efforts to track claimants have been exhausted. Randol Schoenberg, a Los Angeles lawyer for claimants, said those seeking to redistribute the money had a "Robin Hood character to their goals. They seek to take money that was held by once wealthy Jews and redistribute it to poor and needy Holocaust survivors."

On Thursday, the court will hear responses to its proposal to resolve the impasse, prepared by Judge Korman's "special master", former judge Judah Gribetz. Since the court launched consultation last October, he has received more than 100 proposals, ranging from tracing homosexual victims, to paying for survivors in the former Soviet Union to be circumcised.

Mr Gribetz's closely argued report does not recommend a redistribution of funds at this stage. If there is a residue, he says, the priority should be food aid for survivors in the former Soviet Union, who suffer worse poverty than their counterparts in the US and Israel. It is as good a response as any to an impossible moral dilemma, but it will not dim the anger of the protesting survivors.

(source and copyright: Financial Times)