How CS Mishandled New Nazi Account Allegations
Let’s go back to the origins of this new controversy. In March 2020, the Simon Wiesenthal Center, a lobbying organization, presented Credit Suisse with a list of 12,000 unionized workers from German firms in Argentina after World War II.
The Simon Wiesenthal Center is well known for its relentless pursuit of Nazi criminals. During the 1996-1999 investigations, it gained notoriety for publishing historical reports with outrageous but completely false allegations against Switzerland.
It now claims that the names on the Argentina list belong to Nazis who enriched themselves during the Nazi era by expropriating Jewish assets and later transferred these funds to accounts at the Swiss Bank Corporation.
I haven’t seen the Argentine lists myself. However, it’s well documented that many Nazis fled to Argentina, transferring funds there—though not via Switzerland, as it was never a safe haven for Nazis. In Germany, it was well understood that Switzerland had no sympathy for National Socialism or Hitler’s henchmen. The Bergier Commission and the Volcker Committee analyzed similar lists extensively, even producing a detailed special study that found little concrete evidence, despite having access to all records. Therefore, I’m not overly concerned about these so-called new lists.
Faced with this list, Credit Suisse engaged the American forensic firm AlixPartners to investigate the allegations. Former prosecutor Neil Barofsky was appointed as ombudsman for the investigation.
In my view, Credit Suisse and its Swiss attorneys reacted incorrectly. From the beginning, they should have referenced the 1998 settlement and the thorough investigations of the Volcker Committee and Bergier Commission. Instead, they made the mistake of opening the door to some sort of «Holocaust industry,» the Wiesenthal Center, and US attorneys and agencies.
At a significant cost, no less. The Bergier Commission managed with a budget of 20 million Swiss francs ($21.9 million), while the Volcker Committee’s costs were about ten times that. The new investigation under Barofsky is estimated to have already cost 100 million francs.
Those who fail to learn from crises are doomed to repeat them. Credit Suisse initially responded poorly and failed to rely on the comprehensive findings of the 1996-1999 investigations and the 1998 settlement. They allowed opportunists to profit from the Holocaust’s tragic history even 80 years later. The most disheartening part is that none of these millions benefit the remaining Holocaust survivors.
«Switzerland can now approach the new US administration to seek goodwill»
Barofsky has virtually unlimited access to the Credit Suisse archive and frequently flies in with dozens of advisors from the US.
This scenario isn’t new. In the 1990s, American advisors from major auditing firms scoured Swiss archives. All the documents were naturally in German, French, or Italian—languages the US advisors didn’t understand, necessitating translations that drove costs sky-high. The Volcker Committee alone likely cost Swiss banks about 300 million francs for auditing, with additional equivalent internal expenses for the banks themselves. Today, similar tendencies are resurfacing as US advisors navigate Switzerland’s wartime archives.
For him, it’s a paradise: unrestricted budgets and freedom to pore over every document multiple times...
That’s every consultant’s dream. Swiss bankers made a similar mistake in 1996 and 1997 when they underestimated the costs of the Volcker Committee, initially estimating it would cost 5-10 million francs. They didn’t account for the ingenuity and greed of Swiss and US attorneys and auditors. The financial toll of these investigations, conservatively estimated, reached 3.5 billion francs—equivalent to Switzerland’s annual defense budget at the time.
So far, the Barofsky investigation has yielded modest results. According to his interim report to the US Senate Budget Committee, about 30 previously unknown Nazi accounts have surfaced.
If they’ve surfaced at all... During the Bergier and Volcker investigations, names like Rudolf Hess or Erich Müller occasionally appeared in the records. While Hess was one of the 24 defendants at the Nuremberg Trials, the name Rudolf Hess appeared 30 times in Swiss phone books from the 1940s, and Erich Müller hundreds of times. These accounts could belong to entirely innocent individuals. The real question is: What defines a Nazi? Millions of Germans were members of the Nazi Party, but only a fraction were convicted war criminals. I’m not convinced these newly discovered accounts belong to Nazi perpetrators.
Read on the next page for Thomas Borer’s recommendations to UBS and insights on US politics.
