After harrowing probes in the 1990s, Swiss banks thought they’d come to terms with their WWII-era ties to Nazis. But WSJ’s Margot Patrick explains how documents newly unearthed from bank archives include shocking revelations. Further Reading: -Nazi Ties to Credit Suisse Ran Deeper Than Was Known, Hidden Files Reveal Further Listening: -What Just Happened at Credit Suisse? -The Financial Legacy of the Nuclear Tests on Bikini Atoll Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What were the historical ties between Swiss banks and Nazis?
In 1998, two Swiss banks, UBS and Credit Suisse, came to an agreement to settle claims that had their roots in World War II and the bank's historic ties to Nazis.
Chapter 2: What was the significance of the 1998 settlement?
That we've reached an historic agreement. with the Swiss banks that will bring moral and material justice to those who have suffered for so long and bring closure on these issues.
The banks agreed to pay over $1 billion to descendants of Jewish account holders. It seemed like this was the end of a decades-long fight for accountability. Here's our colleague, Margot Patrick, who covers Swiss banking.
So at that point in time, I think a lot of the parties involved felt like this is it. A line has been drawn. We're going to move past this. And certainly that was how the Swiss banks felt. And that agreement in 1998 was also endorsed by more than a dozen Jewish organizations. So it really was like everyone who had been sort of around the table on this had agreed, okay, let's do this settlement.
And this will kind of put an end to it once and for all. But of course, not everyone felt that way.
Chapter 3: What new revelations have emerged about Credit Suisse?
But that settlement didn't turn out to be the end. Last month, a new probe into Credit Suisse surfaced some shocking revelations about the bank's ties to Nazis.
There was a Swiss lawyer who was known for cloaking Nazi transactions, and that person had several accounts at Credit Suisse. There was a relationship with a German manufacturer that used slave labor from concentration camps, and that manufacturer opened an account at Credit Suisse during the war. There were entities run by the SS that were opening accounts during the war.
These new findings are raising doubts about the bank's transparency.
And so there's this feeling that this period of time hasn't been fully studied, that there hasn't been a full sense of accountability. And so I think people want to get more transparency. There's still a sense amongst many families, many Jewish organizations, many people,
of people who otherwise suffered at the hands of the Nazis, that there wasn't a full reckoning of some of the activities in World War II, and that the Swiss banks perhaps were more complicit than people had thought.
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Chapter 4: How did the Simon Wiesenthal Center contribute to the investigation?
Welcome to The Journal, our show about money, business, and power. I'm Kate Leinbach. It's Wednesday, January 15th. Coming up on the show, the relationship between Credit Suisse and the Nazis.
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After the big settlement in the 90s, some organizations kept investigating the Swiss banks. One was the Simon Wiesenthal Center.
Simon Wiesenthal was a Nazi hunter. He was a survivor of the Holocaust. And so the Simon Wiesenthal Center, their mission is really to teach the world about the Holocaust.
But finding out more about the ties between Credit Suisse and the Nazis was hard, in part because of Switzerland's particularly strict laws, which protect the identities of bank account holders.
The Simon Wiesenthal Center was looking at bank accounts that were attached to Nazis and Nazi entities, Nazi affiliates. So say like a holding company that was furthering the Nazi aims for industry that would maybe own a bunch of companies. And some of those companies might have come from Jewish owners that they'd been taken over. So they had these sort of new leads on Nazi linked accounts.
that they studied themselves for some time, and so they shared that with a bank in 2020. And Credit Suisse, to its credit, said, yeah, we want to look into this.
But looking into something so old was a monumental task. A lot of records had been destroyed, and much of what was left was handwritten and sitting in rows and rows of boxes in warehouses.
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Chapter 5: What challenges were faced in investigating historical records?
And it's a huge task to really look at everything.
In 2021, Credit Suisse hired a former U.S. federal prosecutor to head up an in-house investigation. His name was Neil Borowski. And Borowski started finding a lot of new leads.
And so this investigation was producing a lot of information because the last time anyone had really looked was in the 1990s and the technology is a lot better now to process information. And so a lot of leads were coming up.
So what does Borowski find?
What he started to find was that many of these leads were strong, that the Simon Weisenthal Center had given to the bank, that there were some new Nazi clients that hadn't really been found before. So he's finding a lot, and he's finding that the more he looks, the more he finds. And something else he started to find was internal information at the bank about those 1990s investigations.
What kind of information? There was information in those sort of working papers from the 1990s that indicated the bank did know about certain clients, that the bank was aware of certain connections with Nazi affiliates or Nazi-related companies that hadn't been disclosed before. And so he was pursuing that investigation, and then he got fired from the job by the bank.
Why did Credit Suisse fire him? So Credit Suisse fired Neil Brofsky. Some of the executives who were at the bank at the time felt like he was kind of overstepping the bounds of what he was there to investigate. So whilst the Simon Wiesenthal Center had given them lists of names and facts, he was finding even more. He was finding indications about their disclosures in the 90s.
And so it was becoming a bit open-ended. He was finding so much that some executives within the bank were concerned that this is going to take forever and cost a ton of money and what's going to come out of it.
Borowski may have been fired, but he didn't stop working. That's after the break. Even though Credit Suisse had fired Neil Borofsky, Borofsky didn't stop working.
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Chapter 6: What did Neil Borowski discover during his investigation?
After he finished his report, Borofsky handed it to Credit Suisse. And that would have been it. Except a U.S. Senate committee heard about the report and subpoenaed a copy. In early 2023, the U.S. Senate Budget Committee made Borofsky's report public. Here's Senator Chuck Grassley sharing some details on the Senate floor.
The reports revealed new information, including nearly 100, and let me emphasize 100, previously undisclosed Nazi-linked accounts. Some accounts remained open as recently as the year 2020.
So this is where things started to kind of get out of the bank's hands because the bank had, you know, essentially been trying to silence these findings and this report.
At the same time, Credit Suisse had been continuing its investigation without Borowski, and it produced a report of its own.
And the reports were pretty different because the Neil Brofsky report was 205 pages. It had a lot of information about what he'd found. Credit Suisse report was much shorter. And the Credit Suisse position was essentially, OK, he did find some things, but this doesn't really move on the historical record. It's pretty much what we knew already.
At the same time, in March 2023, Credit Suisse collapsed and was taken over by rival Swiss bank UBS. Months later, UBS decided to rehire Borowski so he could finish his work.
And he gets dug in again with a team. UBS devoted resources to it. So there was something like 50 or more people working on this. And Neil Brofsky was also able to hire his own forensic accountants and his own historians and so forth to really sort of look at their work that was being done. So at this point, he had sort of fresh support for his efforts there.
And he also had the Senate Budget Committee behind him saying, please leave no stone unturned.
Now, with a bigger remit and more resources, Borofsky turned up a lot of new information.
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Chapter 7: Why was Neil Borowski fired by Credit Suisse?
The American Blacklist. This was a list kept during World War II of people who the U.S. government and its allies wouldn't do business with.
So this was a designation given to Nazi entities or other Axis powers during the war that the U.S. and its allies were aware of or suspected were financing or trading with the Nazis. And so this is a designation that seems really important to look into.
Those files could have been revealed during that earlier investigation in the 90s, but they weren't.
So they haven't investigated or they haven't fully probed all of these files. That's the work that's going on right now is to understand the significance of the people that had that blacklist, that were on the blacklist, had that stamp on their files, to really understand what they were doing and how that might fit in with the investigation.
Last month, Borofsky released some of his newest findings.
So Borofsky told senators that the investigation uncovered scores of individuals and entities who were linked to Nazi atrocities and that these either hadn't been identified before or the full nature of Credit Suisse's involvement hadn't ever been reported publicly. The investigators also find accounts for several hundred alleged Nazi intermediaries, such as lawyers.
And these are people who had helped the Nazis hide gold or loot Jewish assets or just generally support the war economy under the Nazis. But these are the new leads that Borowski and the investigators are pursuing now. Borowski also found information that the bank hadn't disclosed before about a specific account that other researchers had identified years ago, back in the 1990s.
So this was an account controlled by two SS officers and a Swiss intermediary. And so Credit Suisse in the 1990s had told one of the commissions looking at this issue that it couldn't find any information about this account. But Borowski found that the bank did know about the account. It had documentation in its files in those 1990s reviews.
So this account is important because this Swiss intermediary could have kept sending cash to the Nazis after the war ended, since it was in the name of a Swiss person. And that's the kind of question that Borowski is looking at now, like whether that happened or not, and what happened with some of these assets and with some of this money.
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