$1.25 bn deal over banks' Nazi-period Jewish accounts greeted with relief

Israel gave a mixed reaction yesterday to a compensation accord with Swiss banks over dormant Jewish accounts from the Nazi era…

Israel gave a mixed reaction yesterday to a compensation accord with Swiss banks over dormant Jewish accounts from the Nazi era, with officials happy to close one chapter in the struggle for Holocaust reparations but survivors bitter over the years lost battling for justice.

"This is a little bit late. There are very, very few [survivors] still alive," said Ms Leesha Rose, a former member of the Dutch resistance who survived the Nazi death camps.

"The money is tainted, dirty and was held back for so many years. They should have been truthful and honest right away," said Ms Rose, who lost her mother, father and two brothers in the Holocaust.

Other survivors and their representatives welcomed Wednesday's deal, reached in a New York court, under which two Swiss banks will pay $1.25 billion compensation over three years to the holders of dormant accounts from the Nazi era or their heirs.

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"This really turns a wrong into a right. History is being rewritten," said Ms Jeanette Bernstein, the niece of a Holocaust survivor who was a plaintiff in the Swiss bank case.

The Israeli Prime Minister, Mr Benjamin Netanyahu, was "happy" that the dispute between the Jewish and Swiss peoples had been resolved, said Mr Bobby Brown, his adviser on affairs concerning the Jewish diaspora.

"There is no such thing as perfect justice, but the prime minister hopes - now that the economic aspect is being dealt with - the moral issues will come to the fore," he said.

The state and city governments of New York said yesterday they were cancelling planned sanctions against the Swiss banks. The sanctions, scheduled to go into effect on September 1st, were announced previously in a campaign led by the city comptroller, Mr Alan Hevesy, and the state comptroller, Mr Carl McCall.

"I have spoken to the four other members of our monitoring committee and we agree that in response to this historic agreement with the Swiss banks, we will drop our programme of sanctions," Mr Hevesy said.

Under the agreement, an initial payment of $250 million will be followed by three annual payments of $333 million to settle all claims by the survivors of Nazi atrocities against Swiss banks, industry and government.

Mr Ephraim Zoroff, director of the Jerusalem branch of the Simon Wiesenthal Center, which pursues Nazi war criminals, welcomed the accord but added that in his view it was "more important to bring Nazi criminals to justice than to compensate economic crimes".

Mr Zoroff also expressed concern about where the $1.25 billion would go, arguing in favour of aid to survivors living in poverty in eastern Europe and to education programmes about the Holocaust.

The agreement caps months of arduous and often acrimonious negotiations between the two sides. Swiss banks have been the target of stinging attacks by Jewish groups and some US politicians for over two years.

Switzerland has also been reeling from criticism that it helped bolster the Nazi war effort by acting as banker and broker for Nazis.

As a result, anti-semitism in the country has rekindled, according to the local Jewish community.

"I am pleased and relieved that such an agreement has been able to take place," Mr Rolf Bloch, president of the Swiss Federation of Jewish Communities, said.

Mr Bloch said he had been worried that anti-semitism would be a lasting sentiment. The atmosphere "became more poisoned" the longer the attacks dragged on, he said. "In the United States and Switzerland we have some work to do," to mend relations, but "at least the conditions are now there that we can undertake it".

He stressed however that the "moral" issue "should not go away."

Not everyone yesterday welcomed the New York settlement.

Many Swiss thought they were being unfairly persecuted by foreigners for events that happened more than half a century ago when many of them had not even been born.

. A major Swiss insurer, Zurich Insurance Co, agreed yesterday to honour the outstanding life and property insurance claims of Holocaust victims.