London (CNSNews.com) - The Swiss National Bank is facing a new legal challenge arising from its conduct during World War II, this time from non-Jewish victims of the Nazis in the Balkans and former Soviet Union.
Lawyers in California this week filed a class action lawsuit against Switzerland's central bank on behalf of more than 12 million Nazi victims, whom they claim were unfairly excluded from a "flawed, historically inaccurate, and lopsided" $1.25 billion agreement reached between Swiss banks and Jewish groups in 1998.
The Swiss National Bank was covered by that settlement, which was supposed to protect Swiss banks from any future class action suits. Elderly Jewish Holocaust survivors will benefit from the agreement.
The lawsuit in U.S. District Court in San Francisco accuses the bank of laundering hundreds of millions of dollars' worth of gold looted by the Nazis between 1941 and 1945.
The transactions prolonged the war by providing Nazi Germany with much-needed foreign exchange to keep its war effort going, lawyers Jonathan Levy and Tom Easton claim.
"Much of the victim gold and silver collected from concentration camps, forced laborers, and occupied territories was sent to Berlin for reprocessing, deposited in the German State Bank and then exchanged through the Swiss National Bank and other Swiss banks for hard currency," they said.
"The Nazis then used the hard currency to buy vital war materials from neutral countries."
In effect, the Swiss action helped prolong the war, Levy and Easton added.
"The dealings with the Germans and their Axis partners were apparently so profitable that the Swiss continued the practice through April 1945, despite warnings from the Americans and British that they were dealing with genocide-tainted gold."
The defendants had "unlawfully and unfairly" profited for more than a half-century since the war ended.
The lawyers argue that the 1998 settlement between Swiss banks and Jewish organizations was discriminatory.
"The previous deal is a travesty," Levy said in response to queries. "The Swiss should
have known better and have only themselves to blame. Perhaps they were thinking that no lawyer would contest the issue.
"The organizations I represent, stand for the principal that all victims of fascism
are brothers, therefore why are some entitled to preference over others? Without the sacrifices of the people of the Soviet Union and Yugoslavia, there would have been no survivors, because Hitler would have won in Europe."
The groups suing represent hundreds of thousands of concentration camp survivors, slave laborers, partisans and other victims of the Nazis. Between five and seven million civilians died in the Ukraine, another two million in Russia, and some 1.5 million in what is known today as Yugoslavia and in the former Yugoslavia.
A group of Swiss experts, the Bergier group, estimated that the Swiss National Bank handled between 1.6 and 1.7 billion Swiss Francs worth of gold from the German central bank (Reichsbank) during the war.
The San Francisco lawsuit seeks compensation of 200 million Swiss Francs ($120 million).
"Of the $1.25 billion settlement, $100 million has been set aside for looted assets for Jews and Gypsies. Should not equal amount be set aside for the 12 million plus non-Jewish victims?" Levy asked.
According to the Swiss banks settlement, those entitled to a claim must fall into five classes. Four comprise "victims or targets of Nazi persecution" and their heirs, targeted because they are Jewish, Romany, Jehovah's Witness, homosexual or disabled. The fifth class is anyone, whether or not falling into the earlier category, who was forced into slave labor.
Levy said courts in the U.S. have already made it clear non-Jewish victims of the Nazis not covered by the agreement are free to file their own lawsuits.
In response to queries faxed to Zurich, Swiss National Bank spokesman Werner Abegg said the bank was a public institution and so expected any lawsuits to be transmitted through official government channels, such as embassies and finance ministries.
Failure to do so would leave any lawsuit legally invalid, he said.
Asked how the bank would respond to such a lawsuit in light of the 1998 global settlement, Abegg referred to an earlier bank statement.
It said the bank would oppose any class action cases brought in American courts, as it contested the competence of U.S. courts in cases involving a sovereign central bank. "An out-of-court settlement does not enter into consideration," it added.
Easton and Levy earlier this year filed another suit against the Swiss National Bank, the Vatican Bank and Franciscan Order for allegedly laundering gold stolen from victims of the Nazi's puppet regime in Croatia, the Ustasha.