The settlement in the US by Swiss banks to compensate wartime Jews could fuel action in the UK, reports James Boxell.
The billion-dollar legal action in the US brought by 31,000 Holocaust survivors and their relatives against several Swiss banks has finally been brought to a close.
The $1.25bn (£800m) settlement agreed by Union Bank of Switzerland AG and Credit Suisse Group has averted the threat of sanctions against the banks from US states and has been welcomed by Jewish groups around the world.
This welcome is likely to be accompanied by a huge sense of relief considering the fact that the settlement figure is more than twice the banks' previous “best and final offer” of $600m which was seen at the time as “derisory” by Jewish organisations and their lawyers.
Ed Fagan, the prominent New York lawyer spearheading the 31,000-strong class action, maintains that the $1.25bn settlement is nowhere near enough compensation for the Jewish loss of gold, property and bank accounts, but concedes that it is all his clients will see: “It is all we are going to get, but it is not enough.”
While early signs indicated that the US action would have little impact on the UK claims process, the situation appears to have shifted in the light of what many see as a successful US group effort. Talks are already under way to establish a single entity in the UK to co-ordinate all enquiries regarding restitution claims.
Chairman of the 3,500-strong Association of Jewish Refugees – the leading UK charity in its field – and Fladgate Fielder partner, Andrew Kaufman, says: “At the moment there are about eight, 10 or 12 different organisations dealing with restitution claims in the UK and they are not quite going in the same direction.”
But, according to Kaufman, things may soon change significantly. “There has already been an initial meeting involving as many of the organisations as possible,” he says. “It's still early days but we are definitely seeing a move towards far greater co-ordination.”
Kaufman says the co-ordinated effort is bound to include prominent lawyers and law firms working on restitution claims. “I'm sure we will try to co-ordinate the legal effort,” he says. “We don't want survivors incurring huge legal costs.”
Kaufman says his own firm could be involved and that John Rhodes, a Pritchard Englefield partner who has represented over 200 Jewish restitution claimants, is another likely candidate. Both Kaufman and Rhodes are offspring of Jewish refugees from Germany.
The move towards a UK group effort has undoubtedly been influenced by US events, according to Kaufman. “The US settlement is the result of co-ordinated pressure on governments and banks,” he says. “It shows that pressure works. It isn't so much that it directly affects UK survivors, more that it raises the profile of claims and expedites things. People are actually realising they can do deals.”
Kaufman feels that UK claims have so far taken far too long. “It's similar to the Government's approach to compensation for the former POWs mistreated in Japan,” he says. “Every year their numbers dwindle. The average age of our members is 85. We can't wait much longer.”
Rhodes agrees that the US settlement will have a significant effect in the UK. “I don't think individual lawyers will be involved much in distribution of funds from the US,” he says. “This will more likely be through the various Jewish organisations.
“But,” Rhodes says, “many people have been watching the US before going ahead with claims. I think Andrew is right in saying we should see greater future co-operation.”
Rhodes doubts the UK will see any class action suits similar to the one in the US but believes the breakthrough settlement has undoubtedly strengthened the position of British restitution claimants.
“At the moment it's a question of waiting for the dust to settle and seeing what our options are,” he says. “But it is a very helpful milestone to have passed. The Swiss will no longer be able to deny that they were culpable.”
Izabella Stankowski, who deals with restitution claims at West End firm Edmonds Bowen & Co, says the US action has lead to a huge upsurge of interest from potential UK claimants. Stankowski took over much of the firm's restitution work from Hans Marcus – one of the world's leading experts on Jewish restitution claims – after his death last year.
“People read the articles and this sparks their interest,” says Stankowski. But, she says many claimants “bob up with extremely vague knowledge” which makes the tracing of misappropriated assets almost impossible.
Stankowski says the layers of Swiss bureaucracy make claims “unacceptably” slow to process. “Many of these claims began 15 years ago and new claimants are faced with huge delays,” she says.
But with the renewed sense of vigour finding its way here from the US, perhaps Jewish claimants in the UK will have a greater chance of retrieving some of their long-lost assets after all.