UBS Under Pressure Over Nazi-Related Accounts
UBS, the Swiss banking giant, is facing increasing pressure from a bipartisan pair of U.S. senators and a billionaire Trump donor to provide a full accounting of Nazi-related accounts at its predecessor bank Credit Suisse. Amid allegations of a cover-up and as UBS seeks to expand its U.S. wealth management operations, it finds itself in a delicate political situation in Washington. Neil Barofsky, an independent ombudsperson of the law firm Jenner & Block, is expected to file his final report on the matter later this year.
Two top UBS executives are set to testify before a U.S. Senate panel that is pushing for a complete historical examination of Nazi-related accounts from the Holocaust era. The hearing marks a milestone in a six-year effort, championed by Sens. Chuck Grassley, R-Iowa, and Sheldon Whitehouse, D-R.I., as well as U.S. Jewish leaders, to reexamine the role that Swiss banks played in the Nazis’ theft of European Jews’ assets.
The Stakes for UBS
The stakes are high for UBS, which has incentives to stay in the good graces of the U.S. government. The Zurich-based bank is seeking a national bank charter from federal regulators as it aims to grow its already significant U.S. wealth management business. At the same time, U.S. officials face pressure from Ronald Lauder, President of the World Jewish Congress and a close associate of President Donald Trump, to restrict UBS’ access to the U.S. market until a full accounting of Nazi-related accounts is provided.
The Investigation into Credit Suisse
The scheduled Senate Judiciary Committee hearing witnesses include Rabbi Abraham Cooper, director of global social action at the Simon Wiesenthal Center, which fights antisemitism and made a significant investigative breakthrough on Nazi-related accounts in 2020. This led to an internal examination of Nazi activity at Credit Suisse, which was sold to UBS under emergency circumstances in 2023. The review that Credit Suisse began has continued at UBS with Neil Barofsky overseeing the investigation.
The UBS executives on the Senate panel’s witness list are Barbara Levi, the Swiss bank’s general counsel, and Robert Karofsky, who serves as the company’s co-president of global wealth management and president of UBS Americas.
Historical Examination and Political Implications
UBS faces a particularly delicate political situation due to the checkered relationship between Credit Suisse and the bipartisan pair of senators who have been pushing for a thorough examination of Nazi-related accounts held in Switzerland. The situation was further complicated in 2023, following the release of Barofsky’s interim report, which revealed new information about Nazi-linked accounts at Credit Suisse. However, since then, Barofsky has had a less contentious relationship with the bank.
‘We Settled. And it Sat with Me.’
The question that looms over the ongoing historical research is what, if anything, will come of it. In 1998, Swiss banks reached a $1.25 billion settlement in litigation brought by Jewish community groups over accounts belonging to victims of Nazi persecution. This was widely thought to be the end of the matter. However, advocates for revisiting the settlement argue that the 1999 agreement was signed by Jewish community organizations, not the actual victims and families, and that the large majority of surviving accounts were left outside any independent review.
‘Finding the Truth as Best We Can’
In 2020, the Simon Wiesenthal Center announced the discovery of “a list of some 12,000 names of Nazis in Argentina, many of whom had contributed to one or more bank accounts” at a Credit Suisse predecessor. Credit Suisse committed to “finding the truth as best we can,” but its efforts have seen a number of challenges.
‘There’s a Playbook … it Just Needs to be Turned On’
Grassley and Whitehouse have vowed to be dogged in pushing for a full examination of stolen World War II-era money in Swiss banks. Andrew Adams, a former high-level DOJ official with experience in national security, money laundering, and sanctions enforcement, believes American law-enforcement power can be used in connection with Nazi-related accounts.
‘Justice Through Restitution’
Donald Trump’s return to the White House a year ago gave Ronald Lauder an opening he didn’t have during the Biden administration. Lauder has reportedly known Trump since the two attended the University of Pennsylvania’s Wharton School in the 1960s, and after Trump entered politics, he became a big Trump donor.
‘Unfortunate Situation for Switzerland, UBS, and for the U.S.-Swiss Bilateral Relationship’
The attention on Swiss banks’ activities during World War II marks a turnaround from the first Trump administration. According to the U.S. ambassador to Switzerland from 2017 to 2021, Ed McMullen, the issues around Nazi-era bank accounts were considered well-resolved.
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