Good morning. I would like to thank Chairman D'Amato, Senator Sarbanes and members of the
Committee on Banking, Housing and Urban Affairs for providing us with this opportunity to
examine the role of Swiss banks and their historic and current treatment of assets of Holocaust
I appreciate the thoughtful comments of Deputy Secretary Eizenstat and the hard work he has
dedicated to the issue at hand. I respect the international diplomatic process, and I share the State
Department's goal of cooperative international relations. I have no desire to take actions that
might be counter to this goal.
However, I respectfully disagree with the State Department's opposition to sanctions against the
Swiss government and the Swiss banks. The agony of the Holocaust continues to this day, as
heirs to the victims and survivors are unable to reclaim their rightful assets. For more than fifty
years, they have patiently tried to work within the system to get the monies and material
possessions that are rightfully theirs. Today, they are exhausted; their patience is spent; and they
are rapidly running out of time. They need restitution now. And it appears that the only way to
accomplish that it to take extreme action.
Sanctions are extreme actions. I do not want to impose them. But I will do so if a settlement is not quickly reached, knowing we are on the right side of the moral plumb line, and knowing, too, that we have no choice but to be extreme in our quest for justice.
This issue is of great importance to me, and I have examined it from a variety of perspectives.
As Comptroller of the State of New York -- home to more Holocaust survivors than any place
other than Israel -- I am the State's chief fiscal officer. I am also sole Trustee of the State's $107
billion Common Retirement Fund and administrator of the largest State Abandoned Property
Office. Previously, I have been a banker, and have served as a United States ambassador to the
United Nations. But perhaps most importantly, I am a citizen of the United States, with a deep
and abiding commitment to justice for all people of the world.
The restitution of Holocaust assets is an issue that concerns all of us. No matter who we are or where we come from, we know that the Holocaust was a terrible chapter in the history of civilization. We know that we can neither forget nor forgive the injustice that resulted in the slaughter of millions of innocent people and the destruction of family, home and property for millions of survivors.
For the past two years, I have worked with others to bring about some appropriate restitution. I
want to thank Edgar Bronfman and the World Jewish Congress for bringing this issue to our
attention and for their tireless efforts to ensure that assets are restored to their rightful owners.
Restitution efforts have focused on the Swiss financial institutions because records indicate that
they helped Nazi Germany convert stolen gold into foreign exchange which was then used to
purchase war supplies. Also, the commercial banks held -- and continue to hold -- deposits from
people who died in the Holocaust. We have been concerned that the banks have not made a good
faith effort to restore the monies to rightful owners, nor have they expedited a global settlement
with Jewish groups and with Holocaust victims and their heirs.
At various times last year, I directed my staff to take actions intended to encourage the banks to
negotiate a settlement. For a brief time, I stopped the State's overnight investments in Swiss
banks; and I also barred business with one bank that had publicly indicated it was unwilling to
In December 1997, I joined New York City Comptroller Alan Hevesi and other members of the
Executive Monitoring Committee in a moratorium against sanctions. We were encouraged by
the words of the Swiss bankers and by Deputy Secretary of State Stuart Eizenstat, and believed
that a moratorium would facilitate the negotiating process.
In March 1998, we met with all parties involved in the process. Although we were disappointed
that there was still no settlement, we were again convinced that there would be a prompt
settlement, and we extended the moratorium.
Earlier this month, however, it was clear that there was no possibility of a prompt settlement and
that, in fact, the Swiss government had made a settlement virtually impossible with its refusal to
participate. This was contrary to everything we had been led to believe in the past six months. I
and the other members of the Executive Monitoring Committee were disappointed, angry and
frustrated. We had no choice but to lift the moratorium.
Comptroller Hevesi and I have announced a series of graduated sanctions, and legislation to
support them has been introduced by Speaker of the New York State Assembly Sheldon Silver. I
will begin the sanctions, on behalf of New York State, on September 1st if there is still no
settlement. They are as follows:
The decision to impose sanctions was not easy. But, I believe it was thoughtful, measured, and
informed by comprehensive discussions with all parties involved. The plan that I have outlined
is prudent, and it offers the Swiss a generous timetable.
The Monitoring Committee has been criticized for its decision to lift the moratorium on
sanctions. The Swiss government and several Swiss companies have threatened to impose their
own sanctions against us. And, as we have heard, the United States State Department has
publicly suggested that sanctions may delay further the settlement process and may call into
question the openness and attractiveness of American financial markets.
I am concerned about these criticisms, and I sincerely hope that I do not have to begin to
implement sanctions on September 1st. But I am prepared to do so -- because the repeated
failure of the Swiss government and the Swiss banks to do the right thing has forced our hand.
In the face of egregious wrong, people of good will have no choice but to take a moral stand. Although we respect the State Department's desire to use the diplomatic process, in this case, time is not on our side. The average Holocaust survivor is 81 years old. They do not have time to wait for a process that may or may not collapse again. They have already waited 50 years. While no amount of money or material goods can ever compensate for the atrocities they suffered, we can help them obtain whatever peace and satisfaction that a rough justice restitution may provide.
This is not the first time that state and local governments have determined that morality and
justice require the imposition of sanctions. A mere decade ago, the United States State
Department prevailed upon state and local governments to refrain from sanctions against
companies doing business in South Africa. Nevertheless, many localities and institutions
decided they had a moral obligation to use their leverage to dismantle the system of apartheid,
and a significant number imposed economic sanctions despite State Department opposition.
I have been to Capetown; I have seen Nelson Mandela sitting in the Presidential office; and I
have heard him say that without sanctions -- without visible and painful, economic pressure from
the United States -- he would not be in that seat and, in fact, his nation would not have
experienced a peaceful transition to democracy.
I hope the federal government will not pressure those localities that follow the course of action
the Monitoring Committee is recommending. Instead, that pressure should be directed at the
Swiss government -- to encourage them to come to the negotiating table and make rightful
restitution to the heirs to victims and survivors of the Holocaust.
This morning I respectfully ask the United States government to support our efforts to obtain restitution for the innocent victims of one of the greatest horrors the world has ever seen. I ask all citizens of the United States -- all people of good will -- to help us rise to the challenge of the prophet Amos -- a challenge that was often echoed by the Rev. Dr. Martin Luther King: to "let justice roll down like waters, and righteousness like an ever flowing stream."
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