UBS Loses Legal Bid to Clarify 1999 Holocaust Asset Accord

(Bloomberg) — UBS Group AG failed to persuade a U.S. judge to clear a 1999 legal settlement over claims against Swiss banks over their treatment of Nazi victims during the Holocaust.

U.S. District Judge Edward Korman rejected the bank’s request to more clearly define the $1.25 billion deal, in which UBS and other banks expect protection against any new financial claims. UBS is embroiled in a dispute in federal court in Brooklyn, New York, with the Simon Wiesenthal Center, a US-based group known for tracking Nazis.

UBS had argued that a 1990s settlement in which the company and other Swiss banks settled claims by Nazi victims shielded it from any potential liability, known or unknown at the time. UBS acquired Credit Suisse in 2023.

At a hearing before Korman in March, UBS lawyer David Burns said the bank had sought clarification from the judge to prevent Wiesenthal headquarters from suing for more money and to “encourage any public discussion” in violation of the agreement. Any new allegations about Nazi-linked accounts could expose the bank to billions of dollars in liability.

In his decision on Tuesday, Korman said that he could not give an advisory opinion as there was no case or motion before him.

UBS did not immediately comment on the decision. But he discussed the controversy in a recent Q&A published on his website.

“The resolution was aimed at achieving a global solution, putting a definitive end to the debate,” UBS said. “The SWC and other Jewish organizations are free to continue seeking the truth about the darkest chapter in human history, in accordance with their obligations under the 1999 Agreement.”

The case is Friedman v. UBS, 96-cv-04849, U.S. District Court, Eastern District of New York (Brooklyn).

(Updates with the latest UBS statement on the controversy.)

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