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Swiss order Austrian bank to pay out East German cash

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(Globalpost/GlobalPost)

Switzerland's supreme court Thursday ordered Austrian bank UniCredit to pay Germany over 200 million euros ($262 million) to end a legal battle dating back to the fall of the Berlin Wall two decades ago.

The federal tribunal upheld a ruling by a lower court in the Swiss city of Zurich, which had said UniCredit should hand over funds siphoned off by former East Germany's ruling communist party after its regime collapsed in 1989, the ATS news agency reported.

Then known as Austria Bank, UniCredit released 128 million euros to East Germany's ex-financial chief, a sum which had been deposited by the regime in the bank's Swiss division.

That was contested in 1994 by the newly united Germany's Treuhandanstalt -- the state office responsible for managing and privatising assets owned by the defunct country -- which argued that the Austrian bank knew full well that payments needed its green light.

In March 2010, the Zurich court ruled in favour of the German state and ordered UniCredit to pay the 128 million euros plus five-percent interest dating back to 1994.

Since East and West Germany were reunited in 1990, the country has launched dozens of lawsuits in various jurisdictions to try to recover money stashed by the former regime.

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http://www.globalpost.com/dispatch/news/afp/130411/swiss-order-austrian-bank-pay-out-east-german-cash