Nestle pays $14.6m into Swiss banks' Holocaust settlement

Food giant Nestle said Monday it is paying 25m Swiss francs ($14.6m) into a settlement with Holocaust survivors and Jewish organizations to meet possible claims over use of slave labor during World War II.

Food giant Nestle said Monday it is paying 25m Swiss francs ($14.6m) into a settlement with Holocaust survivors and Jewish organizations to meet possible claims over use of slave labor during World War II.

"It is either certain or it may be assumed that some corporations of the Nestle Group that were active in countries controlled by the National Socialist (Nazi) regime employed forced laborers," the group said in a statement.

It said it would contribute to a $1.25bn settlement agreed by Switzerland's two largest banks.

"Nestle expects this contribution to cover all possible legal claims that might be raised against it both in Switzerland and abroad," the statement added.

Nestle companies operating in Germany and Austria will make voluntary contributions to those countries' foundations to compensate slave laborers, it said, but did not specify amounts.

Some Swiss companies allegedly used slave labor in German subsidiaries or subsequently took over implicated German companies. Nestle has said that, in 1947, it acquired a company that had used forced labor in the Nazi era.

Under huge pressure, the two banks - Credit Suisse and UBS AG - reached their out-of-court settlement in August 1998. This provided for the release of all claims not only against the two banks but also against the Swiss government, the central bank, other commercial banks and Swiss industry.

But when U.S. District Judge Edward Korman approved the settlement July 26, he stated that "those Swiss entities that seek releases (from slave labor claims) are directed to identify themselves ... within 30 days."

Switzerland's main employers' organization urged any company which might have used Nazi forced labor to come forward.

Nestle said that it in many instances did not own the corporations involved at the time and was often unable to "exercise effective control" over those it did.

"As the legal successor of such corporations, Nestle nevertheless accepts its moral responsibility to help alleviate human suffering," the company said.