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Morgenthau's investigations raise serious questions about the ethical role of U.S. banks as conduits for illegal dealings. For instance, says Morgenthau, "the facilities of a California bank and a Midwestern bank were used, under circumstances that should have aroused suspicion, to transfer from an American company to a Swiss bank funds that were being used to pay kickbacks to employees of N.C.O. and officers' clubs overseas." One of the New York banks that Morgenthau was investigating was Manufacturers Hanover Trust, whose Wall Street branch handled millions skimmed from Saigon's black market in recent years. The money was deposited in an account designated Pry Sumeen 677, a cryptonym derived from the names of three Indian families involved in black-marketeering in Saigon. The Pry Sumeen account has recently been active again, according to Senator Abraham Ribicoff. Last week he charged that money from a U.S.-backed fund intended to stabilize the Laotian currency (whose basic unit is the kip) turned up in the same account.
Transfer from Saigon. Bankers maintain that they do not knowingly handle any illegal transactions, but the point can be a fine one. Can a corporation remain formally unaware even though some of its employees, in their official capacity, can hardly avoid knowing of illegal dealings? An estimated $1 billion to $2 billion has been siphoned from Viet Nam into U.S. and foreign banks by profiteering Americans, Vietnamese and their allies. Typically, black marketeers sell Americans their illegally obtained military scrip at discounts of up to 60%. The Americans then take the scrip to a bank and buy travelers' checks or a certified check.
The Patman bill will at least require U.S. banks to be as helpful to the Government as they have been unquestioning of their customers. This week a delegation from Zurich will arrive in Washington to discuss a treaty to curb the use of secret accounts for activities illegal under Swiss law. But in such matters as tax evasion, which is not considered a crime in Switzerland, the Swiss have given no indication that they are willing to help enforce U.S. tax laws. This makes even more urgent the Patman bill's provision to require disclosure before money bound for Switzerland or the Bahamas leaves U.S. shores.