The letter was leaked and printed in a Swiss newspaper last Friday.

The World Jewish Congress campaign culminated last month with the announcement that Switzerland's two largest private banks would pay $1.25 billion to survivors. The payment settles survivors' claims that the banks withheld dormant accounts from their rightful owners and profited from wartime trade in looted Nazi gold.

"You have proved moral leadership in a long and tough struggle against those who profited from the unspeakable suffering of millions of Jews," Netanyahu wrote to Bronfman. "You have done this with great pride, dignity, skill and aplomb."

The letter prompted the Swiss government to re-evaluate whether the Nov. 25 conference will happen. Netanyahu and Swiss President Flavio Cotti were originally scheduled to open the conference.

"The government will have to decide if the conference and Netanyahu's visit to Switzerland can take place," a Swiss Foreign Ministry spokeswoman said.

Earlier this year, Netanyahu criticized Bronfman's remark that a "total war" was needed against the Swiss.

When Cotti visited Israel in May, Netanyahu described such statements as bellicose. Diplomatic sources said government leaders are now irritated that Netanyahu praised Bronfman's methods.

"The Swiss now feel Netanyahu is two-faced…obviously whoever wrote the letter did not consult with any diplomats," a top official at the Foreign Ministry said.

Last Friday, the director general of Israel's Foreign Ministry, Eitan Ben-Tsur, telephoned the Swiss ambassador to Israel to explain that the letter was not meant to insult Switzerland.

But the Swiss government, which discussed the issue at its weekly cabinet session Monday, is seeking more explanation. On Wednesday, the Swiss government ordered a Defense Ministry official to cancel a trip to Israel scheduled for Sunday.

Israel's normally good relations with Switzerland suffered earlier this year, when Swiss police arrested a Mossad spy during a botched eavesdropping mission in Bern. Israel subsequently apologized.