ANONYMOUS LOANS BY PENTAGON FINANCING ARMS TO 14 COUNTRIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP69B00369R000100240057-7
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 15, 2016
• Document Release Date: April 13, 2004
• Sequence Number: 57
• Publication Date: July 24, 1967
• Content Type: NSPR

lit W YORK 31W%S
9,14JUL1967
Approved For Release 2004/05/05 : CIA-RDP69B00369R000100240057-7
The five l,atin.Amrri,-nn
Anonymous Loans by Pentagon countries reportedly obtained
about $100-million. Brazil is un-
Financing A rms to 14 Countries $ 43-mod to have received about
43-million---Atgrnlina about
$21-million and Venezuela Ap-
proximately $29-million, with
the remaining $7-million di.
? Fprclet toThe~llew York Ttm-' vided between Peru and Chile.
WASiIiNGTf)N, July 23-The held up action on legislation to '"_pproximately $24-miltion,l
Defense Department has been extend the life of the Govern- about 4 per cent, was lent to
using anonymous loans from meat-owned Institution for five India and Pakistan, and the re.
the Export-Import Dank to ff. more years and expand its lend- inainder of the $591-million
Ing authority, went to Malaysia and Taiwan,
Hance arms sales in Latin Amer- Iran apparently obtained its
lea, the Middle Cast, North In closed hearings before the loan as at least partial credit)
Africa and Southeast Asia. Ylnuse Ranking and Currency towar (In $?00 million purchatir.
oC mmit re ast Monday, Harold in I9rt; r,f F-4 Phantom jets,
Informants have disclosed .Linde r , the hank president, as- .ilte io'i f Orlvanced of Ameri?
that the $591-million the Pen- screed that until that day he ran r+t,rralinnal fighler?bomhi
tagon obtained from the bank had not known nor wanted to "il """tad rqulpr? eat, I he
between mid-1985 and last June In; t in fitful) Arabia wn9 no
know the names or the coon-I parently financed toward :r p'rr-
30 through so-called "country-X tries that had received the chase of $120-million in llnvvk
accounts" was lent to 14 coup- loans.
tries for purchases of American ~ antiaircraft missiles anti as-
Five of the countries are ill sorted other hardware.
armaments. Latin America-brazil, Argen. Israel is believed to hove, ob.
Under the country-X device,' t.ina, Peru, Chile and Venezuela, taineci its loan for Hawk anti-
the hank opens a line of credit; Your Are Middle Eastern joun- aircraft missiles and tanks that
to the Defense De artmentI tries-Iran, Saudi Arahige Jor- Mr Koss sold the Israelis in
p dan and Israel. Three! are In 1965 and 1966. Jordan was a
arms salesman, Henry J. K"ss' South and Southeast Asia--Ipnrently lent the money for
Jr.. which Mr. Kuss lends to the Pakistan, India and Malaysia, the tank-, and it armored hi.a nrd person-
country lnt
involved for the arms 'The North African country Is's e
Purchase. I p Taiwan is the 14ll,,yenr from the United States,
reelptetttnt. Argrnflnti htirrhased 25 A-4
rt
Th
l
e
oans are guaranteed by In Addition in the eounlry-X Skyliawlc' fir;hter-bombers from
the Defense Department through loans since mid-1965, the De. the. United Slates In 1965 and
Veneurrln has reportedly been
Its $383-million revolving arms tense Department. is believed In
gates credit fund under a law have outstanding about $Bp? gold hilt niters for use against
million In loans to underdevel- lire pin' omnuntist guerrillas
that requires that only 25 per., o
there,
d
ile
countries that the Penta?
cent of the loan must be cov. ' M"
gon made directly from the ' f'f p"p" has been sold a
f+ "et'''ch in of i.'-r) Freedom fight-
eyed by the fund. .' revolving credit account or
o
The extent of the bank's In. tamed from commercial banks, lr'r and Pltnlnysia reportedly oh?
Ive$15-ntil-
The Export-Import Dank has 1"lned a Moan of About
ment in the arms traffic
iirni for
ir
l
trainers and other
.
,
;
also directly lent at Defense
brought vigorous' p~,tests fn;.' Department. requr,st since the '' 1"ipm~~r t.
.~4'.. 55.- fiscal year 196.3, $1.1-billion "it" I~~;in to India Is solil -
I more to a number of developed "hot m, `trfymr because until
fist Mav the Administration of?
countries, including Austria, ficlally ilterposed an embargo on
1
Italy, Britain and Australia, for the slrimr nt of so-called lethal
arms purchases from Mr, Kus,q, miltiarv , equipment. to India
Over the last two fiscal
years, arms loans have consti- and Pi ltigtan. Shipments of
i tuted more than 39 per cent of what the! Adminislratlon calls
I, the bank's lending business, nonlelhirl equilmu nt. such as
1:, and senior administration nffi? radar and Bucks, had been ab
1 dials have testified that the lowed. ~
t bank has made further cons- Sonic military spt'cialists con-
mitments to lend $1?billion skier the distinction specious
an for weapons during the, sltecause n turned force needs
current and future fiscal years. upport equipment as well as
The exact amounts of the guns and, Icnks to be effective.
country-x loans to each of 14 A sizable number of Demo.
aforementioned nations are tin- crats and Republicans on the,
known It to atso h 1 1 h House and Senate Bankingi
e
ov
t
mite
some of tile loans Aq of I ",
June 30 were increments of't'se of the bank to finance arms
large arms purchases that will business, I but they are even
require future loans to co:tr,mure di.;t'trbcd by the fact that
plete financing of the sales, its funds have been employed
The informants, however,,to sell ams to countries In-
4upplied some regional and lo, .volvecl In' disputes with their
cal breakdown. neighbors,
About 75 per cent of the They point out that the majof
country-x loans, they said, ail- portion the loans within the
proximately 5450-million event ast?' two fiscal years, about
r
er ta
. _.-
- -s are angry about the;
to the four Middle Catitern $450-million, went to the.
Cowitrles and Morocco, Middle l'r,Kt and No th Africa,?
therntnst jxplosive area, }
Approved For Release 2004/05/05 : CIA-RDP69B00369R000100240057-7