Document Type: 
Document Number (FOIA) /ESDN (CREST): 
Release Decision: 
Original Classification: 
Document Page Count: 
Document Creation Date: 
December 20, 2016
Document Release Date: 
July 25, 2006
Sequence Number: 
Case Number: 
Publication Date: 
March 29, 1973
Content Type: 
PDF icon CIA-RDP91-00901R000600100006-8.pdf1.08 MB
Approved For Release 2006/07/2iACIA-RDP91-0901 R000600100006-8 CHICAGO, ILL. TRIBUNE- 767,793 S - 1,016,275 t'lliri u 9 1 1 I. T. T. and Chile Officials of International Telephone and Telegraph Corp., a large conglom- erate, have stated in testimony before a Senate subcommittee that the corpora- tion proposed thru the Central Intel- ligence Agency that $1 million of its funds be used to head off the ascension of Marxist Salvador Allende as presi- dent of Chile in 1970. The corporation had assets of $165 million in the country, consisting main- ly.-of a:.70 per cent ownership in the Chilean telephone system. One of its vice presidents, William R.- Merriam, said that I. T. T. feared that an Allende regime would . "steal" its properties. The fear was warranted. President Al- lende subsequently nationalized I. T. T. holdings and the properties of American copper companies ..without compensation. John A. McCone, former director of the C. 1. A., now a director of I. T. T., discussed with CIA officials a plan to unite the two o,j11j.,d Btiun parties against Allende's assumption of power. The C. I. A. failed to act and Mr. McCone said that. Dr. henry hi:,singer, Presi- dential adviser on foreign relations, whom he also approached, did not re- ply to his proposals. 1. T. T. has been a favorite whipping boy for Senate Democratic "liberals" ever since the Justice Del arttnent, be- fore last years Presidential election, settled an antitrust. action against the corporation. 1. T. T. at the time propos- ed making a substantial contribution to the Republican National Convention when it was originally scheduled for San Diego, where the corporation owned - a hotel. An I. T. T. Washington lobbyist, Dita Beard, in a memorandum which came into possession of the Senate, made sweeping claims about her agency in reaching the settlement which put her employer in a questionable light and sought to imply that the Nixon admin- istration had been bought off. If it were not for this checkered back- ground, the Senate critics would have had less reason to indulge in the present field day over the attempted interven- tion in Chile. After all, it has tradition- ally, been regarded as a responsibility of the federal government to protect American lives and property abroad. In the past, stern measures have been tak- en to carry out that responsibility. Businessmen therefore have a proper right to make approaches to the gov- carnment in defense of their interests. We wouldn't say 1. T. T. has taken the most intelligent approach in asserting this right: but it is only fair to re- member that, I. T. T, and the govern-_k moot might not have been led to invite the present suspicion of secret conspi- racy if earlier governments had not conditioned the world to think that. American business interests can be, 1:ichod around with impunity. And the same people who encouraged this atti- tude in the past are in general the ones who now think they can tar 1. T. T. and the administration and coal;c political hay all at the same time. MORI/CDF Pages 1, 2, 4, 5, and 15 Approved For Release 2006/07/25: CIA-RDP91-00901 R000600100006-8 STAT Approved For RPl-- 2006/07/25: CIA-RDP91-00 CHICAGO, 00- PEWS E - 434,849 MAR 2 10973 I . I f ij` i f~'1 t3 k 15 I-,y William J. Eaton of Our W 'asliingcon Bureau WASHINGTON .- The Cen- tral Intelligence Agency once proposed action by American letuie's leading opponent in Chile. 13roe said lie turned dox n that offer. ITT executives feared that Allende, a Marxist, woulcl na- tion line the ITT-owned Chi- companies to create economic t lean telephone company if he chaos in Chile to bloc.: the I became president. He won the the presidency a. top CIA elan elution in the Chilean Con election of Salvador Ailende to has testified. Nilliam V. Broc, director of gress and has moved to take over the ITT-owned cor,~pany. Broe, who said he acted with CIA and a director for ITT, re- layed through Helms to Broe, the agent testified. IIEIII'S AN excerpt from the transcript: Sen, Frank Church I)-Ida.): Did Mr. Geneen say to you that lie was willing to as- semble an election fund for one of the Chilean presidential candidates, MIr. Jorge E. Ales- sandri? Broe: Yes, he did. Church: Did you c;:plain to W. Gen nn why the CI;1 could not accept such a fund? Broe: I told him we could CIA's clandestine services for the approval of former CIA Di- the Western Heaiisghere, said rector Richard Helms, testi- he made the suggestion 'lute in I find that he g~ve Gerrity a list September, 1970, to Edward J. (Ned) Gerrity, senior vice president of International Tele- phone and Telegraph Corp. Gerrity ha,d tcs i -i,.d .lu~~, earlier that. he rejected the plan as impractical. A transcript of Ur'G.'s testi- mony, cleared by the CIA, was made pit'u.ic late > ednesday by a Senate subrutri-.Iitttee On imdtinationni Cornc:c.ut os. It ,vi.; the firsC }:n0:'. n ec n t'eS sional testimony by a CIA agent about a secret oa ration. IMO',: SAID that rig Oise time ITT president Haro!d S. Gen- em had oaered th CIA a substantial" fund to help Al- of U.S. companies operating in Chile as possible (? ,,rticipants in the economic WE CIA plan 4?;t::. presented jve dk.~'s after Allu nde had been the top vote-getter in the popular election but still re- quired approval from a major- ity of the Chilean Congress. "There was a thenis that ad- e 1 t i:1 the drciior tion C'CQI'.imic. situation Could In- a number of Gin istian Democratic congressrflcnl who were planning to '; o .c+ for Al- lenclc," ]tree said. Ainong otjler step:,, Broc said, he mentioned the p,ossi- bl]ity of banks not ng credits in Chile, dale o Al :peridin,o by Companies aird relays in deli'.- crit. , v.itir.Im pal c; tn.hnical llcip ...1!t ])?,'4'Ut_ In alit t..... hours of sn in;a and ioz,n Ci:,tiol; , 11'?:G.A!:')It (-i of I'.5.. Cl)ii j~;U;a': ti1'Jtt ~. lu 1?C: held Geri tlht. CC:i1- wa. i...- a lt?. . . E'.C'tl u:i Jay Iti, ]veal, r;t;r Al?? \'cril "I ]e riteit 1',.15 i:_.d at t It C. sit 0 i, e s t i a 11 01 1 Iii 1icce nsti, fornnur uircc.tur of the not absorb the funds and serve as a funding channel. I also } told him that -the U.S. govern- i ment was not supporting any candidate in the Chilean elec- tion. Church: During the dis- cussion did ?Err. Geneen at any tittle il: l;cat that t:ie fun was ir;t'ti16'Ju for cnrst eCtiVe use, technical asistancc to ag- riculture, the budding of houses or anything of that character? Prm: No, it was to support Jorge Alcs sandri. Other IT.f mecutives have. said the I'i'T liad offered to put up ;1 tailion for social. pro-. '1 n Ica] ,jams, housir.n and t~ ci aici to ;:. lt:c;nca the outcome of (.h.^ t.a:]]~::U7 el`ctions. Ce!le:'P, l.tse Fitt'']] .CU111Iiic"ncCl to tt`slli MM AY. Approved For Release 2006/07/25: CIA-RDP91-00901 R000600100006-8 Approved For Release 20{ D-rTr 91 - 09018000600100006-8 By Laurence Stern Weshrngton Post Staff Writer Senate investigators sought to elab- ora,te yesterday on a report that the Central Intelligence .laency was au- thorized to spend $400,000 for covert propaganda action against Marxist presidential candidate Salvador A1- lende in Chile during the summer of 1970. .The existence of the fund was first broached by Jerome Levinson, counsel to the Senate Foreign Relations Sub- committee on Multinational Corpora- tions. during the questioning of former Ambassador to Chile Edward Korry. Korry confirmed that he knew a sen- ior interdepartmental i n t e l l i g e n c e group of the National Security Council met to discuss the CIA's strategy to- ward Allende in late May or early June of 1970. But he referred the subcommittee tto CIA Director James R. Schlesinger on the question of whether the NSC policy group allocated 5400,000 for co- vert propaganda activities against Allende. The National Security Council com- mittee to which Levinson referred is the government's senior policy forum for covert intelligence operations, and functions tinder the direction ef: Na- tional Security Adviser Henry Kis- singer. "Anything to do with activities of the CIA, I am not going to reply to," Korry told Levinson. "It is the obliga- .tion of the CIA director to advise you." Last week former CIA Director John A. AlcCone told the subcommittee he had been advised by Richard M. Helms, 2 f'F 14AF, 1973 IN CA j Fund - ie:`1O - S TAT twcen an embassy and its government," the former ambassador told the sub- committee. The question of Washington's in- structions to Korry came in the con text of an ITT document in the subcommittee's possession - -a copy of a cable from two executives of the firm on Se pt. 17, 1970, from Santiago to ITT's New York headquarters. The message said: "Late Tuesday night (Sept. 15) Am- bassador Edward Korry finally received a message from the State Department giving him the green light to move in the came of President Nixon. The message - gave him maximum authority to do all possible - short of a Dominican Republic type action-to keep Allende from taking power." Korry said the ITT cable was "erroneous" and that he had not received instructions to do all he could to stop Allende. But he persisted in refusing to tell his questioners what his Instructions were. The former ambassador, who served in Santiago from 1967 to 1971, acknowledged that he (lid personally favor a strategy to block Allende's election by Congress. This strategy, the "Alessandri Formula," was do- the a.oen y's director in 1970, that "a minimal effort" had been authorized in the Allende election "within the fle.d- bility" of the CIA's buchtet. NIcCone said Helms also told him the senior interdepartmental coma- tit-tee, known as the Forty Committee, had considered the matter and decided that nothing, of a major nature should be done to block Allende's election. The subconuiriilee is examining whe- ther the International Telephone and Teleorarti to sell them," lie testified. Thr-re was strong American; gorporate support for the plans until it became clear that it did not have crioup;h support in the Chilean Cnn;~ress. The su'nc?nnrill ltr e cirnoirric- ed that it will r(':en r the Ir molly of lilt' CIA's longer chef for Western Ileill ispiiere clam-I - \' \Vilir i anr ons,. destine operat 11roe, today after it has heetil iu viewed by agency director t chlesilwer. Broe testified for nearly 451 minutes during a closed sos-I lion yesterday ninrnin? on his) dealings with Ill.' hoard chair-l man Ilarold S. Geneen and' other officials of the company in the Chilean affair. Geneen will be asked o :give his ver- sion of those riealin,s when he testifies on Thursday. tails of privilee efp,pprove&Fdr,l 'lease 2006/07/25: CIA-RDP91-00901 R000600100006-8 Approved For Release 200 /a7725`T-CIA-RDM1-009 2 ;; ~ i3/3 VASh'Ja~ T~P~ CLOSE-UP t;l I3 ? 4.s' -v C, ifr ~+ T !I L' !~_Y ~i b (7 11 4 ti' t3!J ~sS ~x Gt tr9 e When last heard of, Interna- tional Telephone & Telegraph was sending its flacks to shrinks to keep them under wraps, bribing San Diego to accept the Republican con- vention against the city's bet- ter judgment, receiving most- favored-nation treatment f rom White House -praratch;ks, causing, Justice Department lawyers to have second thoughts about the advisabili- ty of belting the old corn. be- fore becoming federal judges, and throwing all available papers into the fai:hful shred- ding machine. It was an elaborate pro gram, but basically just an elegantly articulated varia- tion on classic In :lhct:vets in the way of a corxwr ation with a politician. Bing corps. have been dazzling snla'd pals with a bit of the boodle ever since John D. Rockefeller bought the Pennsylvania loolslature at distressed ]merchandise prices. That's really all the ITT potseh against the 1`: hite House and the antitrust divi- sion mounted to, a '.ve]i- thot.-, l;.ou t limit,"-up of the ath+lroto is le clesiucre.ta and disercet pres-ntration of t':r'rl to the correct aplr