THE MARCOS CONNECTIONS IN THE CAPITAL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000302300016-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: October 2, 2012
• Sequence Number: 16
• Publication Date: November 12, 1985
• Content Type: OPEN SOURCE

Declassified and Approved For Release 2012/10/02 : CIA-RDP90-00965R000302300016-0
ARTICLE A34134 NEW YORK TIMES
ON PAGE 12 November 1985
The Marcos Connections in the Capital
By JIFF GERIII _
Spacial ts The New York Thom -
WASHINGTON, Nov. 11 ? As de-
bate over United States policy toward
the Philippines has moved into the
forefront in Washington in recent
months, so has the discussion over
President Ferdinand E. Marcos and
his wife, Imelda, in the use of United
States aid to their country.
Mrs. Marcos, in particular, has
more than a passing interest in Wash-
ington, an interest that often mixes
business, politics and family.
For one thing, the Washington-
based United Stites Agency for Inter-
national Development channels tens
of millions of dollars in aid to the
Philippines through that country's
Ministry of Human Settlements,
which Mrs. Marcos heads and which
has its own Washington attache to
monitor aid issues.
Mrs. Marcos's brother, Benjamin
T. Romualdez, is the Philippine Am-
bassador to the United States and ne-
gotiated the 1984 agreement that now
governs much of the American eco-
nomic and military assistance going
to the Philippines.
Until early this year, another of the
many Philippine Government corpo-
rations or agencies headed by Mrs.
Marcos owned an expensive George-
town restaurant specializing in Phi-
lippine food. It was then sold at less
than a fifth of its original cost, ac-
cording to legal papers, to a man said
by the Philippine Embassy to be the
son of a former Philippine official.
Finally, United States intelligence
oiTiciatt say tars. Marcos has Ori-
lately mvestea consmeranie amounts
01 m me IMMO states. some
of it in " aShillgt011 property.
satisfaction with the monopoly in
flour distribution enjoyed by the Phi-
lippine National Food Authority,
which is headed by Mrs. Marcos and
Is a subsidiary of the Ministry of
Human Settlements.
Earlier, the House of Representa-
tives approved an amendment calling
for more food and development aid to
the Philippines to be channeled
through private rather than govern-
ment channels such as the Ministry of
Human Settlements. Recent audits
by the General Accounting Office and
the inspector general of the Agency
for International Development have
criticized the way the Philippines has
handled United States aid given
through the ministry.
The administrator of A.I.D., M.
Peter McPherson, wrote Representa-
tive Charles E. Schumer, Democrat
of Brooklyn, the author of the amend-
ment, saying that the aid agency
"shares the sentiment" that more
"economic assistance to the Philip-
pines should be muted through non-
government channels to the maxi-
mum extent feasible."
The Senate did not go along with the
amendment. But aid to the Philip-
pines continues to be a hot issue on
Capitol Hill.
"I remain skeptical of any program
involving the Ministry of Human Set-
tlements," Representative Stephen J.
Solarz, another Brooklyn Democrat,
said the other day.
As for Mrs. Marcos's private in-
vestments, she did not respond to
written questions a reporter sub-
mitted to the embassy in Washington
several weeks ago.
Asked about Mrs. Marcos's role in
the Georgetown restaurant, now
known as the Manila, Mr. Caday said,
"It's not been owned by the Phi-
lippine Government." But records on
file with the Philippine Government
and the District of Columbia Alcohol
Beverage Control Board indicate
otherwise.
They show that in 1982 the restau-
rant was purchased for $270,000 by
Phiftrade Inc., an American corpora-
tion controlled by Food Terminal
Inc., a Philippines Government cor-
poration headed by Mrs. Marcos.
Food Terminal is part of the Phi-
lippine National Food Authority,
records further show.
Aid Is Considered 'Rent'
Last summer opposition legislators
in the Philippines filed a motion to
impeach President Marcos on
charges that huge overseas invest-
ments by relatives, friends and Gov-
ernment officials had helped destroy
the economy. The effort failed, but it
focused much attention on the fi-
nances of the Marcos family and the
financial management of the Govern-
ment.
The Philippines considers much of
the aid from the United States to be
rent for the military bases the United
States uses there, and it resents any
strings that come with the money.
"It's the prerogative of the Philip-
pines to determine how the money
will be utilized and the administra-
tion of the assistance," said Leonides
T. Caday, the minister for political af-
fairs at the Philippine Embassy here.
But official expressions of concern
here about the use of that aid have
even extended to the State Depart-
ment, which held up tens of millions
of dollars last summer because of dis-
Earlier this year the restaurant
was sold by the Government for
$50,000 to a corporation controlled by
Lorenzo J. Cruz, ac to records
on file with the Di:UZI Columbia.
According to Mr. Caday, Mr. Cruz is
in the restaurant business and is the
son of Emilio A. Cruz, a former Gov-
ernment press spokesman who was
also identified by the Philippine mis-
sion in New York as a former Phi-
lippine delegate to Unesco.
Repeated messages left for Lo-
renzo Cruz went unanswered. He was
said to be in Manila.
Although Mr. Caday said the Phi-
lippine Government had never owned
the restaurant, other Philippine offi-
cials, after looking further into the
matter confIrmed that Mrs. Mar-
cos's ministry controlled the restau-
rant at one point and offered an expla-
nation as to why the Government had
become involved in the investment.
"Food Terminal promotes Phi-
lippine food products and cuisine in
the United States," said Victor Le-
vista, the agricultural attache at the
Philippine Embassy. "The best way
to promote cuisine is a restaurant.
The private sector community is hesi-
tant to do this, so Philtrade was estab-
lished and then it looked for Filipinos
to take it over."
When asked about the difference
between the initial cost of $270,000 and
the $50,000 sale price, Mr. Leviste
said, "I don't have the details."
On visits to Washington, Mrs. Mar-
cos has met not only with leading
American political figures but also
with some leading American business
figures.
In December 1981, for example, the
GTE Corporation held a formal re-
ception and dinner for Mrs. Marcos in
Washington.
A Nov. 12, 1961, letter to Mrs. Mar-
cos from Edgar Benditzky, the direc-
tor of GTE International Inc., dis-
cussed the reception. The letter also
talked about GTE's proposal to in-
stall a telephone system in the Philip-
pines and to sell GTE's share in a
telephone company to a corporation
headed by Eduardo V. Romauldez
Jr., Mrs. Marcos's cousin. The latter
transaction was to be done "under the
auspices of your Ministry," Mr. Ben-
ditzky told Mrs. Marcos.
"We intend to have as many indus-
trial chief executives and U.S. legis-
lators and their wives as possible at-
tending, and would hope that you
would be prepared to address the
gathering on the topic of your choice
following the conclusion of the din-
ner," Mr. Benditzky wrote.
Continued
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The black-tie reception and dinner,
originally scheduled in New York,
was transferred to Washington.
A GTE spokesman said the recep-
tion was to "celebrate our 25 years in
the Philippines." He added/ that the
transactions discussed in the letter
had not taken place as suggested and
that the company could provide no
additional information about the re-
ception or the transactions.
'A Personal Fortune'
According to Congressional and in-
telligence officials and reports, Mrs.
Marcos, in addition to her official ac-
tivities ? she is also the Mayor of
Manila ? has accumulated consider-
able personal wealth, much of it in-
vested in the United States.
A 1964 staff report by the Senate
Foreign Relations ConImittee said,
"Mrs. Marcos is believed to have a
personal fortune running into the hun-
dreds of millions of dollars, much of it
invested abroad." Other reports have
placed the combined wealth of Mr.
and Mrs. Marcos at well over 91 bil-
lion.
'American officials, who asked not
to be identified, said the United States
investments included real estate in
the Washington area as well as in-
vestments in banks and property on
the West Coast and in the New York
area.
Declassified and Approved For Release 2012/10/02 : CIA-RDP90-00965R000302300016-0