U.S. Court Indicts Marcoses for Fraud

NEW YORK--Deposed Philippine President Ferdinand Marcos and his wife Imelda were indicted on U.S. federal racketeering charges yesterday for allegedly stealing more than $100 million from their country.

The two were also charged with defrauding three lending institutions of more than $165 million in the purchase and financing of real estate in Manhattan. Saudi Arabian financier Adnan Khashoggi--a key figure in the Reagan administration's secret sale of arms to Iran--was also indicted.

"This case amounted to the Marcoses and their co-defendants using their position of trust to turn the Philippines' treasury into their own treasury," said James Fox of the FBI's New York office.

The U.S. government is seeking forfeiture of the illegally obtained holdings, including Swiss bank accounts, and will probably return the money to its rightful owners, the Philippines and U.S. banks.

The charges allege that between 1972 and 1986, when they fled to the United States, the Marcoses amassed $103 million through embezzlement, theft, bribes and kickbacks. Some of this money was used to buy New York properties.

Marcos is the highest-ranking former foreign official indicted in this country, said U.S. Attorney Rudolph Giuliani. Giuliani refused comment on published reports stating that the indictment was sought after plea bargain negotiations broke down earlier this week.

Giuliani said a minimum of $250 million in property would be forfeited if the Marcoses were convicted, including four New York buildings, their home in Honolulu and 28 foreign bank accounts.

The Philippine government has filed 39 civil suits against Marcos, seeking to collect $96.7 billion in damages. But no criminal charges have been filed there because officials fear the deposed leader would insist on his constitutional right to return to the country to face his accusers in court.

The indictment also accused the Marcoses of a scheme to buy $5.9 million in art objects and of transporting money and certain works of art they knew to be stolen.

Those charged with racketeering and racketeering conspiracy face a maximum of 20 years in prison and $250,000 in fines on each count.

The Marcoses and several others indicted along with them were all charged with one count of obstructing justice and one of mail fraud. These offenses could lead to up to five years in prison on each count. Khashoggi would face an additional 15-year penalty on each of two obstruction of justice counts.

The Marcoses were ordered to appear in federal court in Manhattan at the end of the month.

Giuliani described the Marcoses' activities as "a plan hatched and begun in the Philippines to move massive amounts of money illegally into the United States." He added, "Then the Marcoses came to the United States and continued their illegal activities."

The six-count indictment also charged that the Marcoses defrauded two U.S. banks--Citibank and Security Pacific National Bank--and the Security Pacific Mortgage Corp. of more than $165 million in order to buy one of the buildings and refinance others.

Court documents filed earlier said Khashoggi also posed as the owner of valuable paintings secretly held by the Marcoses.

Khashoggi also is accused of submitting a false document to French officials seeking evidence at U.S. request in the Marcos investigation.