A federal grand jury Friday indicted former Philippine President Ferdinand Marcos on charges of diverting enormous amounts of stolen money to his own use. The grand jury also charged Marcos' wife and Saudi Arabian financier Adnan Khashoggi, federal sources said.
Marcos was being charged in New York in a racketeering indictment that involved the alleged embezzlement of money to buy real estate in New York and other personal property, with Imelda Marcos and Khashoggi also being accused as part of the scheme, said the sources, who spoke on condition of anonymity.Khashoggi, a central figure in the secret sale of arms to Iran by the Reagan administration, posed as the owner of valuable paintings and New York property secretly held by the Marcoses, according to court documents filed earlier.
The grand jury charges are the culmination of a criminal investigation launched nearly 21/2 years ago by U.S. Attorney Rudolph Giuliani.
The Justice Department decided to move against Marcos after his lawyers, involved in plea bargaining negotiations with federal prosecutors, missed a Thursday deadline to respond to a demand that he plead guilty to a racketeering charge, said the sources.
Earlier Thursday, President Reagan indicated he would step aside and not intervene to stop a Marcos indictment, saying that to bring the matter to him, "I would think that it would have to be a matter of foreign policy."
Reagan said, "It may not come to my desk at all."
Engaging in plea bargaining discussions prior to indictment was a concession by the Justice Department to the State Department, which had urged such a course in an attempt to avoid indicting the former head of state. Justice Department officials had wanted an indictment to precede any plea bargaining negotiations.
In June 1986, four months after Marcos fled to the United States, Giuliani, the U.S. attorney in Manhattan, began investigating Marcos in connection with allegations that Marcos diverted enormous sums of government money to secret bank accounts.
The government believes that Marcos and his wife fraudulently diverted the money from the Philippine and U.S. governments, according to an opinion Wednesday by a three-judge panel in a matter relating to the Marcos probe.
Marcos and his wife, according to the court opinion, allegedly embezzled the money to buy real estate in New York and other personal property.
Some money, according to the court, allegedly was transferred to secret Swiss bank accounts held by the Marcoses.
In Manila, Philippine officials hailed reports of the impending indictment as a major breakthrough in efforts to collect the billions Marcos allegedly embezzled as president.
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 because officials fear Marcos would insist on his constitutional right to return to the Philippines from Hawaii to face his accusers in court since the Philippine constitution forbids criminal trials in absentia.
On Thursday, President Corazon Aquino said that a U.S. indictment of Marcos would speed recovery of the embezzeled funds. She said Marcos would still be subject to prosecution in the Philippines regardless of American legal moves.
Marcos spokesman Arturo Aruiza said the former president is "in a very relaxed mood (at his hillside home in Honolulu) . . . he's discussing with his lawyers what is going to be done. He's the same president I see every day."
Aruiza said Marcos' wife reacted more emotionally to the news. "Imelda, she's a little more, uh, you know. The president is a lawyer and he takes things a little more" matter of fact, Aruiza said.
He said Marcos would not plea bargain with the U.S. government because he had committed no crime and added that Marcos would not issue a statement until after the expected indictments were handed down.