Marcos, Wife Indicted on U.S. Racketeering Charges : Khashoggi, Calif. Bank Also Cited

From Times Wire Services

A federal grand jury today indicted former Philippine President Ferdinand E. Marcos and his wife, Imelda, on racketeering charges, alleging that they plundered their homeland of millions of dollars to buy Manhattan property and defrauded U.S. banks.

Saudi billionaire Adnan Khashoggi, four other people and a California bank also were indicted, U.S. Atty. Rudolph Giuliani said at a news conference.

The indictment said the accused “did embezzle, steal, purloin and divert to their personal use and the use of others certain Philippine government funds.”

Giuliani said the alleged crimes included the transfer of $103 million in illegally obtained funds into the United States to purchase four buildings in New York and defrauding U.S. financial institutions of $165 million in buying the buildings.


The defendants were ordered to appear before U.S. District Judge John F. Keenan on Oct. 31.

“If they don’t comply with the order of the court, they will be arrested like any other person,” Giuliani said. “It is usual in white-collar crimes to permit surrender. We decided they should be treated no worse or no better than anyone else.”

Ousted in February, 1986

Marcos has been living in exile in Hawaii since being ousted from the Philippines in February, 1986.


The 34-count indictment, brought under the federal Racketeer-Influenced and Corrupt Organizations Act, was handed up in U.S. District Court in Manhattan and unsealed by Giuliani at a news conference.

Marcos, 71, and his wife, Imelda, 59, both were charged on four counts and, if convicted, face a maximum of 50 years in prison and fines totaling $1 million.

Khashoggi, 53, one of the world’s richest men and a figure in the Iran-Contra scandal, is charged on six counts and faces as much as 65 years in prison and fines of $1.5 million.

Also named in the indictment were the former Philippine ambassador to the Vatican, Bienvenido Tantoco Sr.; his wife, Gliceri Tantoco, who was president of Rustans department store in the Philippines; California Overseas Bank and its chairman, Robert Benedicto, and its former president, Rodolfo Arambulo.

Marcos’ Manhattan assets include 40 Wall Street, the largest office building on Wall Street, the Crown Building on Fifth Avenue, a Madison Avenue building and Herald Center, a multistory boutique mall on Herald Square across from the Macy’s flagship store.

4 Prime N.Y. Properties

The indictment, based on a two-year investigation, alleges that the Marcoses’ racketeering activities began before their ouster and continued through the indictment’s announcement.

It alleges that the Marcoses transferred $103 million of illegally obtained Philippines government funds into the United States to purchase four prime Manhattan properties now worth an estimated $300 million.


The Marcoses also are accused of defrauding two U.S. financial institutions--Citibank in New York and Security Pacific National Bank and Security Pacific Mortgage Corp. in Los Angeles--of more than $165 million in connection with the purchase and refinancing of the New York properties.

Khashoggi is accused of helping to conceal the Marcoses interests in the real estate by using false documents, which were submitted in U.S. District Court in what prosecutors alleged was a fraudulent effort to show Marcos acquired an interest in them before the court barred him from doing so.

White House spokesman Marlin Fitzwater said President Reagan will not comment directly on the indictments, but said: “Obviously, the President knew Marcos . . . and regrets the need for this. Certainly, the Justice Department has a strong case and will proceed with it.”