Andrew Maykuth Online
The Philadelphia Inquirer
May 6, 1990
Marcos trial more sobering than sensational

Report on a former first lady

NEW YORK - It was a typical afternoon in the trial of Imelda Marcos and Adnan Khashoggi.

One of the jurors had not opened his eyes for several minutes. Behind the bench, U.S. District Judge John F. Keenan slowly slid down his chair until only the crown of his balding head remained in view, like the sun slipping below the horizon.

The witness, a former Filipino banker, silently read one of the thousands of documents that are numbered like automobile license plates - 1403-B1 or some such thing. He seemed to be one of the few alert people in the courtroom.

One month into the racketeering trial of the former Filipino first lady, spectators hoping to hear sensational testimony about Marcos' footwear or her fabled shopping trips are more likely to encounter less-than-gripping colloquies about the arcane details of international financial transactions.

Frequently the witnesses do not even mention Imelda Marcos by name - or they mention only former President Ferdinand E. Marcos, who was also indicted but died in September before he could be arraigned.

"You never had any contact with Mrs. Marcos, did you?" Gerry Spence, the defense attorney for Marcos, asked Pacifico Villaluz Jr., a former bank official who testified Friday.

"No, never," said Villaluz, who testified that a Marcos associate directed him to set up fictitious accounts, which prosecutors say were used by the Marcoses.

U.S. attorneys say the combined testimony of dozens of witnesses like Villaluz will unravel the labyrinthine channels through which Ferdinand Marcos and his wife allegedly transferred hundreds of millions of dollars for their personal use.

So far, those witnesses have identified thousands of pages of letters, stock certificates and canceled checks that investigators say will prove that the former first family siphoned hundreds of millions of dollars from the Philippines and hid it in a "spider's web" of offshore banks, Swiss accounts and Manhattan real estate.

By all accounts, the prosecution is still in the early stages of presenting its case against Marcos and Khashoggi. Marcos is charged with fraud and racketeering. Khashoggi, a Saudi financier, is charged with helping to conceal the Marcoses' ownership of four Manhattan buildings.

By the looks of Judge Keenan's cavernous fourth-floor courtroom, the three teams of attorneys plan on staying a few more months.

Each team of lawyers occupies a 10-foot-long table, each of which is covered with exhibits and brick-colored folders. Clerks assisting the attorneys frequently shuttle across the courtroom to retrieve documents from the seven file cabinets that line the courtroom's gray marble walls. With all the furniture in the courtroom, the adversaries are separated by narrow aisles.

But those narrow aisles represent a vast gulf in styles.

The three prosecutors, led by Assistant U.S. Attorney Charles LaBella, are a humorless group who question their witnesses according to prepared scripts. Their questions are crisp and methodical, intended to elicit only a measured amount of information.

Spence, the lead attorney for Marcos, lives on a ranch in Wyoming and looks the part - he wears buckskin jackets and a Stetson hat, which he places prominently on the table in view of the jury.

Compared with the prosecutors, Spence is folksy. "We're not trying to embarrass you," he reassured one jittery prosecution witness. He frequently stands behind Marcos and places his hand on her shoulder.

A week ago, Spence went to the defense of Marcos after she broke down during the testimony of a U.S. Customs agent, who described some of the personal belongings that he found in the Marcoses' luggage when they entered the United States after fleeing Manila in February 1986.

Khashoggi's lawyers, headed by James P. Linn of Oklahoma City, keep a low profile compared with Spence. Sometimes Khashoggi's lawyers limit their cross-examination to one question because little of the testimony deals directly with their client.

"Do you see Mr. Khashoggi's name in there?" Linn asked one witness who had identified a document.

"No," replied the witness, prompting Linn to thank him and sit down.

Much of the testimony is not so brief.

Rodolfo Arambulo, a former director of the California Overseas Bank, described how he helped set up the bank in 1976 at the direction of Roberto S. Benedicto, a close friend of Marcos. Prosecutors allege that the bank was a conduit for much of the money obtained illegally in the Philippines.

Under Benedict's direction, Arambulo said that he set up about 15 savings accounts at the bank with fictitious names and that money would be directed into the accounts from the Philippines and other countries. Payments from the accounts included monthly allowances of $10,000 for the Marcos children, Imee and Ferdinand Jr.

Arambulo is only one of several former Marcos associates who have defected to the prosecution. He was indicted in 1988 along with the Marcoses, but pleaded guilty to conspiracy charges in February and is awaiting sentencing.

In fact, many of the Filipino witnesses who once were Marcos allies appeared to have simply shifted their allegiances to the prosecution, as though it were a conquering force.

Andres Genito, a businessman who was granted immunity from prosecution, described with relish on Tuesday how Marcos collected kickbacks from a Japanese government program that paid reparations to the Philippines for World War II damage.

Genito, who represented Japanese contractors who provided equipment and services to the Philippines, said he paid up to 15 percent of the price of the contracts to Gen. Eugenio Balao, the head of the Philippine reparations commission and a close friend of Marcos. Balao told Genito that the money went to Marcos.

Genito said he once met with Ferdinand Marcos about a $1 million deal and the president told him, "Your ma'am is interested in this project." Imelda Marcos was known in the Philippines as "your ma'am."

At another point, Genito said, he was on a yacht with the first family when Imelda Marcos told him privately that she could help with anything if Ferdinand Marcos was unavailable.

Under cross-examination, however, Genito withered somewhat.

"You're not suggesting by your testimony that Mrs. Marcos did anything wrong, are you?" defense attorney Spence asked.

Genito hemmed and hawed. But Spence insisted: "Yes or no."

"No," Genito said.

Genito's testimony also highlighted a frequent problem that the American lawyers and judges have in understanding the Filipino accents.

Genito acknowledged that he was a party to civil suits in the Philippines that named as defendants "President Marcos, Imelda Marcos and Elise Croonies."

"Elise Croonies?" Judge Keenan asked, leaning in.

Genito repeated the phrase several times until Keenan realized that it was not a name.

"All his cronies," Genito said.

Two months later, the jury acquitted Marcos and Khashoggi. home page   
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