From the archives of Kilosbayan Magazine Editorial

THE FACTS AND THE LAW OF THE MARCOS WEALTH Since the spate of press reports two months ago on the Marcos gold and money deposits in a Swiss bank, allegedly placed in the name of a high public official, there has been a renewed agitation by the incumbent President for a compromise settlement with the widow and children of former President Marcos. The purpose, it has been said, is to enable the Government to immediately get the greater share of the Marcos wealth in exchange for dropping all the cases, civil and criminal instituted by the Government against the Marcoses. Eleven years have passed since the EDSA Revolution of February 1986 and only a small part of the Marcos ill-gotten wealth, it is argued, has been recovered it would be better to strike a bargain with the Marcoses now and call it quits. The Senate was asked by President Ramos and his deputies to set the guidelines for such a compromise settlement. As we go to press, the PCGG Chairman was quoted as saying that this should be done before the end of this year, otherwise there will be no time to implement such a settlement in the remaining months of the Ramos Administration which ends in June 1998. Since the Ramos Administration is apparently in a hurry, there is a pressing need to clarify the facts and the applicable law. The day-to-day discussion in the media, with conflicting viewpoints, has only added to the present confusion. Many people seem to think entering into a compromise settlement is just a matter of sitting down with the Marcoses, agreeing with them on (1) their immunity from suites in exchange for the division of the enormous wealth accumulated by the Marcos couple from the time they came into power until they were driven out of Malacaang on February 25, 1986 and (2) ordering the various courts the Supreme Court, the Sandiganbayan, the Court of Appeals and the Regional Trial Courts where there are pending suits against the Marcoses to just dismiss them in the name of national reconciliation and unity. Ferdinand Bongbong Marcos, Jr., has told everyone that what the Marcoses want is a clean slate. And the Ramos Government, subject to the parameters that may be laid down by Congress, would seem to agree. Whether the Marcoses, headed by the former First Lady, can ever have a clean slate or, more importantly, a clean conscience for as long as they do not confront the truth about their past, come to terms with it and

apologize for their misdeeds is an ethical, moral question that the Marcoses and President Ramos do not dare answer. How many suits are pending against them? There are more than a hundred, according to the records. By his own account, former Solicitor General Francisco Chavez filed 79 criminal cases and one forfeiture suit against the Marcoses in December 1991, shortly after their return to the Philippines. There were 34 civil cases pending at the time in the Sandiganbayan. In addition, there are other cases, including tax evasion cases and alleged violations of foreign exchange laws, pending in the various courts. But, it is the forfeiture suit that is of vital importance for the purpose of recovering the deposits in the Swiss banks. While the Marcoses were abroad from 1986 to 1991, criminal cases could not proceed against them. Under Philippine law, the presence of the accused is necessary for the arraignment (when he/she is asked to plead guilty or not guilty) and when the judgment of acquittal or conviction is promulgated. There is no such thing as a criminal proceeding in absentia under Philippine law. In September 1993, Mrs. Imelda Marcos and former Minister Jose Dans were convicted by the Sandiganbayan for violating the Anti-Graft Law and sentenced to a jail term of 18-24 years. The Court found that they had entered into contracts which were grossly disadvantageous to the Government while serving as chairman an Vice Chairman respectively of the Light Railway Transit Authority. This is now pending appeal in the Supreme Court, after their Motion for Reconsideration had been finally denied by the Sandiganbayan on November 13, 1996 after the lapse of three long years. Ironically, the other criminal cases against Mrs. Marcos are may, many times more serious that this one. In the particular case of Ferdinand Bongbong Marcos, Jr., he was convicted on July 31, 1995 of tax evasion and sentenced by the Quezon city Regional Court to a prison term of 9 years. This case is also pending appeal. How much is the ill-gotten wealth of the Marcoses? Mrs. Marcos resents the term illgotten, contending that her husband was very wealthy in his own right, even before they were married on Mary 1, 1954. Her husband has legitimately acquired a lot of gold in fact, she claims that he Marcos house in Batac, Ilocos Norte had walls of gold, presumably part of the so-called Yamashita treasure, which parenthetically does not exist except in fantasy land. History tells us that General Tomoyoki Yamashita arrived in Manila for his hardship post in Anchuria on October 7, 1944, to relieve Lt. General Shigenori Kuroda, shortly before the American landing in Leyte. In the face of the relentless assaults of American

forces unable General MacArthur, Yamashita had to withdraw from one battlefront to another he had no time to bury not even one or two tons of gold, assuming generously that he had any when he arrived here. Moreover, the income tax returns of Ferdinand Marcos before and their income tax returns after his marriage to Imelda in 1954 repudiate her story. Recently, Imeldas fantastic account regarding the wall of gold was promptly ridiculed by a number of senators, some of whom had been to Batac a number of times. For his part, the young Marcos has recently stated that anyone who can find Marcos accounts outside of the US$500 million (US$ 356 million plus interest) which had been identified and frozen by the Swiss Government was free to take it. A few days later, Senator Franklin Drilon, the chair of the Blue Ribbon Committee, confronted him with a list of 97 accounts of Ferdinand Marcos in 27 banks in Europe, the United States and Asia much, much more than what had been identified. Asked to execute a waiver, which he said he was willing to do a week before the young Marcos, a former congressman, beat a hasty retreat and pleaded for time to consult the lawyers of the family in various places. The dailies have reported sensational estimates of the Marcos wealth (US$60 to US $100 billion, according to two sources). With that kind of money, more than the dollar reserves of some Asian countries, such as South Korea and Indonesia, we can more than pay off the entire foreign debt of the Philippines, much of which was incurred during the Marcos years. A more credible estimate, in our view, should be somewhere between USD $5 to US $15 billion. If so, how come the Swiss were able to freeze only US$ 356 million of the Marcos deposits in Swiss banks (now amounting to US $ 500 million), on the basis of bank documents surrendered to the Philippine Government in August October 1991? The latest reports indicate that the Marcoses had obviously amassed much, more than that. In fact, the Marcoses in 1993 had admitted they have more wealth than the Government has been able to discover in their December 1993 Secret Compromise deal with the PCGG, as discussed in an article published in this issue of Kilosbayan Magazine. Here in the Philippines, most of the known Marcos asset amounting o billions of pesos had been sequestered during the first two or three years of the Aquino Administration. Which means that there properties are in the custody of the Government, pending final judicial determination of the true or ownership of each property, now being litigated in many cases before the Sandiganbayan.

How much has our Government, through the PCGG, recovered as ill-gotten wealth since it was created in 1986 by President Cory Aquino? Chairman Gunigundos answer last October 5, 1997: Php 32 billion or almost US$ 1 billion which is not an insignificant amount today. To repeat, how about the assets in Switzerland how come only US$ 356 (now (US$ 500 million due to interest) have been accounted for? Part of the explanation is that around one month elapsed from the time the Marcoses arrived in Hawaii on February 26, 1986 and when the Swiss Government, in an unprecedented move, imposed a unilateral freeze on the Marcos deposits in Swiss banks on March 24, 1986. There after, the Swiss Government continued and regularized the freeze, at the request of our Government, through the PCGG, which was able to get hold of thousands of documents found in the vaults of Malacaang. These documents, a number of which were in their own handwriting, show beyond any dispute the former president Ferdinand Marcos and Mrs. Imelda Romualdez Marcos had been secretly depositing enormous amounts of money in Swiss banks under various code names since March 20, 1968, only a little more than two (2) years since Marcos took his first oath as President on December 30, 1965. In short, the dictator, his kin and trusted associates, had all of one month from February 25 to March 24, 1986 to immediately move their deposits, redocument them and make new and better arrangements for their concealment through their trustees, lawyers and dummies. A second explanation is that not all of the Marcos wealth was in Switzerland. Places like Liechtenstein, Luxembourg, Cayman Islands, Hongkong and States like Austria, Japan and the Bahamas have banking laws unlike that of the Switzerland and, unfortunately, their Governments have not demonstrated any of desire or willingness to cooperate with us. In the US, the Government has been able to recover some assets in New York, New Jersey, Texas, California and Hawaii by means of judicial and extra-judicial proceedings. In New Jersey and California, for example, or Government recovered some assets of the Marcos through judicial proceedings. Because of the suits we filed against the Marcoses and their cronies in New York, Texas and Hawaii, two close associates of Marcos Jose Yao Campos and Antonio Floirendo had to settle with the Government before anti-graft suits could be filed against them in the Philippines, the three conditions imposed by the PCGG during my time were: (a) fair and full disclosure of their connections with the Marcoses; (b) full restitution of the properties entrusted to them and (c) willingness, as long as they are physically able, to testify against the Marcoses. The compromise settlement were approved by President

Aquino and by the supreme court, in the case of Campos and by the Sandiganbayan, in the case of Floirendo. The whole process was transparent. There was no such thing as a secret deal. In understand some PCGG official, Cabinet members and proAdministration senators have expressed the opinion that a settlement has to be entered into with the Marcoses today because of the difficulty of securing evidence against them. This is unadulterated hogwash. First, the many thousands of Malacanang documents that fell into our hands shortly after the EDSA Revolution and the assumption of the presidency by Mrs. Cory Aquino, attesting to the nature and magnitude of the plunder here and abroad, including the United States and Switzerland (several photocopies of these documents were immediately made and deposited in various places), plus the authenticated copies of the valuable documents taken and impounded by the US Customs authorities from the Marcoses when they arrived in Honolulu on February 26, 1986 and then given to us by the State Department pursuant to our request, on March 18, 19856 and finally the document delivered by the Swiss Government to the Philippine, through former Solicitor General Chavez, in August October 1991, all of which have an indisputable bearing on the Marcos secret deposits to Swiss Banks, repudiate this gratuitous assertion. Second, under Sections 2 and 4 of the forfeiture Act (Rep. Act 1379) a law that has been praised by Professor Abram Chayes of Harvard Law School, one of our advertisers who serve pro bono during the first year of the PCGG Whenever any public officer or employee has acquired during his incumbency an amount of property which is manifestly out of proportion to his salary as such public officer or employee and to his other lawful income and the income from legitimately acquired property, said property shall be presumed prima facie to have been unlawfully acquired xxx(Section 2, emphasis supplied). if the respondent is unable to show to the satisfaction of the court that he has lawfully acquired the property in question, then the court shall declare such property forfeited in favor of the State and by virtue of such judgment the property aforesaid shall be come property of the State xxx. (Section 6). In the forfeiture suit (Republic v. Marcos and Marcos, No. 0141, First Division, Sandiganbayan), filed on December 17, 1991, the Government on p. 4, summed up the evidence income tax returns, financial statements (balance

sheets) and the secret accumulations of the former First Couple here and abroad, in the following words: When Ferdinand and Imelda Marcos became the First Couple (in May 1954), their total net worth was only US$ 7,000. When they were driven out of the country by the people they abused for nearly 20 years, their estimated assets amounted to US $ 5 billion. The money must now be forfeited in favor of the State. The Marcos stand on this issue is characteristic double talk. While vigorously denying wrongdoing, they propose compromise with such earnestness and candor they must be reminded of the elementary rules in evidence that offers of compromise in criminal cases are, generally, admissible in evidence against the accused as an implied admission guilt. Hence any talk of compromise must necessarily proceed from the premise the accused admits guilt. Unlike Zaccheus, the tax collector who become rich during the time of Jesus, or to be more contemporary former President Chun Doo Wan of South Korea, now behind bars, the Marcoses have never shown any sign of repentance or contrition, despite the overwhelming evidence against them. What we see or read about, from day to day are their show of arrogance and insolence. On December 13, 1993, during the first years of the Ramos Administration Congress manifested its policy toward the crime of plunder by declaring it to the heinous offense punishable by life imprisonment or death if the amount involved is at least Php50 Million. Although this law cannot apply retroactively, it would nevertheless be the masterpiece of unreason for the Marcoses to be rewarded not only with a handsome percentage (whether 25% or more) of the ill-gotten wealth but also immunity from criminal liability, from all future suits and from taxes of any kind pertaining to said wealth. More than anything else, this kind of a deal, if ever forged by the Goverment with the Marcoses would mean that our high public officials have lost their moral sense, the sense of right and wrong. And they would have no right to talk about integrity in public service. Fortunately, the Senate has recently passed a resolution authored by sixteen (16) originally seventeen (17), senators, stating that any compromise settlement shall not extend to immunity from criminal prosecution. If these Magnificent Sixteen stay true to their plighted word, the expected compromise deal will not materialize. In any event, with only 7 months left to President Ramos, he would be well advised to reaffirm, less in words then in deeds, what he had solemnly stated

on the night of August 15, 1993 before the Kilosbayan organizers, some of whom are his own brothers in the faith, following along, incisive dialogue with him and his trusted men No compromise with the Marcoses on their criminal liability. In any view, there should be no hurry for him now to violate his own word of honor, which he also pledged to the whole nation through is own press statement the day after our forgettable dialogue.