- 4 months ago
An investigation into where Ferdinand and Imelda Marcos hid millions of dollars after the former Philippine first couple left in exile in 1986.
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00:00Funding for Frontline is provided by this station and other public television stations nationwide, and by the Corporation for Public Broadcasting.
00:11Tonight on Frontline, the couple accused of stealing billions of dollars from the Philippines.
00:18Mr. Marcos and his wife and their cronies were systematically looting the wealth of the nation.
00:26Ferdinand and Imelda Marcos ruled for 20 years and lived a life that could not have been paid for by the president's salary.
00:33Where did their money come from?
00:35I deny that we ever stole government money.
00:42Tonight, In Search of the Marcos Millions.
00:45From the network of public television stations, a presentation of KCTS Seattle, WNET New York, WPBT Miami, WTVS Detroit, and WGBH Boston.
01:07This is Frontline, with Judy Woodruff.
01:14Good evening.
01:15When Ferdinand Marcos fled the Philippines 15 months ago, he left behind a nation nearly bankrupt.
01:22One reason?
01:24Marcos, his family, his friends and cronies had for two decades looted the Philippines of hundreds of millions of dollars.
01:32Tonight on Frontline, producers Bill Cran and Stephanie Tepper follow an incredible paper trail.
01:39The documents, the records, which tell the secret story of how Marcos got his millions and where he hid this wealth.
01:48Estimated to be one of the world's largest private fortunes.
01:52Our report is called, In Search of the Marcos Millions.
01:56On a mountain in the Philippines, this vast bust commemorates former President Marcos,
02:05now accused of stealing millions of dollars from his country.
02:09I deny that we ever stole government money or property or that we obtained regular commissions on contracts.
02:24Since it's about Marcos, the dictator, stealer of wealth, I've become the villain.
02:34But I would like to have the opportunity one day to be able to explain the sources of all of these funds.
02:41Not just in court, but before the Filipino people and before the world.
02:51The car on the first family is now approaching the grandstand.
02:58The President's salary was never more than $5,600 a year.
03:03Led by the President and the First Lady, together with her children.
03:14His tax returns state that in his 20 years as President, all his earnings and all his assets added to those of his wife Imelda Marcos amounted to less than $350,000.
03:27Mr. Marcos and his wife and their cronies were systematically looting the wealth of the nation.
03:42His wealth was amassed essentially during the martial law years, the dictatorship years from 1972 to 86.
03:51In 1969, the man who was accused of amassing a hidden fortune worth hundreds of millions of dollars set up a trust and told the people he was giving his personal wealth to the nation.
04:05He looked very quiet, very modest, very subtle, very easy going.
04:11His real personality, those who knew him, was just the opposite.
04:14He was vicious, he was calculating.
04:17Marcos was a very deliberate man.
04:23He had said that I never make an important decision when I'm angry or when I'm in love.
04:30They were called the conjugal dictatorship.
04:42Their self-obsession led them to record their own lives on videotapes.
04:45A treasure trove of these has come to light since their fall.
04:48The tapes are evidence of a lifestyle far more lavish than anything they could afford on their legal income.
05:00They needed each other.
05:04Imelda needed Ferdinand because he was the president of the country and very powerful, of course.
05:13And Ferdinand needed Imelda because she had a following of her own.
05:16She's very charismatic.
05:19Imelda was the frivolous, flamboyant, obscene type of squanderer.
05:25And Marcos, I think, sometimes deliberately allowed her to be the lightning rod, so to speak.
05:31So people will say, well, that Marcos is not all that bad.
05:34That woman, he probably can't control her.
05:37He was the main evil.
05:39He designed what happened these past 20 years.
05:44And in a country where 70% of the people live below the poverty level,
05:49the ostentatious wealth of the Marcoses,
05:52and their unseemly corruption clearly contributed to the national revulsion against them.
06:03And to the outpouring of support for Mrs. Aquino in the presidential campaign.
06:10Fulfill my duty.
06:11As president of the Philippines.
06:13As president of the Philippines.
06:14That same night, the people stormed the presidential palace.
06:21The Marcos family had fled only hours early.
06:25For a moment, the poor of Manila stood on the threshold of the State Apartments.
06:30After the first flush of excitement, they began to notice evidence of gross luxury.
06:40Pots of caviar and chilled champagne.
06:43There were hundreds of jewelry boxes.
06:46All empty now.
06:48And there were crates of cash.
06:51Millions of newly minted notes.
06:52But that night, there was something still more valuable.
06:57Papers being hurled out of the windows and tossed from hand to hand.
07:02Marcos had left in too much of a hurry to clear his desk.
07:08Papers and files were strewn everywhere.
07:12In the communications room, three shredding machines had jammed.
07:16To save this evidence, Aquino aides rushed to the palace.
07:24Chito Roque shows what happened that night.
07:27After one o'clock in the morning, I was all alone.
07:31So I decided to walk around.
07:33I entered the room of Mr. Marcos.
07:38Just like a hospital.
07:40I mean, just really stinking.
07:42And I could see a lot of gadgets.
07:47And later on, we found out this was the dialysis machine.
07:52And I saw this filing cabinet.
07:55So I opened it.
07:57And I was very surprised to see the combination.
08:00Taped inside the drawer was the number of the combination lock.
08:05I don't speak Swiss, Roque said later.
08:11But the files spoke for themselves.
08:16These papers are the basis for the allegations against former President Marcos.
08:21Next morning, more documents were discovered in a secret vault.
08:31And others have come to light in Hong Kong, Hawaii, Switzerland, and the United States.
08:36But what Roque found that night were the first clues in the search for the Marcos Millions.
08:41Come on.
08:42We never keep those documents like that in the palace.
08:49Why should I keep secret files of accounts in Geneva in the palace?
08:58Now tell me, what kind of a lawyer or president do you think I am?
09:03You keep all the incriminating documents there.
09:11Marcos arrived in Hawaii the day after the revolution, where he now lives in this luxury home.
09:17When we interviewed him there, he maintained that all documents linking him to Swiss bank accounts are forgeries.
09:24I would like to know which accounts I really put in there, if I put any.
09:27And I will admit it, if it is really put in there by me.
09:32I can give you the names that are alleged to be your accounts.
09:35Oh, come on.
09:36Those names are all picked out of some allegation made by the Philippine government.
09:43There is no document which indicates that they existed because of me.
09:48Three days after Marcos fled, Corey Aquino's first act as president was to set up a special commission.
09:59Its task was to trace and recover Marcos' hidden wealth.
10:03But there was no time to spare.
10:05It was less than four weeks later that a most unusual visitor made his way towards the headquarters of the Swiss credit bank in Zurich.
10:26He was a Filipino businessman called Michael de Guzman, and he had come from Hawaii.
10:31Marcos' son, Bongbong, had told the bank to expect de Guzman.
10:38He had been sent to make a withdrawal, $213 million in cash.
10:47De Guzman then produced two identical documents that read,
10:50Please hold all securities and cash at the disposal of Michael de Guzman, who will present this letter to you in person.
10:59He will identify himself by presenting his passport.
11:02One was signed, Ferdinand E. Marcos.
11:05The other, Imelda R. Marcos.
11:07The bank officials asked him to come back the next morning.
11:12Then, late in the afternoon, they placed an urgent call to Bern.
11:18Because Switzerland's famous banking secrecy does not apply to dirty money,
11:23they wanted guidance from the Federal Banking Commission.
11:26The man who took the call was Daniel Zuberbuehler.
11:28The bank said that for the time being they could hold him back,
11:34but that on the next morning they would send us a telex advising us that they would dispose of the funds within a few hours if we did not issue a prohibition order.
11:45In Bern that night, the Swiss government was attending a state banquet.
11:50The news from the Banking Commission sent them into a huddle.
11:53At the dinner they issued an order to freeze all Marcos accounts.
11:59We told those banks who had funds would have to give confirmation in writing that they would not release any funds without prior approval by the Banking Commission.
12:10Zuberbuehler won't say how many accounts and how much money Marcos has, but he does confirm that Marcos has Swiss accounts.
12:19I think we can, because otherwise these measures would have been obsolete.
12:24There are certainly some accounts here.
12:27The Swiss banking authorities froze the accounts without the Philippine government even coming forward to ask for it.
12:36This is unprecedented.
12:39It has never been done in the past.
12:42This is a result of concern around the world, but especially in Switzerland, about the use of the Swiss banking system to hide dirty money.
12:55In Manila, the Swiss government's order to the banks gave breathing space to Jovito Salonga, the man heading the search for the missing millions.
13:05Now he and his staff began building their case against Marcos.
13:11When he became president in 1966, on the record, he was already depositing huge sums of money in American banks.
13:27And according to our records, in 1967, during his first term, he was already depositing in Swiss banks.
13:34It was in Zurich that Marcos opened the first of at least eight Swiss bank accounts.
13:42And one official at the Swiss credit bank, a certain Walter Fessler, was to play a special role in the private affairs of Mr. Marcos.
13:50In the spring of 1968, the presidential palace in Manila received a visit from Herr Fessler.
13:59These documents are the earliest evidence we have of Marcos' Swiss accounts.
14:03Fessler wrote out this receipt for four checks worth $950,000.
14:09He had also brought some forms for the Marcos' to fill in.
14:13Imelda Marcos opened her accounts under the pseudonym Jane Ryan.
14:17Marcos chose William Saunders as his false name.
14:22If it was going to be secret, why William Saunders?
14:27William Saunders, schudonym, and then Ferdinand E. Marcos, true name.
14:32Now you explain to me what crazy idea would cost me to do that, given a minimum of rationality for both the bank and me.
14:45So is it not right to question this?
14:49Why should not we ask the bank, or the one who presented these documents, where did they get it?
14:57Who wrote it?
14:59And is it in my handwriting?
15:02Is it? I doubt it.
15:03Yet here, on official stationery, President Marcos seems to have been practicing his new, unfamiliar signature.
15:12And the William Saunders account is signed with his own name.
15:16My signature is copied there.
15:22To determine the forgery, we have to see the originals.
15:27But you must know whether that's your signature or not.
15:30I can tell you this, it is questionable.
15:33Partly, he was corrupted by power, and partly, he was already corrupt to begin with.
15:42By 1969, corruption had become a political issue for the Marcoses.
15:47The opposition were claiming massive fraud in Marcos' re-election campaign.
15:52And he was already being accused of being the richest man in Asia.
15:56In the cities, strikes and demonstrations were turning violent.
16:03In the country, communist insurgency was spreading.
16:13All this unrest did not go unnoticed in Switzerland,
16:17where his bankers felt it prudent to draw an extra veil of secrecy over Marcos' hidden accounts.
16:22Early in 1970, officers of the Swiss Credit Bank, including Herr Fessler,
16:30transferred a million dollars from the William Saunders account
16:34to that of the Sandy Foundation,
16:36a company they had set up for the Marcoses in Vaduz.
16:41Vaduz is the capital of Liechtenstein,
16:44the tiny principality sandwiched between Austria and Switzerland.
16:47Liechtenstein is famous for two things, tourism and tax evasion.
16:53So many thousands of paper companies with no office and no staff are registered here
16:59that special buildings, called bureau houses,
17:02offer the convenience of a postal address and someone to forward the mail.
17:07This one housed the Sandy Foundation.
17:10Marcos told the Swiss Credit Bank that when he wanted to withdraw money,
17:19they should send their Hong Kong representative to Manila,
17:22where he was to contact Colonel Fabian Vare, head of the secret police.
17:27The letter helpfully listed Vare's phone number.
17:29It went on to say that when withdrawals were to be made,
17:34Marcos would telex the words,
17:37Happy Birthday.
17:46Birthdays were getting happier all the time for Ferdinand and Imeldo Marcos.
17:50The Sandy Foundation was only one of fifteen Liechtenstein companies set up for the Marcoses.
18:07In the next twelve years, at least three hundred million dollars would pass through them.
18:12But that still lay in the future.
18:22The 1972 assassination attempt on Imeldo was part of a rising tide of violence.
18:35Imeldo escaped, but by then Marcos had made his decisive move.
18:39In 1972, we went ahead with the declaration of martial law,
18:45using as the immediate excuse the phony assassination of Mr. Juan Ponce Enrile.
18:52The Proclamation 1081, which proclaimed martial law throughout the Philippines,
18:57is dated September 21.
19:00But the assassination did not take place until the following day, which is September 22.
19:04So Mr. Marcos was the one who planned it.
19:08Because how would he have known that Mr. Enrile was going to be assassinated the following day?
19:12I insisted it was phony all these years.
19:14Of course, I was put in prison for it.
19:16But Mr. Enrile finally admitted, after the revolution in Enzo, 1986, that it was a lie.
19:21Many believed Marcos had been planning martial law for some time.
19:32I think Mr. Marcos must have started this right after his re-election in 1969,
19:38because then he was constitutionally prohibited from having another term of office.
19:42He would have had to step down in 1973.
19:45During martial law, Marcos enjoyed a regular round of golf at the Whack Whack Golf Club.
19:52He liked to play for high stakes.
19:55But he didn't pay to beat the president, who was a notoriously bad loser.
20:00But those who could afford to go on losing became part of his circle of cronies.
20:05And this was to be the era of crony capitalism.
20:14Few cronies were so trusted as Bobby Benedicto.
20:17He'd known Marcos since law school,
20:20and even helped him to arrange his affairs in Switzerland and Liechtenstein.
20:23A letter transferring a million dollars from the Sandy Foundation is signed by Benedicto.
20:40Checks for an account in Geneva worth 37 million dollars could be signed by both men.
20:46Notes on Benedicto's own notepaper show that he helped Marcos keep track of his hidden wealth.
20:55That's how we know that in 1975 Marcos had 30 million dollars in five foreign banks.
21:03Marcos believed in buying the loyalty of men like Benedicto.
21:08His prize was a monopoly on the Philippine sugar industry.
21:17No sugar could be bought or sold without Benedicto's say-so.
21:27In a country where cane cutters are lucky to earn a dollar a day,
21:31Benedicto would help Marcos make millions.
21:33It wasn't only the workers who suffered.
21:38Sugar dealers were forced to pay sweeteners as Marcos and Benedicto tightened the screws.
21:46The presidential papers itemized some of these donations.
21:51In just three weeks one businessman donated over a hundred thousand dollars.
21:56Some was paid in cash.
21:58A Marcos aide notes that I personally counted it and placed the same in this records jacket.
22:06All this added up.
22:08A motion before the Philippine Supreme Court claims that in one year Marcos and Benedicto pocketed five hundred million dollars.
22:21Government officials have been trying to trace Benedicto who has fled the country.
22:25Marcos used favorites like Benedicto to take charge of all the nation's resources and every big economic venture.
22:43Martial law gave him the power to manipulate the entire economy.
22:51With a stroke of the pen he could seize his enemies assets.
22:56In this way he gave a newspaper to Imelda's favorite brother, Cocoy Romaldes,
23:01and a four hundred million dollar electric plant that had belonged to a rich family opposed to Marcos.
23:10Herminio Decini, an in-law, had a small cigarette filter business.
23:15Marcos slapped a tax on his rivals and made him a millionaire.
23:19Marcos awarded construction contracts worth a billion dollars to Rudy Cuenca.
23:24The Marcos's were the biggest shareholders in his company.
23:30Marcos put Danding Coenco in charge of the coconut board.
23:34Government auditors now claim he pumped a hundred million of its dollars into a coconut scheme he owned.
23:41Coenco, like Decini, Romaldes, and Benedicto, fled the country with Marcos.
23:46Much of the finances for Marcos's business buddies came from public funds.
23:56Mr. Marcos was an absolute dictator in this country.
23:59He was just, he was not just a president.
24:01And therefore institutions like the Development Bank were operating completely under his control.
24:07Will you get the agreement and I'll call it sir?
24:08The person seeking the loan, they would just come around here and say that we need 100, 200 million dollars for this project which looks viable.
24:17It's not viable, but Marcos says it is viable. When he says that, then it better be viable.
24:22For instance, we were recently sent an account for 65 million dollars that we are supposed to pay.
24:29Now apparently this money was supposed to have put up a steel mill, a factory.
24:33It's got to be pretty big because under our currency that would be more than a billion pesos.
24:39So we asked to see what the factory is and to this day after several months nobody has found it.
24:46In short, the factory does not exist.
24:49But 65 million dollars is just a drop in the bucket.
24:53The bank's newly appointed governors are still trying to trace billions that were given out as loans and never repaid.
24:59From this bank alone, I'd say easily about 3.5 billion US dollars.
25:07And broken down roughly, say about 200 million dollars for the Decini Group.
25:14100 million dollars from the Benedictos, this is the former ambassador to Japan.
25:20From the Cuencas, 65 million dollars.
25:22The Cuencas and the Romualdises, about 50 million dollars each.
25:27But this is not all.
25:30We should be able to multiply this by at least a factor of 3 to take into account the exposure of the government in other financial institutions.
25:39Perhaps the best documented example of how Marcos enriched himself is the story of the North-South Highway.
25:49To build it, the Department of Public Highways had to import a large amount of heavy construction equipment.
25:56Much of it bought from Japan.
25:57And inevitably, the Marcos' took a cut.
26:0415% to be precise.
26:12Once again, the point man in the highway scam was Bobby Benedicto,
26:16who Marcos had made the Philippines ambassador to Japan.
26:18Whenever Japanese corporations might want to invest in the Philippines, they needed, of course, to talk to the Philippine ambassador to Japan, which was Benedicto.
26:31And before any venture or project was approved, money had to change hands.
26:37And this was the role of Benedicto, was to set the terms of the bribe.
26:42The presidential papers contain many like this, which adds up the value in yen of the road building equipment,
26:50then works out what 15% of that is, and converts it into the dollars to be collected.
26:59In just one five-month period, these kickbacks amounted to 2.7 million dollars.
27:05There's nothing exceptional about this.
27:11In the Marcos era, nothing from tin sardines to dump trucks could enter Manila Harbor without the president getting his rake-off.
27:21The skim for spare parts on heavy equipment could go as high as 26%.
27:25To get his pay-offs out of the country, Marcos turned to his minister of highways, a certain Balthazar Aquino, no relation of Corey Aquino's.
27:37Balthazar Aquino claims that he was coerced into acting as an emissary for Marcos with the Japanese corporations.
27:48He made several trips to Japan to transmit messages regarding arrangements on commissions and kickbacks.
27:58Marcos' bag man was sworn to secrecy.
28:02He wrote this note for the president.
28:05I assure you, sir, that I will never open my mouth, even if it will curse my life.
28:10But Aquino has now confessed that every two weeks he was laundering payments worth four, five, or six hundred thousand dollars through money changers in Hong Kong.
28:29Here, Aquino converts Japanese yen into six hundred thousand dollars.
28:42He then deposits the dollars in the Hong Kong branch of the Swiss Bank Corporation, which telexes them to Freiburg in Switzerland.
28:50Quiet, discreet, and well off the beaten track.
28:53The bank here received eight of the twenty million dollars Marcos may have made from Japanese pay-offs.
29:03And this is where Aquino's six hundred thousand dollars ends up.
29:07In account number 51960.
29:10Now that account is registered in the name of Foundation Rossellus.
29:15And Rossellus is, needless to say, a foundation set up in Vaduz for Ferdinand and Imeldo Marcos.
29:21In light of all this, we asked Mr. Marcos, did he or did he not have any Swiss bank accounts?
29:29We had some, I think, but which were deposited not by us.
29:34And that is why I want to know why they cannot seem to identify this.
29:42We want to know whether we have any money there or not.
29:48And if so, if it is in our name, how did it get there?
29:52Who deposited it for us?
29:54Was it us who deposited it?
29:57Show it to us.
29:59Or somebody else.
30:01Then I want the authority.
30:02I want to know under what authority they deposited this amount.
30:07You're saying that if there is money in Swiss bank accounts in your name, it's not yours?
30:11No, it's not in my name.
30:13It's in the name of other people and that is why we ask.
30:18So what connection do we have with these other people?
30:20Hidden wealth was the only possible explanation for the lavish lifestyle of the Marcoses.
30:29Imeldo's extravagance was an endless source of malicious gossip among those who knew her, like Renee Connect.
30:36She certainly will be remembered as the most extravagant woman, perhaps, of this century.
30:41She has to be, because nobody else has spent money the way she has.
30:48She has an incredible collection of jewelry.
30:52According to a major jeweler I know in Beverly Hills, she was the largest buyer in the world in the late 70s.
31:00And her collection is really one of the finest, certainly better than most queens.
31:05She had a necklace made of diamonds, of flawless diamonds, which came from Winston.
31:12And this cost 16 million dollars about five, six years ago.
31:17Imeldo's social ambitions went far beyond the Philippines.
31:21Steve Sinakis.
31:23Her ambition her whole life was centered in reaching her goal, which was to be the richest woman in the world,
31:29accepted by the highest society people in the royalty and the international jet set.
31:37She was described as a social climber of alpine proportions.
31:40We can't give you anything but love. Imelda, that's the only thing.
31:57Imelda wanted to impress jet setting friends like George Hamilton.
32:00On a shopping spree in New York, she bought dresses, flowers, jewels, sheets and towels.
32:21All this in six weeks.
32:22We can't give you anything.
32:23Imelda liked to overwhelm her guests with hospitality and gifts.
32:27We won't give you anything.
32:30We won't give you anything.
32:33Imelda liked to overwhelm her guests with hospitality and gifts.
32:34We won't give you anything.
32:37Imelda liked to overwhelm her guests with hospitality and gifts.
32:40We won't give you anything.
32:42But love.
32:46Through one of her companies, she lent George Hamilton money to buy a lavish mansion in Beverly Hills
32:55and a plantation house in Mississippi.
33:00But at her daughter Irene's wedding, Imelda surpassed herself.
33:04The horses were flown in from Morocco, the carriages from Austria.
33:12When spring came late and the trees failed to bloom in time, paper flowers were pinned to their branches.
33:18She definitely wanted her children to marry European royalty.
33:26She wanted her eldest daughter to marry Prince Charles.
33:33Imelda had to settle for a local boy from a wealthy family.
33:37But she made up for that with a royal style wedding.
33:39Obviously, you know about how often she was being criticized for an exhibit of all this wealth and opulence.
33:52And what many of us consider obscenity.
33:55She always attributed what value is there for beauty.
33:58How can beauty be expensive?
34:00How can it be a waste of money to put money on beauty?
34:03How can you find your beauty?
34:04If it is always beauty and power, it's always beauty that I reach for.
34:12The palace basement is now a museum to Imelda's extravagance.
34:16What few realize is that all this is only what she left behind.
34:20This is probably the room that has shocked people the most.
34:28Here you will find about a thousand gowns, one thousand five hundred handbags and about two thousand six hundred pairs of shoes.
34:36This dress was unabroidered with silver threads and it probably took about six months to finish it.
34:44Now this dress is made of swan down feathers.
34:49Here we see a bulletproof bra.
34:53Another dress studded with Russian diamonds.
34:59And now for her world famous two thousand six hundred pairs of shoes.
35:04In one interview, Mrs. Marcus claimed that the reason why she had so many pairs is because she wanted to help promote the Filipino shoe industry.
35:20As you can see, they're mostly made in France and Italy.
35:23And the sad thing about this is that the average per capita income of the Filipino is roughly the cost of one pair of her evening shoes.
35:37She believed that the people loved it because those who arranged for her trips would make sure to it that thousands of people would be there cheering her on and trying to treat her like some loved person because she was responsible for arranging for the reception.
35:59The reception didn't do it. They won't be working anymore the following day.
36:02She always used that expression. I'm an SNS. Slave and a star.
36:09Well, slave meant that she was working all the time for her good little people, as she calls us.
36:17And a star being the beautiful, bright star that people wanted to be.
36:22We are all planning for man. Man as individual and man in community.
36:45This is Smoky Mountain, where people make a living off the city's garbage.
36:51Of course, it has been filmed by just about every foreign TV crew to visit the Philippines.
36:59Imelda's solution was to start to bulldoze the shanty town, which housed 490,000 people.
37:05So Mrs. DeJesus, her four children and her husband Eduardo, lost the home they had built out of scrap and found themselves dumped several miles outside the city.
37:18But when they got there, there was no water, no electricity, no work.
37:22And so, like thousands of others, they drifted back to Smoky Mountain, where they could earn all of 15 pesos a day, 75 cents.
37:35After six months, there was no job there. I decided to walk in the Smoky Mountain, because in the Smoky Mountain, there's some little job.
37:54If I earn 15 pesos, my family was revived.
37:58But Mrs. DeJesus has had to look on as her two daughters and then her son died.
38:08This little girl, the youngest, was very sick on the day these pictures were taken.
38:13The Smoky Mountain may be an extreme example.
38:39But under the Markoses, the number of people who had slipped below the poverty line went up from 27 to 70 percent.
38:53In many ways, a once prosperous country was now no better off than Bangladesh.
39:09The Markos children had it better.
39:19This is their daughter's 21st birthday party.
39:22She would be amply provided for.
39:26Her parents had set up a trust account for the three children.
39:29Imi, Bongbong and Irene would share this inheritance when their parents died.
39:34By 1982, account number C-7711 was already worth more than $20 million.
39:42To care as home, there are people dying.
39:50Oh, if stands in their hands.
39:53Here is gifts of God.
39:58We are the world! We are the world! We are the children. We are the children. We are the one!
40:04It seems as if the wealth of the Marcoses did indeed make the world their oyster.
40:17So much Marcos money was being invested abroad that in 1982, the CIA commissioned a report on their foreign properties.
40:25More than anything else, perhaps, Imelda's activities in Manhattan drew world attention to the family's hidden wealth.
40:36When in town, she liked to stay here.
40:39This is really the Philippine consulate, but Imelda treated it like private property.
40:49Upstairs, she had a disco installed.
40:51Here, she loved to hobnob with people like Adnan Khashoggi, the Saudi billionaire.
41:01But it wasn't just the social life that drew Imelda to Manhattan.
41:08She was beginning to take an active interest in New York real estate.
41:12Though she tried to be discreet, press reports were naming the Marcoses as the real owners of a $63 million shopping center on Herald Square.
41:21A $95 million skyscraper on Wall Street.
41:26A $60 million office building on Madison Avenue.
41:30Over on Fifth Avenue, the Crown building worth $101 million.
41:35And a luxury estate on Long Island.
41:38These properties were the subject of special hearings conducted by Congressman Stephen Solars.
41:48His star witnesses were the Bernstein brothers, whose real estate company had managed the four Manhattan properties.
41:55They had refused to testify until Solars threatened to cite them for contempt of Congress.
41:59Do you swear that the testimony you are about to give is the truth, the whole truth, and nothing but the truth, so help you God?
42:07I do.
42:07I do.
42:10Have you located properties for Ferdinand and Imelda Marcos?
42:15Yes.
42:16Yes.
42:17Have you acquired properties for Ferdinand and Imelda Marcos?
42:22Yes.
42:23Yes.
42:24Have you managed properties for Ferdinand and Imelda Marcos?
42:29Yes, but let me qualify that.
42:30When we say yes to that, it's through the string of companies that were described previously.
42:35Four strings of companies were set up to conceal the real ownership of four New York properties.
42:42The principals, the Marcoses, hid behind a layer of three Panamanian companies, which in turn owned Basic Cover, a company in the Dutch Antilles.
42:52And this was the legal owner of one of the New York properties.
42:55You will never find anything that will have Marcos's name in it, unless, of course, you find some person who will attest to having done this on behalf of Marcos.
43:08There's no piece of paper that will show that President Marcos had anything to do with his properties.
43:14The internal infection.
43:17The man who devised this paper chase for Marcos was a certain Rolando Gapud.
43:22Mr. Gapud set up bank accounts that only he knew about.
43:29And this bank accounts then was the repository of funds coming from all over the world.
43:35Illegal funds, funds that were stolen by President Marcos.
43:40It was Gapud who signed documents that show that Ferdinand and Imelda Marcos were the real owners of a series of accounts numbered 77.
43:48President Marcos was very superstitious and apparently he thought the number 77 was a lucky number for him.
43:58Of course, that made us trace him that much easier that he had all these 7,700 accounts.
44:05But the Marcos's disguised their names as Beneficio Investment Inc. and Bueno Total Investment Inc.
44:12Now, Beneficio and Bueno are both Panamanian corporations.
44:20The reason why so many foreign banks set up in Panama is that easygoing banking and business laws make it a financial center.
44:29It is, in effect, a Latin American Liechtenstein and attracts thousands of dummy companies.
44:34Have you or associates of yours ever set up dummy companies in Panama, in Liechtenstein, in the Dutch Antilles?
44:43Of course not.
44:44Of course not.
44:46And if anybody says that we did, what is the evidence?
44:50Somebody has to sign something.
44:53Who signed it?
44:54What connection do we have with them?
44:55Morton Stavis is a lawyer working on the New York property suit.
45:01He says there are documents connecting Marcos directly to that string of dummy companies.
45:10I'll read to you the first sentence in the first document, which is fascinating.
45:13By this instrument, the undersigned, and the undersigned is Joseph E. Bernstein,
45:19hereby acknowledges that he shall act as a trustee for the benefit of President Ferdinand E. Marcos
45:26with respect to all matters relating to La Stura NV, a Netherlands Antilles Corporation.
45:36This evidence seems to link Marcos directly to La Stura, the legal owner of the $101 million crown building.
45:45Do you recognize these documents?
45:47Yes.
45:48Okay.
45:48Are they authentic documents?
45:51Well, they're copies of authentic documents.
45:53Did you sign these documents?
45:55Yes.
45:56And they all realized that it was a mistake to have Marcos' name on this piece of paper.
46:04But as those things happened, somebody forgot to tear it up.
46:08And there it was.
46:09And this was, if you please, the smoking gun.
46:15And what is the La Stura Corporation?
46:18The La Stura Corporation was the Netherlands Antilles Company that had acquired the building
46:24at 735th Avenue the prior September, which later became known as the Crown Building.
46:30Well, you said that there was evidence connecting the Marcos'
46:33business, where is this evidence?
46:36The evidence, surely, if there is any, is in the Bernstein's testimony.
46:40Oh, come on.
46:41Well, I've got the...
46:43Will you want to read the...
46:45Um...
46:46The stenographic now?
46:48Well, I have them.
46:49Okay.
46:50Will you get this from Helen?
46:54The Bernstein's testimony.
46:56Now, I'd like to ask each of you a series of questions.
47:04In your opinion, are Ferdinand and Imelda Marcos the beneficial owners of the following
47:10real estate properties in New York?
47:12First, the Crown Building.
47:14That is my impression and belief.
47:17The Herald Center.
47:18Yes.
47:2040 Wall Street.
47:21Same answer.
47:22200 Madison Avenue.
47:23Same answer.
47:25Okay.
47:26So, let me bump with this.
47:30And, Mr. Ralph Bernstein, is it your view that the Marcos' are the beneficial owners of
47:35each of those four properties as well?
47:37That's my impression.
47:39Don't the Bernsteins say that, in fact, you and Imelda Marcos were the owners of the Crown
47:43Building?
47:44Hmm.
47:45They did not directly say so.
47:48They said that this was their impression and belief.
47:52Page 25, line 517.
47:55Doesn't that sound like a confirmation?
47:57Presumption?
47:58Presumption is never evident.
48:01Never.
48:02And this is ahead by a lawyer.
48:05When you say, I presume, you're saving yourself from perjury.
48:10Do you think the Bernsteins are perjuring themselves against you?
48:14I think they may have.
48:15Marcos also flatly contradicts the Bernsteins' version of a conversation with Imelda Marcos
48:24that they allege took place in this restaurant.
48:27She indicated that she had a Swiss bank account.
48:31And I sort of remember her pulling out a statement and waving it.
48:36I didn't actually see the numbers.
48:37But my impression that it was something in the nature of $120 million.
48:43In other words, at this dinner at the Sign of the Dove restaurant, Mrs. Marcos indicated
48:49that she had a Swiss bank account and took out a bank statement, which presumably indicated
48:54that that was the case.
48:57That's what I recall.
48:58Do you recall what led her to do this?
49:00I've been to a lot of dinner parties before, but nobody's ever proclaimed their control
49:06of a Swiss bank account.
49:08Certainly not.
49:08It's kind of hard to forget that.
49:10I would say so.
49:12Now, that's a complete lie.
49:14We can prove it.
49:16She never had a Swiss bank account.
49:18She does not hold any now.
49:20And she never had one.
49:21So, what could she have been showing to him?
49:31Allegations against Marcos increased up to the last days of his regime.
49:38The Philippine government is investigating quantities of gold that left the country by plane.
49:44The first of three flights worth $40 million left in late 1983.
49:48A cable sent by the U.S. Naval Investigative Service lists three more alleged Marcos shipments
49:57of silver and gold which left the country by sea.
50:01The bullion was sold in New York, and some sources say the money went to Switzerland.
50:10This telex shows how, in his last year, Marcos transferred $94 million from the Philippines.
50:16The money passed through banks in New York into numbered accounts in Luxembourg and Switzerland.
50:23The last half million dollars left six days before Marcos fled his country.
50:30Meanwhile, as the banks maintained their code of silence and declined to be interviewed,
50:35a sense of bitterness grows far away in Manila.
50:39This is one of the sources of disappointment, disillusion, if not anger,
50:45not just of our people, but I think of most peoples in the third world
50:49who find themselves saddled with incredible and mind-boggling foreign deaths.
50:54And that is, it is inconceivable that the heads of the various financing institutions,
51:01the huge ones around the world, were not aware that these corrupt leaders in these countries
51:07who are borrowing were actually taking the money out of those countries and depositing it back with them.
51:13Where else will these billions go?
51:16Mr. Marcos' $10 billion are not here.
51:20They are somewhere.
51:21They must be in some bank abroad.
51:24And I don't mean one bank.
51:25They must be in 10, 15, 20 banks.
51:28And who are those banks, if you look at them?
51:30They probably are the same banks that also lend to us.
51:34So they know that this money keeps going back and forth.
51:36And who are they using as collateral?
51:38The 56 million Filipinos.
51:46Exiled in Hawaii for 15 months, the Marcoses still have their supporters.
51:54But can they get their hands on their hidden funds?
51:58To use their money would be to admit its existence.
52:27Or give away its whereabouts.
52:28And so, ironically, they plead poverty and accept handouts.
52:40Shoes, dresses, and food parcels for one of the world's wealthiest couples.
52:45This twist of fortune is hardest on Imelda.
52:52This is worse than death.
52:54We should even defile your basic human rights, of country, of citizenship, of freedom.
53:00Honor.
53:01Of honor.
53:02If this is life, I'd rather die any time.
53:06And I'm going to go back.
53:08Even if I have the face of bothering bullets.
53:13The former strongman of the Philippines is keeping fighting fit, dreaming of a coup or a comeback.
53:19But his real battle is in the courts as he tries to stop the new Philippine government from recovering his hidden wealth.
53:28We are essentially establishing a jurisprudence of the post-dictators.
53:34What that means is that new standards, new international standards of morality, will be created, and is in fact already being created by these cases.
53:44These standards say that no dictator can pillage his country and loot his country's treasury and expect to retire comfortably on the spoils of his corruption.
54:02Some say they have five, others ten billion dollars.
54:06The presidential papers we have obtained suggest an absolute minimum of 2.1 billion dollars.
54:48The Philippine Presidential Commission on Good Government, formed to track down the missing Marcos Millions, is still on the paper trail.
55:10The commission hopes for a breakthrough next month, when the Swiss Supreme Court is expected to give it access to Marcos' Swiss bank account records.
55:20Meanwhile, a federal grand jury in Alexandria, Virginia, is looking into the possibility Marcos skimmed off American military aid money.
55:29Another federal grand jury in Pittsburgh is investigating commissions paid to Marcos cronies by Westinghouse Corporation in order to build a nuclear reactor.
55:40And the Japanese National Tax Administration agency now is investigating alleged commissions paid by Japanese manufacturers to Philippine agents, money which ended up in Marcos' Swiss bank account.
55:57Thank you for joining us.
55:59I'm Judy Woodruff.
56:00Good night.
56:00Coming up on Frontline, a girl from Minnesota becomes a star of porn films.
56:08She enjoyed the recognition.
56:10She enjoyed the money.
56:12Colleen Applegate did not like doing sex on film, period.
56:17She chose to do it.
56:20She could have stopped.
56:21A young life ends with a gunshot and questions.
56:25Watch Death of a Porn Queen on Frontline.
56:28See you next time.
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