The Consortium

By Robert Parry

WASHINGTON -- Republican campaign strategist Ed Rollins has dropped an important clue to the mystery of whether the Reagan-Bush era started in 1980 with an act of treachery that bordered on treason. But it's a clue the mainstream media has misread completely.

In his new book, Bare Knuckles and Back Rooms, Rollins recounted a dinner he had with a top Filipino politician in 1991. Over drinks, the man casually asserted that he had delivered an illegal $10 million cash payment in a suitcase from Philippine president Ferdinand Marcos to Ronald Reagan's 1984 re-election campaign.

"I was the guy who gave the ten million from Marcos to your campaign," the Filipino told Rollins, who was Reagan's 1984 campaign manager. "I was the guy who made the arrangements and delivered the cash personally. ...It was a personal gift from Marcos to Reagan."

Rollins described this stunning news with a light touch. The first thought that raced through his head, he wrote, was "Cash? Holy shit." In the book, Rollins also withheld the names of both the Filipino and the Republican lobbyist who allegedly accepted the cash for Reagan. Rollins suggested, too, that the illegal contribution never reached the campaign or the president. "I knew the lobbyist well and I had no doubt the money was now in some offshore bank," Rollins wrote.

Rollins apparently did not realize that there was a history to the allegations of Ferdinand Marcos paying off Ronald Reagan. Neither did the news organizations that briefly mentioned the cash delivery in their stories about the Rollins book. The news stories gave no larger context, nor was there any editorial demand that the disturbing allegations be investigated. Rollins simply shrugged that the statute of limitations for illegal campaign contributions had probably expired.

But the Marcos-Reagan money story is near the core of the corruption that permeated the 1980s. Indeed, the story begins when Reagan was battling to unseat President Carter in 1980. Some witnesses who claim knowledge of alleged Reagan efforts to sabotage Carter's negotiations to free 52 U.S. hostages then held in Iran maintain that Marcos contributed some of the money used by Republicans to bribe key Iranian mullahs.

Longtime Friends

Certainly in 1980, Marcos was in Reagan's camp. They had been friends for years, since 1969 when President Nixon assigned Reagan to represent the United States at the gala opening of Imelda Marcos's multi-million-dollar cultural center in Manila. Reagan charmed the Philippine president and his wife as the former beauty queen danced with the former actor.

In 1980, Marcos also was annoyed by Carter's nagging about human rights and frightened by Carter's inability to protect another despot, the shah of Iran, from ouster and a humiliating exile. As U.S. president, Reagan would drop the human rights lectures, look the other way on Marcos's renowned corruption, and defend Marcos as an important Asian ally. Vice President George Bush would even toast Marcos for his "adherence to democratic principles."

Documentary evidence about the alleged Marcos-to-Reagan payoffs first surfaced after Marcos was ousted by a revolution in March 1986. As Marcos's fall neared, Reagan arranged for the dictator to be flown to Hawaii. Marcos's opponents then ransacked government files and found a Feb. 17, 1986, letter signed by a senior Marcos aide, Victor Nituda.

In the letter, Nituda warned Marcos that Reagan's emissary, Sen. Paul Laxalt, R-Nev., was demanding that sensitive files, including ones listing the 1980 transactions, be turned over to the Americans before Marcos could go to Hawaii. Nituda's letter specifically cited accounts set up for Reagan and his 1980 campaign manager William J. Casey, who, in 1986, was Reagan's CIA director.

Laxalt "expects all documents checklisted during his last visit or the deal <[>for a Hawaiian exile] is off," Nituda wrote. The first two documents listed were "1980-SEC-014: Funds to Casey" and "1980-SEC-015: Reagan Funds Not Used."

In a follow-up letter three days later, Nituda added, "we urgently need to fly the last batch to Clark <[>Air Force base] soonest. <[>National security adviser William] Clark and <[>Reagan chief of staff Michael] Deaver are not happy with what we've sent them so far." Laxalt wanted files from 1984, too, including papers on bank loans and Marcos's "donations to Gen. <[>John] Singlaub" who was raising money for the Nicaraguan contra rebels.

For years, Laxalt's spokesmen have denied that the senator had any discussions with Marcos about the information referenced in the Nituda letter. In a recent interview, Deaver also told me that he has no idea what Nituda was writing about.

Marcos Admission

But during his Hawaiian exile, Marcos declared that he had given Reagan $4 million in 1980 and $8 million in 1984. He made the admission to a Republican lawyer named Richard Hirschfeld, who secretly tape-recorded the conversation. Hirschfeld turned part of the tape over to Congress. But the core allegations -- that President Reagan had received criminal pay-offs from a foreign dictator -- were never seriously explored.

Despite its lack of details, the Rollins book provides important corroboration that Marcos did make sizable illicit payments to Reagan. Rollins wrote, too, that he asked Laxalt about the $10 million payment when the two men were alone at cabins they own in Front Royal, Va.

"Paul absorbed the story with increasing interest," Rollins wrote. "'Christ, now it all makes sense,'" Laxalt exclaimed. "'When I was over there cutting off Marcos's nuts, he gave me a hard time. "How can you do this?" he kept saying to me. "I gave Reagan ten million dollars. How can he do this to me?" I didn't know what the hell he was talking about. Now I get it.'"

Though Laxalt's comment seems self-serving if not disingenuous, it does confirm that he and Marcos discussed the alleged payoffs to Reagan. That contradicts the denials from Laxalt's aides. But it's more likely that Laxalt, who had been chairman of the 1980 Reagan-Bush campaign and was one of Reagan's closest advisers, understood exactly what Marcos was describing.

Hidden Documents?

Hirschfeld, who lives in Charlottesville, Va., also has dangled hints that he possesses bank records showing where many of the Marcos accounts were located and documenting how much money went to Reagan and other Republicans. Yet, when I spoke with Hirschfeld, he refused to release any documentary evidence voluntarily.

But the possibility that a president of the United States was on the payroll of a foreign despot is not insignificant. It is even more troubling if the dictator's money was used to influence the outcome of an American presidential election and lengthen the captivity of 52 Americans held by a hostile state. If true, the allegations would border on treason or at least be accessory to kidnaping. Neither crime has a statute of limitations.

A serious investigation of the Marcos money might shed light, too, on another perplexing mystery from the 1980s: the curious relationship between the American government and the corrupt Bank of Credit and Commerce International. In Jan. 22, 1981, two days after Reagan's Inauguration, Marcos and his cronies co-founded a Hong Kong bank with New York financier John Shaheen, one of Casey's closest friends dating back to the World War II-era Office of Strategic Services.

Called the Hong Kong Deposit and Guaranty, the bank was capitalized with $20 million supplied by Princess Ashraf, the shah of Iran's strong-willed twin sister who hated Jimmy Carter. The bank attracted onto its board leading BCCI figures, including Abu Dhabi's Ghanim al-Mazrouie and Saudi diplomat Hassan Yassin, the cousin of Iran-contra figure Adnan Khashoggi.

In 1983, the bank collapsed with reported losses of more than $100 million. The money was never recovered, but Shaheen associates claimed that prior to the bank failure, substantial amounts were funnelled to Marcos, who reportedly was pulling the strings behind the scenes.

The Hong Kong bank might have been a missing link in the intelligence mysteries of the 1980s, connecting the early Reagan-Iran deals with key BCCI players. It also could explain how Marcos was repaid for his alleged 1980 largesse and why he would be even more generous in 1984. Marcos died in exile in 1989.

A Time for Truth

Rollins's book also meshes with other new evidence suggesting that Reagan may have maintained offshore accounts. FBI wiretaps placed in the New York office of Iranian banker Cyrus Hashemi in 1980 picked up comments about a "Reagan overseas corp.," according to a secret FBI summary that I found in the files of the House task force that was appointed in 1992 to investigate the October Surprise allegations.

Though that inquiry ended in a bipartisan whitewash (see The October Surprise X-Files: The Hidden Origins of the Reagan-Bush Era ), the Rollins's account should compel some official body to re-examine this important historical issue. At minimum, Rollins should be put under oath and compelled to identify both the Filipino with the suitcase and the Republican lobbyist who received it. Then, they should be interrogated. The government also should force Hirschfeld to turn over whatever evidence he has on the bank accounts.

With the Reagan legacy at the heart of Bob Dole's 1996 presidential campaign, there can be no doubt that the American people should know the truth about that legacy. With the Republican convention resonating with impassioned calls for completing the Reagan Revolution, it is not only relevant, but vital, that the voters are given the facts so they can decide for themselves whether that revolution started out as treason.

Copyright (c) 1996

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