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Marcos, Manila Reportedly Strike a Deal


HONOLULU — Former Philippine First Lady Imelda Marcos and the Philippine government have reached a tentative agreement to settle two $5-billion civil racketeering cases and unfreeze her assets, lawyers for the two sides said Friday night.

The lawyers said the proposed settlement is contingent on her return to the Philippines next week to stand trial on massive civil and criminal charges there. Imelda Marcos, widow of former President Ferdinand E. Marcos, arrived in Honolulu Thursday night and plans to return to Manila on Monday after nearly six years of exile. Ferdinand Marcos died here in 1989.

James P. Linn, Marcos' lawyer, said a worldwide freeze on her assets, imposed by U.S. District Judge Mariana R. Pfaelzer in Los Angeles in 1986, would be dissolved, in effect, by the settlement.

However, Swiss officials who are holding $356 million in Marcos banks accounts there have said they will not release that money until criminal proceedings against Marcos have been concluded in the Philippines.

Lawyers for the Philippine government confirmed that they plan to take the proposed settlement to Judge Pfaelzer in Los Angeles on Monday. They said they had planned to withhold all details of the agreement until then but agreed to talk about it after Linn disclosed it to reporters here.

Under the settlement, the Philippine government would recover about $50 million, according to Alan Bersin, one of the Philippines' Los Angeles lawyers. Previously, the Philippines had recovered about $40 million, including two California banks and a Beverly Hills mansion once owned by actor George Hamilton.

Among the additional recoveries under the settlement would be $1.2 million currently in Sanwa Bank accounts in Los Angeles, plus cash and jewelry that U.S. Customs agents seized from the Marcoses when they arrived in Hawaii in February, 1986. The Marcoses fled after a military revolt and popular rebellion led by Corazon Aquino, now the Philippine president, forced him out after two decades in power.

There have long been reports of hidden bank accounts in other countries, but Linn said he is not aware of any such accounts. Philippine lawyer Alan Bersin said he knows of no accounts other than those in Switzerland.

Both Linn and Bersin emphasized that the deal must be approved by Judge Pfaelzer.

The anticipated $50 million would be a substantial recovery, but far less than the $5 billion that some Filipinos had hoped for.

Linn would not characterize the settlement beyond saying it is a "conciliatory step."

The Philippine lawyers were upbeat about the impending conclusion of the case.

"We feel like it's been a very successful endeavor," said Ronald L. Olson, one of the Philippines' Los Angeles attorneys. "This was the first time that there was U.S. judicial action to enforce the law against a foreign dictator."

Imelda Marcos, 63, still faces major civil and criminal cases in Manila. Just last Wednesday, the Aquino government charged her with illegally stashing hundreds of millions of dollars in Swiss banks "in an almost insatiable lust for power and glory."

She could "easily get more than 100 years in jail" if convicted on all counts, a government lawyer said. In all, the Philippine government has accused the Marcoses and their business associates of stealing up to $10 billion from the country's treasury.

Philippine Solicitor General Francisco Chavez, who filed the charges at the Department of Justice, told reporters last week that he did not expect the cases to be decided by the courts within the remaining eight months of President Aquino's term because of their complexity.

Documents obtained by the Philippine government from Swiss authorities revealed that the Marcoses deposited at least $356 million in Swiss banks, listing 18 phony foundations--under Marcos' control--as beneficiaries, according to charges unveiled in Manila last week. Those documents replicate materials filed in the Los Angeles case two years ago.

During the last two weeks, both Marcos and Aquino signed the settlement agreement, which covers all pending suits against Marcos in the Western Hemisphere. Under the terms of the agreement, another civil fraud case filed in New York by U.S. federal prosecutors would also be dropped.

Last year, a jury in New York acquitted Mrs. Marcos of criminal racketeering charges stemming from many of the same issues in the Los Angeles case.

The Los Angeles civil fraud case was filed in 1986. An identical suit was filed in New York. After Judge Pfaelzer imposed the asset freeze, Marcos appealed, but Pfaelzer's ruling was upheld.

Lawyers for Marcos have contended from the start that U.S. courts have no business attempting to resolve questions about matters that evolved from the Philippines. But Bersin contended that it was appropriate to use U.S. law since the Marcoses acquired major buildings in New York and Los Angeles and hid assets in this country.

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