Island Development Foundation

Fred M. Zeder II, a close friend of President Bush and the head of a government agency, secretly set up a private company to do business in the Pacific islands in 1986 while serving as U.S. ambassador to the region, according to records and interviews. Zeder did not notify the State Department that he had created the company and did not disqualify himself from making decisions as ambassador that could have affected his business.

Fred M. Zeder II, a close friend of President Bush and the head of a government agency, secretly set up a private company to do business in the Pacific islands in 1986 while serving as U.S. ambassador to the region, according to records and interviews. Zeder did not notify the State Department that he had created the company and did not disqualify himself from making decisions as ambassador that could have affected his business.

Fred M. Zeder II, 82, a former U.S. representative to the Micronesian status negotiations who later headed the Overseas Private Investment Corp., died March 12 in Pebble Beach, Calif. The cause of death was not reported. A native of South Orange, N.J., Zeder served as a fighter pilot in the Army Air Forces during World War II. After the war, he founded several successful businesses. From 1956 to 1975, he was chairman and chief executive of Hydrometals Corp., a diversified manufacturing company.