The Lockheed Mystery (Contd.)

Like the Watergate scandal from which it once sprouted, the Lockheed scandal seems to have acquired a quality of indestructibility. Even when the charges of corruption are officially denied, they keep reappearing as rumors and innuendoes. Last week, as the scandal once again rippled across Europe, a parliament debated whether to prosecute a prince, a Premier was publicly accused of graft, and a former Defense Minister repeated his assertions that he had done nothing wrong. The only certainty was that the Lockheed Aircraft Corp., the largest defense contractor in the U.S., has admitted spending some $24 million in bribes overseas. Where it all went, nobody seems to know--at least nobody who is telling.

The impetus for the new gossip and speculation was the 240-page report by a three-man Dutch commission headed by European Court Judge Andreas Donner, charging Prince Bernhard of The Netherlands with "unacceptable" behavior in his dealings with Lockheed. Although the commission found no proof that Bernhard actually received the $1.1 million that Lockheed allegedly paid him, the Dutch parliament last week somberly debated whether the 65-year-old royal consort should be prosecuted. A tiny left-wing faction favored prosecution. But Protestant Anti-Revolutionary Party Leader Willem Aantjes summed up the views of many: "History shows the faithfulness of the House of Orange toward The Netherlands. Let us now show the loyalty of Holland toward Orange." The chamber voted overwhelmingly against prosecution.

Before the week was out, however, the Dutch government released new evidence that Prince Bernhard had also lobbied on behalf of Lockheed's chief rival, Northrop Aircraft. A 1971 exchange of letters between the Dutch and West German Defense Ministers referred to Prince Bernhard's attempts to persuade West German Chancellor Helmut Schmidt (then Defense Minister) to purchase Northrop's YF-17 Cobra prototype fighter to replace Lockheed's Starfighter. Although the Dutch commission did not fully explore the prince's links with Northrop, several Dutch newspapers are now investigating the matter.

The chastened but hardly cowering Bernhard was surviving all the criticism quite well. Indeed, he plans to attend Prince's Day ceremonies, celebrating the official opening of the Dutch parliamentary year, as usual on Sept. 21. The only difference: as he passes through the streets with Queen Juliana in her famous horse-drawn golden carriage, the prince will be dressed in a morning coat rather than in the navy uniform that he has been forced to put into mothballs. Snapped Bernhard to a friend who inquired too curiously about his Prince's Day plans: "You would not have thought that I would go into hiding?" The restrained Dutch reaction to the prince's misdeeds stems largely from a deep affection for Queen Juliana, who is popularly regarded as a kindly monarch. But as the Dutch began their recovery from the Lockheed malaise, new outbreaks of the disease began to occur elsewhere:

> Italy. The search for "Antelope Cobbler" is on again. When portions of a U.S. Senate subcommittee report were leaked last April, they referred to an Italian Premier (code-named Antelope Cobbler in various memorandums) who allegedly received payoffs from Lockheed between 1965 and 1969. Speculation about his identity centered on three former Christian Democratic Premiers: Giovanni Leone (now President of Italy), Aldo Moro and Mariano Rumor, all of whom denied any involvement. The allegations remained unsubstantiated. Then last week the Italian leftist weekly L'Espresso published three documents purportedly showing that Lockheed intended to pay $43,000 in bribes to current Premier Giulio Andreotti. The immediate public and press response was suspicion that right-wingers had planted forged documents in an effort to break up Andreotti's fragile, five-week-old Christian Democratic minority government, which relies heavily on tacit Communist support. Carl Kotchian and Dale H. Daniels, the Lockheed officials who were supposed to have written two of the documents published by L'Espresso, denied any knowledge of them last week. The U.S. Senate subcommittee reportedly had received no testimony on Andreotti, who dismissed the charges as "pure invention."

> West Germany. The newly opened election campaign heated up last week when the Bonn government announced that it would send a high Justice Ministry official to Washington in the next few weeks to make final arrangements for access to U.S. documents concerning the Lockheed scandals. This rekindled interest in the allegations that Lockheed bribes had gone to the right-of-center Christian Social Union, the Bavarian ally of the Christian Democrats, and its longtime leader, former Defense Minister Franz Josef Strauss.

Late last year, former Lockheed Lobbyist Ernest Hauser, the man who first brought Prince Bernhard's name into the Lockheed scandals, told Senate investigators that Strauss and the C.S.U. had received at least $10 million for West Germany's purchase of 900 F-104 Starfighters in 1961. The party and its leader denied the allegations, and Strauss filed a slander suit against Hauser. The quarrel ended what was left of a longstanding friendship that went back to Mauser's days as a U.S. Army intelligence officer during the postwar occupation of Germany. Hauser had helped Strauss get his start in local Bavarian politics, and Strauss repaid him years later when, as Defense Minister, he asked Lockheed to put Hauser on the payroll. Since Hauser's allegations were not corroborated, the Lockheed issue was simply dropped in Bonn.

Now that Chancellor Helmut Schmidt has said he is sending a Justice Ministry official to the U.S., Strauss is angrily claiming that Schmidt deliberately dawdled in gaining access to the documents, which he says could clear him long before the Oct. 3 elections.

> Britain. Hauser, 56, whose previous allegations have been characterized by the Dutch commission as 'largely incorrect and based on false premises," struck again last week when he told the London Sunday Express of rumors that a Tory Cabinet minister had received a $ 1 million payoff three years ago to prevent Air Holdings Ltd. from backing out of its commitment to order 30 Lockheed TriStars (with options for 20 more). Since the TriStar was the one plane that could use Rolls-Royce RB-211 engines--and therefore the plane on which the Tory government's efforts to bail out bankrupt Rolls-Royce's aero-engine program depended--it seems unlikely that Lockheed would have to bribe government officials into backing the purchases. A Labor M.P. called for a parliamentary investigation, but no one else took up the issue.

> Japan. Right-wing Lobbyist Yoshio Kodama, a powerful operator at many levels of government and business, was indicted last week on charges of having established a Hong Kong "cover" company to launder illegal funds from Lockheed. Although 19 other top political and business figures, including former Premier Kakuei Tanaka, have been arrested on bribetaking charges in Japan, Kodama has so far avoided arrest on grounds of illness.

While princes and politicians wade through the debris of the scandal, Lockheed itself is flying high. Despite fears that the turmoil overseas might endanger the survival of the company, which had accumulated $645 million in bank debts by 1974, the corporation's post-scandal business appears to be thriving--particularly its foreign sales. These amounted to $1.7 billion in the first six months of 1976, putting this year's sales at the largest annual rate in Lockheed's 44-year history. Overall 1975 sales were $3 billion, and the corporation's 24 major banking creditors have agreed to a longer-term financing of part of the company's debt, now $560 million. Says Lockheed's new chief executive, Robert Haack, a former New York Stock Exchange president who took over in February: "We have a handle on things now and we are taking as much probity with us as we know how. I am the man in the white hat and I'm trying to fly right."

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