DIRECTOR'S CONVERSATION WITH SENATOR CHURCH RE BILL BROC'S APPEARANCE BEFORE THE SUBCOMMITTEE ON MULTINATIONAL CORPORATIONS.

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75B00380R000300090023-9
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 15
• Document Creation Date: December 19, 2016
• Document Release Date: December 20, 2005
• Sequence Number: 23
• Publication Date: March 26, 1973
• Content Type: MFR

Approved For Release 20 2/ CIA P7
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CIA lil ML
26 March 1973
25X1
SUBJECT: Director's Conversation with Senator Church Re Bill Broe's
Appearance Before the Subcommittee on Multinational
Corporations.
1. This afternoon the Director called Senator Church in response to
his letter of 23 March requesting Mr. Broe's appearance under oath, in
public session, before the Subcommittee, at 10:00 a. m. on 28 March.
2. The Director explained that we wanted to be as cooperative as
possible and the Senator said he appreciated this and recognized that
Broe's appearance created some special problems for us.
3. The Director said that we were prepared to declassify for
publication a large part of the testimony that Mr. Broe had already provided
the Subcommittee staff informally. He suggested that on 28 March Mr. Broe
appear in executive session with the understanding that his testimony at
that time would also be declassified for prompt publication, except for
possible small sensitive items which could be deleted from the record. In
response to the Senator's question the Director said of course there would be
no objection to this testimony being under oath. The Director added that
we were concerned over the precedent which would be established if an
operations officer testified in public, butwe fully recognized the Subcommittee's
legitimate interest and the questions involved and wanted to be as helpful as
possible.
'N r
CIA I
`~ L y a u ' ONE
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 10 MNNI Vvcu V VI R=I=420C ? LV ~ L/ i .111.}tlitt ITT LL~SYJ J 17.VVV.7VVLJ-.7
tr 4
4. The Senator said this sounded like a reasonable proposal and
he would take it up with his Subcommittee the next day.
5. The Director said he was sending a letter formally setting forth
the above proposal, and added that Senator Symington had expressed the
view that an executive session would be the best solution. The Senator
said he appreciated our prompt responses to the Subcommittee's requests,
and remarked that Mr. Broe's testimony was important because the only
other person knowledgeable on some of the significant questions involved
was apparently unable to recall what was said.
JOHN M. MAURY
Legislative Counsel
Distribution:
Original - Subject
1-DD/O
1 - C /WH
1 - IG
1 - General Counsel
I - OLC Chrono
OLC /JMM:
(26 March 1973)
CIA 9 TERN L USE ONLY
25X1
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THE EVENING STAR DAT i # 4Jf7
E Z"
PA?sE,
Testimony by Agent
is
a First
for'
By JEREMIAH O'LEARY drive to nationalize ITT prop- the unique aspects of the hear-
Star-News Staff Writer erties without compensation. ings on ITT. I would agree,
A1n aFrt bo CIA todgy S
therefore to ha
hl
e M
i
B
'
c
v
r
es
nger
roe
s agreement
,. de an un recedented a with the subcommittee about appear before your subcom-
eamance before a senate su mittee under oath to present
comma ee 7oll uncle Brae's appearance today was testimony limited to his con-
what cn described in a letter to Church versation with ITT officials in
iZ-n-sI i wen himself and yesterday. It said. 1970 in connection with Chile.
erns Cana elephone and "I believe that our discus- "Due to compelling opera-
rpganling DO- in recent weeks have in- tional and security reasons
lihinal PtPntc4n Qk;,o which we have already appearance of William dicated my desire to cooperate Y
V a, ormer ief William to the fullest extent possible cussed, I must request that Mr.
Broe's appearance be limited
with the subcommittee in the
CIALatiz aican ' ' on, to executive session. Further,
b ore the erate ubcommit- matter of the ITT-Chile inves.
as the subcommittee feels it is
free an Multinationa-T-t~i,r - a- tigations consistent with res- desirable to make Mr. Broe's
w' behind elfispfi ponsibilities placed on me by testimony public I would be
Butt CT1rman Frank Churc law and with the necessity for glad to review his testimony
o has won ce au an respecting certain sensitive y
_ _._ _ agency relatinn-chine for that purpose.
tr, scri muc o e es- suggested that Mr. Broe meet placing on c record
tion-nn a'p-answer spssinn ill with you and the staff of your placing on the public record
th items wb h b
subcommittee in formally is your mu Min-
be sed to the public r b y and mittee believes are important
an ith n rs. privately to discuss the extent in connection with Its present
t of M B'slih
o _ operaing agent of ther.roe reatonsips investigation. This procedure
siana outgrowth of that meeting, 11"`L'"`" ""'jC`"-
appearance undersucl- tives while allowin me th
U.S. government operation re-
garding the Chilean election
outcome.
John McCone, former CIA
director and now a director of
ITT, testified he understood
the money was to block Al-
lende from taking power but
ITT senior vice president Ed-
ward Gerrity said he thought
the money was for housing
and agricultural projects that
mightal'np, Al rif41;ease 2006/02/09 CIA-RDP75B0038OR000300090023-9
Mr. Broe responded e
near-open conditions. T to su'l- for the flexibility needed to discharge
co i ee, classified record to a series of my responsibilities as called
ally questions submitted to your for by the National Securit3
was- to-makr=pub}' die, subcommittee staff. I have Act of 1947."
fi t to. since reviewed Mr. Broe's an- The subcommittee was to re
dav. according_ _ eS. swer to these questions and
'~ concluded that most, if not all turn to public session later to
Who Initiated Plans? of them, can be declassified day and question former Am
Subcommittee officials said for incorporation in the public bassadar to Chile Edward Kos
it was obvious that the CIA record if you so desire. ry and two officials oof the An;
agreed to this break with prec- Unique Aspects conda Copper Co.
edent because the agency is
anxious
anxious for its side of the ITT "As you know, operating of-
controversy to be made ficials of the agency have not
public. Testimony in the hear- previously testified under oath
ings last week brought to in public sessions. I desire,
light inconsistencies in the however, to continue to coop-
reported relationship between erate as fully possible with
ITT and CIA in connection your subcommittee because of
with the election of Marxist
Pdesident Salvador Allende
in Chile.
The major question raised
by conflicting testimony is
whether CIA or ITT initiated
plans whereby the corporation
offered up to $1 million to any
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DATE 27 MIL-15 - ___ PAGE _J
O.I.A. AIDE TO TELL
OF I.T.T. DEALING&
Official to Testify on Chile!
in Unusual Arrangement
By EILEEN SHANAHAN
Special to The New York 71mee
WASHINGTON, March 26-1
The Central Intelligence Aiz,ji-
;v and a special Sena snh-
c mmit~-t= ? ?`~ tnrlayr inn an
unusual arrangement whereby
a C.I.A. official
morrow about his ilea ings,with!
the International Telephone
and Telegraph Corporate in
^^ ^rith the ~~'* ca]'
connect'
Events at issue occurred in
1970 and 1971, before and im-,
mediately after the election of
President Salvador Allende
Gossens, a Marxist. Testimony
already heard by the Senate
subcommittee on multinational]
corporations shows that I.T.T.
officials, including Chairman,
Harold S. Geneen had repeated
contacts with William V. Broe,
then the C.I.A.'s director oti
clandestine activities in Latin,]
America.
show that Mr. i
ti
h!
alL possible ste
Iz he 41 ign,4
Mir
a f's
ati_mntc to g~narat,R a take.-'
the mili' arv
System ilsed Sparingly
The aampnts made by
_ Ayjltnmmittee. after ex-
tended ne otiations with James
R E ever
,1 thp C I A. will permit the
,i hliratinn after rpnsnrchip,
r,f_Mr Rrne'c tactimnnv before
a closed ,ion of the~ub-
mn ittoP.
I his is the same system that
as used last year by the
eriate Armed Services Com-
inittee in the case of Maj. Gen.
John D. Lavelle, who was de-
_;oted following disclosures
that he had ordered bombings
of North Vietnam that were
not authorized by his superiors.
it is a system for getting
essential testimony without dis-
closure of information deemed
ital to national security and
has been used sparingly since it
first devised for the Sen-
ite investigation of President
truman's ouster of Gen. Doug-
las MacArthur as the United
stances they c uld remember
Coniz,ressional Jointl
?~78 r~lr /1n Upp in the
'I
en he I
expressed ala ov_let!
economy was growing faster
nePr,ran aythe
unary--_o Francis Gary fbp t l-2 rr was
shr -and captured by the
signs.
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THE WASHINGTON POST DATE Z7 IM44G13 PAGE_
CIA Agent
To Testify on
ITT, Chile
By Laurence Stern
Washington Post Staff Writer
In an nnnreeednthA a et'on,.
the Central Intelligence
Agency has agreed to ermit
isfor~~m~er hief vo er o ra-
tiv or emi-
M gare to testify- unde oath
,The CIA officialT&"liar .V.
l ne_ is schedule tj LAD-Mear
at a 9:30 a.m.. e1 nsed s sst' ; of
t1_ Senate Foreign Relatigns
StilbenmmittPa ilt~na_
ti-anal Cornorat}ona to talk
dealings with the In-e tprnatinnal pwith illeth! d
Telegraph-M.
Broc's testimony, due to be
made public later today after
review by the CIA, will re-
solve one of the central con-,
tradictions of the ITT investi-
gation.
It ITT board an a-
rpiri S_ Geneen iii. a S eraton
Cprltnn Hotel room on..th
night of my 1R, 1g70. The
meetinv was arranged b for-
r,,Or CIA.- rli ret tnr Jnhn-A-W.C-
~~. an_ ITT board member
pd still a CIA ncn1 and
by Richard M. Helms Me-
Co e's successor s, _heaT of
tlQagency.
McCone has testified that
two months after the meeting
he transmitted to national se-
curity adviser Henry A. Kis-
singer and Helms, at Geneen's
request, an ITT offer of as
See ITT, A17, CoI. 5
ITT, From Al ITT documents indicate that
much as a million dollars to Igoe came up with a plan un-
help underwrite a U.S. govern-I der which the company would
ment plan to block Chilean] undertake to contact other
President Salvador Allende's American firms doing busi-
election in 1970. ness in Chile, calling for meas-
But one of Geneen's chief ures that would seriously im-
deputies, ITT senior vice pres- pair the already fragile Chi-
ident Edward Gerrity, has told
the subcommittee that Gen-
i Ben's offer was to help provide
housing and technical agricul-
tural assistance after Al-
lende's election. Gerrity could
not provide the subcommittee
with corroborative testimony
that such a proposal had been
delivered to the government.
Arne hag already given the
subcommittee a private, un-
aworn accoun o and
Geneen discussed durlnhe
Carlton meeting, It was re-
su ably on the strength of
tb,a test monothat sucom-
mittee counsel erome 1-MAn-
I A Mc-Cone rat week
so W-
i Geneen a not - off?red
$roe a large- Swn -1g_ inance
tip an -All nd . plan. Mone
said he didn't know.
h testimony of Broe and
former U. ml asG sdoor- to
Unile war orry is a~ ex-
ec e to ex ore egu on
Peet of the plan was that the
CIA would have no opera-
tional role in carrying it out.
McCone told the subcommit-
tee that he personally had op-
posed any plan under which
ITT itself would sabotage Al-
lende's prospects of election.
However, the former CIA
chief said' neither he nor Gen-
een had any objections to un-
derwriting a "government
plan" to achieve the aar e
goal.
Helms was described by Me-
Cone as having felt in the
early summer of 1970 that
there was little prospedt of
blocking the election of Al-
lende, a Marxist who had in-
curred ITT's enmity by raising
the specter of nationalization
of the corporation's Chilean
telephone company subsidiary.
However, after Allende won
his narrow popular plurality
on Sept. 4, 1970, a major lob-
o et er op litical pres pre hying campaign was unleashed
was brou ht to bear o" Ip by ITT, according to corporate
CTA to invnive_itself_Wiwith 7i' documents, to block his elec-
in =ton-All de strategies.
Senators familiar with CIA
operations doubt that Broe, an
tion by the Chilean Congress
eral John N. iti?ib-hell during
the week following the board
meeting.
An ITT field ?f leer in San-
tiago wired the company's
New York heh inuarters on
Sept.. 17 that Ambassador
Korry two nigh s earlier had
received from Washington
"the green light. to move in
the name of Pi eaident Nixon
to do all i osible-short
of a Dominican Republic-type;
action-to keep Allende from
taking power."
Korry will be questioned to-i
day about the "green light" ca-
ble and its origi is One of the
authors of the .rl~ssage, ITT;
public relations in to Hal Hen-!
drix, testified ti i the inform-
ation came fru a well-con-
nected Chilean Ch istian Dem-
lcratic politici-r. not from
U.S. governmer: ,,urces.
Members of i -w Senate sub-
committee wan lo know how
information of such a highly
sensitive nature baked out of
U.S. governmeti . channels into
the hands of an t7T official, if
indeed the "gr en light" re-
port had any ba;as in fact.
g anpe trance toll
wa,i..marx the ri -s? time a CIA
o erative has 1,ei n Perm~t1ed
t~ndgr naith hp f a
cnn~ressinna1 ;,4limittee.c-
^^ r il i n to .nhenmmitt
e
experienced intelligence oper- on Sept. 8 and 9, Geneen es. The agency normally
ative, would have met with asked McCone to transmit his'
carries out its iaison with
Geneen and other ITT execu- financing offer to the White Congress throu-'h select pan-
tives without instructions House and the CIA. McCone els of the Armen Services and
'from his superiors in the CIA, testified that he talked to Kis-
Appropriations committees in
notably Helms. Before leaving singer and Helms in the ensu- the House and :-mate.
for his new ambassadorial ing few days. Other ITT offi-
post in Iran, Helms also testi- cials contacted key staff peo?
,fled at a .closed session of the ple in the State Department
multinational subcommittee and National Security Council
on the Chilean affair. as well as then Attorney Gen-
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i t,sterdloy's high -64_.aU-Zv5u
p.m. Today's low, 38 at 5:50
a.m. Details, Page B-6.
121st Year. No. 87
Copyright Q 11973
The Event Star Newspaper Co.
DATE
~Nii1 C13
WASHINGTON, D. C., WEG1ESDAY,
CLINICS FOR FIRST OFFENDERS
No. Jail for Addi
By PATRICK COLLINS not been made public but one proves to be successful in dis- Another part of the prop ,s;41 Comm
S1.ar-News Staff Writer i p fpQ~d- ' uw. c?~aa w~ro w(nuld give District pc lice in the
1?iJ.Ralaal.J~~/ . -u
in violation or iu~e1I,.
profits"
i
b
ons su
,multinationalcorporat
- EDWARD KOItRY
erformance tional law.
mmittee "the
'
p
Co
, of the Chilean economy has
been poor and a major reason
=for, the present lack of new
,,,lending by the international
development institutions."
The subcommittee is investi-
gating the involvement of the
International Telephone & Tel-
,egr-aph Corp. and the U.S. gov-
.> vrninent in internal Chilean af-
fairs.
No New Loans
Hennessy said no new loans
have been made by the World
r ,Bank, the International Fi-
-; fiance Corporation or the In-
ter-American Development
Bank (IOB) since Allende was
elected president of Chile. in
-,:September 1970.
Before 1971, he said, Chile
had received more than $270
million in loans from the
tiorld Bank group and $312
ai illion from the 1D:B. Allende
la's elected in October 1970.
Iennessy acknowledged that
Treasury is, maintaining
coppacts with all U.S. compa-
sus affected by Chilean expro-
priations, including ITT.
He said he had several con-
ts with ITT's Washington
reptesentatives and that for-
rher Treasury Secretary John
f 'actual't )Ilx${7i;,-
h1e has repudiated
t'Dangerous ]Precedent'
He noted that the excess
profits in copper are attribut-
ed to precisely the period
when Chile was a partner with
the two American copper com-
panies. "They thought they
had a good deal," Hennessy
said. "But if a company loses
money, nobody steps in to say
that is an excess loss and of-
fers to help. Retroactive appli-
cation of excess profits is a
dangerous precedent."
Mcanwh1_e. the committee,
he m h[ a T+Y ank Ohu ,
T,aahn, inn l- it would
re ease this afternos-
on of IA agent William
V-0- ad ia-close-~-
in the C:
o
ec ion
)?gn a hairs-breadt g lity
in agree-ni in race. Bu
fQ"wid c ,runs h lleize and
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B. Connally had received a
visit from ITT president Har-
old S. Geneen after the Al-
lende government intervened
in ITT's telephone holdings in
Chile.
Soundly Managed Economy
The charters of the develop-
ment banks include an explicit
requirement about the ability
of any country to use and re-
pay foreign borrowing, Hen-
nessy said, adding that a pri-
mary condition for lending-
which Chile failed to meet-
was a soundly managed econo-
rny.
No amount of external finan-
cial assistance can substitute
for needed internal measures,
Hennessy said, and present
conditions make it impossible
for funds to be used for the
benefit of the Chilean people
or with reasonable possibility
of repayment.
"In the case of Chile there is
a general debt repayment
problem and particular prob-
lems of debt repudiation,"
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NEW YORK TIMES DATE A-b MO PAGE 3
Ex'-Envoy Says the C.I.A.
Ordered Polls on Allende
By EILEEN SHANAHAN
Special to The New York Times
WASHINGTON, March 27
?The Central Intelligence
Agency commissioned polls to
determine the probable out-
come of the presidential elec-
tion in Chile in 1970, Edward
10. Korry, former United States
Ambassador to Chile, said to-
dlay.
.13nt Mr Knrry wnnld oat
say, under questioning from a
s ecial Senate subcommittee,
yhether he also had known a
)reported by the a enc
to set aside $400.000 for n_oCj
ands activities in Chile
influencing the out-
rs of that election -
' The winner was Dr. Salvador
Allende Gossens, whom Mr.
Korry said he had wanted de-
eated because he relieved that
r. Allende would carry out
the Marxist platform on which
ran and would nationalize
he American owned businesses in
Chile.
Question Raised by Lawyer
with about 40 per cent of the
vote.
Mr. Korry said that he had
challenged the validity of the
polls because they were based
on 1960 census statistics and
he had felt that more up-to-date
information would show less
support for Dr. Allende.
The Chilean won 36 per cent
of the popular vote and was
later elected by the Chilean
Congress under a regular pro-
cedure for deciding an election
in which no candidate received
a majority of the votes.
The decision to allocate
$400,000 for anti-Allende prop-
aganda was made, according to
Mr. Levinson, not just by the
Central Intelligency Agency but
also by the high-level inter-
agency Government committee
that oversees the agency's pol-
!ley.
Mr. Levinson indicated that
the money had been earmarked
for use in Chile in late June or
early July 1970; the popular
election was held Sept. 4, 1970.
Mr. Korry took the position
The question_ ahnnt a s4n0,-that he could not answer ques-
n a fund was raisedtions on the reported fund and
1).Z Jerome T Levenson. crilet on other matters he was asked
Wunsel tote sub coommittee on about today.
i u nn'- 1 c ion nsi Declines to Answer
q =unit n.~n~,.,aais in ~E...11,, .
nJ T.evi ovinann slid not 11 mg ~,,:,~,~ jti.liairj t ^^
-
U:. ............ P-- +1... .. -~n.?+:nn + ..
1
On questions about instruc-
tions he had received from the.
State Department, he said that
if he answered he would be vio-
tin, ortivitinc in I atin America,
\WTilliom V Broe,
Mr. Broe's testimony is to be
made public as soon as top
agency officials have reviewed
't for previously unpublished
Information that might dis-
close United States intelligence
sources or methods.
Results of Polls
According to the Korry testi-
inony, the polls that the C.I.A.
commissioned showed that Dr.
Allende would win the election.
which was a three-way race
$4nn o00 had lien made avail.
a 1 fence electtin.
Earlier in t e day, however,
the cnhrnmmittee had g11PS-
ity he had made when sworn as
Ambassador.
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~ ATE 1~W- C.-13 PAGE
CIA $400,000 Chile Fund Reported
By Laurence Stern
Washington Post Staff Writer
Senate investioators.soii hf ..eb-
Whorized to suend_$4Q0_000iag_Qg,=t
propaganda action against Marxi t
prgsi en is caaaWate 'adnr _.Al-
lende i ing.. hP sip LPZ of
hence of the fund was first
broached by Jerome Levinson, counsel
to the .Senate Foreign Relations Sub-
committee on Multinational Corpora-
tions, during the questioning of former
Ambassador to Chile Edward Korry.
Korrv r - e d that he knew a sen-
group of the National Security Con cil
me_discuss the CIAs strateev to-
Ward AliPndw iai +~ Z qr rl. i~ne
of- 192Q.
But he referred the subcommittee
to CIA Director James R. Schlesinger
on the question of whether the NSC
policy group allocated $400,000 for co-
vert propaganda activities against
Allende.
The National Security Council com-
mittee to which Levinson referred is
the government's senior policy forum
for covert intelligence operations, and
functions under the direction cf Na-
tional Security AdviqHenry Kis-
singer.
"AmNng to d6 iff activities of
the r to,"
?
rrv tolc~lQn. "It is the objiga-
ti rg ~?f the CIA director t6 advise ou?"
Last week former CIA Director. John
A. McCone told the subcommittee he
had been advised by Richard M. Helms,
the agency's director in 1970, that "a
minimal effort" bad been authorized in
the Allende election "within the flexi-
bility" of the CIA's budget.
McCone said Helms also told him
the senior 'interdepartmental commit-
tee, known as the Forty Committee,
had considered the matter and decided
that nothing of a major nature should
be done to block Allende's election.
The subcommittee is examining whe-
ther the International Telephone and
Telegraph Corp. exercised improper
influence in the Chilean presidential
election to stave off nationalization of
its Chilean telephone company sub-
sidiary, and whether U.S. government
agencies worked in collusion with ITT
in an attempt to prevent Allende from
assuming the presidency,
Korry, in an afternoon of testimonial
sparring, declined to tell the subcom-
mittee what instructions he had re-
ceived from the State Department in
the crucial period between Allende's
popular election on Sept. 4, 1970, and
his installation by the Chilean Con-
gress the following Oct. 24.
"I have a deep abiding conviction it
is morally wrong to give you the de
tails of privileged communication be
tween an embassy and its government,'
the former a0bassador told the sub
committee.
The ; gtuettiori of Washington's . In
str t4tjoiis' to' i>> e ` nrrec a been at Wor Infer- vise Mr. Merriam that ap rC A ns.
.lessandri Rodriguez, one -of national Telephone and Tele- proaehes continue to be made In releasing the transcript,
wo relatively conservative can- graph Corporation officials had, to select members of the armed Senator Church said that he
idates running against Dr. Ai'- in the meantime, been talking forces in an attempt to have thought it imprope or either
to the State Department and them. lead some s 09 of uprising? private companies ru he United
,nde, a Marxist who was the President Nixon's adviser on Mr- Broe: No. Qi ,a n m er St
tes Governmen to inter-
a
national security, Henry A. Kis- of occasions Mr. dam. ques- vene in a free elec t n-which
singer. Properties belonging to tioned me regarddng possible the election of or Allende
s this
'
f D
the
b
il
o
a?re free elections i here.
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. action
y
m
itary, a
I.T.T. were seized ater r
was, by all accounts He c
merited took office in Novem was a subject evetybne was In melted that at tb tame time
, o'7n terested in. I advised his' that the ideas for int, -i~ ention in
our coverage of the ,Irlilitary Chile were being d it ussed, the
gave no indication they would, I'United States wa ighting a
take action. v, in Vietnam, the stated.
purpose og which v as to as-
 Approved For Release 2006/02/09 : CIA-RDP75B0038OR000300090023-9
told Senate ,y? rs that
-and dec med
isz~jLlgbbstazitial l fun y
card chairman arc
Gem An to block + e e ec on
ava r
In sworn testimony released
yesterday, William V. Broe,
former ,CIA chief of Glandes-
tine operations in the Western
Hemisphere, aJA21 nowt-
!edged dicri1ssF,dseps
* L1i T T ffirialg to arreler.
ate nrtfic~ in,, ;t4hility in
Chile at a crucial political pe-
riodfor Allende.
,Broe's testimony, given to
an investigating subcommittee
Tuesday under an unprece-
dented arrangement, rnn
4 ed. earlier assertions under
TT vice nresid nt
that j n en had made the
money offer to finance hous-
ling and technical agricultural
a.-istanpp in Chile.
Geneen is due to testify on
,his financial offer to Broe on
Monday. Until then, Sen.
Frantc Church (D-Idaho) said
;yesterday, the investigators
would not "pass judgment" on
the possibility of perjury ac-
tion in the ITT investigation.
Church is chairman of the
Senate Foreign Relations Sub-
committee on Multinational
Corporations, which is con-
ducting the inquiry. The panel
questioned Brae in closed ses-
sion Tuesday morning and
submitted the transcript to
the CIA for review. urch
said it was nn rare r
an operating' agent of -tie
ency v sworn i-
monv to a congressional inv s-
Broe testified that he went
to the meeting with Geneen at
the Sheraton Carlton Hotel on
the night of July 16,? 1970, un-
der instructions from then
CIA director Richard M.
Helms, who was rec'entiy re-
placed by President Nixon and
appointed Ambassador to
Iran.
i At the meeting, roe testa.
fied, Geneen ..offered the sub-
stantial fund - which would
be control, e d a
~$ p 6d
THE WASHINGTON POST
CI A Aide. D
ITT on Fun
d f)f fer
By Laurence Stern
Washington Post Staff Write
r
highhigh-rig Central In.!
lElhnce Ac nev n ' al as
neled by the CJ A -- to sup-
port the eandidacy of Jorge
Alessandri, of tie righ- wingi
National Party, against Al-I
lende.
In declining the ofier, Broe
said, he told Geneen. "we could
not absorb the funds and;
serve as a funding channel. 1
also told him that the United'
States Government was not!,
supporting any candidate in'
the Chilean election."
The CIA. official asserted
that Geneen at. no time sug-
gested that the money would
be contributed for housing or
agricultural assistance. ITT's
vice president for corporate.
relations, Edward Gerrity, tes-
tified last week that txeneen
intended the money to be used
for such purposes and not to
influence the course of the
election,
under questioning by F'or-
eign ea lonsflr>Trnrit e
Chairman J. W. FuIbrilgHr (D-
e saia rrr. no
the the in~itiatiee
intervene ir
to
omits "'Pown
he
corporate purposes."
It was not American policy,
Broe said, to influence the
Chilean elections in 1970.
The CIA witness said Ge-
neen told him that ITT and
other American companies
raised a political fund to influ-
ence the outcome of the 1964
Chilean election, when Chris-
tian Democrat Eduardo Frei
came to power, but that John
McCone, then the director, did
not accept the money.
Broe's testimony indieated
that the agency took a more
cooperative attitrkie vi*.it'h ITT
in subsequent nleetixi? fol
lowing Allende's narrot pope
lar plurality on Sept. 1970,
but bgfore he was insta ed by
a.vote of the Chilean Ccd)gress
the fgllgwing month
Again at the direction of
Helms, Broe said, he met with
Gerrity on Sept. 29 to exi,fore
with the ITT executive ?iiow
the deteriorating economic sit-
uation (in Chile) could be ac-
celerated ..."
DATE Zq' WV_ P AGE
Broe confixpied that he dis-
cussed` with. Gerrity - sucli
measures as curtailing bank
credits and deliver;" gi,pat e,
parts, creating pressure on j
savings . and loan institutions j
to close their doors, and with-
drawing technical assistance.
The CIA's endorsement of
this economic pressure, said
Broe, was designed to discour-
age Christian Democratic con-
gressmen from supporting Al-
lende, a Marxist-Socialist in
the crucial congressional bal-
loting on the presidency.
"There was a thesis," said
Broe, "that additional deterio-
ration in the economic situa-
tion could influence a large
number of Christian Demo-
cratic Congressmen who were
planning to vote for Allende."
He told the subcommittee
that ITT executives were neg-
ative toward the plan because
they felt it was unworkable.
The ;maneuver, described in
Child as the "Alessandri For-
mula," was looked upan fa-
vorably by then U.S. Ambas-
sador Edward Korry and ITT,
as well as by Allende's Chilean
opposition, as a means of re-.
storing Frei to the presidency:
by setting the stage for a newt
election.
-L "ever can
C, jiurch sai
of M-- r lar e s
- e
"im r of-;'
tx he w a,,.,
et , st rivate. cor orations
'
} Inca meeting with newsmen,
~emnrra c~ J
fraiild not clarify t~L l
caRLCddtfon be w an` u e's,
tlenlar~i-n to .,
io
++ a t;al
e eci
SeiL i or P. Case (R-
 Approved For Release 2006/02/09 : CIA-RDP75B0038OR000300090023-9
THE WASHINGTON POST
N.J.) also observed that "thelproposals for covert support
record to me is not clear." I to anti Allende newspapers as
One possibility under con-
sideration is that the policy of
the U.S. government under-
went change between Broe's
first contact ' with Geneen and
his subsequent meeting with
Gerrity.
McCone testified last week
well as.1be hiring of radio and
televf-9io "propagandists"
favoring other candidates.
"Mr Merriam, without any
discussion of those (proposals),
said, `What do you think of
the proposals', and I said I
think they are all right," Broe
testified. "Then there was no
discussion."
a National Security Council The anti-Allende press and
television campaign was pro-
interde
artmental
o
o
p
gr
v-
up g
ernirng CIA covert operations
had decided to take no action
to thwart Allende's accession
to power.
In early September, how-
ever, McCone, an ITT board
member and CIA consultant,
approached national security
adviser Henry Kissinger and
Helms to convey Geneen's of-
fer of aid to finance a U.S.
government plan to block Al-
lende.
On Sept. 16 Kissinger deliv-
ered a. not-for-attribution press
backgrounder in Chicago in
which he said, "I don't think
we should delude ourseves
that an Allende takeover in
Chile would not present mas-
sive problems for the United
States and democratic forces
and pro-U.S. forces in Latin
America and indeed to the
whole Western Hemisphere
So we are taking a close
look at the situation. It is not
one in which our capacity for
influence is very great at this
,particular moment ..."
An intensive lobbying pro-
gram was conducted during
mid-September by ITT offi-
cials with top administration
officials for some form of in-
posed by two ITT field opera-
tives, Hal Hendrix and Robert
Berrellez from Santiago. ITT
officials testified that they
never put the plan into opera-
tion.
The purpose of Church's in-
quiry is to determine whether
ITT brought improper influ-
ence in Chile to affect the out-
come of the 1970 election and
the extent to which it had the
active cooperation of the CIA.
ITT and a number of other
companies contended that
their fears of an Allende ad-
tions against extending n( w
lines of credit to an A11ent a
government because of -.i
shaky financial condition.
He acknowledged, howevc
that the administration h a d
authorized a $10 million loan
to the Chilean military la
year.
"That seems to me from a'j
economic point of view e:;
tirely inconsistent," observe I
Case.
Replied Hennessy: "I woul
have to admit there is som
inconsistency."
ministration were prompted
by campaign pledges of the
Socialist candidate to national-
ize basic industries, such as
ITT's telephone subsidiary as
well as American owned cop-
per and bank holddings.
Allende's government con-
tended that it was negotiating
in good faith to compensate
ITT for the telephone com-pany until March 21, 1972,
when columnist Jack Ander-
son published internal ITT
documents suggesting that the
corporation had actively en-
gaged in plans to block the
election of Allende.
On the day the Anderson
papers were published, the
Chilean Ambassador to the
United States, Orlando Lete-
lier, had just returned from
Santiago with a counter-offer
to ITT, according to Chilean
government sources. After
publication of the documents,
Chile broke off its contacts
with ITT.
At yesterday's hearing the
.Assista .t .Ti?asury Secretary
ington office director Will}am for Iu1~L'a' iuuai Affairs, John
Merriam on Sept. 22, a week AL Hen , said the Nixon
prior to the Gerrity meeting, admiaistrauuu cautioned in-
and gave his assent to ITT ternational ,ending organiza-
tervention in Chile. Geneen's
offer of financial aid for a
CIA operation was rejected.
But on Sept. 29 Broe, acting
with the full consent of his su-
periors, endorsed an economic
program to frustrate Allende's
candidacy in the Chilean Con-
gress.
Broe testified that he also
met with ITT's former Witsh-
Approved For Release 2006/02/09 : CIA-RDP75B0038OR000300090023-9
 Approved For Release 2006/02/09 : CIA-RDP75B0038OR000300090023-9
THE EVENING STAR DATE -2!R VIRPK,713 PAGE ~._.._
ExOfficiaI Minimizes
ITT-CIA Discussion
By JEREMIAH O'LEARY Broe, and ITT senior Vice Frank Church, D-Idaho, chair-
Star-News staff writer President Edward Gerrity met man of the Senate subcommit-
- - - -
.-LI,i.l.Clii
of exerting economic pressure was no change in the U.S. gov-
C1?1
- f
r to the election of ern.me t'a policy of not inter-
n
e
o
M
rxist
a
"" public tional Telephone: meeting was made pliyes- -t ____ninntion _ tWcen nolicv and
The CIA agent, William V. Under questioning from Sen. Asaid.
w VU- LU17 n; 4Q.
e r aitaGe. t
Allende" in the Oct. 24 run-
~
y~. vii election. ,ntplli~Pnc relative to world:
., 4 j ,r }t'ori'ng?,.ChiI at Allende had won a narrow ~"?? =_
t r. ~
d
l
lit
in he Sept. general C 11;g.&Lnlster or anythiri at
~7(~~7Q }~a ~,y ~6."SL"'~35F's.S4'SCC..L7 YY'SY~dS..Yk~''^t p
uVla
+. ovi ge niesbauuri and Chris- p , that Xtr lie . rc?e -
e.Y Theyi ~vpre, o n
tian Democrat Radomiro 1o Pg-~ l"aa`i
I 4` bxainst
feared. Tomic but needed the Ch
i
r
s-
, Meyer contended that Broe tian Democratic vote for the t
proposed no firm course of ac-
runoff in the Chile C
anon-
tion tion to Gerrity but only sug- gress.
gested feasible courses of ac- Broe also gave information
tion. He described this as the that appeared to contradict j
sort of "free thinking that t
i
est
mony given the subco
m-
goes into policy making every- mittee e a r l i e r by Gerrity.
day from A to Z." Gerrity had testified about an
Broe told Senate investiga- earlier offer by ITT to pro-
tors that he met with Gerrity vide the U.S. with up to $1
on orders from CI?A Director million to apply to the Chile
Richard Helms. situation. Gerrity testified the
William V. Broe, former money was to be limited to
chief of CIA clandestine serv- constructive projects, such as
ices in the Western Hemi= housing and agricultural ex-
sphere, testified Tuesday in pansion.
closed session under,oath. But Broe said he had met
Broe described 'a number with ITT President Harold
of meetings he had with top- Geneen in Washington and
ranking ITT officials during Geneen had told him ITT was
the crucial period of the 1970 prepared to assemble an elec-
Chilean election which pro- tion fund for Alessandri's
pelled Allende into power. All campaign.
the meetings, Broe told the
subcommittee, stemmed from
suggestoin of John McCone,
an ITT director and former
CIA chief, to Helms, and from
Helms' instructions to Broe.
"Did you discuss vi:.th Mr.
Gerrity the feasibility of pos-
sible actions by U.S. com-
panies designed to create or
accelerate economic instabili-
ty in Chile?" Church asked.
"I explored with Mr. Ger-
rity the feasibility of possible
Church asked Broe if Geneen
had ever indicated "that the
fund he stood ready to con-
tribute was to be for construc-
tive use, technical assistance
to agriculture, building of
houses, or anything of that
character?" Broe replied "No,
it was to support Jorge Ales-
sandri."
Broe said the CIA did not
accept the money offer.
Earlier in the questioning
York meeting was not an ex-
change of intelligence but A
series of suggestions made by
Brae to Gerrity that must have
been made with a serious pur-
ference th it Gerrity had told
Broe at tie New York meet-
ing he di:in t think the plan
to provoke economic pres.
sures wor Id work, but this
does not at=ear in the edited
transcript :?eleased by the
subcommi' i ce.
The New York Times re-
ported th ,- according to in-
ternal IT'l memos that were
read into the subcommittee's
record week, Geneen re-
jected Brt c' , suggestions be-
cause he s t they would not
work.
Sen. Chcrd Case, R-N.J.,
said the r !c=trd was not clear
on whethe - 3roe went to New
York specifically to offer the
economic. suggestions to Ger-
rity. Chui cl: said there was
no evidenoe this was a pol-
icy adopted by the U.S. gov-
ernment but repeated that all
Broe's contacts were in ac-
pose. ' cord with instructions from
1941 ',d- w his superiors at CIA.
'#e g0e; e_r:Chwzh_,said-_i1?e
LU-Jaz
See CHILE, Page 146
banks should delay or not re- t sti-
new credits; that companies +Ii6S?Fpp 1Coad c,' ch
drag their feet in spending said, "~,p will ..x him
money, making deliveries and S,tel ,po43X~slGm
shipping spare parts, creating ?t.liis_..v~ si