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Panama Probes Vice President in Drug Case as U.S. Military Moves In

June 25, 1996

PANAMA CITY, Panama (AP) _ A vice president and a leading diplomat were targeted by investigators in a widening drug scandal as the United States announced a major anti-drug operation by American troops in Panama.

U.S. forces are taking part by air, land and water in the drug interdiction mission, the Pentagon said in Washington.

A 13-member pool of journalists accompanying U.S. forces during the operation arrived at Howard Air Force Base in Panama late Monday, Pentagon officials said.

The officials did not specify exactly when the operation was starting nor provide other details.

The U.S. military intervened in Panama in 1989 to depose former dictator Manuel Noriega, who is now serving a prison term in the United States on racketeering and drug trafficking charges.

In April, the U.S. Coast Guard was in the Darien jungle area along the Colombian border. Although it never announced what it was doing there, media reports at the time suggested they may have been training Panamanian police.

This latest military operation comes as Panama is embroiled in a drug scandal that has touched the highest levels of the ruling party. There was no known connection between the anti-drug operation U.S. troops are involved in and the political scandal.

Panamanian prosecutors announced Monday they will investigate what Second Vice President Felipe Virzi and Felix Estripeaut, the country’s ambassador to Costa Rica, knew about drug-tainted donations to the 1994 presidential campaign of Ernesto Perez Balladares.

Perez Balladares revealed Friday following an audit of the ruling Democratic Revolution Party his campaign had received $51,000 in two separate checks from a company controlled by a reputed drug boss.

He has denied allegations of corruption. The disclosure has nevertheless embarrassed an administration that pledged to rid the country of drug influences.

Perez Balladares’ supporters argue his case is different from that of Colombian President Ernesto Samper, who was accused of taking contributions from the Cali cocaine cartel in his 1994 election bid.

Samper was recently absolved by Colombia’s congress, but U.S. officials, opposition activists and many Colombians remain skeptical.

Perez Balladares acknowledged that he endorsed the questionable checks. But he insisted that he did not know at the time that the money was tainted. He said Virzi and Estripeaut had helped process the donation, but were also unaware the checks’ source.

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