PCGG Commissioner Jorge Sarmiento said the money seized from the late dictator Ferdinand Marcos had been invested in London, Switzerland, Singapore, Hong Kong and the United States as part of the escrow agreements it had entered into with the PCGG. The agreements were approved by the Swiss Federal Supreme Court.

''The investments were placed in a number of forms of investments such as in the money market, high-yield securities, bonds, notes and precious metals with varying maturities,'' he said.

The seized Marcos assets were transferred to the escrow accounts established by the PNB on April 17, June 30 and July 3, 1998, according to Sarmiento.

''The Swiss high court agreed for the transfer to avoid the dissipation of the funds,'' he said.

Double A rating

 But the assets are kept abroad on the condition that the bank or company in which the money is invested would have a Standard & Poor's rating of at least ''AA,'' according to Sarmiento.

An ''AA'' rating means that nothing could go wrong with the investment.

''Since we don't have companies here with such rating, the PNB thought it best to invest the escrow money in five countries--England, Switzerland, Singapore, Hong Kong and the United States,'' Sarmiento said.

Sarmiento's disclosure was confirmed by PCGG Chair Magdangal Elma, who wrote former Senate President Jovito Salonga to dispute the latter's allegations that the escrow agreements were ''spurious.''

Elma told Salonga that the escrow agreements were found to be ''in order, binding and legal'' by District Attorney Peter Cosandey of Zurich and were upheld by the Swiss Federal Supreme Court. Cosandey was in Manila last week.

Cosandey issued three separate orders for an ''early restitution'' of the Marcos assets on Aug. 21, 1995, according to the PCGG chair.

Elma said Cosandey informed the Swiss Bank Corp. in Geneva, Swiss Bank Corp. in Freiburg, and Credit Suisse in Zurich that the restitution of assets was ''in accordance with the obligations of the Philippines and the PNB as set down in the escrow agreements of Aug. 14, 1995.''

In a 16-page letter to Salonga, a copy of which was furnished the Inquirer, Elma said the escrow agreements upheld the PNB's decision ''to keep and reinvest the assets in the form of investments and currency as received.''

But Elma stressed that the assets could not be disposed of other than in accordance with an ''enforceable judgment'' of the competent Philippine court, or in accordance with ''identical instructions'' of the PCGG. But the foundations concerned or the estate must be represented by the Marcos heirs.

Two conditions

 Elma stressed that the government was strictly complying with the Swiss tribunal's two conditions--judicial proceedings for collection or restitution and indemnification of the victims of the Marcos regime.

The PCGG chair conceded that only the Sandiganbayan could decide on the disposition of the escrow accounts after it shall have ruled either in favor or against the Marcoses.

For his part, presidential spokesperson Fernando Barican said the PCGG saw no ''substantial and compelling reason'' to revise the existing escrow agreements covering the Marcos Swiss deposits.

''These are not spurious and illusory as alleged by certain quarters,'' Barican said.

Based on PNB records furnished by the PCGG, the escrow deposit is now $589,305,805.94, according to Barican.

''The escrow money can only be touched after the government has obtained a final decision from the Sandiganbayan on Civil Case No. 0141 or the forfeiture case against the Marcoses,'' Sarmiento pointed out.

''In the meantime, the money may be placed in safe investments to make it grow,'' he said.

Diplomatic notes

 To ensure that the conditions for the ''unfreezing'' of the $590 million would be complied with, the Philippines and Switzerland have maintained formal communications since last year, according to records submitted by the Office of the Solicitor General to the Supreme Court.

Solicitor General Ricardo Galvez submitted to the Supreme Court the diplomatic notes of the Swiss Embassy and the Department of Foreign Affairs when he presented his position on the escrow agreements.

The Estrada administration, particularly, had vowed to indemnify the 10,000 human rights victims of the Marcos regime, which was one of the conditions set by the Swiss Federal Supreme Court.

In July 1998, the Department of Foreign Affairs said the Philippines had reiterated its acceptance of the conditions of the Swiss court, including working on an enforceable judgment on the forfeiture case filed against the Marcoses.

Should the PCGG be abolished, the Swiss government said the DFA, or the government agency which would take over PCGG's functions, could continue to provide the needed information to the Swiss authorities in accordance with the decision of the Swiss court.

The Philippines first accepted the two conditions in diplomatic notes dated Jan. 13 and 19, 1998.

The notes were sent by the Philippine Embassy in Berne to the Swiss Federal Department of Justice and Police.

The Swiss Embassy sent its note reiterating the conditions on March 26, 1998.

In response, the DFA on July 13, 1998, sent another note saying the Swiss government's proposals were ''acceptable.''

By Christine Herrera, with reports from Donna S. Cueto and Juliet L. Javellana