he Reagan administration has caused a minor outcry in the Peruvian press by nominating as ambassador to Lima a diplomat who reportedly cut short an earlier tour of duty here after allegations linking him to the Central Intelligence Agency.
Frank Ortiz, the proposed new ambassador to Peru, is a 30-year veteran of the Foreign Service who served as chief political officer at the U.S. Embassy here from 1967 to 1970. In October 1968, the Peruvian military overthrew the government and began what was portrayed at the time as a social and economic revolution, including the much-publicized expropriation of a major U.S.-owned oil company.
A year later, according to two former government officials who were close confidants of the then-president, Gen. Juan Velasco Alvarado, certain rumors and observations involving the oil company expropriation and other politically sensitive issues led Velasco to believe that Ortiz was working with the CIA. As a result, these officials say, Velasco called the U.S. Embassy to ask that Ortiz be removed from his position.
Diplomatic officials in the U.S. Embassy, according to these former Peruvian officials and versions of the story that circulated at the time, asked that Ortiz's departure be delayed long enough to allow him to leave quietly, with no international fuss. Three months later, Ortiz left his Peru post and became deputy chief of mission in Uruguay. The CIA allegations were never proved, and both Peruvian Foreign Ministry officials and some U.S. diplomats now say there was nothing irregular about Ortiz's departure.
"Frank ended his normal tour of duty as assigned by the Department of State," said a U.S. diplomat in a recent interview. "He did not leave here early. . . . Before he left, he was included in, I don't remember if it was a lunch or dinner or what, and more or less apologized to."
Ortiz also had trouble during the Carter administration, when it was reported that he had been transferred from ambassadorial posts in Barbados and Guatemala, in part because of disagreements with administration policy. Ortiz is close to Reagan foreign policy advisers.
But for critics of the Ortiz nomination--some of whom disagree with the official version of Ortiz's final weeks here--it is both haughty and insensitive to send back as ambasador a man who became identified with some of a previous era's most volatile U.S.-Peruvian conflicts.
"It's just asking for trouble," said Enrique Zileri, editor of the influential and generally progovernment news magazine Caretas, which has run several editorials attacking the nomination. "It's a show of arrogance, I think . . . saying, 'You kicked this guy out, more or less.' Now he comes back as ambassador."
The newspaper Correo, saying that it was irrelevant whether Ortiz belonged to the CIA, called his nomination "a dispiriting example of how out of touch the Reagan administration is with Latin America." Current U.S. Ambassador Edwin Corr, the newspaper said, has worked comfortably with the government here and avoided conflicts with the substantial Peruvian left. Now he is to be replaced "with a diplomat who even before arriving has rekindled anti-American passions. . . . This is an arrogant vision of foreign policy that has brought a lot of headaches to the United States."
El Diario, the most widely read newspaper of the Peruvian left, has declared outright that Ortiz was "expelled from Peru years ago for being a CIA agent." The leftist newspaper Kausachum, which is edited by Velasco's former press secretary, Augusto Zimmerman, has made similar statements, and has taken advantage of the nomination to reprint old allegations that President Fernando Belaunde Terry directly asked for CIA counterinsurgency aid when he was president in the mid-1960s. Belaunde's first government was overthrown by the coup that brought Velasco to power.
In one issue, Kausachum reprinted in English a page from Victor Marchetti's and John D. Marks' book "The CIA and the Cult of Intelligence." The reprinted page says the CIA secretly sent Green Berets and combat equipment into eastern Peru in the mid-1960s to help the Peruvian government fight guerrillas.
Velasco died in 1977, and most of the few men closest to him in the Ortiz matter are out of the country or unwilling to discuss it publicly. But roughly the same version of events was described recently in interviews with Zimmerman, who was presidential press secretary in October 1969, and retired Gen. Jose Graham Hurtado, who was chief of the president's advisory committee and a close associate of Velasco.
According to their stories, Velasco became concerned about Ortiz during negotiations over the International Petroleum Co., an American-owned enterprise that became a kind of nationalistic revolutionary symbol when Velasco expropriated it shortly after taking power. Velasco was unwilling to pay the company the money it claimed, and in the course of the protracted U.S.-Peruvian negotiations, Zimmerman and Graham said, Velasco began to suspect Ortiz of CIA links.
Then in October 1969, according to the two former officials and to a published political chronology of Velasco's government, Peruvian officials raided the offices of a private security firm run by an American. Inside, they reportedly found files on 50,000 Peruvians, including union leaders and military men, with background and political information on each name.
Rumors and suspicion reportedly linked these files both to the CIA and to Ortiz, although no such evidence was ever made public, and the file discovery is not even mentioned in the major newspapers' accounts of that week. According to Zimmerman and Graham, it was the discovery of these files that prompted Velasco to ask that Ortiz leave the country.
"The important thing is that they never found a single element of proof," said Julio Balbuena, undersecretary for political affairs at the Foreign Ministry, which has officially conveyed the Peruvian government's acceptance of Ortiz. "On the contrary, he's been accused simply by rumors. . . . At that time there was a xenophobia against everything American. . . . It was a kind of psychosis, that the CIA was all over South America. It was very easy to accuse an American citizen, but very hard to prove."
"Let's suppose there was nothing, and there was just a scandal," said Graham. "This is a guy who isn't going to help relations between our countries. . . . He's a man who's been questioned. A country as big as the United States can't find anybody but a questioned man when there must be dozens or hundreds of qualified people as good or better? It seems like a kind of vendetta on the part of the United States."
The official U.S. response to that is that Ortiz is extremely well-qualified. He speaks fluent Spanish, is generally referred to as the highest ranking Hispanic in the Foreign Service, and has held eight State Department or diplomatic positions related to Latin America.
"I know Frank personally," said Corr. "I know his personal qualities and his professionalism . . . . I'm quite certain he'll do a great job."
While Ortiz was ambassador to Guatemala in 1979 and 1980, he came into conflict with the Carter administration over its human rights policy. Ortiz, critics said, resisted applying the kind of pressure called for under the Carter policy, until he was finally transferred out of Guatemala.
He has been close to the Reagan foreign-policy-makers. As one Foreign Service officer said, "He took it in the ear for what is essentially current U.S. policy, and they owe him."