Police will question some 70 Dumagat tribesmen to determine who had financed the illegal cutting of trees in the Real-Infanta-General Nakar (REINA) area.
In an aerial survey, officials saw more than 100 illegal sawmills operating along the banks of the 65-kilometer Agus River.
Maj. Gen. Ernesto Carolina, Southern Luzon Command (Solcom) chief, said the New Peoples Army (NPA) provides protection to the illegal loggers.
"Illegal logging is one of the major sources of rebel funds," he said.
Unscrupulous traders also fund the operations of illegal loggers in the REINA area, he added.
Quezon Gov. Wilfredo Enverga learned about the illegal logging following a tip-off from Thelma Aumentado, a leader of the Dumagat tribe.
Enverga confirmed the report following an aerial survey of the Agus River with a joint military-police team headed by Senior Superintendent Roberto Rosales, provincial police director, and Solcom official Col. Jose Recuenco.
Enverga said he has ordered Rosales to draw up the "necessary documentation" to identify the financiers of illegal logging in Quezon.
"We know that the NPA is receiving P2 for each board foot of logs but we should find out who are the financiers and where the logs are being brought so the necessary charges could be filed," he said.
Pastor Marquez, chairman of Barangay Mahabang Lalim in General Nakar, said illegal logging has been going on in his village for decades and that the Department of Environment and Natural Resources has done nothing about it.