Re: legalized

The answer to your question is most assuredly, no,

unless one or both of your parents happened to be American citizens.

Re: legalized

Please clarify: How old is your friend? Your friend may have had the right to elect US or Panamanian citizenship up through the age of 18, on the theory that the Canal Zone is U.S. territory. But if he was a citizen of Panama, I'm not sure. The more important question is why is he having trouble getting a visa? Are there any specific indications, hints, questions, feedback from the Consulate as to what the issues are he has to solve?

Re: legalized

You might check out the website: http://policy.ssa.gov/poms.nsf/0/0fdfb3fb60cad0e485256e370011ee66?OpenDocument which is the policy of the Social Security administration regarding those claiming to have US citizenship. As Mr. Moseley states, some persons born in the Panama Canal Zone before 1979 may be eligible to apply for citizenship, but I understand that you had to be properly registered there AND have elected US citizenship before reaching the age of 18.

In any case, I would recommend contacting INS or US Citizenship and Immigration Service: http://uscis.gov/graphics/index.htm.