For six weeks after his series came out, Webb waited in a kind of honeymoon. His e-mail was exploding, he recalls, "from ordinary people who said, 'This has restored my faith in newspapers.' It was from college students, housewives that heard me on the radio; it was really remarkable to think that journalism could have this kind of effect on people, that people were out marching in the streets because of something that had been hidden from us all these years. The thing that surprised me was that there was no response from the press, from the government. It was total silence."
Finally, in early October, The Washington Post ran a story by Robert Suro and Walter Pincus headlined, THE CIA AND CRACK: EVIDENCE IS LACKING OF ALLEGED PLOT. The story focused in part on the fact that Webb had given a defense attorney questions to ask Oscar Danilo Blandon about his CIA connections. It also quoted experts who denied that the crack epidemic originated in Los Angeles, disputed that Freeway Rick Ross and Blandon were significant national players in the cocaine trade of the eighties (pegging Blandon's coke business at five tons over the decade, whereas Webb had evidence that it was more like two to five tons per year). And, the article continued, there was no evidence that the black community had been deliberately targeted (the "plot" referred to in the headline and a claim never made by Webb), that the CIA knew about Blandon's drug deals (also a claim never made by Webb, who in the series merely connected Blandon to CIA agents), or that Blandon had ever kicked in more than $60,000 to the contra cause (the Post based this number on unnamed law-enforcement officials;
Webb based his estimate of millions of dollars to the contras from dope sales on grand-jury testimony and court documents). Perhaps the best summary of the Post's retort to Webb came from the paper's own ombudsman, Geneva Overholser, some weeks later: "The Post...showed more passion for sniffing out the flaws in San Jose's answer than for sniffing out a better answer themselves. They were stronger on how much less money was contributed to the contras by the Mercury News's villains that their series claimed, how much less cocaine was introduced into L.A., than on how significant it is that any of these assertions are true."
In late October, the Los Angeles Times and The New York Times weighed in on consecutive days. The Los Angeles Times had two years before described Freeway Rick Ross vividly: "If there was an eye to the storm, if there was a criminal mastermind behind crack's decade-long reign, if there was one outlaw capitalist most responsible for flooding Los Angeles's streets with mass-marketed cocaine, his name was Freeway Rick....Ross did more than anyone else to democratize it, boosting volume, slashing prices, and spreading disease on a scale never
before conceived....While most other dealers toiled at the bottom rungs of the market, his coast-to-coast conglomerate was selling more than five hundred thousand rocks a day, a staggering turnover that put the drug within reach of anyone with a few dollars." In the 1996 response to Webb's series, the Los Angeles Times described Ross as one of many "interchangeable characters" and stated, "How the crack epidemic reached that extreme, on some level, had nothing to do with Ross." Both stories were written by the same reporter, Jesse Katz, and the 1996 story failed to mention his earlier characterization. The long New York Times piece the following day quoted unnamed government officials, CIA personnel, drug agents, and contras, and noted that "officials said the CIA had no record of Mr. Blandon before he appeared as a central figure in the series in the Mercury News."
A common chord rang through the responses of all three papers: It never really happened, and if it did happen, it was on a small scale, and anyway it was old news, because both the Kerry report and a few wire stories in the eighties had touched on the contra-cocaine connection. What is missing from the press responses, despite their length, is a sense that anyone spent as much energy investigating Webb's case as attempting to refute it. The "Dark Alliance" series was passionate, not clinical. The headlines were tabloid, not restrained. But whatever sins were committed in the presentation of the series, they cannot honestly be used to dismiss its content. It is puzzling that The New York Times felt it could discredit the story by quoting anonymous intelligence officials (a tack hardly followed in publishing the Pentagon Papers). In contrast, what is striking in Webb's series is the copius citation of documents. (In the Mercury News's Web-site version-cgi.sjmercury.com/drugs/postscriptfeatures.htm -- are the hyperlinked facsimiles of documents that tug one into the dark world of drugs and agents.) But when Jerry Ceppos, the executive editor of the Mercury News, wrote a letter in response to the Post's knockdown, the paper refused to print it because a defense of Webb's work would have resulted in spreading more "misinformation."
Despite Ceppos's initial defense of the series, the Mercury News seemed to choke on these attacks, and Webb could sense a sea change, But he kept on working, building a a bigger base of facts, following its implications deeper into the government. When the Mercury News forced him to choose between a $600,000 movie offer and book deals and staying on the story, Webb picked the story. He kept discovering people who had flown suitcases full of money to Miami from dope sales for the contras. He documented Blandon's contra dope sales from '82 through '86. Gary Webb was on a tear; he was going to advance the story. Almost none of this was published by the Mercury News; the paper grudgingly ran (and buried) one last story on New Year's Eve 1996.
The paper had printed the story of the decade, the one with Pulitzer prize written all over it, and now was unmistakably backing off it. Webb entered a kind of Orwellian world where no one said anything, but there was this thing in the air. The Mercury News assigned one of its own reporters to review the series, using the stories of the L.A. Times, The New York Times, and The Washington Post as the benchmark for what was fact.
Webb wouldn't admit it to himself, but he had become a dead man walking.
WHEN HECTOR BERRELLEZ SPENT HIS YEAR GOING TO MOVIES IN Washington, he knew he was finished in the DEA. One day in October 1996, a month after he retired, Hector Berrellez picked up a newspaper and read this big story about a guy named Gary Webb. Hector had lived in shadows, and talking to reporters had not been his style. "As I read, I thought, This shit is true," he says now. He hadn't a doubt about what Webb was saying. He saw the reporter as doomed. Webb hit a sensitive area, and for it he would be attacked and disbelieved.
Hector knew all about the Big Dog and the Big Boy rules.
Hector's body aches from the weight of secrets. When we meet, he is in a white sport shirt, slacks, a blue blazer with brass buttons, and a shoulder-holstered 9mm with fifteen rounds in the clip and two more clips strapped under his right arm. He may be a little over-armed for his Los Angeles private-investigation agency (the Mayo Group, which handles the woes of figures in the entertainment industry -- that pesky stalker, that missing money -- for a fat fee up front and two hundred dollars an hour), but not for his history. For the rest of his life, Hector Berrellez will be sitting in nice hotels like this one with a cup of coffee in his hand, a 9mm under his jacket, and very quick eyes.
He saw a lot of things and remembers almost all of them. He wrote volumes of reports. In 1997, he was interviewed by Justice Department officials about those unseemly drug ledgers and contra materials he saw during the raid on the fourteen Blandon stash houses back in 1986. His interviewers wanted particularly to know whether anyone besides Hector had seen them. They then told Hector that they couldn't find the seized material anymore.
Before he retired, Hector was summoned to Washington to brief Attorney General Janet Reno on Mexican corruption. He talked to her at length about how the very officials she was dealing with in Mexico had direct links to drug cartels. He remembers that she asked very few questions. Now he sits in the nice lounge of the nice hotel, and he believes the CIA is in the dope business; he believes the agency ran camps in Mexico for the contras, with big planes flying in and out full of dope. He now knows in his bones what the hell he really saw on October 27, 1986, when he hit the door of that house in the Los Angeles area and was greeted with politeness and fresh coffee.
But he doesn't carry a smoking gun around. The photos, the ledgers, all the stuff the cops found that morning as they hit fourteen stash houses where all the occupants seemed to be expecting company, all that material went to Washington and seems to have vanished. All those reports he wrote for years while in Mexico and then later running the Camarena case, those detailed reports of how he kept stumbling into dope deals done by CIA assets, never produced any results or even a substantive response.
Hector Berrellez is a kind of freak. He is decorated; he is an official hero with a smiling Ed Meese standing next to him in an official White House photograph. He pulled twenty-four years and retired with honors. He is, at least for the moment, neither discredited nor smeared. Probably because until this moment, he's kept silent.
And Hector Berrellez thinks that if the blacks and the browns and the poor whites who are zombies on dope ever get a drift of what he found out, well, there is going to be blood in the streets, he figures -- there is going to be hell to pay. He tells me a story that kind of sums up the place he finally landed in, the place that Gary Webb finally landed in. The place where you wonder if you are kind of nuts, since no one else seems to think anything is wrong. An agent he knows was deep in therapy, kind of cracking up from the undercover life. And the agent's shrink decided the guy was delusional, was living in some nutcase world of weird fantasies. So the doctor talked to Hector about his patient, about whether all the bullshit this guy was claiming was true, about dead men and women and children, strange crap like that. And he made a list of his patient's delusions, and he ticked them off to Hector. And Hector listened to them one by one and said, "Oh, that one, that's true. This one, yeah, that happened also." It went on like that. And finally, Hector could tell the shrink wondered just who was nuts -- Hector, his patient, or himself.
ON SUNDAY, MAY 11, 1997, GARY WEBB WAS hanging wallpaper in his kitchen when the San Jose Mercury News published a column by executive editor Jerry Ceppos that was widely read as a repudiation of Webb's series. It was an odd composition that retracted nothing but apologized for everything. Ceppos wrote, "Although the members of the drug ring met with contra leaders paid by the CIA and Webb believes the relationship was a tight one, I feel we did not have proof that top CIA officials knew of the relationship." Fair enough, except that Webb never wrote that top CIA officials knew of the contra-cocaine connection. The national press wrote front-page stories saying that the San Jose Mercury News was backing off its notorious series about crack. The world had been restored to its proper order. Webb fell silent. He had to deal with his own nature. He is not good at being polite. "I'm just fucking stubborn," he says, "and that's all there was to it, because I knew this was a good story, and I knew it wasn't over yet, and I really had no idea of what else to do. What else was I going to do?"
What he did was have the Newspaper Guild represent him in arbitration with the Mercury News over the decision to ship him to the wasteland of Cupertino. "I'm going to go through arbitration, and I'm going to win the arbitration, and I'm going to go to work," he says. "I was just going to fight it out. This was what I did, this was me, I was a reporter. This was a calling; it was not something you do eight to five. People were not exactly
beating down my door, saying, Well, okay, come work for us. I was...unreliable." So he went to Cupertino, and he wrote stories about constipated horses and refused to let his byline be printed. And then he went to his
apartment and missed his wife and family and watched Caddyshack endlessly. He was a creature living a ghostly life. The only thing he didn't figure on was himself. Webb slid into depression. Every week, the 150-mile drive between his family in Sacramento and his job in Cupertino became harder. Every day, it was harder to get out of bed and go to work.
And he was very angry most of the time. He says, "I was going to live in my own house and see my own kids. At some point, I figured something was going to give." Finally, he couldn't make it to work and took vacation time. When that was used up in early August, he started calling in sick. After that, he went on medical leave. A doctor examined him and said, "You are under a great deal of stress," and diagnosed him as having severe depression. He couldn't sleep. He couldn't do much of anything. He decided to write a book about "Dark Alliance," but this time no one wanted it. His agent was turned down by twenty-five publishers before finding a small press, Seven Stories, that operates as a kind of New York court of last resort.
A job offer came from the California state legislature to conduct investigations for the government-oversight committee at about the same money he made for the Mercury News. His wife said, Take the job. Why hang around in this limbo? Webb thought about her words and told himself, What do I win even if I do win in arbitration? I get to go back to my office and get bullshitted the rest of my life. He watered his lawn, worked on the house, read more and more contra stuff. Drifted in a sea of depression. "I didn't know what to do if I couldn't be a reporter," he says. "So all of a sudden, I was standing there on the edge of the cliff, and I don't have what I was doing for the last twenty years -- I don't have that to do anymore. I felt it was like I was neutered. I called up the Guild and said, 'Let's see if they want to settle this case.' They sent me a letter of resignation that I had to sign."
Webb carried the letter with him from November 19 to December 10 of last year. Every day, he got up to sign the letter and mail it. Every night, he went to bed with the letter unsigned. His wife would ask, Have you signed it? Somebody from the Mercury kept calling the Guild and asking, Has he signed it yet? "I mean," he says softly, "writing my name on that thing meant the end of my career. I saw it as a sort of surrender. It was like signing," and here he hesitates for several seconds, "my death certificate."
But finally he signed, and now he is functionally banned from the business. He's the guy nobody wants, the one who fucked up, the one who said bad things. Officially, he is dead, the guy who wrote the discredited series, the one who questioned the moral authority of the United States government.
If Gary Webb could have talked to a Hector Berrellez in the fall of 1996, when his stories were being erased by the media, Hector would have been like a savior to him. "Because he would have shown what I was reporting was not an aberration," Webb says now, "that this was part of a pattern of CIA involvement with drugs. And he would have been believed." But Webb was not that lucky, and the Hectors of the world were not that ready to talk then. So Webb was left out there alone, one guy with a bunch of interviews and documents. One guy who answered a question no one wanted asked.
I CAN HEAR HECTOR BERRELLEZ TELLING ME that I will never find a smoking gun. I can hear the critics of Gary Webb explaining that all he has is circumstantial evidence. Like anyone who dips into the world of the CIA, I find myself questioning the plain facts I read and asking myself, Does this really mean what I think it means?
-- In 1982, the head of the CIA got a special exemption from the federal requirement to report dealings with drug traffickers. Why did the CIA need such an exemption?
-- Courthouse documents attest to the fact that the Blandon drug organization moved tons of dope for years with impunity, shipped millions to be laundered in Florida, and then bought arms for the contras. Why are Gary Webb's detractors not looking at these documents and others instead of bashing Webb over the head?
-- The internal CIA report of contra cocaine activity has never been released. The Justice Department investigation of Webb's charges has never been released. The CIA has released a censored report on only one volume of Webb's charges. The contra war is over, yet this material is kept secret. Why aren't the major newspapers filing Freedom of Information [Act] requests for these studies?
-- The fifty-year history of CIA involvement with heroin traffickers and other drug connections is restricted to academic studies and fringe publications. Those journalists who find themselves covering the war on drugs should read Alfred McCoy's massive study, The Politics of Heroin: CIA Complicity in the Global Drug Trade, or Peter Dale Scott and Jonathan Marshall's Cocaine Politics: Drugs, Armies, and the CIA in Central America.
-- Following the release of "Dark Alliance," Senator John Kerry told The Washington Post, "There is no question in my mind that people affiliated with, on the payroll of, and carrying the credentials of, the CIA were involved in drug trafficking while involved in support of the contras." Why has the massive Kerry report been ignored to this day?
-- On March 16, 1998, the CIA inspector general, Frederick P. Hitz, testified before the House Intelligence Committee. "Let me be frank," he said. "There are instances where CIA did not, in an expeditious or consistent fashion, cut off relationships with individuals supporting the contra program who were alleged to have engaged in drug-trafficking activity, or take action to resolve the allegations."
Representative Norman Dicks of Washington then asked, "Did any of these allegations involve trafficking in the United States?"
"Yes," Hitz answered.
The question is why a mountain of evidence about the CIA and drugs is ignored and why the legitimate field of inquiry opened by Webb remains unpursued and has become journalistic taboo.
Maybe the CIA is great for America. But if it is, surely it can roll up its sleeves and show us its veins.
WEBB AND HIS WIFE, SUE, ARE STANDING IN the driveway with me after a Thai dinner in Sacramento. The night is fresh; spring is in the air. A frog croaks from the backyard on the quiet and safe suburban street. Sue has just finished rattling off details from one facet of the contra war, the CIA drug-airline operation run out of Ilopango airfield in El Salvador. She seems to have absorbed a library of material over the last three years of her husband's obsession. Before, he always worked like hell, she knows, but on this one he brought it home. He could not keep it separated from his wife and family and his weekly hockey games. So Sue, with her winning smile and cheerful ways, has become an authority on America's dark pages. And we stand there in the fine evening air, the rush of spring surging through the trees and grass and shrubs, talking about the endless details of this buried episode in the secret history.
And I wonder how Webb deals with it, with all the hard work done, with all the facts and documents devoured, and with all this diligent toil resulting in his personal ruin, depriving him of the only kind of work he has ever wanted in his life.
And I remember what he said earlier that day while he sat in his study, leaning toward me, his right hand gripping his left wrist: "The trail is littered with bodies. You go down the last ten years, and there is a skeleton here and a skeleton there of somebody that found out about it and wrote about it. I thought that this is the truth, and what can they do to you if you tell the truth? What can they do to you if you write the truth?"
(c)1998 by Hearst Communications, Inc. Printed in the USA.
*Judge Overrules Bid to Link CIA, Drug Lords in Camarena Trial - June 08, 1990 by Henry Weinstein, Times Staff Writer
U.S. District Judge Edward Rafeedie barrs attorney Mary Kelly from questioning Laurence Victor Harrison about possible CIA links during the Camarena murder trial. Harrison was a government-paid witness who had extensive dealings with both Mexican law enforcement and drug traffickers. Harrison stated that he worked for Miguel Nazar Haro who was DFS director from 1977 to 1982. Harrison called Nazar his "overboss" and said Nazar was involved in drug trafficking. U.S. officials in Mexico attempted to block DOJ prosecution stating that Nazar was "an essential repeat essential contact for CIA station Mexico City." At one point, Harrison testified that he had told drug kingpin Ernesto Fonseca Carrillo, for whom he had installed a sophisticated radio system, that law enforcement might go after him (Fonseca). "He told me I was crazy," Harrison recalled. "He told me there was no danger."
Then the witness was asked, "Did Fonseca say it (his feeling of safety) was a political thing?" Harrison replied, "Yes."
On Thursday, Kelly asked Harrison if Nazar was connected to the CIA. Prosecutor Manuel Medrano objected on the grounds that the question was irrelevant to the case. U.S. District Judge Edward Rafeedie sustained the objection.
Later, however, outside the presence of the jury, Kelly told the judge why she thought questions about the CIA were relevant to the Camarena case.
"Fonseca thought his actions were condoned by the Mexican government, as well as sanctioned by the CIA," she said. "This goes to the issue of whether this was an illegal enterprise" and could help her client in her defense.
** After presiding over the hearings on the Contra Drug Controversy, Porter Goss, the Chairman of the House Permanent Select Committee on Intelligence (HPSCI) was later appointed to the position of Director of Central Intelligence by George W. Bush. He served as CIA Director from September 22, 2004 to May 25, 2006. Goss had prior service in the intelligence community from 1960 until 1971 — working for the Directorate of Operations, the clandestine services of the CIA. After holding its hearings behind closed doors, the final report on the Contra Drug allegations titled "CIA and Drugs in Los Angeles” was classified in 2000 and never released to the public.
“In the end the objective of unseating the Sandinistas appears to have taken precedence over dealing properly with potentially serious allegations against those with whom the agency was working,” CIA Inspector General Britt Snider said in classified testimony on May 25, 1999. He conceded that the CIA did not treat the drug allegations in “a consistent, reasoned or justifiable manner.”
Retired CIA Officer Robert D. Steele appeared with Celerino Castillo III in Kevin Booth’s 2007 film American Drug War: The Last White Hope along with several other notable law enforcement agents and political figures. Steele went on to review Dark Alliance and validated the Contra drug allegations. His comments go even further as he alleges that intelligence agencies employed a “eugenics” policy towards low income blacks, considering them “expendable”. “It is safe to say that all US Senators know the truth and have chosen to betray their Oaths of Office and their responsibility under Article 1 of the Constitution….We the People are considered expendable by those who do this.”
American Drug War: The Last White Hope can be viewed for free on Youtube. http://www.americandrugwar.com/
The full Two hour film is here:
Also see: "CIA are drug smugglers" Robert Bonner, DEA Administrator,- Federal Judge Bonner, head of DEA- You don't get better proof than this
From 1982 to 1995 the CIA did not to have to report if they suspected any of their agents of dealing drugs. Why?
Plus: History 101: The CIA & Drugs. The CIA has a long and sordid history with drug traffickers. And it's all in the Congressional Record.
By Eric Umansky
June 16, 1998
It's the kind of government exchange you assume never actually takes place. But it did. And it went something like this:
CIA Chief: Dear Attorney General, Do you mind if CIA agents or informants are dealing drugs? I mean, we don't have to tell on them, do we?
Attorney General: Of course not! Well, you did. But I just changed the law. Don't worry about it.
CIA Chief: Gee, thanks!
This may sound absurd, but according to a series of recently declassified documents obtained by the MoJo Wire, it's just what happened in the spring of 1982.
Central Intelligence Agency Director William Casey's request to then-Attorney General William French Smith isn't in the public domain. But two letters, one from Smith thanking Casey for his request, and a follow-up by Casey, are both available. They were released as part of a internal CIA report that explored allegations of CIA involvement in drug trafficking. (The most comprehensive allegations were reported by Gary Webb in a series of San Jose Mercury News reports and a book entitled "Dark Alliance.") In the first document, Smith thanks Casey for his letter (the one that isn't public) and says:
"...in view of the fine cooperation the Drug Enforcement Administration has received from CIA, no formal requirement regarding the reporting of narcotics violations has been included in these procedures."--William French Smith Attorney General[See the full document]
--William French Smith Attorney General
Casey in return thanks the Attorney General for his understanding:
"I am pleased that these procedures, which I believe strike the proper balance between enforcement of the law and protection of intelligence sources and methods, will now be forwarded to other agencies..."--William J. Casey Director, Central Intelligence Agency[See the full document]
--William J. Casey Director, Central Intelligence Agency
The two men then codified their agreement in a Memorandum of Understanding. According to the agreement, intelligence agencies would not have to report if any of their agents were involved in drug running. (By agents, the agreement meant CIA sources and informants. Full-time employees still couldn't deal drugs.) That understanding remained in effect until August of 1995, when current Attorney General Janet Reno rescinded the agreement.
It's reasonable that the CIA be allowed to keep its mouth shut if it knows that some of its agents are involved in minor illegal affairs. Presumably some of the value of informants comes from the fact that they keep company with shady characters who engage in unlawful activities.
But why would the CIA ask to be exempt specifically from drug enforcement laws? According to Congresswoman Maxine Waters (D-Calif.), who is calling for full disclosure of the facts, "The CIA knew that the Contras were dealing drugs. They made this deal with the Attorney General to protect themselves from having to report it."
Some of the remaining questions may still be answered. The Department of Justice and the CIA have finished separate investigations into possible CIA involvement in drug smuggling. But neither report has been made available to the public; the Justice department cites an "ongoing investigation" while the CIA says their report is an internal document and therefore classified. Says Congresswoman Waters: "What is it they don't want Americans to see? If the CIA was involved in drug trafficking, they should be brought to justice. Not covered up."
SEE THE ACTUAL DOCUMENTS ON THE CIA'S WEBSITE:
News: The CIA-coke connection was detailed long before Dark Alliance -- and the evidence keeps coming
August 25, 1998
You may have seen the headline last month on the front page of the NEW YORK TIMES. (Then again, you may not have, since it ran in a small box on the bottom-left corner.) It announced, "CIA Says It Used Nicaraguan Rebels Accused of Drug Tie." The beginning of that story read:
"The CIA continued to work with about two dozen Nicaraguan rebels and their supporters during the 1980s despite allegations they were trafficking in drugs.... [T]he agency's decision to keep those paid agents, or to continue dealing with them in some less formal relationship, was made by top officials at headquarters in Langley, Va."
How did it come to this? The paper of record running a story, perhaps leaked purposely by the CIA itself, that admits what many have charged for years...and then the story disappears as quickly as it came.
A look at the twisted history of the CIA/Contra/cocaine story:
If you've heard about the CIA/Contra/crack allegations, it's probably because of Gary Webb, who in August 1996 authored several stories for the SAN JOSE MERCURY NEWS. Titled "Dark Alliance," the series linked drug smuggling by CIA-trained Contras to the crack epidemic that has ravaged America. It never actually said the CIA knew about the drugs, but it did strongly imply it (the logo for the series -- yes, it had a logo -- showed a person smoking crack, superimposed over the CIA seal.)
The series ignited a firestorm of controversy. And the major papers, specifically the NEW YORK TIMES, LOS ANGELES TIMES, and WASHINGTON POST, all ran lengthy pieces questioning the accuracy of Webb's reporting. (These stories were themselves criticized for being hell-bent on proving Gary Webb wrong, rather than attempting to follow up on his stories.) Even Webb's own editor retreated from the story's conclusions.
But the story of the CIA-funded Contras trafficking coke isn't new. And neither is the surprising lack of media interest in getting to the bottom of it:
Senator KERRY: What did you do with those drugs?Mr. MORALES: Sell them.Senator KERRY: What did you do with the money?Mr. MORALES: Give it to the Contras.Senator KERRY: All right.
[I]t is clear that individuals who provided support for the Contras were involved in drug trafficking, the supply network of the Contras was used by drug trafficking organizations, and elements of the Contras themselves knowingly received financial and material assistance from drug traffickers. In each case, one or another agency of the U.S. government had information regarding the involvement either while it was occurring, or immediately thereafter.
What was the response when the Kerry Committee report was released? According to a Lexis-Nexis search, only four major papers reported the committee's findings -- none on the front page. The NEW YORK TIMES' story, tucked away on Page 8, did mention one of the committee's more interesting findings: "The State Department paid $806,401 between January and August 1986 to four companies that distributed humanitarian aid to the contras but 'were owned and operated by narcotics traffickers.'"
But if the media weren't biting, the Reagan administration was keenly interested in the committee findings. Jack Blum, the lead investigator for the committee, complained that the administration obstructed the investigation. The report itself complains of pressure from the executive branch: "...officials in the Justice Department sought to undermine attempts by Senator Kerry to have hearings held on the [Contra drug] allegations."
From a July 12, 1985, meeting with Richard Secord, North's boss in the Reagan administration:
"$14M to finance came from drugs."
And this entry on Aug. 9, 1985, which was submitted as part of the Iran-Contra special prosecutor report:
"Honduran DC-6 which is being used for runs out of New Orleans is probably being used for drug runs into U.S."
From: Gary WebbDate: Fri, 24 Jul 1998 22:22:06 EDTTo: firstname.lastname@example.orgMime-Version: 1.0Subject: Re: CIA/coke NYT article>Do you feel vindicated?
The second CIA report not only vindicates me, but all the other reporters and activists who have been trying to bring this to the public's attention for the last 13 years. It also proves that, once again, the CIA lied to the American public and was assisted in this effort by our national news media, which denigrated anyone who challenged the official denials.
The story mostly stayed out of the media for the next five years. Then Gary Webb and the SAN JOSE MERCURY NEWS released "Dark Alliance." In many ways, the series didn't advance the CIA/Contras/drugs story. But it did make one stunning allegation: The Contras' drug-smuggling operation bore major responsibility for a public-health epidemic in America.
"The cocaine that flooded in helped spark a crack explosion in urban America..."
Ironically, it was the title and graphic of the story -- "Dark Alliance" and a picture of a crack pipe superimposed over the CIA logo -- that most strongly implied a direct CIA connection to drug dealing. And titles and graphics are rarely the responsibility of the author.
The best wrap-up of both Webb's story and the big papers' responses to it appeared in the COLUMBIA JOURNALISM REVIEW, in an article by Peter Kornbluh, senior analyst at the National Security Archive. He agreed with the major papers' assertions that Webb's feature contained hyperbole and overstatement. But he also pointed out that the major papers' rebuttals had similar problems. He concluded that, by attacking Webb's story rather than following leads, "The mainstream press shirked its larger duty; thus it bears the larger burden."
The New Evidence
Both the Justice Department and the CIA launched investigations as a result of the "Dark Alliance" series. The results, so far, have dislodged new evidence that gives credence to Webb's account, some of it shocking:
During his testimony, Hitz revealed for the first time a very special agreement that the CIA had with the Justice Department: The CIA did not have to report if its non-employee agents, paid or unpaid, were dealing drugs. The secret agreement, which remained in place from 1982 to 1995 (when Janet Reno rescinded it), was not mentioned in the CIA report, nor was a copy made public; Rep. Maxine Waters (D-Calif.) later obtained a copy of the agreement and provided it to the MoJo Wire (see "A Tainted Deal").
In other words, it wasn't just incompetence or lack of interest that led the CIA to ignore the fact that their operatives were dealing drugs: It was policy. Almost no major media reported the existence of this agreement. The only exception was the WASHINGTON POST, which mentioned the agreement on Page A12, in the sixth paragraph of a five-hundred-word story.
The article, written by James Risen, relies on an unnamed source for information about the second CIA report; it is unclear whether Risen saw the report himself. When the MoJo Wire called Risen to ask whether he saw the report or relied on a source to describe it to him, Risen said he'd "rather not say."
The story summarizes the report by saying, "no clear guidelines [were] given to field officers about how extensively they should investigate [drug] allegations." What the story never mentions, inexplicably, is the one set of clear guidelines that have been reported: The agreement between the CIA and the Justice Department that said the CIA didn't have to report its operatives, even when it knew they were guilty of drug-running.
Strategic Investment Newsletter - Sept. 1995: "The Latin American drug cartels have stretched their tentacles much deeper into our lives than most people believe. It's possible they are calling the shots at all levels of government."
Dennis Dayle, former head of DEA's Centac, was asked the following question: "Enormously powerful criminal organizations are controlling many countries, and to a certain degree controlling the world, and controlling our lives. Your own U.S. government to some extent supports them, and is concealing this fact from you."
Dennis Dayle's answer: "I know that to be true. That is not conjecture. Experience, over the better part of my adult life, tells me that that is so. And there is a great deal of persuasive evidence.
"I have put thousands of Americans away for tens of thousands of years for less evidence for conspiracy with less evidence than is available against Ollie North and CIA people...I personally was involved in a deep-cover case that went to the top of the drug world in three countries. The CIA killed it." - Former DEA Agent Michael Levine - CNBC-TV, Oct. 8, 1996
"The connections piled up quickly. Contra planes flew north to the U.S., loaded with cocaine, then returned laden with cash. All under the protective umbrella of the United States Government. My informants were perfectly placed: one worked with the Contra pilots at their base, while another moved easily among the Salvadoran military officials who protected the resupply operation. They fed me the names of Contra pilots. Again and again, those names showed up in the DEA database as documented drug traffickers. When I pursued the case, my superiors quietly and firmly advised me to move on to other investigations." - Former DEA Agent Celerino Castillo - Powder Burns, 1992
"I really take great exception to the fact that 1,000 kilos came in, funded by U.S. taxpayer money." - DEA official Anabelle Grimm - CBS-TV "60 minutes"
Former Arkansas Supreme Court Justice Jim Johnson Statement: "He (Former Congressman Bill Alexander - D. Ark.) made me privy to the depositions he took from three of the most credible witnesses in that project, which left absolutely no doubt in my mind that the government of the United States was an active participant in one of the largest dope operations in the world.."
From LOYAL OPPOSITION: In Plain Sight: The CIA Keeps Getting Away With It
By David Corn
June 5, 2000
A few weeks ago, the House intelligence committee released a 44-page report that declared the CIA had nothing to do with the rise of crack in Los Angeles in the 1980s. Why did the Agency need to be exonerated of such malfeasance? Because a controversial 1996 San Jose Mercury News series by reporter Gary Webb exposed a group of California-based Nicaraguan drug-dealers who in the 1980s had supported the Nicaraguan contra rebels battling the leftist Sandinista regime. The contras, of course, had been a pet project of President Ronald Reagan and the covert cowboys he put in charge at the CIA. The headlines on the Mercury News pieces suggested that this particular band of contra backers shared responsibility for triggering the crack wave that wreaked havoc on inner-city communities across the nation. "America's crack plague has roots in Nicaragua war," read the day-one headline. "Shadowy origins of 'crack' epidemic," read the next day's. "Role of CIA-linked agents a well-protected secret until now." Thousands rushed to read the stories on the newspaper's website. The phonelines at black radio talk shows lit up. Members of Congress, particularly those in the Congressional Black Caucus, demanded answers from the CIA. (Even today, the CIA says that its recruitment of African-Americans suffers because of these stories.) The CIA director at the time, John Deutch, felt obligated to attend a town meeting in Watts to deny the charges.
And what passes for investigation in Washington began. The CIA's inspector general examined the allegations of the "Dark Alliance" series. The Justice Department did the same. Not surprisingly, the CIA's own gumshoes -- and those of Justice -- pronounced the CIA not guilty of complicity in the crack explosion. Webb's series had its problems. He had unearthed a good tale of contra drug involvement, but he had not uncovered a definite link between the Agency and these dealers, and his suggestion that this one drug outfit was instrumental to the birth of crack epidemic was far-fetched. Now, the House intelligence committee, nearly four years later, has seconded the verdicts of the CIA and the Justice Department: "The committee found no evidence to support the allegations that CIA agents or assets associated with the contra movement were involved in the supply or sale of drugs in the Los Angeles area."
But the case is not closed -- that is, it should not be closed. The spies' overseers in the House -- the people who keep an eye on the CIA for the rest of us -- also confirmed, in a quiet fashion, the real dirty secret of the CIA: that during the contra war, the Agency worked hand-in-cloak with persons it had reason to believe were smuggling drugs. In a report released in late 1998, the CIA inspector general acknowledged that the Agency, obsessed with its contra mission, had on a number of occasions collaborated with suspected drug-runners. This should have been a scandal in itself. The report provided the details of several examples. It also noted that the "CIA did not inform Congress of all allegations or information it received indicating that Contra-related organizations or individuals were involved in drug trafficking." Put more bluntly: the CIA had covered up the contra-drug connection. A CIA official who served in Central America told the inspector general, "Yes there [was] derogatory stuff [on the contras] ... but we were going to play with these guys." Webb had gotten near this truth. In the middle of the just-say-no Reagan years, a federal agency had indeed struck a "dark alliance" -- not the one Webb had depicted, but one as disturbing. This revelation, though, received scant media attention; most news coverage echoed the CIA's self-exoneration regarding the crack charges.
The House intelligence committee investigation repeats the pattern. The bulk of the report is directed at disputing the crack allegations. But toward the end there is understated recognition that scandalous CIA activity did happen: "As described in Volume II of the CIA IG report, under various circumstances, the CIA made use of or maintained relationships with a number of individuals associated with the Contras or the Contra-supply effort about whom the CIA had knowledge of information or allegations indicating the individuals had been involved in drug trafficking."
Now why does the House intelligence committee have nothing else to say on this front? It preferred flogging Webb one more time to examining the real skulduggery. Moreover, the committee interviewed several senior CIA managers, and these people insisted they could only recall only one single report of contra-related drug-dealing. But with the CIA inspector general having determined there had been many such instances, it's plausible (make that, likely) that these CIA officials did not speak truthfully to the committee. Did the committee's report address this contradiction and the possibility CIA officials had once again withheld information from Congress? Not at all. And the House's report registered barely a blip in the national news media.
When the CIA released the IG report that acknowledged the contra program had been tainted by drugs, Frederick Hitz, then the inspector general, said the study was merely a start: "This is grist for more work, if anyone wants to do it." A year and a half has passed since then, and it is clear that no one in government has the desire to pursue this topic. The House intelligence committee is positioned to do so. But it is more concerned with bolstering the CIA than in providing an independent and thorough look at this ugly piece of recent history. Al Gore could raise the issue -- as a reminder of what happened the last time Republicans controlled the CIA -- but then he would have to explain why his administration has shown no inclination to hold the Agency accountable. George W. Bush is hardly able to complain about lackadaisical oversight of the CIA. When the spies were hobnobbing with suspected drug runners, they were doing so to implement the pro-contra policies of the Reagan-Bush White House. (And the CIA headquarters is now named after George the Elder, who was a CIA director in the 1970s.) It's in no one's interest in Washington to make a stink. The CIA is permitted to slither off. This is not a cover-up; it's a look-away. Reagan and Bush's CIA made common cause with suspected drug thugs and ... no big deal. Nevertheless, it will be worth keeping this nasty episode in mind, for when the ailing Reagan expires, the media hoopla will overflow with praise of the Old Man. Yet nothing that happened in Bill Clinton's Oval Office was as untoward as what went on in Reagan's CIA.
September 17, 1987 Mr. Edwin Meese, III Attorney General Main Justice Building 10th & Constitution Avenue Northwest Washington, D.C. 20530 Re: Citizen Complaint of Wrongdoing by Federal Officers Dear Mr. Meese: I am writing to you to register my complaints about certain actions that have been carried out against me and my associates. I believe these actions constitute violations of our civil rights as well as violations of the criminal law in some instances. These actions are all the more reprehensible in that they are politically motivated. I take this means to request that you investigate these matters and, where appropriate, reprimand the individuals involved and file criminal charges. Let me explain my situation to you. I am a veteran of the United States Army. I served with the Special Forces in the Vietnam War for more than two years between 1964 and 1970. I consider myself to be a patriot and am proud of my service to this country. Since the end of the Vietnam War, I have been actively involved in seeking to locate and free American POW's and MIA's left behind in Southeast Asia. I have been associated in these activities with Lt. Col. James "Bo" Gritz and others, including Scott Weekly. I believe our efforts have been carried out with the tacit ) if not always, overt ) approval of certain elements within our government. These government and military officials share our goal of freeing these forgotten Americans. In the fall of 1986 Col. Gritz and Mr. Weekly went to Burma. They had received intelligence from the "Basement of the White House", which led them to believe certain Burmese had information about American POW's. These leads proved to be unfounded. However, on that trip Col Gritz learned about illegal drug trafficking directed by U.S. government-related operatives. These drug dealing activities were on such a scale that they were used to fund covert, para-military operations in Southeast Asia and in other parts of the world. In May of 1987 I went to Burma with Col. Gritz and others. We brought back startling evidence directly linking American officials with illegal drug trafficking. A report on this Burma trip is attached hereto as Exhibit "A." Over the years it has baffled me why the U.S. Government would not actively and vigorously pursue the release of our POW's and MIA's. Now, the answer is clear. Any renewed American activity in Southeast Asia, on a scale necessary to the release of the abandoned POW's and MIA's, would attract unwanted attention to covert activities in the are. Government-sponsored drug trafficking is an explosive subject. Obviously, many government elements want the story left untold. Scott Weekly was charged with illegal transportation of explosives. He was made promises by ATF Agent Thomas Hahn which induced him to plead guilty to the charges. It is, of course, highly improper for law enforcement officials to make promises, especially false promises, to criminal defendants to persuade them to plead to criminal charges. This was done in Mr. Weekly's case. Pages were extracted from his pre-sentence report which would, very likely have mitigated his sentence. This action would have to have been known about and approved by the Assistant U.S. Attorney Stephen Korotash. In Montana, Mr. Korotash's activities would have violated the Canons of Professional Ethics, which hold:
``"a public prosecutor or other government lawyer in criminal litigation shall make timely disclosure to counsel for the defendant, or to the defendant if he has no counsel, of the existence of evidence, known to the prosecutor or other government lawyer, that tends to negate the guilt of the accused, mitigate the degree of the offense, or reduce the punishment." DR 7*103(b)^E^ ``"A lawyer shall not suppress any evidence that he or his client has a legal obligation to reveal or produce." DR 7)109(A)^E^ I believe Agent Hahn and Attorney Korotash conspired to violate \Mr. Weekly's rights by persuading him not to retain effective counsel and to plead guilty. Thereafter, Col. Gritz was charged with a passport violation and has registered his own complaint, a copy of which is attached hereto as Exhibit "B." Col. Gritz recently informed me that U.S. government representatives offered him government employment and dismissal of the charges against him if he would cease activities relative to the POW's and stay out of Southeast Asia. In other words, if Col. Gritz would shut up and cease his activities in Southeast Asia everything would be all right ) for him. As usual no thought was given to the POW's and MIA's nor their families and loved ones. Following my return from Burma on June 1, 1987, Col. Gritz was charged. I set out to investigate facts relative to the passport violation charge as well as the Scott Weekly situation. During the course of my short investigation there were several incidents which took place that were certainly blatant violations of my rights as a U.S. citizen. Itt is my opinion that the reason these violations took place is because I had in my possession reports, documents and tapes which accuse and support accusations that U.S. Government officials deal in drugs and certain government employees have lied and obstructed justice in order to convict perfectly innocent persons of criminal wrongdoings. I believe they have been motivated by a desire to silence myself and my associates to keep the lid on the drug trafficking evidence we have uncovered. Short of that, they seek to discredit us and the information we've obtained. I traveled to Seattle, Washington, on June 27, 1987, to interview a U.S. Customs Agent named James Foley. Mr. Foley's telephone number is (206) 442)1974. His address is 1580 South 156th Street, Seattle. I spoke with Inspector Foley and told him I needed to locate the customs agent who passed Col. Gritz used, which was stamped at SEA)TAC Airport by Agent 1099. Attached hereto as Exhibit "C" is a copy of the passport. I told him that Col. Gritz had had several passports with him and the agent had taken him to an interrogation room. There he told Col. Gritz he hoped he had a telephone number they could call. Col. Gritz gave them a number and one of the customs men left. Returning a few minutes later, he said "Okay Col. Gritz, you're free to go". Inspector Foley told me he may know hwo the customs agent was that finally cleared Col. Gritz through. He said that the number stamped in the passport may or may not mean anything but he may possibly recognize the handwriting. The next day, June 27th, I contacted Inspector Foley at his home. He told me he had spoken with another Inspector named Arthur Henning. He said he had asked Henning if he could remmeber an incident about five years ago when a Green Beret Colonel came through customs with several passports. Inspector Foley told me Inspector Henning immediately told him, "James `Bo` Gritz." Henning said he remembered the incident because of the publicity Col. Gritz received on the POW issue shortly thereafter. Henning said he had taken Col. Gritz to an interview room along with another customs agent, John Hood. Col. Gritz had given them a telephone number whihc Henning said was to the State Department. Henning told Foley he handled the incident. He said Agent Hood may have written down the telephone number Gritz had given them a telephone number which Henning said was to the State Department. Henning told Foley he handled the incident. He said Agent Hood may have written down the telephone number Gritz gave them in his notes and could still possibly have it. He told Foley the call to the State Department would have been made by a supervisor, possibly Lynne Robson, who is now dead. Henning told Foley he remembered Col. Gritz was carrying at least three passports. He, also, said there would be a "Negative Search Report" on the incident. I sought this information because we had been led by U.S. Attorney Wulfson that this type evidence should have been sufficient to result in the dismissal of the charges against Col. Gritz regarding the fraudulent passport. After receiving this information from me, Col. Gritz's attorney, Lamond Mills, contacted Wulfson. Wulfson told Mills he had already talked to Customs Inspector Henning about the incident, but that he wasn't dropping any charges, despite what he had said earlier. About that same time I was contacted by an investigative reporter named Tony Kimerey from Oklahoma City, Oklahoma. Kimerey told me he was in the office of the Assistant U.S. Attorney, Stephen Korotash. Jerry Bohnen, a KTOK news reporter, was there too. Kimerey can be reached at telephone number (404) 525-6780. Jerry Bohnen can be reached at (405) 840)1948. Also present in the office was Alcohol, Tobacco, Firearms Agent Tom Hahn. Kimerey said that ATF Agent Tom Hahn told him, in the presence of Korotash and Bohnen, that he (Hahn) had removed 9 pages from the documents that went before Federal Judge Alley, before the sentencing of Scott Weekly. The pages that Hahn removed were letters from several different Government agencies corroborating the story that Scott Weekly was involved in the Afghan traiing program which was sanctioned by the U.S. Government. If it were so, that the program was sanctioned by the government, then no laws would have been broken in shipping the C)4 by commercial air carrier. Kimerey also said that a U.S. Government investigator, who has done investigations for the U.S. Attorney's Office in Oklahoma City, told him he could not understand why ATF Agent Hahn and U.S. Attorney Korotash were being so malicious in prosecuting and railroading Scott Weekly. On July 18th, I traveled to Vancouver, British Columbia to find a man named Ahmad Rashid and his wife, Margaret. Ahmad was Scott Weekly and Col. Gritz's government contact in the Afghan training program. A meeting with Ahmad, Scott Weekly and Col. Gritz was set up in August 1986 by William Bode, then Special Assistant to the Under Secretary of State for Security Assistance. Assistant U.S. Attorney Korotash and ATF Agent Hahn have been saying all along that there was no Afghan traiing. They claim Weekly and Col. Gritz were selling explosives ot the Iranians. This is utterly ridiculous. I had thought at one time that maybe they really didn't know about the Afghan training. Maybe they were being lied to by persons in the government. But now I find that Agent Hahn has been in contact with William Bode since the early days, even before Weekly was arrested in December of 1986. Hahn was given a training schedule of the Afghan training by William Bode. Bode admitted this to Col. Gritz. Upon my arrival in Vancouver, British Columbia, I contacted Margaret Rashid, wife of Ahmad. Margaret had assisted her husband in the briefing of Col. Gritz and Scott Weekly. Margaret and Ahmad were to have given Gritz and Weekly all of their knowledge on the Mujahadeen Afghan Freedom Fighters so that they could use this knowledge in training several different factions of Mujahadeen in hopes of unifying them. I was lucky to have reached Margaret when I did because she was getting ready to leave Vancouver within a few days to join her husband in\j\Montreal. Ahmad was in Montreal looking for a place for them to live. Margaret and I talked about her role in giving the information to Weekly and Gritz about the Mujahadeen in August of 1986. Margaret told me that she and Ahmad were in constant contact with William Bode. She said that Bode was their U.S. Government contact. As a matter of fact Bode was the one that gave her and Ahmad the money to move to Montreal. This evidence would provce that this was a government)sponsored program. That being the case, Weekly should not have been convicted of the crime he was charged with. Bode and his associates were trying to get the Rashids out of Vancouver before Col. Gritz or anyone tried to contact them. Margaret said she also knew of Gritz and Weekly's problem. She knew Weekly was in jail but she did not exactly know why. She said she had a three way telephone conversation with Bode and another man from the U.S. Government some time ago. The man from the U.S. Government was the one who suggested they move to Montreal away from Vancouver. He was also the one who suggested that Bode give them the money to move on so that we could not find them. Margaret could not remember the name of the U.S. Government official they had the conversation with, but I found out later it was ATF Agent Tom Hahn. William Bode had called Col. Gritz about the same time I was visiting MArgaret. He had no idea I had been talking to her. He told Col. Gritz he had just heard of Weekly`s being in jail. He told Col. Gritz he was no longer working in Afghan studies or in the State Department. He told Gritz that he hadn't been there since last February. He said that if someone had contacted him before he would have at least given ATF a copy of the Afghan training schedule to prove Weekly was working under the auspices of the Government. A few days later, when Bode had found out I had talked to Margaret Rashid, he again called Col. Gritz. He asked Col. Gritz who Lance Trimmer was. He told Col. Gritz he had tried helping all he could. He said he had given Agent Hahn a copy of the training schedule. In the prior converstaion he had said he may have given him a copy. He also stated then that ATF Agent Hahn was the third person on the three way telephone conversation with him and the Rashids. The above information are all lies told by Government employees ATF Agent Hahn and Assistant U.S. Attorney Korotash have lied from the beginning and they continue to lie. My attorney in Oklahoma City, Frank Miskovski, who is a very prominent attorney in that area, told me that he has not once talked to ATF Agent Hahn that Hahn had not lied to him. Hahn admitted to two reporters that he omitted several pages of documents to be presented to a U.S. Federal Judge in recommending a long jail term for Scott Weekly. This was a clear violation of Weekly's rights. Hahn was instrumental in trying to hide\j\witnesses that could prove Scott Weekly's innocence. Those witnesses could have proven that Weekly was involved in a legitimate, U.S. Governemnt)approved, training program of Mujahadeen Afghan Freedom Fighters. It seems very clear to me that Assistant U.S. Attorney Korotash was also involved in the hiding of these documents. I have continuously tried to determine why ATF Agent Hahn and U.S. Attorney Korotash would want so badly to put Col. Gritz and Scott Weekly in jail. The only conclusion that I have is that some persons or people higher up in the Government are pressuring them to muzzle Col. Gritz. Col. Gritz is a proven American hero, whose only goal in life is to bring home American Prisoners of War left behind in Southeast Asia after the Vietnam War. The government wants to stop him from giving to the Americna people documents and evidence that show U.S. Government officials are now, and have been, dealing in drugs. These are acts of governmental agents involving the obstruction of justice and illegal suppression of evidence, which would show the charges against both Weekly and Gritz to be ill)founded. Now, let me address the acts which have carried out against me. I was arrested at the U.S./Canadian Point of Entry, Blaine, Washinton, on August 13, 1987, by U.S. Customs officials. I was arrested on a warrant, issued out of the federal district court of Oklahoma City, Oklahoma. There were no charges. I was wanted as a material witness to testify before the grand jury in Oklahoma. Immediately following my arrest, I was searched and placed in a holding cell. I was told by a Customs Agent that they were going to look in my car. Much later, three agents came to my cell. One of them, who appeared to be in charge, introduced himself as Jim Williams. He read me my rights and asked me a couple of questions. I would not answer his questions but told him I was sure he had read a report that was in my bag that would answer all the questions he had. He insinuated that what he had read was interesting. One of the agents with him asked me if I had a number that he could call. What he meant was, he wanted to know if I was working for some government agency. I told him I had none. I don't believe he would have asked that had he not read papers in my briefcase. I was then chained up with leg irons, belts and handcuffs and taken to Whatcom County Jail where I was booked in, finger)printed and mugged. I was told that ATF Agents would pick me up in the morning and take me before a magistrate in Seattle. The next day two ATF Agents, Norm Prins and Jane Heffner, picked me up for transfer to the Seattle U.S. Marshall's Office. Agent Prins handcuffed me with my hands behind my back, put me in leg irons and escorted me to his vehicle for the 1 1/2 hour drive to Seattle. He told me he had two of my bags in their trunk. He also said that he had been to the Canadian Border where they had picked up my bags from Customs. I asked where the other two were and was told he knew nothing about them. Obviously, they had searched my car and seized and searched my personal property. On the way in Agent Prins said he'd like me to answer some personal questions he had. He said they had nothing to do with my case because he knew nothing about it. He said his questions had to do with POW's. If he knew nothing about my case, he would not have known to ask me about POW's. I assume he had read the papers in my briefcase and clothes bag. We talked about POW's and also about my Burma Report. When we arrived at the U.S. Marshall's Office, where I had to appear before the Magistrate, my hands and arms were asleep from having to sit handcuffed with my arms behind my back. The marks and bruises were still on my hands from the cuffs four days later. Agent Prins got my two bags out of the trunk of his car. I noticed the center section of my clothes bag was still zipped open. I never was allowed to look in my bags. They said they had brought them to turn over to the U.S. Marshall's Office, but the Marshall's Office refused to accept them. They obviously argued over them for some time until the ATF agents said they would take them and hold them in their office. I asked again about my briefcase and clothes bag but was told that Customs had kept them. I asked why and was told that they were "doing something" with them. I asked what, and was told just "something, but I shouldn't worry about it." I said abviously they are making copies of my diary and reports. They said they didn't know but admitted it was possible. Before appearing before the Magistrate one of the U.S. Marshalls called the Customs Agent Williams and asked about my briefcase and camera case. I could not hear what Agent Williams was saying but when he hung up the Marshall told me that Williams would have my bags sent to whatever address I wanted. I told him I wanted my bags brought to me because they also contained my credit cards and identification which the agents had kept when they took my wallet, also I told them they had no reason to keep them. The Marshall then told me they were "doing something with them." When I asked "what," he said he had no idea. I was then taken to the Magistrate where I was admitted to a $10,000 bail. I told them I could make bail immediately if I could make a phone call. This was approximately 4:30 p.m. The Marshalls then took me from the courtroom back up the elevator to their office. When we passed a phone I asked if I could make that call. They said I could when I got to the office. When we reached the office, they had me go into their little holding room and then fooled around preparing this and that. I asked again about a call and was told, "in a minute." It was obvious they were stalling for time since it was close to 5:00 p.m. When I was finally allowed to call it was too late for anything to be done. This meant I was stuck in jail for the weekend.\j\ I was then allowed to call Custons Agent Williams. I asked him about my briefcase and camera bag. He said he would send them somewhere for me. I told him I had to have them in my hands. I needed my identification and credit cards to bail out of jail. He said there was no way to get them to me now that the weekend was there. I told him someone could surely drop them at the ATF Office with my other bags. He said they couldn't do that until Monday. I asked if it was going to take that long to make copies of my personal diary and papers. He said they weren't doing that. I said what about the phone numbers. He said we are just "doing something" with the bag. I said I would like them right away. He said it was impossible and I would get them on Monday or maybe Tuesday. They would be through with them then. He stated he would not be there personally himself next week but someone else would handle it. That was the best he could do. I was then taken to Kent, Washington, to the Kent Corrections Center. I was taken there in handcuffs and chains. I was fingerprinted and mugged for the third time. While in the Kent Corrections Center I made four written requests. The first one was made on August 15. I requested they return my briefcase and personal belongings being held by Customs immediately. This included my credit cards and other identification. I was told they could do nothing. They said I must contact the agency that had them, although those agencies wouldn't accept a collect call. I wrote another request on August 16 and was told the same thing. Copies of all four requests are attached as Exhibit "D." On August 17 they would not answer my request and on August 18 I was not allowed to make a phone call. They did finally tell me that a U.S. Marshall had brought my identification cards from Customs on that day after I had told them I would not leave the jail without my identification even if I was bailed out, because it was clear they could arrest me for vagrancy. While in the jail there were two phone calls I made which were very important regarding my bail. On one occasion, I was right at the point of learning a phone number that I needed to call to have bail brought immediately, when the conversation was cut off by whoever was monitoring the call. Several persons called the jail with messages for me, with regard to bailing me out, but the messages were never given to me. Finally on Tuesday afternoon, August 18, I was allowed to bail out on a $10,000 cash bond. The attorney who was instrumental in bailing me out had to drive me to the Canadian Border at Blaine, Washington, which was more than 125 miles away in order for me to get my briefcase and camera bag. All of the contents in those bags obviously had been removed. My notes and papers were thrown back in completely out of order and it looked as though several typewritten notes were missing. The Customs Agent, Joe Rydell, stated that I either had to sign an inventory list they had made up or he would not return my belongings. There was no way I could tell if every piece of paper was there. I was never given an inventory list of what they took from me. They kept my personal diary, papers, pictures, and identifications cards, including credit cards, for six days and refused to return them. They told me they were "doing something" with them. It was clearly an illegal search and seizure. I was only arrested as a material witness. I have been a law enforcement officer and understand what the term "probable cause" means. There was no probable cause to seize my property and search it. There was no reason to treat me like a criminal. I can understand being jailed on a warrant. I cannot understand being handcuffed, chained, mugged and fingerprinted on numerous occasions, being denied access to my property, and being denied the opportunity to arrange bail. All of this was a serious violation of my civil rights. After I finally got released on bail I had to travel more that 200 miles to retrieve my personal belongings. They forced me to personally go out of the way which took another day. It was then too late to travel to my home in Montana. I had to go to California to secure my automobile and then travel to Oklahoma City where I was to appear before a Grand Jury on the Subpoena the government had issued me upon my arrival. I called the U.S. Attorney's Office and checked in as I was supposed to do. The man that I talked to about transportation to Oklahoma City told me that I should pay my own way and turn in a voucher on the day I appeared before the Grand Jury. I then left for Oklahoma City. I needed to find a lawyer for my appearance. When I appeared at the U.S. Attorney's Office with my attorney, Frank Miskovski in Oklahoma City, we were met by ATF Agent Tom Hahn. Tom Hahn stated that U.S. Attorney Korotash was out of town. I asked if he was also on vacation and Hahn replied he didn't know. He told me Korotash was out of town and could not be reached. Hahn said he had been trying to contact me for the past ten days. I called him a liar. He said he was not lying. I told him I called in twice to the U.S. Attorney's Office. Hahn stated that I only called in once. I told him I called on Monday August 24 and checked in with a woman secretary. I also called in on August 26 and told a male I would be coming to Oklahoma City and wanted to know about travel arrangements. Hahn said he only heard of one time I called. He said that he had called my attorney several times in Washington. I called Mike Jordan, my attorney in Washington, on August 30 from Oklahoma City. He told me that Hahn had called him on Friday trying to contact me to tell me they postponed the Grand Jury Hearing. On September 1st, the day of my scheduled appearance, Hahn gave me a new subpoena for September 14. I asked if my bail would now be returned. He said he didn't see why not. He would check. I waited for some time before Hahn returned and told my attorney that they were going to hold my cash bail of $10,000 until I appeared on September 14. I left to make a phone call and then returned with my attorney and asked for Agent Hahn. I was told he was no longer around. My attorney asked to speak with the U.S. Attorney Price. He was not around. This was at 11:30 a.m. We asked to speak with any U.S. Attorney who could make a decision. We were taken to a Chief U.S. Attorney whom I told I wanted my bail returned or to be put back in jail. I told him the bail I received was promised to be sent back to the person it came from on September 1 and I had appeared as promised. This U.S. Attorney called Agent Hahn who, just a few minutes earlier, could not be found, and had Hahn come to his office. He told Hahn I was there to be put in jail so my bail would be returned. Hahn immediately made many calls. A long time later he came out ant told my attorney that they would either return my bail and place me in jail, return my bail and release me on my own recognizance or schedule the hearing in the morning. He was to call my attorney at his office. Later in the afternoon, my attorney contacted me about 4:30 p.m. and said that Hahn was obviously a habitual liar. He had finally talked to Hahn after 4:00 p.m. and Hahn told him he called 4 or 5 times but couldn't reach him. My attorney's secretary said that Hahn had called once. My attorney was not in and Hahn did not call back. My attorney called Hahn back twice but could not find him. He finally reached Hahn about 4:10 p.m. and Hahn told him they reset the Grand Jury Hearing for the following morning, September 2. I appeared at 9;00 a.m. on September 2nd before the Grand Jury. I talked about U.S. Officials dealing in drugs., about General Khun Sa of Burma, about a statement I made of a complaint being filed regarding charges oif wrongdoing by AFT Agent Hahn. Halfway through the U>S> Attorney's questions, they stopped the hearing and tol;d me there would be no more questions. It was approximately 11:00 a.m. I was told that I was free to go and would have to return on Oct. 5. I believe that is less than coincidental that Col. Gritz passport violation case is scheduled for trial in Las Vegas, Nevada, on the very same date. My attorney and I asked that my bail be returned along with my passport. AFT Agent Hahn said he saw no problem with that. He said he would clear it with U.S. Attorney Blair Watson. We waited about 45 minutes. Hahn came later and said he would have it taken care of after lunch. My Attorney called him after lunch but, as usual, he was not around then. He talked to the U.S. Attorney Watson who said he didn't know about the bail and it would have to stay whereever it was. He believed it was being held in Washington State where it was posted. My attorney called the U.S. Attorney`s office in Seattle, Waashington and was tiold it had been sent to Oklahoma. My attorney talked with the U.S. Attorney in Seattle later and was told Hahn had told them that because it took so long for them to find me he didn't think they should release my bail. There was never andy agreement to release my bail until Sept. 14th. At this writing I still don't have it back. Since recovering my property I have discovered that several items are missing, including typed notes and a tape\j\of conversations with Margaret Rashid and Tony Kimerey. I spent more than ten years of my life serving my country as a soldier. I risked my life in combat in support of our government. I worked as a court officer a police officer and as an investigator for a prperiod of 15 years. I have a college degree in criminal justice. I believe in our system and have proven my commitment by my service. I cannot tolerate nor abide the perversion and subvertion of our system, especially by those)like me)who have taken an oath to defend it. This complaint deals with high)level government policy makers who have sacrificed our POW'S and MIA's, and alot more, to cover)up illigal and reprehensible drug trafficking activies. It deals with federal Justice Department officials who have lied, silenced witnesses, discredited genuine patriots and heroes, obstructed justice and used their power to harass and intimidate honorable citizens. I've heard of the alleged illigal drug trafficking, supported by the CIA, in Central America. Until my recent experience I wouldn't have believed it. You are the top law enforcement officer in the United States. You have a duty to investigate, vigorously, the charges raised in this complaint. Today is the 200 anniversary of our constitution. The greatest threat to that sacred document is being mounted today by the lairs, obstructors of justice and other slime who believe the ends justify the means and "plausible deniability" is a defensible standard of conduct in an open, democratic system. The people and activites, complained of herein, threatenour very system of laws. Do yourself proud. Deal with these complaints vigorously.. The issue of illegal drug trafficking is now before the publis. When it becomes apparent to the public that our POW's and MIA's have been abandoned and our youth have been exposed to drugs to protect such an activity, the wrath of the people will be incredible. It no longer works to try to hide this activity, too many know of it. The tactics that have been used to produce the silence of people like me oon this issue, are unjustifiable. Restore my faith in my government. Do your duty, as I have sought to do mine. And as those POW's and MIA's abandoned in Southeast Asia, have done theirs. Sincerely, Lance Trimmer Suite 316, 600 Central Plaza Great FAlls, Montana 59401 Subscribed and Sworn to before me this day of Sept. 1987 (Linda Cooper) Notary Public for the State of Montana My commision expires : 4/1/89 cc: ATF, Washington, D.C ATF, Oklahoma City, Oklahoma U.S. Attorney William Price, Oklahoma City, Oklahoma U.S. Customs Service, Washington, D.C. U.S. Customs Service, Blaine, Washington, D.C. U.S. Department of State, Washington, D.C. DEA, Washington, D.C. Members of the United States Congress
Honorable George Bush, Vice President, United States of America, Washington, D.C.
Why does it seem that you are saying "YES" to illegal narcotics in America?
I turned over video tapes to your NSC staff assistant, Tom Harvey, January 1987, wherein General KHUN SA, overlord of Asia's "Golden Triangle", offered to stop 900 tons of heroin/opium from entering the free world in 1987. Harvey told me, "...there is no interest here in doing that." General Khun Sa also offered to identify U.S. Government officials who, he says, have been trafficking in heroin for more than 20 years.
November 1986, Scott Weekly and I went into Burma in coordination and cooperation with The White House. Tom Harvey told me you received a letter from Arthur Suchesk, Orange County, CA, dated 29 August 1986. Dr. Suchesk said that Gen Khun Sa had access to U.S. POWs. Harvey said the letter had received "highest attention". He gave me a copy along with other case documents. I was asked if it was possible to verify the information. According to Harvey, the CIA said Khun Sa had been assassinated some months before. Harvey supplied Scott and myself with language under White House and NSC letterhead that would help us gain access to Khun Sa. It worked. Unfortunately, Khun Sa knew nothing about US POWs. He did, however, offer to trade his nation's poppy dependence for a legitimate economy.
Instead of receiving an "Atta Boy" for bringing back video tape showing Khun Sa`s offer to stop 900 tons of illegal narcotics and expose dirty USG officials, Scott was jailed and I was threatened. I was told that if I didn't "erase and forget" all that we had discovered, I would, "hurt the government". Further, I was promised a prison sentence of "15 years".
I returned to Burma with two other American witnesses, Lance Trimmer, a private detective from San Francisco, and Barry Flynn from Boston. Gen Khun Sa identified some of those in government service he says were dealing in heroin and arms sales. We video taped this second interview and I turned copies over in June 1987, to the Chairman of the Select Committee on Intelligence; Chairman of the House on Foreign Affairs Task Force on Narcotics Control; Co-Chairman, Senate Narcotics Committee; Senator Harry Reid, NV; Representative James Bilbray, NV; and other Congressional members. Mister Richard Armitage, Assistant Secretary of Defense for International Security Affairs, is one of those USG officials implicated by Khun Sa. Nothing was done with this evidence that indicated that anyone of authority, including yourself, had intended to do anything more than protect Mr. Armitage. I was charged with "Misuse of Passport". Seems that it is alright for Oliver North and Robert MacFarlane to go into Iran on Irish Passports to negotiate an illegal arms deal that neither you nor anyone else admits condoning, but I can't use a passport that brings back drug information against your friends.
Lance Trimmer and I submitted a "Citizen Complaint of Wrongdoing by Federal Officers" to Attorney General Edwin Meese, III on 17 September 1987. Continuous private and Legislative inquiries to date indicate that the Attorney General's Office has "lost" the document. Congressional requests to the Government Accounting Office have resulted in additional government snares and stalls.
January 20, 1988, I talked before your Breakfast Club in Houston, Texas. A distinguished group of approximately 125 associates of yours, including the Chief Justice of the Texas Supreme Court, expressed assurance that you are a righteous man. Almost all of them raised their hand when I asked how many of them know you personally. If you are a man with good intent, I pray you will do more than respond to this letter. I ask that you seriously look into the possibility that political appointees close to you are guilty of by passing our Constitutional process, and for purposes of promoting illegal covert operations, conspired in the trafficking of narcotics and arms.
Please answer why a respected American Citizen like Mister H. Ross Perot can bring you a pile of evidence of wrongdoing by Armitage and others, and you, according to TIME magazine (May 4, page 18), not only offer him no support, but have your Secretary of Defense, Frank Carlucci tell Mr. Perot to "stop pursuing Mr. Armitage". Why Sir, will you not look into affidavits gathered by The Christic Institute (Washington, D.C.), which testify that Armitage not only trafficked in heroin, but did so under the guise of an officer charged with bringing home our POWs. If the charges are true, Armitage, who is still responsible for POW recovery as your Assistant Secretary of Defense ISA, has every reason not to want these heros returned to us alive. Clearly, follow on investigations would illuminate the collective crimes of Armitage and others.
Several years ago a secretary working for Armitage asked me "Why would he have us expunge his official record of all reference to past POW/MIA assignments and activities?" Not knowing, I ventured a guess that maybe he was considering running for public office and didn't feel the POW -Vietnam association would be a plus in his resume. It was about the same time a CIA agent named by Khun Sa turned up dead in Bangkok under "mysterious circumstances". Also about this time, as an agent of NSC's Intelligence Support Activity, I was told by ISA Chief Jerry King, "...there are still too many bureaucrats in Washington who don't want to see POWs returned alive". I failed to realize the fullness of his meaning, or these other events, until in May 1987, Gen Khun Sa, in his jungle headquarters, named Richard Armitage as a key connection in a ring of heroin trafficking mobsters and USG officials. A U.S. agent I have known for many years stopped by my home last month enroute to his next overseas assignment. He remarked that he had worked for those CIA chiefs named by Khun Sa, and that by his own personal knowledge, he knew what Khun Sa said was true. He was surprised it had taken so long to surface.
I am a registered Republican. I voted for you twice. I will not do so again. If you have any love or loyalty in your heart for this nation; if you have not completely sold out, then do something positive to determine the truth of these most serious allegations. You were Director of the CIA in 1975, during a time Khun Sa says Armitage and CIA officials were trafficking in heroin. As Director of Intelligence you were responsible to the American people for the activities of your assistant - even as you should know what some of these same people are doing who are close to you now as our Vice President because I feel these "parallel government" types will only be promoted by you, giving them more reason to bury our POWs.
I am enclosing some documentation that supports the charges made. Chief is a letter from Khun Sa to the U.S. Justice Department dated 28 June 1987, wherein Richard Armitage is named along with Theodore Shackley (your former Deputy Director CIA from Covert Operations) and others. Please also note William Stevenson's article, "Bank of Intrigue-Circles of Power". You, Armitage, and General Richard Secord are prominently mentioned. Stevenson, you might remember, authored A MAN CALLED INTREPID. Also Tom Fitzpatrick's article, "From Burma to Bush, a Heroin Highway", should interest you. Both of these men are prize winning journalists. The book, CRIMES of PATRIOTS, "A True Tale of Dope, Dirty Money, and the CIA", by Jonathan Kwitny, reporter for the Wall Street Journal, details for you the bank connections that Khun Sa mentions. Finally, the basic primer that spells out exactly how this dope for covert operations gambit began, is Alfred McCoy's THE POLITICS OF HEROIN IN SOUTHEAST ASIA. All of these should be required reading for the man appointed chief cop by our President to safeguard America from illegal narcotics. These are just a sampling of many works now available that chronical disgraceful conduct by those sworn to protect and defend our Constitution.
Parting shot Mr. Vice President: On 28 January 1988, General Khun Sa tendered an offer to turn over to me one metric ton (2,200 pounds) of heroin. He says this is a good faith gesture to the American people that he is serious about stopping all drugs coming from the infamous Golden Triangle. I, you and Nancy Reagan are really serious about saying "NO" to drugs, why not test Gen Khun Sa? I challenge you to allow me in the company of agents of your choice to arrange to receive this token offer worth over $4 billion on the streets of New York City. It will represent the largest "legal" seizure of heroin on record. You can personally torch it, dump it in the ocean, or turn it into legal medication; as I understand there is a great shortage of legal opiates available to our doctors. I think Gen Khun Sa's offer is most interesting. If you say "YES" then the ever increasing flow of heroin from Southeast Asia (600-- tons-- '86, 900 tons-- '87, 1200-- tons'88) may dry up--not good for business in the parallel government and super CIA circles Oliver North mentioned. If you say "NO" to Khun Sa, you are showing colors not fit for a man who would be President.
What is your decision? I challenge you to demonstrate exactly where you stand with respect to big-business-drugs, parallel government, misuse of U.S. tax-payer dollars in foreign drug supression programs that don't work, no interest in dialogue that will stem the flow of illegal narcotics, return of POWs while they are still alive? I for one am not for a "USA, Inc." with you or anyone else as Chairman of the Board.
Respecting Your Office,
James "Bo" Gritz, Concerned American, Box 472 HCR-31 Sandy Valley, NV 89019, Tel: (702) 723-5266
Before the Senate Subcommittee on Terrorism Senator John Kerry questioning.
(The witness having been previously sworn)
Senator KERRY. Let me do this, because my colleague is also under some pressure. I want to ask you a few questions about one area, and then we'll come back. But I do want the record to go through this detail. I know it's tedious, but it's very important.
In 1984, you said your shipments began to change. Is that correct?
Mr. MORALES. Yes, they did.
Senator KERRY. Is that the point in time in which you were approached by people you knew to be part of the Contra organization?
Mr. MORALES. Yes.
Senator KERRY. Can you describe specifically when that took place and what took place?
Mr. MORALES. That was right after my indictment.
Senator KERRY. When was your indictment?
Mr. MORALES. March 3, March 3 or March 6, 1984. Right after that, few weeks, maybe a month, I was introduced by the Contra leaders in South Florida.
Senator KERRY. Who were you introduced to?
Mr. MORALES. I was introduced by Popo Chammoro, Octaviano Cesar, and --
Senator KERRY. Popo Chommoro.
Senator KERRY. Octaviano Cesar.
Mr. MORALES. Yes, and Marcos Aguado.
Senator KERRY. And Marco Aguado.
Mr. MORALES. Which they represent themselves as being leaders of the Contras and also represent themselves as CIA agents.
Senator KERRY. Now when you say they “represented themselves,” did you know of them at that time?
Mr. MORALES. I heard about they being CIA agents. Yes, I did.
Senator KERRY. When you say “their being,” who was a CIA agent?
Mr. MORALES. Marcos Aguado and Cesar Octaviano.
Senator KERRY. How do you know that?
Mr. MORALES. It's being very well known through many people for a long time around Central America and south Florida.
Senator KERRY. You knew that at the time?
Mr. MORALES. Yes, I did.
Senator KERRY. Did they have to tell you that for you to know that?
Mr. MORALES. Not whatsoever.
Senator KERRY. And what happened at that point in time?
Mr. MORALES. I was asked for help, financial help, any type of help that they were looking to have, because they had to be in this problem, they didn't have enough money, whatever. And also for exchange of taking care of my legal problems at the moment.
Senator KERRY. I just want to understand this very clearly. You're saying that they asked you for help?
Senator KERRY. Were they specific about the kind of help they asked you for?
Senator KERRY. All right. Who specifically asked you for what help?
Mr. MORALES. Octaviano Cesar was the one doing most of the talking in my office.
Senator KERRY. What did he say to you?
Mr. MORALES. He said that I[he] was looking for airplanes, money, training, weapons, explosives, any type, any kind of help.
Senator KERRY. Did you agree to help?
Senator KERRY. What did you agree to do?
Mr. MORALES. I agreed to give him some planes, money, and to help him, to help him out.
Senator KERRY. When he asked you for explosives, and guns, and other weapons, did you agree to get those weapons?
Senator KERRY. Did you know where to get those weapons at that time?
Senator KERRY. How did you know where to get them?
Mr. MORALES. I used to buy the weapons in south Florida, in a gun shop, before that meeting. It was very obvious that I can buy more guns after I have the meeting with these particular fellows.
Senator Kerry. How many times did you meet with these leaders to discuss your help?
Mr. MORALES. Many times, Senator. Many times.
Senator KERRY. In what year?
Mr. MORALES. Since 198 the first time that I saw him, not met him, but I saw him, was in 1983, around this time, July or so. And then I was introduced formally to them, and the people, the person who was going to introduce me, told me who they were. And I became to be introduced formally with them in 1984.
Consequently to that meeting, I have several, several meetings.
Senator KELLY. Now you agreed to give the Contras a plane?
Mr. MORALES. I agreed to give the Contras quite a few planes.
Senator KERRY. How many planes did you give them?
Mr. MORALES. The first time I agreed to give them a DC 4, a DC 3, a helicopter, a Piper Navajo.
Senator KERRY. You just gave them? You gave them away?
Senator KERRY. What was in it for you? Why did you give away these planes?
Mr. MORALES. Well, Senator, like I told you before, I was arrested long before that time, and I was facing one of the most critical charges because of my indictment. So, they promised me that they would take care of the legal activities, the legal activities that I was charged for.
Senator KERRY. Who promised you that?
Mr.MORALES. Cesar and Popo.
Senator KELLY. He said he could take care of your legal problems?
Mr. MORALES. Yes, yes.
Senator KELLY. Specifically?
Senator KELLY. Was he more specific about that?
Senator KERRY. How?
Mr. MORALES. Many times I talked to him and he told me that he had plenty of friends, being him, the CIA, can advise the superiors about my financial support and airplane and training, and, therefore, they will finally, eventually will take care of my problem, which they did. To an extent, they did. As a matter of fact, they did.
Senator KERRY. We'll come back to that in a little while. If you'd make a note on that, we'll come back to that in a while. I want to just run through this so Senator McConnell can have his round.
Mr. MORALES. Excuse, me one second. [Pause.]
Senator KERRY. Was the plane that you gave the Contras used by them?
Mr. MORALES. Yes, it was.
Senator KERRY. And you know that for a fact?
Mr. MORALES. For a fact, sir.
Senator KERRY. At this point in time, did you make some agreement about running guns down to various locations and bringing drugs back?
Mr. MORALES. Yes, I did. That was part of the agreement.
Senator KELLY. When you say “that was part,” can you be more specific? Precisely how did that discussion come about?
Mr. MORALES. I was supposed to give him financial support, also buying guns for them, supplies, safety houses for them, in south Florida, buying equipment, different type of equipment, boats, engines, boots, uniforms, whatever it was they need for them to have.
Senator KERRY. How were you supposed to buy this? Did they give you money?
Mr. MORALES. No. I was the one who was going to buy, from my own money.
Senator KERRY. Where was the money coming from?
Mr. MORALES. Drugs.
Senator KERRY. Did they know that?
Mr. MORALES. Of course they know that.
Senator KERRY. Why do you say “of course they know that”?
How do you know they know that?
Mr. MORALES. Because we discussed, as a matter of fact, we discussed to bring drugs that did not belong to me. They were their own drugs.
Senator KERRY. Whose drugs?
Mr. MORALES. The Contras drugs.
Senator KERRY. How do you know they were Contra drugs?
Mr. MORALES. They told me.
Senator KERRY. What?
Mr. MORALES. They told me. As a matter of fact
Senator KERRY. What did they tell you? Did they say here's drugs, these are Contra drugs?
Mr. MORALES. No, no, no.
They say, there was a few trips that I was supposed to do for them in drugs. I did not ever ask him where the drugs come from other than that they were the drugs.
Senator KERRY. Did you do those trips?
Senator KERRY. When you say you did, did you personally fly them?
Mr. MORALES. No. I instruct my pilot to fly them. I was waiting on the runway for some of them, and I saw the drugs.
Senator KERRY. Now, in 1984, did you personally load weapons into an airplane in Fort Lauderdale?
Senator KERRY. Did you see those weapons?
Mr. MORALES. I bought them.
Senator KERRY. Where did you buy them?
Mr. MORALES. I bought them, some of them I bought them in the gun shop in south Miami.
Senator KERRY. What kind of weapons were they?
Mr. MORALES. Machineguns, automatic rifles, high powered rifles, pistols, explosives.
Senator KERRY. Were these fully automatic machineguns?
Mr. MORALES. Oh, yes. They were.
Senator KERRY. Did you buy fully automatic machineguns on the open market in Florida?
Mr. MORALES. I did.
Senator KERRY. In what quantity did you buy them?
Mr. MORALES. We sent many planes full of weapons down there. I really don't recall specifically the amount of items, but it was very considerable.
Senator KERRY. Did you load these weapons onto the airplane in daytime or nighttime?
Mr. MORALES. I did load them in the daytime, 12 noon in the daytime.
Senator KERRY. Right in the full view of people?
Mr. MORALES. Yes. Many times.
Senator KERRY. And were you at the airport when the planes came back?
Mr. MORALES. Yes, I was.
Senator KERRY. What did you unload from those planes when they came back?
Mr. MORALES. I was in the beginning of the runway. The plane lands and unloads the drugs into the end of the runway.
Senator KERRY. How did you know they were drugs?
Mr. MORALES. I saw them.
Senator KERRY. What did you do with those drugs?
Mr. MORALES. Sell them.
Senator KERRY. What did you do with the money?
Mr. MORALES. Give it to the Contras.
Senator KERRY. All right. I'm going to come back to this because there's obviously considerably more detail that needs to be filled in.
Mr. MORALES. Let me make myself clear, Senator.
Senator KERRY. Please.
Mr. MORALES. I gave them back to the same people because the Contras means a lot to a lot of people. I gave them back to Mr. Octaviano Cesar, who works for, used to work for the CIA, and Mr. Popo Chammoro, and Marcos Aguado...
How much -- can you estimate the amount of narcotics in dollars that you shipped back as part of this scheme for transfer of weapons down there?
Mr. MORALES. How much was the money?
Senator KERRY. How much money in narcotics value was brought back in as part of this linkage in 1984 and 1985?
Mr. MORALES. Many, many, many millions of dollars. Many millions of dollars. Many.
Senator KERRY. Can you give us an estimate of the kilos of cocaine?
Mr. MORALES. In 1984, the kilos of cocaine in July were going around $32,000, $34,000, $35,000 a kilo. That is $35 million right there, in July.
Senator KERRY. It’s $35 million?
Mr. MORALES. In July.
Senator KERRY. In July.
Mr. MORALES. July, yes...
Senator KERRY. Now, when the drugs flew back in, did they come in the daytime or nighttime?
Mr. MORALES. They come in in nighttime. A few of them in daylight. But a few of them.
In the United States, they came twice at night. The rest of them came daylight.
Senator KERRY. Now here you are. You have been indicted before. You have a known reputation in the region as a narcotics trafficker. You are leading a pretty flashy lifestyle. You have helicopters, planes at your disposal, you are racing fast boats, with a lot of money moving around. And you’re telling us that at this airport, with all of this knowledge about you, you were still able to move around without any fear?
Mr. MORALES. I was very, very surprised myself.
WASHINGTON — A fresh surge of doubts about Vice President George Bush and his insider information on drug smuggling in Panama reached a peak Sunday with a published account saying he knew more than he is telling. The account was quickly challenged by the principal in the tale--but the suspicions are apt to linger on, anyway.
Bush, as former CIA director and as a member of the Administration's National Security Council, has campaigned for the presidency on the edge of a sword--saying his long foreign-policy experience makes him perhaps the most qualified man in modern history for the job, but at the same time skirting uncomfortable foreign policy problems of the Administration by claiming lack of knowledge.
The controversy over Panama strongman Gen. Manuel A. Noriega and his role as reputed international drug lord is the latest example.
Meeting With Envoy
On Sunday, the New York Times reported that Bush was informed about Noriega's drug-running in a December, 1985, meeting with then-U.S. Ambassador to Panama Everett Ellis Briggs. The date is nearly three years before Bush said he had convincing evidence of the Latin American general's involvement. Bush has said he was unaware of the matter until Noriega was indicted by two federal grand juries in February of this year.
According to the New York Times report, Briggs, who is now U.S. ambassador to Honduras, made serious drug-running charges against Noriega in cables sent to the State Department before his meeting with Bush. The story cited unnamed Reagan Administration sources who indicated that Briggs had related the substance of those cables to the vice president at their meeting.
On Sunday, in Tegucigalpa, Honduras, Briggs said the account was inaccurate. "We simply did not have evidence of these activities at that time, and so any statement that I did brief him at that time simply is not true," Briggs said.
Paper Quotes Testimony
Meanwhile, the Washington Post published a long account concluding that Bush "understates" just how much he knew about Noriega and when he knew it. The paper quoted the no-holds-barred congressional testimony of Norman Bailey about what the U.S. government knew of activities in Panama dating back to the 1970s. Bailey was formerly an aide to the NSC, of which Bush is one of four statutory members.
"Available to me as an officer of the NSC and available to any authorized official of the U.S. government is a plethora of human intelligence, electronic intercepts and satellite and overflight photography that, taken together, constitute not just a smoking gun but rather a 21-cannon barrage of evidence," he said.
Still, a key Democratic staff member to a Senate panel that has investigated Noriega said: "We haven't come across anything to suggest that he (Bush) had a considerable amount of knowledge."
Regardless, Democrats said doubts about Bush's role will not disappear.
"If he didn't know, that's almost as disturbing in a sense," said Sen. Christopher J. Dodd (D-Conn.), who chairs the Latin American subcommittee of the Senate Foreign Relations Committee. "He was director of the Central Intelligence Agency and Gen. Noriega has been on the U.S. government payroll for some years. I'm concerned, in a sense, that he would suggest he wasn't aware of it at all."
Confronts Questions Daily
On the campaign stump, Bush is confronted daily with questions from reporters--sometimes disbelieving in tone. His response is unequivocal and sometimes combative.
"It is our Administration that is bringing Noriega to justice," he told an interviewer in Columbus, Ohio, for instance.
Yes, the questioner said, but could U.S. officials have acted sooner and did you not know sooner?
"In terms of drugs, absolutely not, no. And nobody with any sense of decency in the political arena has alleged I have. And they better not because it's not true. And if they say it's true, let's see the evidence," Bush replied.
"You have to defend yourself in life and that kind of charge coming out of the Democrats--I hear it from some of the liberal (former Sen. George S.) McGovern types around Mr. (Michael S.) Dukakis and (Jesse) Jackson that there is some connection there. What is it? Let them be man enough to stand up to my face and tell me."
Jackson, campaigning in Huntington, W. Va., on Sunday, said: "This Administration is up to its throat. It is choking on sleaze. Obviously Mr. Bush could not have been a hands-on vice president who knew what was happening and then have selective memory and not know what was happening."
'Aware' of Rumors
As for the latest charges, Bush spokesman Peter B. Teeley reiterated that the vice president was "aware" of the rumors linking Noriega to drug-running, but had no concrete evidence of it until this year, when the federal government took action. Teeley also denied that Bush had discussed the matter with Briggs in 1985.
Teeley also denied that Bush was aware at the time of a trip which Vice Adm. John M. Poindexter, then national security adviser, made to Panama, six days before the vice president's meeting with Briggs. The purpose of the trip was to convey U.S. warnings to Noriega about official drug corruption.
Bush has been similarly dogged--and forced to claim lack of knowledge--on two other major foreign policy controversies. On the sale of U.S. weaponry to Iran, the vice president has said that, along with the President, he did not believe it was an arms-for-hostage swap. He has likewise said he was unaware of secret U.S. operations to assist the Nicaraguan Contras in 1985, despite a legal ban on such aid.
Until last week the Iran-contra scandal seemed ready to fade from the courts, the news and the mind. After costing more than four years and $25.5 million, the investigation headed by special prosecutor Lawrence Walsh was limping to a close. A federal appeals court had overturned Lieut. Colonel Oliver North's felony conviction, and a retrial seemed unlikely. The same outcome seemed possible for former National Security Adviser John Poindexter's conviction.
Then the scandal roared back to life with a series of stunning developments. They suggested that:
-- Top intelligence officials had engaged in covering up the Reagan Administration's attempts to evade a congressional ban on aid to the Nicaraguan rebels by siphoning off profits from secret arms shipments to Iran.
-- The Iran-contra affair may be only part of a broader and previously undisclosed pattern of illegal activities by intelligence agencies during the tenure of Ronald Reagan and his CIA chief William Casey. Sources close to the unfolding investigation of the Bank of Credit & Commerce International told TIME that U.S. intelligence agencies, including the CIA, maintained secret accounts with the globe-girdling financial empire, which has been accused of laundering billions of dollars in drug money, financing illegal arms deals and engaging in other crimes.
The discovery of the CIA's dealings with B.C.C.I. raises a deeply disturbing question: Did the agency hijack the foreign policy of the U.S. and in the process involve itself in one of the most audacious criminal enterprises in history? Items:
-- Alan Fiers, head of the CIA's Central America task force from 1984 to 1986, pleaded guilty on Tuesday to two counts of lying to Congress about when high- ranking intelligence officials first learned of the illegal diversion of funds to the contras. Fiers said he became aware of the diversions and informed Clair George, then the CIA's deputy director for operations, in the summer of 1986. But, Fiers said, George ordered him to deny any knowledge of the transfers when he testified before the House intelligence committee that October. In exchange for being allowed to plead guilty to two misdemeanors instead of more serious felonies, Fiers is now assisting Walsh's investigation. With his help, Walsh will probably seek a perjury indictment of George and perhaps other present and former government officials.
-- Three days after Fiers entered his plea, the New York Times disclosed that Walsh possesses tapes and transcripts of hundreds of telephone conversations between CIA headquarters in Langley, Va., and agents in Central America. The talks occurred during the period when North, former Air Force General Richard Secord and his business partner Albert Hakim were operating their secret arms pipeline. The tapes -- which have been in Walsh's hands for three years -- were recorded on a system that George installed at the agency's operations center in the early to mid-1980s.
In recent months Walsh has used the tapes to prod the memory of North and other reluctant witnesses before the grand jury that is still gamely looking into the scandal. The tapes are expected to furnish evidence that could lead to further indictments. Some transcripts of the recordings have been examined by staff investigators for the congressional Iran-contra committees. But curiously, until last Friday, no member of the Senate intelligence committee was aware of the recordings.
-- Investigators probing B.C.C.I. have told TIME that the Iran-contra affair is linked to the burgeoning bank scandal. Former government officials and other sources confirm that the CIA stashed money in a number of B.C.C.I. accounts that were used to finance covert operations; some of these funds went to the contras. Investigators also say an intelligence unit of the U.S. defense establishment has used the bank to maintain a secret slush fund, possibly for financing unauthorized covert operations. More startling yet, even before North set up his network for making illegal payments to the contras, the National Security Council was using B.C.C.I. to channel money to them. The funds were first sent to Saudi Arabia to disguise their White House origins; then they were deposited into a B.C.C.I. account maintained by contra leader Adolfo Calero.
The Iran-contra affair has been characterized by U.S. officials as a rogue operation managed by overzealous members of the National Security Council. But if Fiers is correct, top-ranking CIA officials not only knew about the operation and did nothing to stop it; they also participated in an illegal cover-up.
One of the first casualties of the disclosures could be the nomination of Deputy National Security Adviser Robert Gates to head the CIA. Though Fiers did not implicate Gates in the deception, some Senators find it hard to believe Gates' claim that he knew next to nothing about the Iran-contra scheme when he served as Casey's principal deputy. Four years ago, that suspicion forced Gates to withdraw after Reagan picked him to succeed Casey, who was dying from brain cancer.
Those misgivings appeared to have faded when George Bush chose Gates to replace William Webster. But the mounting questions about the scandal could put his nomination on hold. The Senate intelligence committee, which had expected to begin its hearings on Gates this week, decided to hold off. Members may want to question Fiers, George and perhaps others about what Gates may have known. If the committee's uncertainty drags on, it could run into the August congressional recess, which would delay hearings until September.
Sensing the threat to Gates' confirmation, Bush rushed to defend his nominee. He implored the Senate not to leave Gates "twisting in the wind" through the summer. "Get the men up there who are making these allegations," Bush demanded. "Isn't that the American system of justice -- innocent until proven guilty?"
But Gates is just one more figure twisting in a resurgent storm. Suddenly a number of unanswered questions assume a new urgency. Just what did Ronald Reagan -- and George Bush -- know? And when did they know it?
Beyond that, the discovery of the secret intelligence-agency accounts in the renegade B.C.C.I. raises a whole new set of unsettling possibilities. The most serious is that U.S. spymasters may have been undertaking unauthorized covert operations and all the while furthering the ends of B.C.C.I. By providing clandestine services for intelligence agencies in numerous countries, B.C.C.I. was able to cloak its activities in an aura of national security and thereby stave off investigations from banking officials in the U.S. and abroad.
In 1988 Gates is reported to have told a colleague that B.C.C.I. was "the bank of crooks and criminals." Yet when customs agents investigated the bank in 1988, they found "numerous CIA accounts in B.C.C.I.," says former U.S. Commissioner of Customs William von Raab. Those, he says, were being used to pay agents and "apparently to support covert activities."
Senate investigators, who have known of the agency's links to the bank, have demanded an explanation from the CIA -- so far, without getting a satisfactory response. One question they might ask is whether the CIA link to B.C.C.I. explains the Justice Department's slowness in pursuing its case against the bank. Last year the Justice Department tried unsuccessfully to persuade the Florida state comptroller not to lift B.C.C.I.'s license to operate in that state.
Armed with Fiers' testimony and the treasure trove of CIA phone tapes, Walsh is likely to seek more indictments. In addition to George and perhaps other CIA officials, there are two potential targets outside the agency: former Assistant Secretary of State Elliott Abrams and Donald Gregg, now U.S. ambassador to South Korea. In his plea Fiers says he lied to Congress at a Senate intelligence committee hearing on Nov. 25, 1986. On the same day, Abrams testified that no one at the State Department knew of the diversion of funds. A few days later, when Abrams made a second appearance before the lawmakers, Democratic Senator Thomas Eagleton of Missouri angrily accused him of having lied earlier. "You've heard my testimony," Abrams said during their exchange. "I've heard it," Eagleton replied, "and I want to puke."
Fiers may also implicate Gregg, a onetime CIA officer who served as a foreign policy adviser to then Vice President Bush. Gregg was a close friend of Felix Rodriguez, another former agent, who became a crucial link in the North pipeline to the contras. But Gregg has repeatedly denied before Congress that the office of the Vice President recruited Rodriguez. One tantalizing entry in North's diary indicates that on Jan. 9, 1986, North and Fiers had a phone conversation about Rodriguez. It reads, "Felix talking too much about V.P. connection." Was the reference to Gregg or to Bush?
Walsh's biggest worry may be that the Senate intelligence committee will call Fiers and George as witnesses at Gates' confirmation hearing. Last July a federal appeals court set aside North's 1989 conviction on the ground that some witnesses who testified against him may have been influenced by his congressional testimony about Iran-contra. That testimony could not be used against North in court because Congress had granted him immunity. Concerned that future Senate testimony by Fiers or George might also be put beyond his reach by a grant of immunity, Walsh last week issued a pointed warning to the committee not to imperil his case. "Our investigation has reached a point of significant breakthrough," Walsh said. "To jeopardize this progress in a vain hope of getting quick facts as to an individual nomination would be regrettable."
In one respect, at least, Walsh is right: an individual nomination is no longer the central issue. The main questions now focus on whether the intelligence community covered up illegal acts and how high the conspiracy reached.
One of the great myths of the Clinton scandals is that Mena -- the major Contra training, supply, and drug running headquarters -- was a myth. One of those with solid evidence to the contrary is William Duncan, the former Special Operations Coordinator for the Southeast Region of the Criminal Investigation Division, Internal Revenue Service. In 1991, Duncan (who had lost his job trying to get to the bottom of the Mena story) gave a deposition to a joint investigation conducted by Rep. William Alexander and the Arkansas attorney general's office, represented by Winston Bryant. Here are some excerpts from the deposition -- giving a vivid snapshot of what was going on and what honest investigators such as Duncan and Arkansas state trooper Russell Welch were up against.
Q. Would you state your name, age, and address, please? A. William C. Duncan, age forty-four, 513 Pine Bluff Street, Malvern, Arkansas.
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Q. You were a criminal investigator for the U.S. Treasury Department? A. Yes, perpetually from December of '73 through June 16, 1989.
Q. And as a criminal investigator for the Treasury Department, did you have occasion to investigate matters surrounding activities in Mena, Arkansas? A. Yes, I did.
Q. Would you describe the nature of your instructions and the manner in which you carried out those instructions as they relate to activities surrounding the Mena Airport matter? A. I was assigned to investigate allegations of money laundering in connection with the Barry Seal organization, which was based at the Mena, Arkansas airport.
Q. And can you -- how long a duration were you involved in this investigation? A. I received the first information about Mena and illegal activities at the Mena Airport in April of 1983, in a meeting in the U.S. Attorney's Office, Fort Smith, Arkansas. Asa Hutchinson was the U.S. Attorney then. Also present at that meeting was Drug Enforcement Administration Agent Jim Stepp, S-T-E-P-P.
Q. Did you discover what you believed to be money laundering? A. Yes, I did.
Q. Who was the object of your investigation, and what institution? A. Rich Mountain Aviation, Incorporated based at the Mena Airport. Barry Seal was not actually a target. We had targeted the employees and cohorts of his which operated out of the Mena Airport.
Q. What did you do with the evidence of money laundering that you gathered from your investigation? A. Presented it to the United States Attorney's Office, Western Judicial District, Fort Smith, Arkansas.
Q. And what were your recommendations to the U.S. Attorney? A. That those individuals and corporation -- the corporation be prosecuted for violations of the money laundering statutes, also there were some perjury recommendations and some conspiracy recommendations.
Q. Did you present to the U. S. Attorney a list of prospective witnesses to be called? A. Yes, I did.
Q. For a grand jury? A. Yes.
Q. And do you have the names of those witnesses? A. There were a variety of witnesses. There were some 20 witnesses. He called three witnesses. The witnesses including -- included the law enforcement personnel who had participated in the investigations, Barry Seal, members of his organization, people who were involved in the money laundering, and various financial institution officers who had knowledge.
Q. Mr. Duncan, the money laundering to which you refer, did that arise out of an alleged drug trafficking operation managed from the Mena, Arkansas airport? A. It did.
Q. And it has been alleged that the Central Intelligence Agency had some role in that operation. Is that the same operation that you investigated? A. Yes.
Q. And when you submitted the witnesses, the names of the prospective witnesses to the U. S. Attorney in Arkansas, are you referring to Mr. -- what was the name of the U. S. Attorney? A. Asa Hutchinson.
Q. Asa Hutchinson. And what was his reaction to your recommendations? A. It had been my experience, from my history of working with Mr. Hutchinson, that all I had to do is ask for subpoenas for any witness and he would provide the subpoenas and subpoena them to a grand jury. His reaction in this case was to subpoena only three of the 20 to the grand jury.
Q. Now, of the three witnesses, who were -- what was the nature of the evidence that would have been elicited from those witnesses? A. Direct evidence in the money laundering.
Q. And did those witnesses testify for the grand jury? A. yes, they did.
Q. Were you present at the time of the grand jury? A. No, I was not.
Q. You were not? A. I was in the witness room, but I was not in the grand jury.
Q. I see. What was the result of the testimony given by the three witnesses to the grand jury? A. As two of the witnesses exited, one was a secretary who had received instructions ~~~ and I think on some occasions had discussed with Barry Seal, the methodology. She was furious when she exited the grand jury, was very upset, indicated to me that she had not been allowed to furnish her evidence to the grand jury. ~~~ She was the secretary for Rich Mountain Aviation, who participated in the money laundering operation upon the instructions of Hampton, Evans.
* * * * * Q. And what did she say about the evidence that she was allowed to give the grand jury as it might have been different from the evidence that you wanted her to give to the grand jury? A. She basically said that "she was allowed to give her name, address, position, and not much else.
Q. And there were two other witnesses, I believe you made reference to, did you talk with them? A. I talked to another one, his name was Jim Nugent, who was a Vice-president at Union Bank of Mena, who had conducted a search of their records and provided a significant amount of evidence relating to the money laundering transactions. He was also furious that he was not allowed to provide the evidence that he wanted to provide to the grand jury.
Q. And was there a third witness? A. There was a third witness, I don't recall her name off-hand. She was an officer at one of the financial institutions in Mena, and she did not complain to me.
Q. What was the result of the grand jury inquiry into the money laundering investigation which you had conducted? A. There were never any money laundering indictments.
Q. There was no indictment? A. No.
Q. Did you have occasion to talk to any of the jurors that were impaneled on the grand jury that heard the evidence? A. At a later date, I came in contact with the deputy foreman of the grand jury, who had previously given testimony to an investigator for the House Judiciary Subcommittee on Crime, concerning her frustrations as the deputy foreman of the grand jury.
Q. And could you relate to us any other conversation you might have had with her concerning her appearance before the grand jury? A. Well, she was perpetually involved in the grand jury as it heard evidence concerning the Barry Seal matter, and she related to me the frustrations of herself and the entire grand jury because they were not allowed to hear of money laundering evidence.
Q. Do you recall any statements that she made to you concerning that grand jury, her service on the grand jury? A. .She stated to me that they specifically asked to hear the money laundering evidence, specifically asked that I be subpoenaed, and they were not allowed to have me subpoenaed.
Q. Mr. Duncan, are you saying that the grand jury that was impaneled to hear your investigation, hear evidence of the investigation that you had conducted for the U.S. Treasury as a special investigator, was compromised? A. The evidence was never presented to the grand jury. The evidence gathered during that investigation was never presented to the grand jury.
Q. There were no indictments? A. Never any indictments.
Q. There were no prosecutions? A. None.
Q. In effect, the evidence that you gathered has not been acted on by the U. S. Attorney's Office? A. Not to my knowledge.
Q. Did you complain to your superior? A. Yes.
Q. What was his name? A. Paul Whitmore, Chief of Criminal Investigation. I also complained to my group managers, Tim Lee, Charles Huckaby and Max Gray.
Q. And what did they -- what was their response? A. They were very frustrated, also. Mr. Whitmore, in fact, made several trips to Fort Smith, Arkansas to complain to the U. S. Attorney's Office.
Q. Did he relate to you the conversation he had had with the U. S. Attorney? A. On several occasions, and also related to me that the U.S. Attorney wrote him a letter telling him not to come to his office anymore complaining, that that was unprofessional behavior.
Q. What was the conclusion of Mr. Whitmore concerning your investigation and the manner in which it was handled by the U. S. Attorney in Arkansas? A. That there was a coverup.
Q. Are you saying -- do you agree with his-with Mr. Whitmore's conclusion? A. Absolutely.
Q. Are you stating now under oath that you believe that the investigation in and around the Mena Airport of money laundering was covered up by the U. S. Attorney in Arkansas? A. It was covered up,
Q. Would you state that succinctly for the record in your own words, so that we might -- to have the benefit of how you would state your opinion and conclusions as a result of your activities as a special investigator -- as to this investigation? A. I was involved from April of 1933, really to this date, in gathering information, gathering evidence, until 1987-1988. I, on a perpetual basis, furnished all the evidence, all the information to the U. S. Attorney's Office. In January of 1986, a Special Assistant U.S. Attorney from Miami, I believe, who was a money laundering specialist, came to Fort Smith, met with then U. S. Attorney Fitzhugh and myself and drafted a series of indictments. I think there were 29 indictments, charging the aforementioned individuals and Barry Seal, as I recall, as an unindicted co-conspirator in the money laundering scheme. At that point in time I had every indication that the cases would go to the Grand Jury, that the evidence would be presented to a grand jury. We experienced a variety of frustrations, mid '85 on, not able to obtain subpoenas for witnesses we felt were necessary. I had some direct interference by Mr. Fitzhugh in the investigative process. Specifically he would call me and interrupt interviews, tell me not to interview people that he had previously told me were necessary to be interviewed.
Q. Did you have any interferences or interruptions from anyone within the U. S. Treasury Department that would interfere with your investigation? A. They interfered with my testimony before the House Judiciary Subcommittee on Crime.
Q. Would you tell us about that? A. In late December of 1987, I was contacted by Chief Counsel for the House Judiciary Subcommittee on Crime, Hayden Gregory, who told me that they were looking into the reason why no one was indicted in connection with the Mena investigations. The Internal Revenue service assigned to me disclosure litigation attorneys, which gave me instructions which would have caused me to withhold information from Congress during my testimony and to also perjure myself.
Q. And how did you respond to the Treasury Department? A. Well, I exhibited to them that I was going to tell the truth in my testimony. And the perjury, subornation of perjury resulted in an -- resulted because of an allegation that I had received, that Attorney General Edwin Meese received a several hundred thousand dollar bribe from Barry Seal directly. And they told me to tell the Subcommitte on Crime that I had no information about that.
Q. What is this about Meese? Where did you get that information? A. I received that from Russell Welch, the State Police investigator.
Q. (BY MR. ALEXANDER) Mr. Duncan, prior to your resignation from the Department of Treasury, do you recall any other conversations you may have had with your superiors concerning the investigation of Mena? A. With respect to what?
Q. With respect to the manner in which the case was attempting to be covered up? A. We had continuing discussions because none of us, my managers nor myself, had ever experienced anything remotely akin to this type of interference. I had a very good working relationship with all the Assistant United States Attorneys and the U.S. Attorney's Office, Western Judicial District, never any problems. The office was open to me, and I visited with them every time I was in Fort Smith. And we couldn't understand why there was this different attitude. I had found Asa Hutchinson to be a very aggressive U.S. Attorney in connection with my cases, then all of a sudden, with respect to Mena, it was just like the information was going in but nothing was happening over a long period of time. Mr. Hutchinson did not directly interfere as did Mr. Fitzhugh. But just like with the 20 witnesses and the complaint, I didn't know what to make of that. Alarms were going off. And as soon as Mr. Fitzhugh got involved, he was more aggressive in not allowing the subpoenas and in interfering in the investigative process. He was reluctant to have the State Police around, even though they were an integral part of the investigation. For instance, when the money laundering specialist was up from Miami, Mr. Fitzhugh left Mr. Welch in the hall all day until late in the afternoon and refused to allow him to come in. We were astonished that we couldn't get subpoenas. We were astonished that Barry Seal was never brought to the grand jury, because be was on the subpoena list for a long time. And there were just a lot of investigative developments that made no sense to us. One of the most revealing things, I suppose, was that we had discussed specifically with Asa Hutchinson the rumors about National Security involvement in the Mena operations. And Mr. Hutchinson told me personally that he had checked with a variety of law enforcement agencies and people In Miami, and that Barry Seal would be prosecuted for any crimes in Arkansas. So we were comfortable that there was not going to be National Security interference.
Q. Did you ever talk to a Mary Ann Curtin? A. Yes, I did.
Q. What was her job? A. She was the disclosure litigation attorney in Washington assigned to counsel me, provide legal advice with respect to my testimony before the House Judiciary Subcommittee on Crime.
Q. What was her advice to you? A. Told me not to offer any opinions, even if specifically asked for my opinion by the Subcommitte on Crime. Told me not to volunteer any information. Basically did not want me saying anything that would reflect badly on the U.S. Attorney's Office in the Western Judicial District of Arkansas.
Q. What was your conclusion from her instructions to you? A. It made no sence for me not to give full and complete testimony to the subcommittee on Crime.
Q. Mr. Duncan, do you get the impression that she was ordering you to cover up the investigation? A. Absolutely.
Q. If you were asked to state that in your own words, what would you say? A. I would say that we had conducted textbook investigations of all the individuals at Mena, there were a variety of legal issues involved, which I had always had them in loop on. We had proceeded very soundly. There was nothing for us to be ashamed of. The investigations were thorough, to the extent that we could conduct the investigation without subpoenas. And I would have thought that the Internal Revenue Service would have wanted a complete disclosure to Congress about the problems that we encountered, but quite the opposite was true. They obviously did not want any negative testimony coming from me concerning the U.S. Attorney's Office. At one point when we were arguing about the Meese allegation, she told me that she had discussed my frustrations with the personal assistant to the Commissioner of Internal Revenue, who was Larry Gibbs at the time, and the personal assistant's name was Bryan Sloan. And that Bryan Sloan told her, "Bill is just going to have to get the big picture."
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FURTHER EXAMINATION BY MR. BRYANT:
Q. Bill, let me ask you a few questions. I want to take you back to your investigation at the Mena Airport. How many federal agencies were involved in that investigation at the time you first went there? A. I was aware that U.S. Customs Service was involved..I was aware that the FBI was involved, the Drug Enforcement Administration. Those were federal agencies. The Arkansas State Police was involved. The Polk County Sheriffs Office was involved and also the Louisiana State Police was involved in investigating a link between Louisiana and Arkansas.
Q. In your opinion, were those agencies actively involved in the investigation of the Mena operation and specifically Barry Seal at that time? A. Actively involved since at least 1982.
Q. And when did you first go to Mena? A. In May of 1983.
Q. And after you were involved in the investigation, when did you make your presentation to the U.S. Attorney for the grand jury laundering allegation that you had prepared? A. The reports, the prosecutorial reports went to Mr. Fitzhugh in December of 1985.
Q. At that particular time were all federal agencies still actively involved in investigating the Barry Seal matter or had they--had their interest cooled, or how would you describe it? A. It was a very strange thing, because we were dealing with allegations of narcotics smuggling, massive amounts of money laundering. And it was my perception that the Drug Enforcement Administration would have been very actively involved at that stage, especially along with the Arkansas State Police. But DEA was conspicuously absent during most of that time. The FBI appeared on the scene intermittently. Usually when Russell and I were going to conduct some credible interviews, Tom Ross, from the Hot Springs FBI Office, would suddenly appear on the scene. He would make some trips to Baton Rouge with us. U.S. Customs was conspicuously absent, also. It was primarily just Russell Welch and myself.
Q. Regarding the allegations of drug running and weapons running and any other things that you might have heard, what information do you have to, number one, substantiate that there might have been drugs brought to the Mena Airport? A. We were receiving information from a variety of sources that Barry was doing some work for the United States Government, but that be was smuggling on the return trips for himself. We knew from his modus operandi in Louisiana that he many times dropped the rugs in remote areas and retrieved them with helicopters. He had helicopters in the hangers at Mena and a variety of aircraft, smuggling type aircraft on the ground in Mena. And we heard, you know, all the time that he was making on return trips -- Terry Capeheart, a Deputy at Polk County Sheriff's Department, had received information from an informant on the inside at Rich Mountain Aviation that drugs were actually brought into Rich Mountain Aviation, and on one occasion guarded with armed guards around the aircraft.
Q. What specific physical evidence did you observe at the Mena Airport that would indicate to you, that in your professional opinion, drugs were brought to Mena or that Mena was being used as a base for drug smuggling? A. primarily I was reviewing evidence gathered by the law enforcement agencies, surveillance logs, their representations to me. I was focusing on the money laundering and financial analysis end of it, and did not conduct a lot of physical surveillance myself. But we had a lot of intelligence reports and surveillance reports of various airplanes in there being refueled, leaving in the middle of the night, N numbers being changed, typical modus operandi of a smuggling. We also had testimony that his aircraft had been plumbed with longer range tanks and bladders, that illegal cargo doors had been installed in the aircraft. And there was a lot of evidence of that. And I was seeing on some of the cashier's checks, Barry Seal's name on cashier's checks. The secretary ~~~ stated that when Barry would come in in his airplanes, the next morning many times there would be stacks of cash to be taken to the bank and laundered.
Q. In connection with your investigation into the laundering activities, what -- how much money was laundered in your opinion through the Mena bank? A. At the time we couldn't proceed any further because of the lack of subpoenas. I would have to review the records, which the Internal Revenue Service has now. But it seems like there was a quarter of a million dollars, $300,000, something like that that we had documented, that had been laundered through the Mena banks, just the Mena banks.
Q. And when you say "laundered," what specifically do you mean; what happened? A. They were obtaining cashier's checks in amounts of $10,000 or less at a variety of financial institutions in Mena and some further north from Mena or sometimes different tellers in the same banks to avoid preparation of the Currency Transaction Report. Kathy Corrigan testified that her instructions ~~~ were, that they were to do this to avoid the Internal Revenue Service knowing about the money and to avoid payment of taxes on the money.
Q. Now, are you saying the' someone from Rich Mountain Aviation would appear at a local bank with $10,000 or less in cash, and then give that to the bank in exchange for a cashier's check, was that the typical arrangement, or what was the typical arrangement? A. They would go with, say, $9,500, or they might go with $30,000, but they would break it up in increments of $10,000 or less. And on one occasion Freddie Hampton personally took a suitcase full of money, I think it was seventy some thousand dollars, into this bank officer, and the testimony of the tellers revealed that the bank officer went down the teller lines handing out the stacks of $10,000 bills and got the cashier's checks. Those cashier's checks, in that instance, went to Aero House of Houston for the building of Barry Seal's hanger. This, as I recall, was November of '82.
Q. Do you have any doubt in your mind that Mena was used as a base for drug operation. headed by Barry Seal? A. Do I have any personal doubt?
Q. Do you have any personal doubt in your mind that that is not the case -- that that was not the case? A. I very much believe that was the case.
Q. You had an occasion to interview Mr. Seal yourself, did you not? A. That's correct.
Q. Now, when was this? A. This was December of '85.
Q. Was this prior to the laundering grand jury or after? A. After.
Q. After. Was there any particular reason why Barry Seal was not called to testify at the grand jury? A. I never received an explanation from the U.S. Attorney's Office as to why he was not called. Because we were given assurances that he would be called to the grand jury. He was on the witness list, and I issued him a subpoena at the time I interviewed him for appearance at the grand jury. You've already stated you, as a law enforcement official did not testify? A. That's correct.
Q. Did any law enforcement official testify before the grand jury, to your knowledge? A. It's my understanding that Larry Carver with DEA testified before the grand jury sometime maybe in '87 or '88. Russell Welch testified before the grand jury, and also Terry Capaheart testified before the grand jury.
Q. In your professional opinion as a law enforcement official with extensive experience, is that -- wouldn't it be highly unusual in extreme cases where law enforcement officials who investigated the case would not be called to testify? A. Every grand jury case that was ever presented where I conducted the investigation, I was the law enforcement officer who summarized the evidence before the grand jury. I find it highly unusual.
Q. And isn't it highly unusual that Barry Seal was not called to testify in view that he was - - in view of the fact that he was the principal involved in the investigation? A. We found it highly unusual.
Q. You had an opportunity to interview Mr. Seal. Did Mr. Seal make any admissions regarding drug operations that he headed? A. I would have to review a copy of that transcript. he basically admitted that he had been a smuggler, that he had smuggled drugs. he told -- he said that he told the people at Rich Mountain Aviation that they were guilty of money laundering and should be prepared to plead guilty to it. That he provided instructions to them that resulted in them getting involved in money laundering. "Not to put his business on the street," I think is the way he put it.
Q. Mr. Duncan, we've talked about -- you have testified that a one Barry Seal, in your judgment, laundered money from -- that was derived from the sale of drugs -- A. Yes.
Q. -- in several banks in and around Mena, Arkansas. He had to get those drugs -- "he," Barry Seal, , had to get those drugs from somewhere. Do you know the source of those drugs? A. The specific drugs in the Mena operation?
Q. Well, Barry Seal got drugs that he sold for money. Are those the drugs that came to Mena from Central America? A. I don't have direct evidence of that.
Q. Do you have any evidence as to where Barry Seal might have gotten the drugs that he sold for money that was laundered at Mena? A. I believe that he testified that he had a history of smuggling narcotics, marijuana and cocaine, from Central America.
Q. Did Barry Seal have a connection with the so-called Mena operation, drug smuggling operation? A. The evidence that we have indicates that his entire base of operation moved from Baton Rouge to the Mena Airport in approximately 1982, late 1982.
Q. Mr. Richard Brennecke testified earlier today that he was a former contract employee with the CIA, and that as a pilot he transported guns and munitions from Mena, Arkansas to Panama. And that on the same airplane returned with a cargo of drugs, mostly cocaine but some marijuana, that was brought back to Mena and delivered to one Hampton, Freddie Hampton, and to representatives of the Gotti New York crime syndicate operation, the Mafia from New York. Do you know whether or not any of those drugs that were described by Mr. Brenneke went to Mr. Seal as well and were sold in the United States in exchange for the money that he laundered at Mena? A. I have no personal knowledge of that.
FURTHER RE-EXAMINATION BY MR. BRYANT:
Q. Even though, while you do not have personal knowledge of that, Bill, would Mr. Brenneke's scenario, based on what you personally know happened at Mena, be consistent? A. What Mr. Brenneke has related concerning the Mena operation would be consistent with testimony from a variety of individuals and additional information that we received concerning the method of operation at Rich Mountain Aviation. For instance, Kathy Corrigan related that on numerous occasions they would be forced to stay inside their offices because airplanes would land and strange faces would be around, Central American or Mexican, Spanish origin folks would be around that they had not seen before. But on those occasions they were given instructions by Hampton and/or Joe Evans to stay in the office and make no contact with those individuals. Airplanes landing in the middle of the night, hanger doors opening, the airplanes going in, then leaving out before daylight, numerous, dozens and dozens of accounts like that. Great secrecy surrounding the entire operation at Rich Mountain Aviation.
Q. So if everything that Mr. Brenneke stated regarding his relationship with the Mena operation were true, it would fit into the overall picture as you understand the situation at Mena, would it not? A. Yes, It would. With respect to the training at Nella, we had numerous reports of automatic weapons fire, of people in camouflage in the middle of night, low intensity landing lights around the Nella Airport, twin-engine airplane traffic in and about the Nella Airport. Reports as far as 30 something miles away of non-American type of troops in camos moving quietly through streams with automatic weapons, numerous reports like that from a variety of law enforcement sources. Also, reports that -- from the Arkansas Game and Fish Commission people that they found vast quantities of ammunition hulls secreted in shacks around the Nela Airport. On one occasion the Game and Fish officer was warned away from the Nella Airport by someone who purported to be an FBI agent and exhibited a badge, On and on and on.
Q. Regarding the Nella Airport, have you been there personally? A. Yes, I have.
Q. And so there is another airport not far from the Mena Airport? A. Yes, there is, approximately ten miles north.
Q. And would there be any other reason for the Nella Airport other than clandestine activities, paramilitary training, use by planes to bring in drugs, illegal contraband and so forth? A. Not to my knowledge. There are no hangers out there. The type of reports that we had from individuals living around the airport would indicate that type of an operation. Some of those people said that there were frequent visits by people from Rich Mountain Aviation basically asking what they were seeing and hearing. There was a large expenditure of money in preparation of the strip by Freddie Lee Hampton. The type of expenditure that you wouldn't make just for an out-of-the-way little country airport.
Days after Avirgan and Honey's report is published, Hull files suit against the journalists, charging them with ``injuries, falsehood and defamation of character''
because of their allegations of his role in the bombing [La Penca: On Trial in Costa Rica, Edited by Avirgan and Honey, 1987]
the truth in `Dark Alliance'
August 18, 2006 | Nick Schou, NICK SCHOU is an editor for OC Weekly. His book, "Kill the Messenger: How the CIA's Crack-Cocaine Controversy Destroyed Journalist Gary Webb," will be published in October.
TEN YEARS AGO today, one of the most controversial news articles of the 1990s quietly appeared on the front page of the San Jose Mercury News. Titled "Dark Alliance," the headline ran beneath the provocative image of a man smoking crack -- superimposed on the official seal of the CIA. The three-part series by reporter Gary Webb linked the CIA and Nicaragua's Contras to the crack cocaine epidemic that ripped through South Los Angeles in the 1980s.
INS Agent Tells of Errors in Handling Drug Informant
June 23, 2000 | JESSE KATZ, TIMES STAFF WRITER
Launching his bid for a new trial, South-Central Los Angeles crack kingpin "Freeway" Ricky Ross put one of his own captors on the witness stand Thursday, accusing an INS agent of illegally supplying a green card to the Nicaraguan parolee who helped set him up for arrest. Ross, whose conviction four years ago sparked an international furor over the U.S.
Judge Seeks Records in 'Freeway' Ricky Ross Case
November 20, 1999 | JESSE KATZ, TIMES STAFF WRITER
A federal judge on Friday kept open the possibility that jailed drug dealer "Freeway" Ricky Ross could be granted a new trial, saying that a U.S. Justice Department probe into the ex-kingpin's 1996 conviction raised enough questions to merit further review. U.S.
Notorious South-Central Drug Figure Again Battling to Avoid Long Prison Term
November 3, 1999 | JESSE KATZ, TIMES STAFF WRITER
Twice in his long and storied crack-dealing career, "Freeway" Ricky Ross has stared down the barrel of a life sentence. Twice, after sensational trials that called America's drug war into question, he has dodged the bullet. Some would say he is Los Angeles' slipperiest dope man, others the most persecuted. This month, he is scheduled to be resentenced in U.S.
January 24, 1999 | MICHAEL MASSING, Michael Massing is the author of "The Fix."
Gary Webb is a man on a mission. The series he wrote for the San Jose Mercury News two years ago alleging that the CIA-backed Nicaraguan Contras helped ignite the nation's crack explosion set off its own outburst of indignation and dismay. Radio talk shows burned up long hours discussing the story, and the Mercury News' Web site received more than 1 million hits a day. Both California senators wrote CIA Director John Deutch demanding an inquiry, and Deutch eventually agreed to conduct one.
CALIFORNIA | LOCAL
CIA's Trail Leads Back to Its Own Door
October 22, 1998 | ALEXANDER COCKBURN, Alexander Cockburn is co-author, with Jeffrey St Clair, of "Whiteout: The CIA, Drugs and the Press," (Verso, 1998)
Just under two years ago, John Deutch, at that time director of the CIA, traveled to a town meeting in South-Central Los Angeles to confront a community outraged by charges that the agency had been complicit in the importing of cocaine into California in the 1980s. Amid heated exchanges, Deutch publicly pledged an internal investigation by the CIA's inspector general that would leave no stone unturned.
Drug Lord's Life Sentence Overturned
September 11, 1998 | HECTOR TOBAR, TIMES STAFF WRITER
An appeals court has overturned the life sentence of onetime Los Angeles cocaine lord Ricky Ross, saying that a judge erred when she sentenced Ross under a federal three-strikes law. The U.S. 9th Circuit Court of Appeals ordered U.S. District Judge Marilyn Huff to resentence Ross, whose links to a former leader of the Nicaraguan Contras, Oscar Danilo Blandon, spawned a public furor.
CIA and Crack Cocaine in L.A.
May 18, 1997
Kudos for Jerry Ceppos, executive editor of the San Jose Mercury News. He acknowledges that the story of the CIA influencing crack cocaine in the Los Angeles South-Central area may have been without accurate evidence (May 12). I was the LAPD representative who investigated Thomas "Tootie" Reese for nine years. During that period he visited San Francisco and experimented with a new creation called "freebasing" cocaine. Freebasing was brought to some very exotic parties in the late '70s.
San Jose Editor Admits to Crack Series Deficiencies
May 12, 1997 | From Associated Press
The executive editor of the San Jose Mercury News on Sunday wrote an open letter to readers, admitting to shortcomings in the newspaper's controversial series on the crack cocaine explosion in Los Angeles in the 1980s. Jerry Ceppos said the newspaper solidly documented information that a drug ring associated with the rebel force in Nicaragua known as the Contras sold large quantities of cocaine in inner-city Los Angeles. Some of the profits from those sales went to the Contras.
Undeterred, Waters Crusades for Answers
March 4, 1997 | JOHN L. MITCHELL, TIMES STAFF WRITER
As she crusades across the country, from hotel ballrooms to college campuses, from talk radio to the Internet, Rep. Maxine Waters (D-Los Angeles) asks a series of troubling questions at almost every stop: "Who knew what? When did they know it? And how high did it go?" For six months, she has been demanding answers to a controversial and disputed San Jose Mercury News series that suggested the federal government aided the spread of crack cocaine in the inner city.
Waters Goes to Nicaragua in Probe of Alleged Cocaine-Contra Links
January 3, 1997
Rep. Maxine Waters (D-Los Angeles) said Thursday that she is traveling to Nicaragua today to continue her investigation of alleged links between the crack cocaine trade and the CIA-backed Contra rebels. Waters said she was scheduled to arrive today in Nicaragua for a meeting with Enrique Miranda Jaime, a former associate of Norwin Meneses, a drug dealer and Contra rebel sympathizer.
Sheriff's Probe Sees No CIA Role in Crack Sales
December 11, 1996 | JIM NEWTON and VICTOR MERINA, TIMES STAFF WRITERS
An exhaustive, self-critical investigation by the Los Angeles County Sheriff's Department has uncovered no evidence of CIA involvement in Southern California drug trafficking, but has turned up controversial new details about the conduct of local narcotics officers--including admissions that one group of sheriff's deputies stole roughly $50,000 during a 1986 raid.
Drug Dealers Aided Contras, Ex-Chief Says
November 27, 1996 | ROBERT L. JACKSON, TIMES STAFF WRITER
A former leader of the Nicaraguan rebel movement in the 1980s told senators Tuesday that he received a small amount of money from a major Nicaraguan cocaine dealer in Southern California, as well as larger sums from other drug traffickers in Miami. But the former Contra leader, Eden Pastora, insisted in testimony to the Senate Intelligence Committee that he did not know at the time that his donors were involved in illegal activities.
Ross Gets Life; His Case Fueled CIA Crack Furor
November 20, 1996 | TONY PERRY, TIMES STAFF WRITER
Onetime crack cocaine kingpin "Freeway" Ricky Ross, whose case renewed a national controversy about alleged CIA involvement in drug dealing, was sentenced to life in prison by a judge who said Ross cannot use unproven allegations about the CIA to escape the maximum punishment for being an "eager participant" in the illicit drug trade. "Mr. Ross does not get a free pass to deal drugs the rest of his life and addict further people because of something that happened in the 1980s," said U.S.
CIA Says It Has No Record of Ties to Drug Trafficker
November 6, 1996 | DOYLE McMANUS, TIMES WASHINGTON BUREAU CHIEF
The Central Intelligence Agency said Tuesday that it has no record of any CIA relationship with the principal members of a Nicaraguan-American cocaine trafficking ring that operated in California during the 1980s. In a legal declaration filed in federal court in San Diego and released in Washington, the CIA said it knew as early as 1984 that cocaine smuggler Norvin Meneses was a major drug trafficker.
CIA and Drugs in South-Central
October 25, 1996
Re "The Cocaine Trail," Oct. 20-22: Let's get real with the big picture about the illegal drug sale industry in the U.S. Conservative estimates put it at tens of billions of profits yearly. Though this translates into several American billionaires yearly, it is amazing how incapable the federal government is at finding any of them. No agency seems interested, including the CIA, DEA, FBI, customs, defense, state or IRS. It's a bipartisan problem too. President Clinton's illegal drug czar Barry R. McCaffrey has proven just as incapable as the former Republican czar William J. Bennett.
Cyberspace Contributes to Volatility of Allegations
October 22, 1996 | ELEANOR RANDOLPH and JOHN M. BRODER, TIMES STAFF WRITERS
The controversy that began with the San Jose Mercury News' publication of a series on cocaine and the Nicaraguan Contra rebels has become a case study in how information caroms around the country at whiplash speed in the digital age. In its printed version, as the paper's editor has pointed out, the stories were careful never to claim that the Central Intelligence Agency condoned or abetted drug dealing to support the Contra movement.
Examining Charges of CIA Role in Crack Sales
October 21, 1996 | DOYLE MCMANUS, This story was reported by Times staff writers John Broder, Doyle McManus, David Willman and researcher Robin Cochran in Washington; Ralph Frammolino, William C. Rempel and Claire Spiegel in Los Angeles; Dan Morain in San Francisco; Juanita Darling in Nicaragua, and special correspondent Michael Clary in Miami. It was written by McManus
Adolfo Calero, the burly, back-slapping political leader of the Nicaraguan rebel movement known as the Contras, was in an ebullient mood. It was June 1984, and Calero was in San Francisco to rally American support for his cause--and to look for financial donors. After a speech at the elegant St. Francis Yacht Club, where well-heeled conservatives cheered his calls of "Viva Reagan! Viva Nicaragua libre!"
Ex-Associates Doubt Onetime Drug Trafficker's Claim of CIA Ties
October 21, 1996 | VICTOR MERINA and WILLIAM C. REMPEL, TIMES STAFF WRITERS
In 1986, when federal and local anti-drug agents raided his Mission Viejo home, cocaine trafficking suspect Ronald J. Lister met officers in his bathrobe and warned that they were making a mistake, that he "worked with the CIA, and . . . his friends in Washington weren't going to like what was going on." According to a Los Angeles County sheriff's report on the incident, when deputies dismissed Lister's claim, he threatened to report them to his contact at CIA headquarters in Langley, Va.
Waters Releases Drug Raid Data
Narcotics: She says documents seized by Sheriff's Department support charges that CIA was linked to crack sales. Block denies claim that his agency is hiding information, much of which surfaced in 1990 trial.
October 08, 1996|RALPH FRAMMOLINO and VICTOR MERINA | TIMES STAFF WRITER
Deputies Said in '86 Drug Ring Was Tied to Contras
Crime: Southland raids targeted operation that funded Nicaragua rebels, sheriff's document said. It does not mention alleged CIA link.
October 08, 1996|RALPH FRAMMOLINO and JIM NEWTON | TIMES STAFF WRITERS
Probe of CIA Rekindles Interest in Old Drug Case
Inquiry: Defense attorney says sheriff's deputies found evidence in 1986 linking agency operatives to L.A. drug sales and Contras.
September 28, 1996|JIM NEWTON | TIMES STAFF WRITER
Braun's allegations were reported by The Times when he first filed the motion in 1990, but the issue quickly died, in part because U.S. District Judge Edward Rafeedie, at the request of prosecutors, issued a gag order barring Braun and other trial lawyers from airing the matter. Rafeedie said that even if the allegations made by Braun were true, they were not relevant to the case against sheriff's deputies accused of skimming drug money and filing false tax returns, among other things.
"Someone in the 1980s made the decision that it was important enough to support the Contras that they [the government] would participate in drug dealing," he said
Prosecutors Told to Rebut Claim of CIA Plot
Court: U.S. judge's order comes after defense lawyer's allegation that intelligence agency used informant tied to Nicaraguan rebels.
September 14, 1996|TONY PERRY | TIMES STAFF WRITER
Sentencing of L.A. Drug Dealer Ross Postponed
Courts: Lawyer is granted time to try to show that authorities misused witness to entrap defendant. L.A. council seeks federal inquiry into alleged Contra links to crack epidemic @of the 1980s.
August 24, 1996|TONY PERRY and MONICA VALENCIA | SPECIAL TO THE TIMES
As Drug Debate Rages, Dealer to Be Sentenced
Crime: Federal prison term awaits 'Freeway' Ricky Ross, who contends he is a pawn in a CIA conspiracy involving Nicaraguan Contras.
August 23, 1996|TONY PERRY and JESSE KATZ | TIMES STAFF WRITERS
Drug Trial to Focus on Sting : DEA, Former Supplier Offer Glimpse Into World of Informants
March 05, 1996|JESSE KATZ | TIMES STAFF WRITER
Drug Cartel Reportedly Offered to End Smuggling, Spy on Rebels
July 21, 1988|Associated Press
"Lehder appeared to be under the impression that he, Escobar and Ochoa can work for American intelligence by supplying information about guerrilla activities, thereby incurring amnesty for their efforts," the DEA account said. "They then can return to their families and call an end to their trafficking activities."
Lehder was captured three months after the meeting with the lawyer in a jungle shoot-out.
U.S. officials noted that similar offers had been floated by cartel leaders in the past. In 1984, they reportedly offered to pay off the Colombian national debt--then estimated at more than $9 billion--if the government would drop charges against them and scrap the country's extradition treaty with the United States.
ASHINGTON -- Early last year, as undercover U.S. Customs agents neared the end of the biggest investigation ever conducted into the illegal movement of drug money, bankers working with Mexico's most powerful cocaine cartel approached them with a stunning offer.
MEXICO'S DRUG WAR Related Articles D.E.A. Chief Warns Senate on Traffickers in Mexico (Feb. 25) U.S. Is Brushing Off Mexico's Drug Data (Feb. 14) U.S. Plan to Help Mexican Military Fight Drugs Is Faltering (Dec. 23, 1998) Drug Inquiry Into a Governor Tests Mexico's New Politics (Nov. 26, 1998) Mexico Jails 2 Drug Agents, and U.S. Officials See Graft (Sept. 25, 1998) Mexico Promises Full Inquiry Into Tainted Elite Drug Unit (Sept. 18, 1998) U.S. Officials Say Mexican Military Aids Drug Traffic (Mar. 26, 1998) Trial of a Drug Czar Tests Mexico's New Democracy (Aug. 22, 1997) U.S. Helps Mexico's Army Take a Big Anti-Drug Role (Dec. 29, 1997) Mexico and Drugs: Was U.S. Napping? (July 11, 1997) The agents, posing as money launderers from Colombia, had insinuated themselves deeply into the Mexican underworld, helping the traffickers hide more than $60 million. Now, money men working with the cartel said they had clients who needed to launder $1.15 billion more. The most important of those clients, they said, was Mexico's powerful defense minister. The customs agents didn't know whether the money really existed or if any of it belonged to the minister, Gen. Enrique Cervantes, officials said. But having heard about American intelligence reports pointing to corruption at high levels of the Mexican military, the agents were mystified by what happened next. Rather than continue the undercover operation to pursue the deal, Clinton administration officials ordered that they shut it down on schedule several weeks later. No further effort was ever made to investigate the offer, and officials said prosecutors have not even raised the matter with the suspects in the case, who have pleaded guilty and are cooperating with the authorities. "Why are we sitting on this kind of information?" asked the former senior customs agent who led the undercover probe, William F. Gately. "It's either because we're lazy, we're stupid, or the political will doesn't exist to engage in the kind of investigation where our law-enforcement efforts might damage our foreign policy." Senior administration officials denied that foreign policy influenced their decision to end the operation, saying they were moved primarily by concerns for its security. They also emphasized that the agents were unable to verify the Mexican traffickers' claims. Other officials of the administration, which has based much of its Mexican drug strategy on collaboration with Cervantes, said they are confident that he is above reproach. A spokesman for the Mexican Defense Ministry, Lt. Col. Francisco Aguilar Hernandez, dismissed the traffickers' proposal as self-serving lies. The Hunters and Their Prey: Characters in a Complex Drama of Deception The Targets AMADO CARRILLO FUENTESFormer head of the so-called Juarez cartel, Mexico's most powerful drug smuggling operation. Bribed senior military and police officials to protect his operations. Died after plastic surgery in July, 1997. JUAN JOSE CASTELLANOS ALVAREZ TOSTADOJuarez cartel lieutenant responsible for money laundering activities; negotiated deals with undercover Customs team. Protected in Mexico by men identified as federal police agents. Now a fugitive, thought to be living in Mexico. VICTOR ALCALA NAVARROJuarez cartel operative who worked closly with the Customs team, arranging pickups of drug money in the United States and introductions to corrupt Mexican bankers. Jailed in Los Angeles. The Undercover Operation "JAVIER RAMÍREZ"Pseudonym of Colombian source who worked with undercover Customs agents. Posed as the head of a money laundering operation run out of a dummy front company in a Los Angeles suburb. Made more than $2 million for his undercover work. WILLIAM F. GATELYFormer senior Customs investigator in Los Angeles, developed and led Operation Casablanca. Battled with senior officials skeptical of the plan. Recently retired after being called back to Washington and given a desk job. JOHN HENSLEYCustoms chief in Los Angeles. Officials said he accused Gately of stealing money and other abuses that were investigated and found baseless. Received $20,000 Presidential award for Casablanca and other cases. The Administration JAMES E. JOHNSONUndersecretary of the Treasury for Enforcement, helped oversee Casablanca as an Assistant Secretary. Said to have warned officials involved in the case not to mention the name of the Mexican Defense Minister unless they could prove his involvement. RAYMOND W. KELLYFormer New York City Police chief, now Customs Commissioner. Was the Treasury Undersecretary overseeing Customs during Casablanca. Said he did not extend the investigation to pursue the purported $1.15 billion deal because there was no hard evidence that it was real. ROBERT E. RUBINTreasury Secretary who, despite concerns about political fallout, ordered the undercover operation to go forward without informing officials at the State Department, the National Security Council or the Mexican Government. But a detailed account of the case -- based on confidential government documents, court records and dozens of interviews -- suggests that U.S. officials walked away from an extraordinary opportunity to examine allegations of the official corruption that is considered the main obstacle to anti-drug efforts in Mexico. For nearly a decade, American officials have been haunted by the spectacle of Mexican officials being linked to illicit activities soon after they are embraced in Washington. And just weeks before the customs investigation, known as Operation Casablanca, ended last year, administration officials received intelligence reports indicating that the Mexican military's ties to the drug trade were more serious than had been previously thought. But when faced with the possibility that one of Washington's critical Mexican allies might be linked to the traffickers, the officials gave the matter little consideration. They said they opted for a sure thing, arresting mid-level traffickers and their financial associates and at least disrupting the money laundering system that drug gangs had set up. To reach for a general, they said, would have added to their risks with no certainty of success. "Obviously it was a significant allegation," Customs Commissioner Raymond W. Kelly said in an interview. But he added: "There was skepticism about it. Was it puffing? It just was not seen as being -- I won't use the word credible -- but it wasn't verified." Taking Stock: Arrests, Indictments and Drug Money When senior administration officials announced the sting last May 18, they took a triumphant inventory: the indictments of three big Mexican banks and bankers from a dozen foreign banks; the arrests of 142 suspects; the confiscation of $35 million in drug profits and the freezing of accounts holding $66 million more. The officials claimed the success as the result of a longstanding administration fight against money laundering. But Gately, who retired from the Customs Service on Dec. 31, said his investigation ran a gantlet of resistance from the start. The Justice Department, uncomfortable with cases in which undercover agents laundered more money for drug traffickers than they ultimately seized, were imposing new limits on the time that such operations could run and the money they could launder, officials said. And though the restrictions did not apply to Customs, a branch of the Treasury, Justice Department officials continued to play strong, skeptical roles in supervising cases throughout the government. One federal official, who spoke on the condition of anonymity, admitted that he initially dismissed Gately's plan as a nonstarter. "You're out of your mind," the official remembered saying. Several colleagues said it was the sort of response that Gately, 49, tended to see as a challenge. A decorated former Marine who enlisted for service in Vietnam at the age of 17, he had already been at the center of several cases that mixed internal struggle and public success. Friends and critics described him in similar terms: driven, sometimes abrasive and unusually creative. After leading an investigation that revealed ties between the Italian mafia and Colombian cocaine cartels, Gately co-wrote a 1994 book about the case, "Dead Ringer," that cast him as a lonely crusader surrounded by small-minded bureaucrats. "It is the story of one man who refused to succumb to corruption," the prologue reads, "who believed in his oath and mission, and the consequences he paid for believing in what he was doing." As the senior customs drug investigator in Los Angeles, Gately said, he first heard from an informant in 1993 about an important shift in the way that Mexican and Colombian drug traffickers were converting their cash into funds that could be freely spent. The informant said traffickers were depositing their money with corrupt Mexican bankers, who sent it back to them in almost untraceable cashier's checks drawn on the American accounts that the Mexican banks used to do business in the United States. Gately hoped his informant could infiltrate that system -- collecting illicit cash from drug wholesalers in the United States and then wiring it to corrupt bankers in Mexico. The bankers would issue drafts for the money, and customs would develop evidence against suspects on both ends of the transaction. Many customs officials, however, were skeptical that the ruse would work. Drug-enforcement agents wanted to use the informant in another case. One federal prosecutor opposed using him at all because he had a criminal past and threatened to indict him in a 10-year-old case. Even when Gately was eventually able to recruit another informant, a Colombian known by the pseudonym "Javier Ramirez," a senior Justice Department official, Mary Lee Warren, pressed him to limit the operation's scope, Gately and others said. "What she wanted to know was, when was this going to be over?" he recalled. "What was our endgame?" Getting Involved: U.S. Operatives Meet a Kingpin In November 1995, Colombian drug contacts introduced the undercover agents to Victor Alcala Navarro, a representative of Mexico's biggest drug mafia, the so-called Juarez cartel. The customs agents, posing as money launderers from a dummy company called Emerald Empire Corp., began picking up the Mexican's profits and laundering them as planned. In February 1997, at meetings in Mexico, Ramirez was introduced to Alcala's boss. A few months later, the customs informant found himself chatting by phone with the head of the cartel, Amado Carrillo Fuentes. Over scores of meetings and million-dollar deals, the traffickers grew more open about the official protection they enjoyed in Mexico, law-enforcement officials and government documents indicate. At one meeting in Mexico City on May 16, 1997, the traffickers brought along 16 federal police agents as bodyguards. At another meeting, a man who identified himself as an official of the Mexican attorney general's office picked up $1.7 million in cash, including $415,000 that the undercover agents had brought for the cartel boss himself. During a later meeting in New York, Alcala told the agents that like Mexico's drug-enforcement chief, who had been arrested for collaborating with the Juarez cartel, the defense minister, Cervantes, was in league with the competing Tijuana cartel. Customs officials said they remained skeptical of what the agents heard, including the traffickers' claim that Carrillo Fuentes had actually faked his own death in 1997. But in December 1997, Ramirez invited Alcala to Colombia for an elaborately staged meeting that seemed to raise their partnership to a new level. At a heavily guarded hacienda overlooking Bogota, an informant acting as Ramirez's Colombian boss, Carlos, said he and his partners had $500 million of their own to launder. They wanted to know whether the Mexican bankers used by Alcala's boss, Juan Jose Castellanos Alvarez-Tostado, could help. "Alvarez called us right back," Gately recalled. "He said, 'Let me send you my very best people, and we will get it done.' " On March 6, 1998, Alcala arrived with several businessmen at the tastefully furnished offices of Emerald Empire in an industrial suburb of Los Angeles. This time the businessmen brought a big deal of their own. One of the men, David Loera, said he knew "a general" who had $150 million in Mexico City to invest. Would Ramirez -- who had told the traffickers he owned part of a Nevada casino used to launder money -- care to help? Over the next six weeks, according to government documents and the accounts of Gately and several officials, the deal was discussed in three more meetings and three telephone conversations between Ramirez, the undercover agents and the traffickers. All of the contacts were secretly tape-recorded and transcribed, officials said. In one call, two senior investment managers at Mexico's second-largest bank told the customs operatives that the money belonged not just to "a general" but to the minister of defense. Later, the two Mexicans advised Ramirez that the minister was sending "his daughter" (a woman later said to be a friend) to meet with them, along with an army colonel and a third person. However, the investment managers said, the amount to be laundered was much more than they had discussed: the minister had $500 million in cash in New York and another $500 million in the Netherlands, in addition to the $150 million in Mexico City. Customs officials said they queried the CIA, which works closely with the Mexican military on drug-control and other programs. The CIA responded tersely that they had no such information about Cervantes, an assessment that other officials have since reiterated. But while Cervantes has not been a focus of suspicion, Mexican and American officials said several senior generals close to him have been under scrutiny by investigators from both the Mexican attorney general's office and a special military intelligence unit. On Feb. 6, analysts at the Drug Enforcement Administration briefed Attorney General Janet Reno on intelligence indicating that senior Mexican generals might indeed be cooperating with Carrillo Fuentes' organization, officials said. And in a separate customs case in Houston, undercover agents had been approached about laundering millions of dollars for an unnamed Mexican army general, officials said. On April 9, Alcala visited Emerald Empire with a cousin, who had just returned from Mexico with a message. "He was very nervous about the deal," Gately said. "He said it could be very dangerous if it got screwed up, because the money belonged to 'all of them, including the president,' " Ernesto Zedillo. (A spokesman for Zedillo, David Najera, dismissed the claim as baseless.) Later that month, Gately went to Washington to brief officials including Kelly -- who was then about to take over the Customs Service after overseeing it as the Treasury Undersecretary for Enforcement. "Kelly said, 'How do we know it's really him?' " Gately recalled, referring to Cervantes. "I told him, 'We don't know,' " Gately said. " 'We can't substantiate it. But we have no reason to believe they're telling us anything other than what they know.' "They weren't trying to impress us, they were trying to make deals with us," Gately added. "So whoever had this money, I thought it was worth pursuing -- whether it was the defense minister of Mexico or somebody we'd never heard of." People familiar with the discussions said they did not go much further. The general's supposed emissaries were to meet Ramirez in Las Vegas on April 22. They did not arrive, and the traffickers reported that they had gotten nervous. Kelly acknowledged that he had been pressing for months to wrap up the investigation; he said he had grown increasingly concerned that information about it might leak out, endangering the undercover agents. The final sting had already been postponed twice because federal prosecutors were still preparing indictments. James E. Johnson, who succeeded Kelly as undersecretary and has closely supervised Treasury's relationship with Mexico on enforcement issues, added a cautionary note that several officials said seemed to underscore his concern for the political stakes. Unless the agents had proof of Cervantes' role, several officials quoted him as warning, they should not bandy his name about in connection with the case. "We need to be very careful about how we talk about this sort of thing," a senior law-enforcement official, who would not speak for attribution, quoted him as saying. "If we don't have the goods, it makes us look like we're overreaching." Avoiding Pitfalls: U.S. Agents Begin Fretting Over Leaks The operation had already navigated a series of sizable obstacles. Gately and some other agents were worried that their boss in Los Angeles, John Hensley, had leaked information about the secret operation to congressional aides and others; Hensley had also pressed hard to bring the operation to an end, officials said. For his part, officials said Hensley had accused his strong-willed subordinate of transgressions ranging from traveling without authorization to stealing millions of dollars. Kelly acknowledged that the charges were investigated and found baseless; Hensley declined any comment. As discussions about the supposed $1.15 billion were going on, the undercover operation also suffered a serious setback with the capture of a key Juarez operative in Chicago. The arrest brought money deliveries to a halt while the cartel hunted for a mole. On Saturday, May 16, more than two dozen Mexican traffickers, bankers and other operatives who had been invited to the United States by the undercover team were rounded up in San Diego and at the Casablanca Casino Resort in Mesquite, Nev. And officials said whatever thoughts they had that the allegations about Cervantes might be pursued were dropped in the diplomatic backlash that followed. While the Mexican authorities were asked to arrest about 20 suspects indicted in the case, they initially located only six. One was the partner of Loera, the fugitive businessman who first proposed the deal with "the general." The partner was found dead in a Mexican jail from injuries that the police described as self-inflicted. Alvarez-Tostado has never been found; his deputy, Alcala, awaits trial in Los Angeles. Soon after the operation, American officials said, they showed the Mexican government some of their information on apparent corruption in the case. They said they kept silent about more explosive evidence to avoid exacerbating the furor that had broken out over their decision not to warn Mexico about the operation. Still, the officials said that none of the information was ever pursued, and the Mexican attorney general, Jorge Madrazo Cuellar, obliquely dismissed the allegations in a little noticed statement issued last July. Madrazo said in an interview that the Americans told him only about unnamed federal agents and a money laundering scheme involving "a general who had a daughter." He said the name of Cervantes, who has no daughter, was never mentioned. "With the information that they gave me, what could I possibly have done?" Madrazo asked. "Gone and looked for a general with a daughter?"
Related Articles D.E.A. Chief Warns Senate on Traffickers in Mexico (Feb. 25) U.S. Is Brushing Off Mexico's Drug Data (Feb. 14) U.S. Plan to Help Mexican Military Fight Drugs Is Faltering (Dec. 23, 1998) Drug Inquiry Into a Governor Tests Mexico's New Politics (Nov. 26, 1998) Mexico Jails 2 Drug Agents, and U.S. Officials See Graft (Sept. 25, 1998) Mexico Promises Full Inquiry Into Tainted Elite Drug Unit (Sept. 18, 1998) U.S. Officials Say Mexican Military Aids Drug Traffic (Mar. 26, 1998) Trial of a Drug Czar Tests Mexico's New Democracy (Aug. 22, 1997) U.S. Helps Mexico's Army Take a Big Anti-Drug Role (Dec. 29, 1997) Mexico and Drugs: Was U.S. Napping? (July 11, 1997)
The agents, posing as money launderers from Colombia, had insinuated themselves deeply into the Mexican underworld, helping the traffickers hide more than $60 million. Now, money men working with the cartel said they had clients who needed to launder $1.15 billion more. The most important of those clients, they said, was Mexico's powerful defense minister.
The customs agents didn't know whether the money really existed or if any of it belonged to the minister, Gen. Enrique Cervantes, officials said. But having heard about American intelligence reports pointing to corruption at high levels of the Mexican military, the agents were mystified by what happened next.
Rather than continue the undercover operation to pursue the deal, Clinton administration officials ordered that they shut it down on schedule several weeks later. No further effort was ever made to investigate the offer, and officials said prosecutors have not even raised the matter with the suspects in the case, who have pleaded guilty and are cooperating with the authorities.
"Why are we sitting on this kind of information?" asked the former senior customs agent who led the undercover probe, William F. Gately. "It's either because we're lazy, we're stupid, or the political will doesn't exist to engage in the kind of investigation where our law-enforcement efforts might damage our foreign policy."
Senior administration officials denied that foreign policy influenced their decision to end the operation, saying they were moved primarily by concerns for its security. They also emphasized that the agents were unable to verify the Mexican traffickers' claims.
Other officials of the administration, which has based much of its Mexican drug strategy on collaboration with Cervantes, said they are confident that he is above reproach. A spokesman for the Mexican Defense Ministry, Lt. Col. Francisco Aguilar Hernandez, dismissed the traffickers' proposal as self-serving lies.
The Hunters and Their Prey: Characters in a Complex Drama of Deception
The Targets AMADO CARRILLO FUENTESFormer head of the so-called Juarez cartel, Mexico's most powerful drug smuggling operation. Bribed senior military and police officials to protect his operations. Died after plastic surgery in July, 1997. JUAN JOSE CASTELLANOS ALVAREZ TOSTADOJuarez cartel lieutenant responsible for money laundering activities; negotiated deals with undercover Customs team. Protected in Mexico by men identified as federal police agents. Now a fugitive, thought to be living in Mexico. VICTOR ALCALA NAVARROJuarez cartel operative who worked closly with the Customs team, arranging pickups of drug money in the United States and introductions to corrupt Mexican bankers. Jailed in Los Angeles. The Undercover Operation "JAVIER RAMÍREZ"Pseudonym of Colombian source who worked with undercover Customs agents. Posed as the head of a money laundering operation run out of a dummy front company in a Los Angeles suburb. Made more than $2 million for his undercover work. WILLIAM F. GATELYFormer senior Customs investigator in Los Angeles, developed and led Operation Casablanca. Battled with senior officials skeptical of the plan. Recently retired after being called back to Washington and given a desk job. JOHN HENSLEYCustoms chief in Los Angeles. Officials said he accused Gately of stealing money and other abuses that were investigated and found baseless. Received $20,000 Presidential award for Casablanca and other cases. The Administration JAMES E. JOHNSONUndersecretary of the Treasury for Enforcement, helped oversee Casablanca as an Assistant Secretary. Said to have warned officials involved in the case not to mention the name of the Mexican Defense Minister unless they could prove his involvement. RAYMOND W. KELLYFormer New York City Police chief, now Customs Commissioner. Was the Treasury Undersecretary overseeing Customs during Casablanca. Said he did not extend the investigation to pursue the purported $1.15 billion deal because there was no hard evidence that it was real. ROBERT E. RUBINTreasury Secretary who, despite concerns about political fallout, ordered the undercover operation to go forward without informing officials at the State Department, the National Security Council or the Mexican Government.
AMADO CARRILLO FUENTESFormer head of the so-called Juarez cartel, Mexico's most powerful drug smuggling operation. Bribed senior military and police officials to protect his operations. Died after plastic surgery in July, 1997.
JUAN JOSE CASTELLANOS ALVAREZ TOSTADOJuarez cartel lieutenant responsible for money laundering activities; negotiated deals with undercover Customs team. Protected in Mexico by men identified as federal police agents. Now a fugitive, thought to be living in Mexico.
VICTOR ALCALA NAVARROJuarez cartel operative who worked closly with the Customs team, arranging pickups of drug money in the United States and introductions to corrupt Mexican bankers. Jailed in Los Angeles.
"JAVIER RAMÍREZ"Pseudonym of Colombian source who worked with undercover Customs agents. Posed as the head of a money laundering operation run out of a dummy front company in a Los Angeles suburb. Made more than $2 million for his undercover work.
WILLIAM F. GATELYFormer senior Customs investigator in Los Angeles, developed and led Operation Casablanca. Battled with senior officials skeptical of the plan. Recently retired after being called back to Washington and given a desk job.
JOHN HENSLEYCustoms chief in Los Angeles. Officials said he accused Gately of stealing money and other abuses that were investigated and found baseless. Received $20,000 Presidential award for Casablanca and other cases.
JAMES E. JOHNSONUndersecretary of the Treasury for Enforcement, helped oversee Casablanca as an Assistant Secretary. Said to have warned officials involved in the case not to mention the name of the Mexican Defense Minister unless they could prove his involvement.
RAYMOND W. KELLYFormer New York City Police chief, now Customs Commissioner. Was the Treasury Undersecretary overseeing Customs during Casablanca. Said he did not extend the investigation to pursue the purported $1.15 billion deal because there was no hard evidence that it was real.
ROBERT E. RUBINTreasury Secretary who, despite concerns about political fallout, ordered the undercover operation to go forward without informing officials at the State Department, the National Security Council or the Mexican Government.
But a detailed account of the case -- based on confidential government documents, court records and dozens of interviews -- suggests that U.S. officials walked away from an extraordinary opportunity to examine allegations of the official corruption that is considered the main obstacle to anti-drug efforts in Mexico.
For nearly a decade, American officials have been haunted by the spectacle of Mexican officials being linked to illicit activities soon after they are embraced in Washington. And just weeks before the customs investigation, known as Operation Casablanca, ended last year, administration officials received intelligence reports indicating that the Mexican military's ties to the drug trade were more serious than had been previously thought.
But when faced with the possibility that one of Washington's critical Mexican allies might be linked to the traffickers, the officials gave the matter little consideration. They said they opted for a sure thing, arresting mid-level traffickers and their financial associates and at least disrupting the money laundering system that drug gangs had set up. To reach for a general, they said, would have added to their risks with no certainty of success.
"Obviously it was a significant allegation," Customs Commissioner Raymond W. Kelly said in an interview. But he added: "There was skepticism about it. Was it puffing? It just was not seen as being -- I won't use the word credible -- but it wasn't verified."
Taking Stock: Arrests, Indictments and Drug Money
When senior administration officials announced the sting last May 18, they took a triumphant inventory: the indictments of three big Mexican banks and bankers from a dozen foreign banks; the arrests of 142 suspects; the confiscation of $35 million in drug profits and the freezing of accounts holding $66 million more.
The officials claimed the success as the result of a longstanding administration fight against money laundering. But Gately, who retired from the Customs Service on Dec. 31, said his investigation ran a gantlet of resistance from the start.
The Justice Department, uncomfortable with cases in which undercover agents laundered more money for drug traffickers than they ultimately seized, were imposing new limits on the time that such operations could run and the money they could launder, officials said. And though the restrictions did not apply to Customs, a branch of the Treasury, Justice Department officials continued to play strong, skeptical roles in supervising cases throughout the government.
One federal official, who spoke on the condition of anonymity, admitted that he initially dismissed Gately's plan as a nonstarter. "You're out of your mind," the official remembered saying.
Several colleagues said it was the sort of response that Gately, 49, tended to see as a challenge. A decorated former Marine who enlisted for service in Vietnam at the age of 17, he had already been at the center of several cases that mixed internal struggle and public success. Friends and critics described him in similar terms: driven, sometimes abrasive and unusually creative.
After leading an investigation that revealed ties between the Italian mafia and Colombian cocaine cartels, Gately co-wrote a 1994 book about the case, "Dead Ringer," that cast him as a lonely crusader surrounded by small-minded bureaucrats. "It is the story of one man who refused to succumb to corruption," the prologue reads, "who believed in his oath and mission, and the consequences he paid for believing in what he was doing."
As the senior customs drug investigator in Los Angeles, Gately said, he first heard from an informant in 1993 about an important shift in the way that Mexican and Colombian drug traffickers were converting their cash into funds that could be freely spent.
The informant said traffickers were depositing their money with corrupt Mexican bankers, who sent it back to them in almost untraceable cashier's checks drawn on the American accounts that the Mexican banks used to do business in the United States.
Gately hoped his informant could infiltrate that system -- collecting illicit cash from drug wholesalers in the United States and then wiring it to corrupt bankers in Mexico. The bankers would issue drafts for the money, and customs would develop evidence against suspects on both ends of the transaction.
Many customs officials, however, were skeptical that the ruse would work. Drug-enforcement agents wanted to use the informant in another case. One federal prosecutor opposed using him at all because he had a criminal past and threatened to indict him in a 10-year-old case.
Even when Gately was eventually able to recruit another informant, a Colombian known by the pseudonym "Javier Ramirez," a senior Justice Department official, Mary Lee Warren, pressed him to limit the operation's scope, Gately and others said.
"What she wanted to know was, when was this going to be over?" he recalled. "What was our endgame?"
Getting Involved: U.S. Operatives Meet a Kingpin
In November 1995, Colombian drug contacts introduced the undercover agents to Victor Alcala Navarro, a representative of Mexico's biggest drug mafia, the so-called Juarez cartel.
The customs agents, posing as money launderers from a dummy company called Emerald Empire Corp., began picking up the Mexican's profits and laundering them as planned.
In February 1997, at meetings in Mexico, Ramirez was introduced to Alcala's boss. A few months later, the customs informant found himself chatting by phone with the head of the cartel, Amado Carrillo Fuentes.
Over scores of meetings and million-dollar deals, the traffickers grew more open about the official protection they enjoyed in Mexico, law-enforcement officials and government documents indicate.
At one meeting in Mexico City on May 16, 1997, the traffickers brought along 16 federal police agents as bodyguards. At another meeting, a man who identified himself as an official of the Mexican attorney general's office picked up $1.7 million in cash, including $415,000 that the undercover agents had brought for the cartel boss himself.
During a later meeting in New York, Alcala told the agents that like Mexico's drug-enforcement chief, who had been arrested for collaborating with the Juarez cartel, the defense minister, Cervantes, was in league with the competing Tijuana cartel.
Customs officials said they remained skeptical of what the agents heard, including the traffickers' claim that Carrillo Fuentes had actually faked his own death in 1997. But in December 1997, Ramirez invited Alcala to Colombia for an elaborately staged meeting that seemed to raise their partnership to a new level.
At a heavily guarded hacienda overlooking Bogota, an informant acting as Ramirez's Colombian boss, Carlos, said he and his partners had $500 million of their own to launder. They wanted to know whether the Mexican bankers used by Alcala's boss, Juan Jose Castellanos Alvarez-Tostado, could help.
"Alvarez called us right back," Gately recalled. "He said, 'Let me send you my very best people, and we will get it done.' "
On March 6, 1998, Alcala arrived with several businessmen at the tastefully furnished offices of Emerald Empire in an industrial suburb of Los Angeles. This time the businessmen brought a big deal of their own.
One of the men, David Loera, said he knew "a general" who had $150 million in Mexico City to invest. Would Ramirez -- who had told the traffickers he owned part of a Nevada casino used to launder money -- care to help?
Over the next six weeks, according to government documents and the accounts of Gately and several officials, the deal was discussed in three more meetings and three telephone conversations between Ramirez, the undercover agents and the traffickers. All of the contacts were secretly tape-recorded and transcribed, officials said.
In one call, two senior investment managers at Mexico's second-largest bank told the customs operatives that the money belonged not just to "a general" but to the minister of defense. Later, the two Mexicans advised Ramirez that the minister was sending "his daughter" (a woman later said to be a friend) to meet with them, along with an army colonel and a third person.
However, the investment managers said, the amount to be laundered was much more than they had discussed: the minister had $500 million in cash in New York and another $500 million in the Netherlands, in addition to the $150 million in Mexico City.
Customs officials said they queried the CIA, which works closely with the Mexican military on drug-control and other programs. The CIA responded tersely that they had no such information about Cervantes, an assessment that other officials have since reiterated.
But while Cervantes has not been a focus of suspicion, Mexican and American officials said several senior generals close to him have been under scrutiny by investigators from both the Mexican attorney general's office and a special military intelligence unit.
On Feb. 6, analysts at the Drug Enforcement Administration briefed Attorney General Janet Reno on intelligence indicating that senior Mexican generals might indeed be cooperating with Carrillo Fuentes' organization, officials said. And in a separate customs case in Houston, undercover agents had been approached about laundering millions of dollars for an unnamed Mexican army general, officials said.
On April 9, Alcala visited Emerald Empire with a cousin, who had just returned from Mexico with a message. "He was very nervous about the deal," Gately said. "He said it could be very dangerous if it got screwed up, because the money belonged to 'all of them, including the president,' " Ernesto Zedillo. (A spokesman for Zedillo, David Najera, dismissed the claim as baseless.)
Later that month, Gately went to Washington to brief officials including Kelly -- who was then about to take over the Customs Service after overseeing it as the Treasury Undersecretary for Enforcement.
"Kelly said, 'How do we know it's really him?' " Gately recalled, referring to Cervantes.
"I told him, 'We don't know,' " Gately said. " 'We can't substantiate it. But we have no reason to believe they're telling us anything other than what they know.'
"They weren't trying to impress us, they were trying to make deals with us," Gately added. "So whoever had this money, I thought it was worth pursuing -- whether it was the defense minister of Mexico or somebody we'd never heard of."
People familiar with the discussions said they did not go much further. The general's supposed emissaries were to meet Ramirez in Las Vegas on April 22. They did not arrive, and the traffickers reported that they had gotten nervous.
Kelly acknowledged that he had been pressing for months to wrap up the investigation; he said he had grown increasingly concerned that information about it might leak out, endangering the undercover agents. The final sting had already been postponed twice because federal prosecutors were still preparing indictments.
James E. Johnson, who succeeded Kelly as undersecretary and has closely supervised Treasury's relationship with Mexico on enforcement issues, added a cautionary note that several officials said seemed to underscore his concern for the political stakes. Unless the agents had proof of Cervantes' role, several officials quoted him as warning, they should not bandy his name about in connection with the case.
"We need to be very careful about how we talk about this sort of thing," a senior law-enforcement official, who would not speak for attribution, quoted him as saying. "If we don't have the goods, it makes us look like we're overreaching."
Avoiding Pitfalls: U.S. Agents Begin Fretting Over Leaks
The operation had already navigated a series of sizable obstacles.
Gately and some other agents were worried that their boss in Los Angeles, John Hensley, had leaked information about the secret operation to congressional aides and others; Hensley had also pressed hard to bring the operation to an end, officials said.
For his part, officials said Hensley had accused his strong-willed subordinate of transgressions ranging from traveling without authorization to stealing millions of dollars. Kelly acknowledged that the charges were investigated and found baseless; Hensley declined any comment.
As discussions about the supposed $1.15 billion were going on, the undercover operation also suffered a serious setback with the capture of a key Juarez operative in Chicago. The arrest brought money deliveries to a halt while the cartel hunted for a mole.
On Saturday, May 16, more than two dozen Mexican traffickers, bankers and other operatives who had been invited to the United States by the undercover team were rounded up in San Diego and at the Casablanca Casino Resort in Mesquite, Nev. And officials said whatever thoughts they had that the allegations about Cervantes might be pursued were dropped in the diplomatic backlash that followed.
While the Mexican authorities were asked to arrest about 20 suspects indicted in the case, they initially located only six. One was the partner of Loera, the fugitive businessman who first proposed the deal with "the general." The partner was found dead in a Mexican jail from injuries that the police described as self-inflicted. Alvarez-Tostado has never been found; his deputy, Alcala, awaits trial in Los Angeles.
Soon after the operation, American officials said, they showed the Mexican government some of their information on apparent corruption in the case. They said they kept silent about more explosive evidence to avoid exacerbating the furor that had broken out over their decision not to warn Mexico about the operation.
Still, the officials said that none of the information was ever pursued, and the Mexican attorney general, Jorge Madrazo Cuellar, obliquely dismissed the allegations in a little noticed statement issued last July.
Madrazo said in an interview that the Americans told him only about unnamed federal agents and a money laundering scheme involving "a general who had a daughter." He said the name of Cervantes, who has no daughter, was never mentioned.
"With the information that they gave me, what could I possibly have done?" Madrazo asked. "Gone and looked for a general with a daughter?"
here is a article about some of the banks and methods used to facilitate the trade.http://www.wakeupmag.co.uk/articles/ciadrugslaunder.htm
Drugs, Money, Murder, and Family
Lionel Bruno Jordan was murdered on January 20, 1995, in an El Paso parking lot, but he keeps coming back as the key to a multibillion-dollar drug industry, two corrupt governments — one called the United States and the other Mexico — and a self-styled War on Drugs that is a fraud. Beneath all the policy statements and bluster of politicians is a real world of lies, pain, and big money.
Down by the River is the true narrative of how a murder led one American family into this world and how it all but destroyed them. It is the story of how one Mexican drug leader outfought and outthought the U.S. government, of how major financial institutions were fattened on the drug industry, and how the governments of the U.S. and Mexico buried everything that happened. All this happens down by the river, where the public fictions finally end and the facts read like fiction. This is a remarkable American story about drugs, money, murder, and family.
Tonight, Mike and Mark speak with author Charles Bowden about this tragic, neverending story.
About the guest:
Charles Bowden is an American non-fiction author, journalist, and essayist based in Tucson, Arizona. He is a former writer for the Tucson Citizen and often writes about the American Southwest. He is a contributing editor of GQ and Mother Jones magazine, and writes for other periodicals including Harper’s Magazine, New York Times Book Review, Esquire, and Aperture. He is the winner of the 1996 Lannan Literary Award for Nonfiction.
Down bY The Riveri also wanted to mention that in Charles Bowden's recent book "Down By The River" Bowden interviews the head of the El Paso Intelligence Center (EPIC) Phil Jordan. the book details the rise of the cartels, links to the intelligence community and political corruption from the president on down.http://www.amazon.com/exec/obidos/tg/detail/-/0684853434/002-6668459-0280845?v=glanceJordan details capturing a man at a texas airport based on profiling. the man is found to be carrying $28.8 million in cash and is found to be working for BCCI, a notorious money laundering bank.Jordan then receives a telephone call "from a high level DOJ employee" who orders that the man be allowed to continue on his was AND he was to be given his money back!Jordan did as he was ordered and didnt ask why. (makes me wonder why)the book was published in November, 2002. i highly recommend it.
The Real Deal!, March 7, 2003Reviewer: A readerYou want the true story about the "War On Drugs"? Then don't wait and buy this book NOW. Bowden takes you right inside what's going on with this so called war, and the people who get hurt by it. Once you pick up this book you won't be able to put it down. Charles Bowden is one of this country's great reporters/writers.
Jay MarvinWLS RadioChicago, IL
Shocking slice of reality, February 7, 2003
As a former participant in the drug war (on the wrong end), I will assure you this is an accurate portrayal. Participants on both sides of the issue are decimated, and people prefer to bury their heads and hide from this reality, a reality that may be the most critical problem facing our nation.
This book is extremely well written. My hat is off to Mr. Bowden.
Charles Bowden, a Fly on the Wall Watching the Drug War that's 'Down by the River'
A BUZZFLASH INTERVIEW
This isn’t some ugly conspiracy by corrupt American presidents. This is what’s called realpolitik. Tolerating the existence of a narco-state in Mexico is preferable to having an economic collapse in Mexico. Successive presidents have looked at the facts and made the same decision. ... It’s simply confronting reality. ... The effort of the border patrol to stop illegal immigration is also simply for show, because if we really bottled up Mexico and a half million people a year couldn’t come north, the economy would collapse.* * *
This isn’t some ugly conspiracy by corrupt American presidents. This is what’s called realpolitik. Tolerating the existence of a narco-state in Mexico is preferable to having an economic collapse in Mexico. Successive presidents have looked at the facts and made the same decision. ... It’s simply confronting reality. ... The effort of the border patrol to stop illegal immigration is also simply for show, because if we really bottled up Mexico and a half million people a year couldn’t come north, the economy would collapse.
* * *
"The war on drugs." It's the kind of label that just stops us, allowing preconceived notions to take over. Most of us don't think that much about it, or ever wonder who who has been killed in that "war." Investigative reporter Charles Bowden did wonder. He got into his truck and drove to the front lines and embedded himself in that war to get some answers. His investigation, focusing on a lone victim and his grieving family, unfolds in Down by the River, an absolutely haunting book.
BuzzFlash: Why did you make the murder case of Lionel Bruno Jordan the centerpiece of your book?
Charles Bowden: I thought if I could understand and explain one murder, I could explain what was happening on the border. I take the murder of Bruno Jordan because his brother was the head of DEA intelligence in El Paso. I had seen a small mention about the killing in a Mexican newspaper called La Jornada. They had arrested a 13-year-old boy for the killing. I just dialed information, got the phone number for the El Paso intelligence center, and talked to Phil Jordan, Bruno’s brother, who ran the center. He said, “If you come here, I’ll talk to you. I won’t talk on the phones.” I got in my truck and drove 321 miles and walked into his office. Seven-and-a-half years later, the book came out. That’s how it started.
BuzzFlash: Why did it take seven-and-a-half years?
Charles Bowden: Because in the drug wars, whether you’re dealing with law enforcement or dealers, you have to spend months to get what would amount to one paragraph in the book.I became obsessed.
BuzzFlash: That comes through in the book.
Charles Bowden: The structure of the book is simple - we’ll look into one murder. But to explain that murder, you have to retell the history of the United States and Mexico, going back forty or fifty years. The narrative arc is the killing, and trying to solve it, but to understand that you have to understand all this history. I wound up writing the history, with hundreds of footnotes. That took time.
BuzzFlash: Your style is like the Southwestern landscape itself – very beautiful and very engaging and lyrical. You manage to be both compassionate toward the Jordan family, yet very cynical about the context of his death, meaning the drug world lurking in the background.
Charles Bowden: His murder could never be solved, in a simple sense, because it would implicate the governments of both nations in the solution. Once you get into the drug wars in Mexico, it goes all the way to the top of the government.That’s just a fact. And Phil Jordan received zero cooperation from the DEA, his agency, or from the FBI, in solving his brother’s murder.
BuzzFlash: "Cynicism" becomes the operative word, in that this is a show drug war. Phil Jordan, despite being head of a DEA center engaged in the drug war on the frontier, was given the cold shoulder and not helped to solve his brother’s murder.
Charles Bowden: Like I say in the book, he is briefing Janet Reno, the Attorney General of the United States, about the high Mexican officials he’s going to meet in a week in Mexico, and he's giving the drug connections of every one of them. She stares at him with total disbelief. I don’t know how you want to characterize that, because Phil Jordan is your basic American true believer. But they basically destroyed him for trying to find justice for his brother.
BuzzFlash: The Jordans are a close-knit, Mexican-American family. The book was called Down by the River because that's where they lived.
Charles Bowden: Their house is five blocks from the river in a very old barrio in El Paso, Texas. His parents have lived in the same home for over fifty years, just adding rooms as more children came. They won’t leave, because if they leave, they will lose their connection with their dead son.He’s buried four blocks away.
BuzzFlash: You burrow into this family and almost became a fly on the wall in their lives.
Charles Bowden: We’re still friends. I sit alone in silence and grief every January 20th, which was the day Bruno was killed.At 7 p.m. on January 20, 1995, he got out of the pick-up truck at the K-Mart in El Paso, Texas, and was instantly gunned down.
BuzzFlash: In your effort to ascertain who killed Lionel Bruno Jordan, you really do find that the "war on drugs," as the politicians call it, is a show war for domestic consumption. All the obstacles you ran up against, and his brother ran up against, and the great risk you took to enter the drug underworld to try to get some answers, just led you to conclude that it doesn’t really exist. There’s a peaceful coexistence between the U.S. and Mexico in terms of drugs coming into the United States, except for occasional busts.
Charles Bowden: The United States wants a stable Mexico. Mexico is economically dependent on narco dollars to survive. If you could actually shut down the border and stop the importation of drugs into this country, Mexico would collapse. So it’s a show war.
BuzzFlash: What about the argument that they now have increased economic power in petro-dollars?
Charles Bowden: The Mexican oil fields are in severe decline. They’re nationalized and run by one of the most corrupt mechanisms in Mexico – Petroleos Mexicanos, also known as Pemex. Mexico makes more money from drugs than they do from oil, tourism, and the remittances sent back by illegal Mexicans working here. They earn at least $50 billion a year now from selling drugs. They simply can’t live without it. You have to understand the Mexican economy is 4% the size of the United States' economy. Fifty billion dollars is big money in an economy of that size.
BuzzFlash: If we go back over the last five decades of Mexican-American relations, in terms of the drug situation, this has been a de facto show war on drugs.
Charles Bowden: Smoke and Mirrors, by Dan Baum, was an excellent book on that subject which was also heavily footnoted. He proved conclusively that every reaction or thought in the drug war for forty years by the U.S. government was simply to get domestic political support. It had nothing to do with the drug problem. Until the early 1990s, more Americans died every year by falling down staircases than died from overdoses. We’ve created a sort of fictional monster in drugs.
BuzzFlash: Does the solution lie in the legalization of drugs?
Charles Bowden: Well, if you continue the current policies, your prison population will continue to grow - and 40 to 50% of all inmates now are jailed on drug charges. Drugs will become more common, they will be of higher quality and at lower prices, because that is what’s happened over the course of forty years. Our drug consumption increases, and it becomes cheaper simply because of competition. So this is a failed policy. But there isn’t a politician in the United States who will question the drug wars. It’s considered political death.
BuzzFlash: I want to commend you just for your courage. Clearly you are an investigative journalist who took a lot of risk.
Charles Bowden: You don’t really see it that way when you’re doing it.
BuzzFlash: Why is that?
Charles Bowden: All the roadblocks are just little obstacles, because you’re obsessed with finding out the facts. When you get into this kind of work, you just want to get it down right. What other people see as danger, you see as a nuisance. If I wasn’t writing that book, I never would have gone into the saloons and hellholes that are in that book. I don’t court danger.
BuzzFlash: From our perspective, you took tremendous risks. You contacted drug dealers.
Charles Bowden: I was tired of reading about drug dealers as sort of “them,” and so I went and met them. They’re just people making a living in a murderous business.
BuzzFlash: Is Juarez the city where so many women have disappeared and been found dead and mutilated?
Charles Bowden: Yes. In the same period, 2900 men have vanished. Juarez is a death machine. I did a whole book on it called Juarez, the Laboratory of Our Future. It’s part of the barbarism which they call free trade.
BuzzFlash: In what way?
Charles Bowden: Juarez is full of maquiladoras - factories - where people are paid a wage so low you can’t survive on it.
BuzzFlash: That’s as a result of NAFTA, in large part.
Charles Bowden: Yes, it’s all connected.And illegal immigration explodes in the United States once NAFTA passes. There’s an absolute linear progression. If you’re a Mexican, your real earning power has been declining since the early 1990s.
BuzzFlash: Your look at the war on drugs involved a tremendous investigative job. Out of the story of one person, one family, one murder, grew all these tentacles that illuminated the failed war on drugs and the real acceptance of the drug trade by both the United States and Mexico.
Lionel’s murder is officially unresolved, but reading your book, certainly one would be left with the understanding that this was drug-related and sending a signal to his brother that he better not be an Eagle Scout and take the war on drugs seriously. You had the head of Mexico and his brother, the Salinas brothers, seemingly intimately involved in the drug trade. Carlos Salinas, the president, was a close friend of George Bush Senior.
Charles Bowden: They were making money off it, and banking with Citibank in New York and in Switzerland. They were using the same banker in New York that the head of the Juarez cartel was using to funnel money to a secure place. It’s not an accident. Everybody in DEA knows it, although they wouldn’t officially say it. It would destabilize our relationship.
BuzzFlash: Do you think the President of the United States gets briefing papers that are top secret from DEA, from CIA, and NSA and so forth? Do you think President Bush the first knew this?
Charles Bowden: Of course. Everybody knows it. As it happens Phil Jordan was the guy preparing those briefing papers. I know exactly what they were told because I know the guy who told them.
BuzzFlash: What's the trade-off for a President of the United States?
Charles Bowden: All I can say is, if they really cracked down on drugs in Mexico, the economy and the Mexican government would collapse. Millions of people would stream north to survive.Given that choice, successive American presidents have put on a kind of theatrical war on drugs, but let the business continue because the consequences of ending the business are worse than letting the business continue. Mexico needs the money.
BuzzFlash: What was the torture murder of DEA agent Enrique Camereno in Mexico all about?
Charles Bowden: He was kidnapped by members of the Guadalajara cartel and tortured for two days. They taped the torture, and they were asking him questions. Those tapes have never been made public - the DEA and the CIA have the tapes. What they were trying to find out is how much he knew about the connections between the cartel leaders and the heads of the Mexican government. That’s it. I happen to know the guy who led the investigation of the murder of Camereno. Almost every human being that was in the house in Guadalajara where they tortured Camereno had been trained by the CIA and was an asset. They had trained them to be an anti-drug force in Mexico, but they went over to the other side. That’s why the case was "buried."
BuzzFlash: Are these people still free and moving about Mexico?
Charles Bowden: That’s right. They busted a couple guys, who are technically in prison, but they show up at parties all over Mexico.
BuzzFlash: You have one very vivid description of going down further south into Mexico, and meeting with a drug kingpin in a vast ranch, and the partying that’s going on.
Charles Bowden: The party went on for five days and five nights.
BuzzFlash: It's like the old Al Capone days in Chicago.
Charles Bowden: They are the government. They are interchangeable in Mexico. I was once drinking with a major drug dealer, and I said, “Who do you work for?” And of course, what I was asking was which cartel. And he said, “I work for the President of Mexico.” And he meant it. He was angry over the hypocrisy that he’s allegedly a criminal, when in fact, the people he sees on TV are taking money from him. He was a killer. I know of four people that man had murdered in my own city, because he told me that.
BuzzFlash: Why didn’t you pose a threat to these people?
Charles Bowden: One, anybody in the drug business knows they’re going to be murdered and forgotten. Secondly, if I had sneaked around trying to find things out, I would have been killed. But I was public about it. I’d sit in front of these people while they were sitting there with machine guns, and make notes. That’s how it happened. I just acted like it was normal. Slowly, I built relationships with trust. At the same time I’m doing this, I have deep connections in DEA. One thing I never did was betray a DEA operation to a drug dealer, and I never betrayed a drug dealer to DEA.
BuzzFlash: You kept the confidentiality of your sources.
Charles Bowden: I’m down there at one point with a drug dealer from the United States. He’s buying cocaine for a shipment north while I’m there. We go down to get a bunch of drugs and he’s going to bring them up through U.S. Customs. If that shipment had been seized, I would have been murdered, because they would have thought: ah, he was the reason it was seized. That’s the risk. I knew when I was sitting there, and they were arranging this business deal, that if anything went wrong, they’d blame me.
BuzzFlash: You’ve written other books and articles on the drug trade. How did this come to interest you?
Charles Bowden: I was a reporter for a newspaper in the early eighties in Arizona. I’ve always had a deep interest in biology, ecology, the environment. Scientists I knew who had been going into the Sierra Madres in certain areas, collecting plants, started coming back with reports that they couldn’t get into villages because suddenly there were men there with machine guns. Everybody was growing drugs. I thought, well, this was a story. I became increasingly obsessed with why this huge industry was growing right at my doorstep, and it was not being reported. That was the beginning.
Then the scale of the business got huge. Full-bodied jets were landing, full of cocaine, and none of this was being reported. At one point, I took photos and gave them to Jack Anderson, the columnist, trying to get him to print it. They simply didn’t believe what I gave them.
BuzzFlash: We have an argument about immigration going on in the U.S., now, and there are the Minutemen. A couple of weeks ago, there were allegedly encounters between American immigration officials on the border and people who looked like they were in the Mexican Army.
Charles Bowden: They were in the Mexican Army. No drug dealer would try and look like the Army, they would try and blend in. The Mexican Army is in the drug business. The movie "Traffic" was not a complete fiction.
BuzzFlash: Let's get back again to the personal story of the Jordan family.
Charles Bowden: It’s absolutely certain that Lionel Bruno Jordan, who was murdered at the age of 27, had no connections to drugs.He was getting ready to get married, he sold suits at Men’s Warehouse, and he was preparing to enter law school. He had lived a totally blameless life. He had nothing to do with his brother’s career in DEA. He was slaughtered for no reason.
BuzzFlash: The family is the fine, upstanding, model American family. They happen to be of Mexican descent. One brother is a heroic DEA agent – your honest, straight-arrow DEA agent, incorruptible. His younger brother was shot and killed in a parking lot. No one will cooperate to find the real murderer. They pin it on a young kid. The Mexican Consul in El Paso won’t answer any questions directly.
Charles Bowden: The Mexican Consul is funneling drug money to the criminal attorneys that are defending the kid who did the killing.We know that because of DEA wiretaps.
BuzzFlash: And the American government didn’t want him to pursue it. They didn’t want to anger the Mexican government by pursuing this.
Charles Bowden: The effort of the border patrol to stop illegal immigration is also simply for show, because if we really bottled up Mexico and a half million people a year couldn’t come north, the economy would collapse.
BuzzFlash: You also have in your book that, even on shipments coming through in trucks at border check points, crooked Americans are just allowing these trucks in.
Charles Bowden: Yes. When I spoke earlier of the drug dealer arranging the shipment of a load of cocaine to the United States, that person I’m dealing with "owned" the border crossing. He owned U.S. agents. That’s how he was going to move it through. I knew the exact town it would go through, and he had paid people in U.S. customs to wave it through.
BuzzFlash: Has there been any official government response to your book?
Charles Bowden: No. Nobody wants to deal with it. This war is a fraud, unless you get murdered in this war.
BuzzFlash: Suppose that we in the United States were really serious about taking on the drug industry in Mexico, and let’s just say theoretically we could wipe it out. You’re saying the economy in Mexico would collapse. People would do whatever they could to cross over into America to make whatever money they could make
Charles Bowden: That’s right.
BuzzFlash: Therefore we leave the status quo, which is drugs coming in.
Charles Bowden: This isn’t some ugly conspiracy by corrupt American presidents. This is what’s called realpolitik. Tolerating the existence of a narco-state in Mexico is preferable to having an economic collapse in Mexico. Successive presidents have looked at the facts and made the same decision. So this is not the result of some evil leadership in our country. It’s simply confronting reality.
BuzzFlash: The Mexicans might say, you’re using this stuff, that is your responsibility. You clean up the consumer side. It’s not our problem.
Charles Bowden: That’s correct. That’s what they all say, and they have a point. Also, drugs don’t have very much value until they get to the United States. Then they explode in value. The real profits are made here.
BuzzFlash: And you couldn’t have the extent of drug trafficking unless you had some officials paid off in the police department.
Charles Bowden: In almost any city in the United States, it’s easier to find cocaine than it is to find veal. The stuff is everywhere, and everybody knows it.
BuzzFlash: Someone’s got to be letting it get through.
Charles Bowden: Everybody that gets into the drug industry becomes corrupted. It doesn’t matter if you’re a cop or a robber. There’s just too much money. All you have to do is blink and you can get paid. You’re standing there waving cars through at the border. You’re a U.S. official. You wave cars through all day. All you have to do is wave one more through and you can make $50-100,000 in the blink of an eye.
I’ll give you an example. They busted a drug ring in 1989. This ring had moved 900 consecutive loads of cocaine into the United States through one crossing in El Paso – one bridge – without ever being detected. That's mathematically impossible unless you buy people.
BuzzFlash: Did anything happen?
Charles Bowden: Well, the ring got busted. But it terrified DEA and I’ll tell you why. They took down 21 tons of cocaine in a warehouse in California in 1989, and after they did that, the price of cocaine did not go up. It had no effect on the market, so much was coming in. That was the first time that DEA really understood the magnitude of the drug use in this country, because it’s very hard to track. People don’t report how much coke they use every week.
BuzzFlash: Has anything changed under Vincente Fox?
Charles Bowden: I’m not going to criticize Mr. Fox, but he’s not really in control of Mexico. The drugs continue to be moved. The cartels continue to flourish. The army continues to be corrupt. Any Mexican president that effectively waged war against the drug industry would be murdered.
BuzzFlash: As one candidate was.
Charles Bowden: Yes, Colosio.
BuzzFlash: It’s heart-wrenching to read about the Jordan family and their loss.
Charles Bowden: It devastated that family. That family believes in America, and America betrayed that family. They have gotten no justice for the murder of their son and brother.
BuzzFlash: The only justice done - because the Mexican and American governments both put up obstacles to finding out who really was responsible - the only justice for Lionel Jordan is your book, Down by the River.
Charles Bowden: That’s right, and it’s even worse than that for me. Lionel Bruno Jordan was one of thousands of people murdered on the border in these drug wars, but he’s the only one that got a book. The others don’t even get that. It’s like it never happened. I find that morally repellent. I think human life matters, and I think ignoring death on this level is a sin.
BuzzFlash: Thank you very much.
Charles Bowden: Adios.
Interview Conducted by BuzzFlash Editor Mark Karlin.
Down by the River: Drugs, Money, Murder, and Family (Paperback) by Charles Bowden, a BuzzFlash premium
Down by the River: Drugs, Money, Murder, and Family (Paperback) by Charles Bowden , a BuzzFlash review
Charles Bowden: No more fear: Vote as if it matters - because it does (9/04, Arizona Daily Star)http://www.buzzflash.com/interviews/06/03/int06008.html
Former contra wins review of U.S. drug ties.
By Bob Egelko
OF THE EXAMINER STAFF July 27, 2000
Fights deportation to Nicaragua, says CIA knew of cocaine deals The former Northern California spokesman for the Nicaraguan contras, facing deportation for cocaine trafficking in the 1980s, will apparently get the chance to convince a federal judge that he was assured the drug deals had U.S. government approval.
The 9th U.S. Circuit Court of Appeals ruled Wednesday that a judge should hear and evaluate Renato Pena's claim that a federal prosecutor in San Francisco had told him after his arrest in 1984 that he was at no risk of deportation for having carried cocaine and cash to Los Angeles about a dozen times.
In court papers opposing Pena's challenge to his current deportation order, the U.S. attorney's office said no such assurance was given. Pena's case recalls the controversy over allegations of CIA- backed drug dealing by the contras, the U.S.-supported guerrillas fighting Nicaragua's leftist government in the 1980s. Accused in a San Jose Mercury News series of connections to the early crack cocaine trade in Southern California, the CIA hotly denied having anything to do with Los Angeles drug traffickers who claimed contra connections.
Pena said he had been told by Norwin Meneses, a major drug trafficker with ties to the contras, that CIA-connected contra commanders were aware of the drug operation in which Pena took part. The CIA has denied any relationship with Meneses.
The appeals court stopped well short of finding that the government condoned Pena's activity as a drug courier. But the court said Pena's claims about the government's attitude were relevant to his attempt to overturn his 1985 drug conviction, the basis of the current attempt to deport him.
"Pena and his allies supporting the contras became involved in selling cocaine in order to circumvent the congressional ban on non-humanitarian aid to the contras," the three-judge panel said. "Pena states that he was told that leading contra military commanders, with ties to the CIA, knew about the drug dealing. Pena believed that the sole purpose of these drug transactions was to help the contras, and he believed the United States government would not seek to prosecute.
"The circumstances surrounding Pena's case, including his belief that his activity was supported by the U.S. government and his alleged reliance on the assurances of the assistant U.S. attorney regarding his immigration status, raise important questions about public confidence in the administration of justice."
The court said a federal judge should hear testimony from Pena and others about what assurances he had been given before pleading guilty in 1985, and about whether his court-appointed attorney had acted incompetently by failing to tell him he risked deportation. The judge would then decide whether to set aside the guilty plea. Pena's suit, seeking to overturn the guilty plea, had been dismissed by U.S.
District Judge Fern Smith in 1997. The hearing ordered Wednesday would be held before another judge, because Smith now heads the Federal Judicial Center in Washington, D.C.
"He's a credible person," said Pena's current attorney, Stephen Shaiken. "He was good enough for the U.S. government when he was spokesperson for the opposition and when he was an informant (against others in the drug ring). He was telling the truth then, and he's telling it now."
He said Pena, now a San Francisco city employee, was not speaking to reporters about the case.
The U.S. attorney's office, which represented immigration officials who want Pena deported, declined comment on the ruling.
Pena was a member of the security force of Nicaraguan dictator Anastasio Somoza, who was overthrown by the leftist Sandinistas in 1979. Pena came to the United States in 1980 and became the chief of public relations in Northern California for the FDN, the contras' political arm. He applied for political asylum in August 1984 but was arrested three months later on charges of possessing cocaine with intent to distribute it. Pena said he had been asked by Norwin Meneses' nephew, Jairo Meneses, to travel to Los Angeles with money that would be used to buy cocaine and finance contras, whose U.S. military aid had been cut off by Congress. He was paid about $6,000 for carrying money and drugs to Los Angeles between March and November 1984, the court said.
Pena said he had agreed to cooperate with prosecutors in exchange for a reduced sentence and been told by a federal prosecutor that he would be taken care of and had nothing to fear about his immigration status. He said he never would have pleaded guilty if he had known he could be deported to Nicaragua, then governed by the Sandinistas. He also said his court-appointed attorney had never spoken to him about the possibility of deportation.
After serving a year in a halfway house and testifying against another Meneses relative in the drug case, Pena was granted asylum in 1987, the court said. But the Immigration and Naturalization Service revoked his asylum in 1996 and moved to deport him to Nicaragua because of his drug conviction.
In court papers, Special Assistant U.S. Attorney Robert Yeargin said Pena's asylum had been withdrawn because he had failed to disclose his conviction on his asylum application. Yeargin also said the original prosecutor in the case, Rodolfo Orjales, had discussed drug smuggling to Pena but made no promises to him.
Orjales, now a Justice Department employee in Washington, D.C., was out of his office Wednesday and unavailable for comment.
(c)2000 San Francisco Examiner
November 15, 1996--John Deutch, Director of the Central Intelligence Agency, went to Watts to speak to hundreds of neighborhood residents. The head of the CIA visiting the ghetto!? Now you know they must be in deep trouble! The CIA and the media tried to suppress the stories of CIA drug-dealing.
For 10 years, the mainstream media refused to report on it--even when the Senate's own Kerry Report brought out damning evidence. They tried to ignore the series by Gary Webb that appeared in the San Jose Mercury that revealed the names of Nicaraguan contra operatives who were distributing cocaine in South Central L.A. and Compton to raise money for the CIA's secret contra war.
In the last month, this country's most prominent newspapers, the Washington Post, the Los Angeles Times, and the New York Times, all carried stories intended to discredit Webb's report. This campaign has not worked. On Nightline, November 15, Ted Koppel remarked how attempts to dis Webb's report had only made the masses of people more suspicious that crimes were being covered up.
The story is out! Millions know! And now, the CIA is forced to combine more coverup with an unprecedented public attempt at damage control. Deutch was in L.A. to promise that the CIA's Inspector General would "get to the bottom of things." And he had to sit there as the people spoke bitterly of how the system has ruined lives--denying people jobs, packing the youth into prisons, bringing drugs into the community, denouncing the history of CIA drug running.
The first woman at the microphone told how Black men had been allowed to die of syphilis, while government doctors in the infamous "Tuskegee experiment" withheld medicine and studied their deaths. "How is this any different?" she asked Deutch, referring to CIA involvement in bringing drugs into the Black community. One brother said it was an insult to people's intelligence to claim "The CIA doesn't sell drugs," since everyone knows about CIA heroin-running from Asia's Golden Triangle. A former LAPD narcotics cop described how documents about CIA drug operations were suppressed by authorities. Joey Johnson, revolutionary activist against police brutality, exposed how the CIA's contras had murdered thousands of people to destabilize Nicaragua, while their drug traffic destabilized the oppressed communities of L.A. "When are the prison doors going to open?" he demanded, to free those jailed by racist crack laws.
The CIA investigate itself? Nobody is having it!
This scandal cuts to the heart of this government's legitimacy: It lays bare the utter hypocrisy, the racism and the complete hard-heartedness of this system's rulers. They've been jailing thousands of youth--locking them away!--for involvement in the illegal economy. And then it turns out that the government itself, possibly at the highest levels, was deeply involved in the import and sale of that poison!
The Central Intelligence Agency, its head John Deutch, its main investigator CIA Inspector General Frederick P. Hitz, and much of the mainstream media are already claiming that there is no evidence that the CIA itself approved or participated in cocaine trafficking.
These claims are simply not true: There is massive evidence that the CIA was a key force organizing guns-for-drugs operations that secretly financed much of the U.S.'s dirty war against Nicaragua.
In this article, we will explore evidence that came out even before Gary Webb's series: the network of airlines and airstrips used to transport cocaine into the U.S. during the '80s.
Thirty years ago, Malcolm X made a penetrating observation: Oppressed people don't own airplanes and boats. The media and the government try to blame oppressed people for drugs--but international drug trafficking requires fleets of cargo planes, landing strips in several countries, networks of international contacts, pools of investment money, networks for money laundering and the high-level contacts for getting past U.S. Customs and the Drug Enforcement Agency (DEA).
In 1989, pilot Mike Tolliver told CBS that, after years of smuggling drugs, he was recruited into the contra supply operation by a "Mr. Hernandez." Tolliver identified "Hernandez" as Felix Rodríguez, the CIA agent directing contra supply from El Salvador's Ilopango Air Base. Tolliver says he flew a DC-6 loaded with guns and ammunition for "Hernandez" in March 1986, from Butler Aviation at the Miami Airport down to Aguacate, the U.S.-controlled contra air base in Honduras. Tolliver says the guns were unloaded by contras and he was paid about $70,000 by "Hernandez." After a three-day layover, Tolliver said he flew the aircraft, reloaded with over 25,000 pounds of marijuana, as a "nonscheduled military flight" into Homestead Air Force Base near Miami.
"We landed about 1:30, 2 o'clock in the morning," said Tolliver, "and a little blue truck came out and met us. [It] had a little white sign on it that said `Follow Me' with flashing lights. We followed it." "I was a little taken aback," Tolliver told the CBS program West 57th. "I figured it was a DEA bust or a sting or something like that." It wasn't. Tolliver said he just left the plane and the drugs sitting there at the airport to be unloaded, and took a taxi from the base.
West 57th traced this DC-6 back to a company called Vortex. Vortex is one of four airlines hired by the U.S. State Department to supply the contras--using money designated by Congress as being for "humanitarian aid" only.
In April 1987, a Customs service official told the Boston Globe, "We think he did land at Homestead," and acknowledged that there was a system under which contra supply flights were able to fly in and out of U.S. airports free of Customs inspection. But that same Customs official claimed that Tolliver was only a "free-lancer" who "bluffed his way" into Homestead. One researcher writes, "It was not explained how Tolliver bluffed his way into an Air Force base, leaving behind over 25,000 pounds of marijuana which apparently bluffed their way out."
The operation Tolliver described is similar to stories told over and over again in testimony before the Senate Subcommittee headed by Sen. John Kerry. A report was issued in the spring of 1989 by this Foreign Relations Subcommittee on Terrorism, Narcotics and International Operations. That report describes how the U.S. government recruited major drug smugglers, used their airlines to "supply the contras," and how these airplanes flew down to Central America loaded with guns and flew back loaded with drugs.
When the contra war started in 1981, a "retired" U.S. Air Force Colonel, Richard Gadd, was put in charge of creating a secret, private network of cargo airlines to supply the contras. His network worked closely with the CIA-linked Southern Air Transport.
Until 1972, the CIA directly owned Southern Air Transport, an air cargo company based in Miami. In 1972 this airline was "sold" to its president. A 1976 congressional report noted that the sales of other such "proprietary" companies were usually conditioned on "an agreement that the proprietary would continue to provide goods or services to the CIA." The Washington Post reported on January 20, 1987: "According to informed sources, a witness told the Federal Bureau of Investigation last summer of having seen a cargo plane with Southern Air markings being used for a guns-for-drugs transfer at an airfield in Barranquilla, Colombia in 1983." This witness "Wanda Doe," the wife of a major drug trafficker, told the Kerry Subcommittee staff "that she saw airplanes owned by Southern Air Transport land in Barranquilla, Colombia, unload weapons and load cocaine." The flight logs of Wallace B. Sawyer, the Ilopango-based pilot who worked for Southern Air indicate two visits to Barranquilla in October 1985.
After 1984, Congress made it illegal for the White House, the Pentagon, and the CIA to secretly supply arms for the contras. So the operation's organizers stepped up its recruitment of major drug smugglers to do this work for them. Congress allowed the administration to provide the contra army with only "humanitarian aid." According to the Kerry Subcommittee report, the U.S. State Department transferred over $800,000 of this "humanitarian aid" money to four Miami-based firms connected with major drug-smuggling rings:
In short, after 1984, the relationship between the U.S. government and the airlines of major drug traffickers becomes part of the public record. This network carried weapons to the CIA's contra army in Central America and returned with drugs to the U.S.
In the early summer of 1984, two contra representatives met with George Morales, a big-time Colombian trafficker who was then under indictment in the U.S. They met at the Miami home of a wealthy Nicaraguan exile. The contra representatives were Octaviano César and Adolfo "Popo" Chamorro.
A San Francisco Chronicle article reports: "Chamorro and César said they asked a CIA official whether they could accept the offer of airplanes and cash from the drug dealer, Morales. `I called our contact at the CIA,' Chamorro said recently. `The truth is, we were still getting some CIA money under the table. They said he (Morales) was fine.' " Journalist Leslie Cockburn subsequently corroborated César's CIA status from no less than eight sources, including high-level administration officials in Washington.
Morales went on to organize numerous guns-for-drugs flights between the United States and Central America. Morales told the Christic Institute that he donated approximately $5 million in drug money to the contras in 1984 and 1985. Morales said that the payment was part of a deal with three contra leaders a few months after his indictment on drug charges: they would `take care' of his legal problem in return for financial and logistical support. Morales later testified before the Kerry Subcommittee that his pilots flew weapons to contra bases and returning to the United States with drug cargoes. At a federal trial in April 1990, Colombian drug pilot Ernesto Carrasco testified that he saw Morales pay more than $1 million in drug profits to contra leader Adolfo "Popo" Chamorro at a Florida restaurant in 1985.
Morales claims that the CIA opened up an airstrip in Costa Rica, on the 1,500-acre ranch of the American John Hull, and that his pilots flew 20 shipments of weapons into Costa Rica in 1984 and 1985, and smuggled thousands of kilos of cocaine on the return flights into the United States. This was confirmed by Gary Betzner, a pilot for Morales, who testified he flew cocaine from Costa Rica to Lakeland, Florida.[7, 1] "I smuggled my share of illegal substance," said Betzner, "but I also smuggled my share of weapons in exchange, with the full knowledge and assistance of both the DEA and the CIA." (Newsweek, January 26, 1986)
The Kerry Subcommittee described John Hull as "a liaison between the contras and the United States government." And subcommittee testimony said that, on at least two occasions, Hull was present while bags of cocaine were transferred to the planes.
In May 1990, Colombian drug kingpin Carlos Lehder told ABC News that Hull was "pumping about 30 tons of cocaine into the United States every year."
In his Kerry Subcommittee testimony, Morales described the protection he enjoyed as long as he worked with the contra supply: Despite a previous indictment and DEA objections, a court order permitted him to enter and leave the country on his drug business. He landed his drug planes at the government-controlled Ilopango Air Force Base in El Salvador. And for two years, arms and drugs were loaded and unloaded from his planes, in broad daylight, at Fort Lauderdale's Executive Airport.
The reports of such enlistment of drug smugglers are routinely denied by the CIA. However, there is much evidence that recruiters of the contra supply network would make drug smugglers "an offer you can't refuse." Drug traffickers were offered protection from prosecution and protection for their planes flying in and out of various U.S. airports and military bases. In exchange, the U.S. government got a large "self-financing" network of cargo aircraft and pilots that could not be easily traced to the CIA or Defense Department.
During the 1991 trial of Panama's Manuel Noriega, Carlos Lehder testified that a U.S. official offered to allow him to smuggle cocaine into the United States, if he would allow the contra supply network to use a Bahamian island he owned. Lehder also testified that the Colombian cartel had donated about $10 million to the contras.
According to a Senate narcotics subcommittee, the federal indictment against drug trafficker Michael B. Palmer, owner of Vortex, was dropped because the government decided the case was not "in the interest of the United States." This narcotics subcommittee also reported that in 1985 a federal attorney in Miami stopped investigating drug trafficking on John Hull's ranch because U.S. officials "were taking active measures to protect Hull." The Kerry report says it was the U.S. embassy in Costa Rica that stopped this investigation.
Michael Levine, a DEA agent for 25 years reported from personal experiences in the L.A. Times that "high-level drug investigations had been destroyed" because the CIA would step in--protecting the drug traffickers and forcing DEA prosecutions to be called off in the name of "national security." In 1983, as the contra supply operation was building, the DEA closed its station in Honduras, where the main contra bases and airstrips were located.
Flights like Tolliver's into major U.S. bases were routine. In April 1987 the Boston Globe reported that between 50 and 100 flights "arranged by the CIA took off from or landed at U.S. airports during the past two years without undergoing inspection" by U.S. Customs. Government-protected drug smugglers used many U.S. bases, including Homestead Air Force Base near Miami, U.S. air force bases in Texas, and a number of airstrips around Mena, Arkansas, during the time when Bill Clinton was governor.
Meanwhile, in Latin America, the gun-for-drugs operation used two major U.S.-controlled air bases, in addition to John Hull's ranch, Panamanian government air bases, and the Colombian airstrips in Barranquilla. One was the Salvadoran Air Force base at Ilopango, El Salvador--a base virtually under the control of the U.S. Department of Defense. In 1985, this control was exercised by Col. James Steele, who was then chief of the U.S. Military Advisory Group in El Salvador, and who, in that capacity, oversaw the Contra supply operation at Ilopango at first hand. The other base was the contras' main air base at Aguacate in Honduras. These locations were valuable because their runways could handle large, heavily laden military cargo planes.
Celerino Castillo, who was once Drug Enforcement Agent in charge of Honduras, El Salvador and Costa Rica, says he reported to DEA headquarters that huge drug- and gun-smuggling operations were being run from Ilopango military airport by the "North Network" and the CIA. In his 1994 book, Powder Burns: Cocaine, Contras and the Drug War, Castillo writes, "My reports contained not only the names of traffickers, but their destinations, flight paths, tail numbers, and the date and time of each flight. Hundreds of flights each week delivered cocaine to the buyers and returned money headed for the great isthmus laundering machine in Panama."
Castillo reported that the operations were run out of two hangars at Ilopango: "The CIA owned one hangar and the National Security Council ran the other." Gary Webb documents that cocaine for California's contra ring came through Ilopango, and that its main leader Meneses had close personal ties with Salvadoran generals. "We don't know the extent of the Honduran military's involvement in drugs," said a State Department official. "But our educated guess is that all of the senior officials have knowledge, many are involved...and they are all reaping the profits."
This evidence reveals that U.S. government officials were involved in creating and directing the air networks that supplied the contras with arms and smuggled drugs into the U.S. People are asked to believe that the contras carried these operations out on their own, while low-level CIA agents merely "turned their heads and did nothing."
On one level, the evidence that links these operations to the CIA is fragmentary. These were covert operations--designed by professionals for the specific purpose of giving the U.S. rulers "plausible deniability."
But clearly such operations could not have been conceived by the hired contra mercenaries. Only support within the U.S. government at the highest levels could have protected these networks and assured their safe entry into U.S. air bases. Evidence at every point--in the testimony and documents of DEA agents, in the investigations of the Costa Rican government, in statements by Customs officials and the testimony of contra agents and drug smugglers--points to CIA involvement in these operations--creating them, protecting them, and directing them.
The CIA denies this. But the facts remain: While the government preached "just say no," while it was criminalizing a whole generation of ghetto youth, that same government was deeply involved in transporting cocaine and other drugs into the United States to secretly finance their dirty counterrevolutionary war against Nicaragua.
 Washington's War on Nicaragua, Holly Sklar, South End Press, 1988
 The Iran Contra Connection--Secret Teams and Covert Operations in the Reagan Era, Jonathan Marshall, Peter Dale Scott and Jane Hunter; South End Press, 1987
 "How the U.S. Government Has Augmented America's Drug Crisis," Peter Dale Scott, Ph.D., War on Drugs: Studies in the Failure of U.S. Narcotic Policy, Alfred W. McCoy and Alan A. Block (Eds), Westview Press, Boulder, 1992
 "CIA and Drug Trafficking by Contra Supporters," Affidavit by Peter Dale Scott, Ph.D., September 30, 1996
 "Account Links Contras, Drug Trafficking," Douglas Farah and Walter Pincus, Washington Post, reprinted by San Francisco Chronicle, October 31, 1996
 "The Contra-Cocaine Connection," Amy Lang, Convergence magazine, Christic Institute, Fall 1991
 "State Organized Crime," American Society of Criminology Presidential Address, William J. Chamblis, 1988
 "A Media Snow Job," In These Times, October 28, 1996
 "Is the CIA's New Openness Just Another Con Job on a Naive Public?", Michael Levine, Los Angeles Times, September 12, 1993
DARK ALLIANCE TIMELINE1977
June 2—Nicaraguan crime boss Norwin Meneses, who will become the leader of an international drug ring, is arrested and jailed in connection with the murder of Nicaragua’s top Customs official. His brother, Gen. Edmundo Meneses, chief of Managua’s police department believed to have been a CIA asset who coordinated couterinsurgency movements throughout Latin America in the 1970s, investigates and clears Norwin.
Spring—FBI and DEA reports together show that Norwin and Ernesto Meneses are smuggling large quantities of cocaine into the United States via commercial airliner. The DEA believes Norwin is dealing cocaine from Colombia and selling it in San Francisco and Miami. Norwin’s nephew, Jaime Meneses, is distributing the cocaine in San Francisco.
Sept. 29—Gen. Edmundo Meneses dies of wounds after being machine-gunned in Guatemala City two weeks earlier by Sandinista supporters.
June—Norwin Meneses and Danilo Blandón, who would later become Los Angeles’s biggest cocaine trafficker, separately flee Nicaragua for the United States.
July 1—International cocaine conference opens in Lima, and North American scientists get first-hand reports about cocaine smoking craze in Peru.
July 17—Nicaragua falls to Sandinista rebels. Dictator Anastasio Somoza and about 100 others are airlifted to Homestead AFB in Florida.
July 19—Congress convenes cocaine hearings and receives first warnings of oncoming cocaine smoking epidemic.
December—”Freeway” Ricky Ross, an illiterate teenager from South Central L.A., sees his first rock of crack.
August—Former Nicaraguan National Guard Colonel Enrique Bermúdez goes onto CIA payroll and heads to Guatemala to take over command of the Legion of September 15, a violent gang of ex-Guardsmen and mercenaries, the forerunners of the Contras.
Sept. 17—Anastasio Somoza assassinated in Ascuncion, Paraguay.
October.-November.—Small groups of pro-Contra Nicaraguans meet in Miami to form the UDN-FARN Contra army, which buys some weapons and radio equipment.
Nov. 4—Reagan elected President.
Mar. 9—Reagan signs “finding” to begin destabilizing the Nicaraguan government. CIA gears up for covert actions.
Mid-year—Ricky Ross and his friend Ollie Newell begin selling small amounts of powder cocaine in South Central L.A., which they get from a teacher.
Aug. 10—At the CIA’s behest, UDN-FARN and the Legion of Sept. 15 form the FDN and move their base of operations to Honduras.
Nov. 23—Reagan signs NSDD #17, authorizing the CIA to spend $19.95 million to set up the Contras, a paltry sum to fund such an ambitious project.
December—FDN begins setting up support committees in various U.S. cities, including Los Angeles, San Francisco, Washington, D.C., New Orleans, Houston, and Miami.
December—Blandón and Meneses “start the Contra revolution” in California. They meet with Bermúdez in Honduras to figure out how to raise money for the Contras. On return to U.S., Blandón picks up two kilos from Meneses in San Francisco and begins selling drugs in L.A.
Jan. 23—Ex-fighter pilot Carlos Cabezas is recruited in San Francisco to sell cocaine for the Contras. Obtains it from Contra supporters in Costa Rica working for Meneses.
Mid-year—Crack cocaine starts appearing in noticeable quantities on streets of South Central. Ricky Ross begins buying cocaine from Nicaraguan subordinate of Danilo Blandón.
September—Former Sandinista Edén Pastora unites with the UDN-FARN commander “El Negro” Chamorro to form ARDE, the main Contra army in Costa Rica.
Oct. 22—CIA gets information that Contras, Meneses aide Pena Cabrera, and unnamed religious group will meet in Costa Rica to discuss arms for drugs.
Nov. 8—FBI identifies Meneses lieutenants Troilo Sánchez, Fernando Sánchez and Horacio Pereira, Contra supporters operating out of Costa Rica, as sources of cocaine for San Francisco drug ring.
Late year—Ricky Ross begins marketing pre-made crack “ready rock” to other dealers.
Early—Ross’s drug enterprise has become so large he begins buying his cocaine directly from Blandón. This substantially reduces his costs, which he passes on to his customers, thereby helping to spread crack even more liberally throughout South Central L.A.
Jan. 17—Colombian freighter docked in San Francisco is raided and 430 pounds of cocaine are seized, breaking open the “Frogman Case,” the first documented instance of Contra drug dealing in the U.S. Carlos Cabezas and other Contra supporters are arrested soon after.
Summer—Crack market in South Central explodes.
Sept. 19—Reagan signs another secret finding, this one authorizing money and CIA help for paramilitary operations against the Sandinistas. Authorizes $19 million for fiscal year 1984.
Mar. 5—Norwin Meneses begins his conspiracy to distribute cocaine in San Francisco, according to a secret indictment.
May—Contras run out of money.
June 4—Norwin Meneses pays for a dinner party in San Francisco in honor of CIA agent Adolfo Calero, the political boss of the Contras. Meneses and Calero have a series of private meetings over the next few months.
July 30—CIA is told evidence in Frogman case links CIA operatives in Costa Rica to U.S. drug traffickers. Agency scrambles to keep information from public and returns $36,000 to convicted drug dealer.
Oct. 10—Boland Amendment passed by U.S. Congress outlawing U.S. funding for contras.
Nov. 26—FDN official and Meneses’s nephew are busted in San Francisco for cocaine trafficking.
Dec. 5—CIA is informed that Meneses and Contra leader Sebastian “Guachan” González are involved in drug dealing and arms trafficking in Costa Rica.
March—DEA is told Chepita and Danilo Blandón are “members of a cocaine trafficking organization.” Soon, U.S. State Department grants both political asylum. By this time, Blandón reports, he and Ross are moving upwards of 100 kilos a week.
Apr. 4—Jairo Meneses implicates his uncle in drug trafficking, yet no charges are filed. Norwin soon moves to Costa Rica and goes to work for the DEA.
September—DEA identifies Blandón has the head of a cocaine distribution organization in Los Angeles. No action is taken.
September—Panamanian doctor Hugo Spadafora, a Contra leader, meets three times with DEA agent Robert Nieves in Costa Rica, reportedly to accuse Contra leader “Guachan” Gonzalez and Manuel Noriega of drug trafficking. A week later, Spadafora is decapitated.
Dec. 20—Brian Barger and Robert Parry write story for Associated Press saying Contras are dealing in cocaine and running guns. Story is largely ignored by the American press.
- Associated Press reporter Robert Parry publishes first stories linking CIA, contras and cocaine; Parry eventually quits job under pressure from Reagan officials and allies in right-wing media.
Mid-April—Guatemalan DEA agent Celerino Castillo III gets telegram from DEA agent Robert Nieves in Costa Rica that says Contras are involved in drug smuggling out of Hangars four and five at Ilopango in El Salvador.
June—Crack problem “discovered” by the mainstream press after college basketball player Len Bias and pro football player Don Rogers die of overdoses.
June 25—House approves $100 million Contra aid package by 221-209 vote. Senate approves it two months later.
Aug. 25-27—DEA agents in southern California debrief confidential informant inside Blandón’s operation and are told that cocaine sold in South Central is financing the Contras. L.A. County Sheriff’s office begins investigation and discovers FBI has same information.
Oct. 5—Cargo plane used by Oliver North’s illegal Contra resupply effort is shot down over Nicaragua.
Oct. 27—Blandón’s house and used car lot and a dozen other locations are raided by the L.A. County Sheriff, FBI, IRS, and Bell police. Detectives told by one suspect and Blandón’s lawyer that CIA is involved. Reagan signs bill authorizing CIA to spend $100 million on Contras.
Nov. 3—Iran arms story breaks in Beirut magazine. Two weeks later Attorney General Ed Meese and Reagan hold press conference to admit Contra diversion scheme. Iran-Contra scandal erupts.
Dec. 10—All charges against Blandón stemming from drug raid are dropped and he applies for permanent residence in U.S.
Dec. 13—Former Contra mercenary Steven Carr is found dead of a drug overdose in Los Angeles, shortly before he was to testify about Contra drug and arms dealing in Costa Rica.
Dec. 27—Assistant U.S. attorney assigned to Blandón case allegedly commits suicide in Los Angeles soon after Blandón case is rejected for prosecution in Washington, D.C.
Jan. 12—LAPD and County Sheriff form Freeway Rick Task Force.
Jan. 21—San Francisco Contra supporter Dennis Ainsworth contacts the FBI and tells them that the FDN “has become more involved in selling arms and cocaine for personal gain than in a military effort to overthrow the current Sandinistas.”
Spring—Blandón leaves L.A. and moves to Miami. FBI discontinues its investigation. Ricky Ross leaves L.A. a couple months later and Freeway Rick Task Force disbands.
November—George Bush is elected President.
March 23—Sandinistas and Contras sign truce at Sapoa.
July 7—Ross indicted in Texas on cocaine conspiracy charges.
Nov. 5—Ross moves back to L.A. from Cincinnati.
-Gary Webb is hired by San Jose Mercury News to work as investigative reporter at Sacramento bureau. Wins Pulitzer for role in team coverage of Loma Prieta earthquake.
Feb. 8—Norwin Meneses is indicted by a federal grand jury in San Francisco for acts committed in 1984 and 1985. An arrest warrant is issued the same day. Both are put under seal and never made public in U.S.
June—Ricky Ross is indicted in Cincinnati.
Sept. 1—FBI sting in L.A. snares several members of Blandón raid team and Freeway Rick Task Force.
Late—Blandón returns to Southern California and resumes cocaine dealings.
Nov. 28—Ross arrested in L.A. on Cincinnati warrant and jailed.
March—DEA San Diego begins investigation of Blandón.
July 21—Undercover DEA agents meet with Blandón, who mentions that he is “due to receive $1 million dollars back from the U.S. government.”
Sept. 6—Ross pleads guilty to drug charges in Cincinnati.
Oct. 16—Defense lawyer in FBI police corruption sting tells press about Blandón and the 1986 raids, and claims CIA involvement in drugs. Attorney hit with gag order by federal judge.
Feb. 8—Ross is sentenced to 10 years in federal prison.
June 13—Blandón is audio- and videotaped negotiating a 50-kilo drug deal with a DEA informant.
August—Ricky Ross begins testifying against police in the L.A. corruption trials.
November—Nicaraguan police arrest Norwin Meneses and aides and seize 725 kilos of cocaine.
Dec. 9—Blandón arrested on conspiracy and drug charges by LAPD but the charges are dropped at the request of the Justice Department.
May 15—Blandón and his wife are arrested in San Diego at the INS offices where they went to pick up Chepita’s green card.
August—Norwin Meneses convicted of cocaine trafficking in Nicaragua. Sentenced to 30 years, which he is currently serving in Tipitapa Prison.
Oct. 13—Blandón cuts a deal with government, which reduces a probable life sentence to 48 months in jail.
August—Ricky Ross released from federal prison after serving four years and starts rebuilding old theater in South Central.
Nov. 10—Ross is convicted of old conspiracy case to deliver a controlled substance in Smith County, Texas, and returns to jail.
August 12—DEA targets Ross for drug sting, a few weeks before he is released from prison.
Sept. 19—Blandón walks out of jail on the arm of an INS agent, a free man.
October—Blandón, now a DEA informant, begins negotiating a drug deal with Ross.
March—Ross arrested in DEA sting.
July—Gary Webb begins investigation of Blandón and Contra cocaine dealing, learns of drug sales to Ross in South Central.
October—DEA agents meet with Webb to dissaude him from writing about Blandón. Two weeks later, former Costa Rican DEA agent Nieves resigns from top DEA position.
November—DEA alerts CIA that Webb is investigating Contra drug dealing and is trying to locate Meneses, who DEA expects will admit Contra drug dealing.
March—Ross goes on trial in San Diego and is convicted. Blandón testifies as prosecution witness, admits Contra drug dealing.
August—”Dark Alliance” series appears in San Jose Mercury News.
September—CIA and Justice Dept. launch internal investigation of “Dark Alliance” allegations.
October—Ross sentenced to life without parole.
November—Then-chief of the CIA, John Deutsch, makes an unprecedented trip to South Central L.A. to respond to public outrage over “Dark Alliance” allegations.
May-June—Mercury News editor Jerry Ceppos recants some findings of “Dark Alliance” series. Webb disagrees with Ceppos and is yanked off the story and reassigned to a bureau 150 miles from his home.
Nov. 19—Webb quits Mercury News.
December—Attorney General Janet Reno refuses to release a declassified report by the Justice Dept.’s Inspector General on the U.S. government’s handling of Blandón and Meneses investigations.
January—CIA declassifies and releases one volume of a two-volume report on its internal investigation of Contra drug dealing. Volume two is still classified.
March—CIA Inspector General Fred Hitz tells Congress that CIA had secret deal with Justice Dept. from 1982 to 1995 which permitted the agency to avoid reporting cases of drug trafficking by its agents and assets.
Dr. Death Revisited May 5 ,2005 In French TV documentary, ex-CIA official admits ties to CIA-cocaine scandal character
Ink-Stained Wretchedness April 25, 2005 http://www.ocweekly.com/ink/05/33/media.php
DEA'S FINEST DETAILS CORRUPTION By John Veit
(Celerino Castillo III, one of the Drug Enforcement Agency's most prolific agents, who netted record busts in New York, Peru, Guatemala, El Salvador and San Francisco, was ordered not to investigate US-sponsored drug trafficking operations supervised by Oliver North. After twelve years of service, Castillo has retired from the agency, "amazed that the US government could get away with drug trafficking for so long." In his book Powderburns: Cocaine, Contras, and the Drug War [Mosaic Press, 1994], Castillo details the US role in drug and weapons smuggling, money laundering, torture, and murder, and includes Oliver North's drug use and dealing, and the training of death squads in El Salvador and Guatemala by the DEA.)
VIETNAM BLUES Sergeant Castillo was a doper's nightmare during his days in Vietnam. Constantly testing the reflexes and surveillance skills of his platoon, Castillo had no tolerance for soldiers stoned on heroin or OJ's (marijuana soaked with opium). Compassionate with users suffering emotional problems, Castillo took a hard line with those who compromised the safety of the unit, court-martialling anyone who failed to clean themselves up after two warnings.
With addicts dying around him regularly, Castillo vowed to make fighting narcotics his life's work once back in the states. He told the SHADOW: "Every week we would send another overdose victim home in a green bag. If the soldier was well liked, someone would pump a bullet in the soldier's body. The family would be told he died a hero's death. If the consensus was that the dead soldier had been an asshole, he would be sent home with nothing more than the needle pricks in his arm." Dope and undisciplined soldiers were problems Castillo left behind when he volunteered to join a secret sniper unit in neighboring Cambodia in 1971. The Vietcong used Cambodia as a staging ground for raids on South Vietnam since the US Congress had declared it off-limits to American soldiers. Castillo's twelve-man team would pick off commanding officers at VC bases with M-14 sniper rifles. "We never missed," Castillo recalled. "According to the Pentagon, we were never there."
These were the first of many US Government cover-ups Castillo was to be involved with in his twenty-one year career as a public servant.
OFFICER CASTILLO, TEXAS DEA 101 Things were tamer back in Edinburgh, Texas, where Castillo served as a police officer while earning a criminal justice degree from Pan American University in 1975. "I drank in every detail of the lectures, paying particular attention to any mention of drug laws. They would be my weapons in the streets." Serving first as a dispatcher at the Edinburgh Police Department, he moved to the field, using his Vietnam surveillance and combat skills well, often surprising thieves and other miscreants during the commission of crimes.
Being fluent in Spanish enabled Castillo to intimately interact with people on his beat and he became a model community police officer. His network of informants grew quickly. Unlike the felons in later assignments with the DEA, most of Castillo's informants were locals, people with families fed up with the drug trade in their neighborhood. It was when working with federal agents that Castillo saw basic classroom policing get "thrown out the window."
Two senior DEA agents, Jesse Torrez and Chema Cavazos, took Castillo on as an apprentice of sorts, taking him along when he fed them busts too big for Edinburgh's small force to handle. When Castillo got wind of any smuggling over the border, his DEA mentors summoned the federales, the Mexican national police renowned for their violence.
Mexican interrogations involved hanging the suspected trafficker by a beam and pouring seltzer up his nose. Often a cattle prod, the chicara, named after the cicada, was used to extract names of customs officials and traffickers working both sides of the border. The Americans would stand by at a distance, listening for valuable intelligence.
During other co-ventures between the Edinburgh PD and the DEA, Castillo witnessed the DEA's disregard for the safety of informants. DEA agents would often barge in minutes after a transaction was made, giving the informant's identity away instantly. Castillo had always waited long enough to create an avenue of doubt in the mind of the suspect, a necessary courtesy insuring the relationship's continuity. Like all the DEA offices Castillo later worked in, the one in McAllen, Texas was cooperatively dysfunctional, with two sets of agents pitted against each other, divided primarily along racial lines. Animosity and suspicion among agents were constants in an organization where precision and coordination is a prerequisite to mutual survival.
NEW YORK CITY: NO RULES After six years in Edinburgh, Castillo joined the DEA. His first assignment was New York City in 1980, a far cry from Vietnam's jungles and the relatively placid living of the Rio Grande Valley. Cocaine was making a healthy return to streetcorners and the city's surviving discos. Crack pipes were making their first gasps in the city as Ronald Reagan ushered in a new era of borrowed prosperity and conspicuous decadence.
Placed in the New York office's wiliest squad, the "Raiders," Castillo watched as dealers' doors were kicked in without warrants, illegal wiretaps were performed, and Miranda rights were forgotten. During a stint at Kennedy Airport, he saw agents rip off traffickers, regularly pocketing cash, jewelry and drugs. Not being one to snitch, the young agent held his tongue. "I had always done things by the book. Here they ripped out the pages and stomped on them," Castillo told the SHADOW. "Internal Affairs was always watching, but we were protected by the cluster of New Yorkers in DEA's Washington office known as the New York Mafia." These administrative agents insured that the New York office, the country's largest, was immune from "messy internal investigations." Contacted by the SHADOW, DEA spokesman John Hughes denied that such an organization existed, stating that such a thing would, "stick out like a sore thumb."
DEA BRASS: BIGOTS WITH BADGES The DEA has never been a pioneer of affirmative action. Most agents do not speak Spanish, despite the Agency's constant interaction with Hispanics. On several occasions, Castillo's safety was jeopardized when Spanish-challenged agents failed to recognize the bust's signal word among the rolling Spanish chatter, leaving him to improvise with armed dealers anxious for their drugs or cash.
Spanish-speaking agents follow cases from the mouth of the informant to the prison cell, their superiors often performing only administrative tasks. Despite the paucity of their investigative work, DEA administrators would rush in with the swarm of blue windbreakers the day of the bust, eager to take credit for everything. Castillo told the SHADOW, "Every Hispanic agent I knew fell into the same trap and was assigned wiretap monitoring, translations, and surveillance. We worked long hours building cases against Dominicans and Puerto Ricans and would have to stand back while paper pushers took the credit."
Being a workaholic brought quick results in the Big Apple for Castillo. In his four years working the city, Castillo orchestrated some of the biggest busts the nation had ever seen. On November 4th, 1982, twenty pounds of heroin worth $20 million were hauled in, one of the largest busts in New York City history.
With every day spent on the streets, Castillo's hatred for drugs grew with increasing vehemence. Castillo witnessed addicts of every ilk, sometimes as young as fourteen, constantly throwing their lives into the toilet so drug dealers could get rich. It would be a hard slap of reality to later discover that the United States government was instrumental in saturating American streets with life destroying drugs.
PERU: DRUG WAR FUTILITY By 1984, the US appetite for cocaine was peaking as fields in South America were converted to accommodate the coca leaf. Castillo, the only Spanish-speaking field agent in Peru, continued his efficient work, making numerous busts in his two years there.
Working the jungles, although frustrating for Castillo, was a welcome change from Manhattan's steel maze and reminiscent of Vietnam. Stymied by the DEA's advisory status in foreign countries, however, Castillo was unable to probe too deeply into Peru's narco underworld. The Peruvian military thought their American advisor would be satisfied torching small labs and shooting down traffickers' planes. Castillo demanded to bust the big labs, the factories run by the cartels. Peru's military however, conveniently kept the larger fields and refineries off-limits to American investigation. The military claimed that the Shining Path (Sendero Luminoso, the Maoist guerrillas whose reign of terror included cocaine smuggling and numerous murders of government officials and civilians) controlled the areas of major cocaine production.
The last thing Peru's government wanted was to have an American agent killed by Sendero, which would jeopardize future military aid. Castillo later learned their caution was merely a smokescreen used to protect Columbian cartel-controlled airstrips and refineries from American intervention. The military, like most Peruvian governmental agencies, was largely dominated by Colombia's cartels who were adept at greasing palms and instilling fear in the hearts of potential drug enforcement heroes.
The US took a more prominent role in the Peruvian military during Castillo's four years there, with programs like Operation Condor, which used the collective services of the DEA, CIA and the armies of Colombia and Peru to fight drug trafficking. With their help, Castillo was able to coordinate more and larger busts, including South America's biggest ever: four tons of raw coca paste, three airplanes, and a gargantuan cocaine refinery able to perform every phase of the leaf's metamorphosis into nose candy. As a result, US military aid to Peru was increased.
Despite his successes, Castillo remained mired in the DEA's bigoted bureaucracy. Castillo's station chief, Peter Rieff, a non-Spanish speaker, felt threatened by Castillo and transferred him to Guatemala without the promotion originally promised after one year's service. Rieff's reasoning was, "you just haven't paid your dues, Cele."
DEA NEGLECT: AN AGENT IS MURDERED It was during Castillo's Peru junket that DEA agent Enrique "Kiki" Camerena was killed by CIA informants on March 6th, 1985 in Vista Hermosa, Mexico near Guadalajara. Left alone to work Mexico with some of the country's most notoriously dangerous traffickers, Camerena often complained about not receiving enough support in the field while working undercover. "Camerena warned the DEA brass things were getting dangerous in Guadalajara. The Agency ignored him," Castillo recalled to the SHADOW after listening to audio tapes of Camarena's torture and murder. "Both of the killers worked for the CIA and were double-dipping," (snitching for the CIA while using their protected status to deal dope on the side.) Only one of Camarena's killers were caught.
Castillo empathized with Camerena's plight. He could just as easily have been the one who dug too deeply for the cartel's convenience. Kidnapping and murdering family members of police and informants is common practice in the drug-dominated nations of Latin America. With his wife and two children following him on his long-term assignments, Castillo constantly worried that they would suffer a fate similar to El Salvador's President José Napoleon Duarte, who had to walk unarmed into a guerrilla compound in 1986 and beg for the release of his daughter in exchange for immunity for their imprisoned comrades.
During a later assignment, an informant provided Castillo with wiretapped conversations of a drug dealing Guatemalan colonel outlining an intricate plan to assassinate him. "Instead of talking about the bust the informant was setting up, Colonel Moran kept going on about how he was going to blame the rebels for my assassination. A hit squad was going to wait in the bushes and ambush me when I drove past on Highway 8 in El Salvador," Castillo told the SHADOW from his home state of Texas, where he is currently president of his local Parent Teachers Association.
Castillo had reported to his superiors that Moran was heavily involved in narcotics trafficking, frequently orchestrating cash drops to the Panama City branch of the scandal-ridden Bank of Credit and Commerce International (BCCI). After hearing the tapes outlining the assassination, DEA superiors ordered Castillo to drive down Highway 8 to El Salvador to investigate a mission of dubious importance. "I felt as if someone had painted a bullseye on the back of my head," Castillo recalled. "Tree branches were sniper rifles, I drove about ninety miles an hour most of the way."
DEA files outlining Colonel Moran's sporadic career as a DEA and CIA informant were provided to Castillo by agents sympathetic to his plight as an agency pariah. During later DEA attempts to silence Castillo, the Colonel was summoned to testify before the DEA's Office of Professional Responsibility. Moran detailed allegations to enthralled inspectors that Castillo had shot several drug dealers in the back of the head during a bust in Puerto Barrios, Guatemala in 1986. The charges were false and Moran's plot to assassinate Castillo was never mentioned during the proceedings.
DEA informants include some of the world's most disreputable rouges who often use their informant status as carte blanche to deal dope on the side. Although DEA spokesman Hughes denied to the SHADOW that such "double dipping" is tolerated, he added: "You don't use the Pope to catch drug dealers."
Hughes also denied that the agency is reckless with their overseas agents, saying they "always have a recourse for back-up, usually with local police." Local police certainly didn't help Camerena, and Castillo laughed when the SHADOW told him Hughes' remarks.
CENTRAL AMERICA: CHAOS, COCAINE, DEATH SQUADS The Guatemala City DEA office in the US Embassy compound covers four countries: El Salvador, Guatemala, Be-lize, and Honduras. In 1985, Castillo's beat, El Salvador and Guatemala, was one of the most volatile on the globe, racked by years of internal warfare, death squad violence, and narcotrafficking.
Like Peru, both governments were subservient to three related entities: the US Government, the cartels, and their militaries. The militaries operated on their own, violently rooting out sus-pected communists from their borders while trafficking drugs and weapons to support themselves. Both nations' mili-taries harbored death squads who rou-tinely kidnapped and tortured suspected subversives. It was with these elements that Castillo was forced to cooperate in forming anti-narcoterrorism units.
In training his elite drug squads, Castillo utilized the services of re-nowned death squad leaders. Dr. Hec-tor Antonio Regalado was hired as a firearms trainer for Castillo's El Salva-dor unit at the recommendation of Colonel James Steele, commander of the United States Military Group which oversaw American armed forces in Cen-tral America.
Trained at the US' School of the Americas in Ft. Benning, Georgia, Regalado often bragged of his trigger-man role in the assassination of Arch-bishop Oscar Romero, a globally be-loved human rights activist, in March 1980. Regalado was also a torture ex-pert, frequently using his skills as a dentist to extract information from nota-ble "subversives." Much to Castillo's dis-gust, the death squads' most notorious human butchers and drug dealers be-came his students and colleagues. While Castillo's classes dealt primarily with surveillance, raid tactics and firearms training, others detailed explicit torture methods. Deemed "interview tech-niques," students were instructed how to use cattle prods and hoses and to sub-merge suspects' faces in buckets of water until nearly causing drowning.
Death squad drug busts made the Mexican federales seem tame by com-parison. Standard procedure involved Castillo doing the intelligence gathering for a bust, after which the military would swarm in, interrogating and tor-turing the traffickers to death before absconding with a portion of the drugs.
One such bust happened on Septem-ber 25, 1987, when Castillo's unit busted a cocaine ring run by Guatemalan Con-gressman Carlos Ramiro de Paz. 3000 kilos of cocaine, the largest bust in Central American history, were found. By the time the coke got to headquar-ters, however, six hundred kilos were missing. A soldier laughingly admitted to Castillo that the G2 (Guatemala's elite military unit) had pilfered it.
While the G2 let de Paz live, (G2 wiretappers later relished listening to him pleading with Medillin cartel leader Pablo Escobar to have mercy on him), everyone else was hacked to death with machetes. A Mexican drug courier's daughters were gang-raped before their execution.
Castillo reported these and other de-tails of Guatemalan and Salvadoran military corruption to his station chief, Bob Stia, who reluctantly signed the re-ports. All of Castillo's reports were for-warded to the US Embassy, where they went on to Washington. DEA Washing-ton refuses to open the Puerto Barrios file, in addition to most of Castillo's reports, citing privacy restrictions. Cas-tillo has, however, made his reports available to journalists and the public.
IRAN-CONTRA-COCAINE The Iran-Contra scandal blared across American television and newspapers, but drug activity was rarely mentioned. The American public accepted the Reagan Administration's version of Iran-Contra, which maintained that weapons were covertly sold to Iran in order to generate funds for Contra mercenary soldiers seeking to overthrow the Nica-raguan Sandanista government. The money used by US Marine Corps Lieu-tenant Colonel Oliver North and his entourage from weapons sales to Iran to fund the Contras was a "drop in the bucket," according to Castillo. He told the SHADOW, "To the best of my knowledge, most of the money to fund the contras came through narcotics trafficking."
During Castillo's first day briefing, DEA Station Chief Stia casually men-tioned an operation being conducted by North and the National Security Council in El Salvador's Ilopango airport. This operation was to dominate the rest of Castillo's life, ruining his career as an agent. Stia said North picked up where the CIA left off, in supplying the con-tras with the necessary trappings of in-surrection. US support of the contras was highly illegal, prohibited by the US congress' Boland Amendments.
While Castillo empathized with con-tra soldiers in the field, who were de-pendent upon the erratic stream of sup-plies by the US, he would not tolerate drug trafficking by anyone. Reports of the Contras dealing in narcotics had saturated the DEA Central American office. Stia always looked the other way, warning "don't interfere with their oper-ation," according to Castillo. Castillo told Stia that he would report any and all trafficking he witnessed. Castillo says this prompted a laugh from Stia, who assured him that excessively insightful investigations into the contra operation would prompt DEA brass to find an ex-cuse to pull him out of the country. It proved to be a prophetic statement.
Castillo had established an informant at Ilopango who was in charge of in-specting cargo and routing air traffic. Soon, Castillo had detailed information on "hundreds of flights carrying cash, drugs, and weapons through Ilopango. All of which was sanctioned by the US government." Unaware of Ilopango's protected status, Bobby Nieves, a DEA country attache from Costa Rica, wired Castillo in April of 1986, instructing him to in-vestigate hangars four and five at Ilo-pango, saying in his cable, "We believe the Contras are involved in narcotics traf-ficking."
Castillo was shocked to see that most of Ilopango's traffickers were protected by the National Security Council's secur-ity blanket. In the spring of 1986, the Central Intelligence Agency had re-quested a US visa for Carlos Alberto Amador to use on narcotics trafficking missions. Amador is documented in ele-ven DEA files for narcotics trafficking and was typical of Ilopango's pilots. Castillo asked US Embassy Consular General Robert Chavez to block the visa request. Chavez complied, but worried he would be later castigated by his superiors. "Everyone was afraid of what might happen to them if they sup-ported my allegations," Castillo told the SHADOW.
The El Salvador home of Walter Grasheim, known in Powderburns as William Brasher, was raided by Cas-tillo's anti-narco terrorism unit on September 1, 1986. Grasheim is a con-victed cocaine dealer and is documented in seven DEA files alleging drug traf-ficking. Grasheim's place was a bar-racks for Contra pilots stopping through El Salvador. Prostitute informants who frequented the disheveled ranch house told Castillo it was the site of many all-nighters where contra pilots and govern-ment officials including Oliver North, spent long hours "doing cocaine, having sex, and shooting rifles."
The Grasheim raid yielded "enough firepower to arm a platoon," according to Castillo. The arsenal included "cases of C-4 explosives, hand grenades, rifles, night vision equipment, helicopter hel-mets, US embassy license plates and files documenting payoffs to El Salva-doran military officials. An M-16 rifle belonging to US Military Group Com-mander Steele was also found."
Castillo called US Customs agent Richard Rivera, asking him to find the sources of the American weapons. Cus-toms called him off the case and the weapons disappeared into the prover-bial memory hole. US Customs did not return SHADOW phone calls seeking permission for Rivera to talk. Rivera, however, has since confirmed Castillo's account in eleven interviews with the mainstream press.
Castillo tried to get an American official to answer his inquiries as to how Grasheim, a civilian with no legitimate ties to the US government, had pro-cured brand-new American arms, US embassy radios, and license plates. Edwin Corr, then US Ambassador to El Salvador, denied any link between Gra-sheim and Iran-Contra, telling the SHADOW that such allegations were "absolutely false." Like most US officials contacted by the SHADOW, however, Corr effusively praised Castillo's dili-gence as an agent, but expressed bewil-derment as to why Castillo has under-taken his crusade.
PSYCHOTIC OLLIE NORTH: COKE DEALER Jack Blum, Special Prosecutor for Senator John Kerry's (D-Mass) Subcommittee on Terrorism, Narcotics and International Operations told the SHADOW: "There is no doubt in my mind that Oliver North knew about narcotics trafficking at Ilopango." The Committee interviewed dozens of pilots who openly detailed the "guns down, drugs up" operation. One such pilot, Michael Palmer, indicted for bringing 300,000 lbs. of marijuana into the US in the mid 1908's, frequently boasted to prosecutors that his activities were supported by the US government.
During Kerry's investigation, Castillo was ordered by the DEA's Freedom of Information Office to keep his reports on the Contras active, thereby rendering them inaccessible to the Committee and the press. Lacking Castillo's reports, the Committee still concluded in 1989 that: "There was substantial evidence of drug smuggling through the war zones on the part of individual Contras, contra pilots, mercenaries who worked with the Contras and the Contra supporters in the region."
Tim Ross, a twenty-one year veteran broadcaster for the BBC in Colombia, connected what he called "Ollie North's mob" to drug dealing in that country as well. Ross told the SHADOW that "In late '84, early '85, North brought five Afghani military advisers to Colombia on a speaking tour, three left, two stayed. The two that stayed were chemists who introduced heroin manufacturing to Colombia. He also brought in an Israeli agronomist who helped to cultivate opium poppies."
Ross said that when he started investigating too deeply for North's comfort, however, he was summoned to the US Embassy in Bogota and told, "You're going to lay off this story or you are going to die" by an "ex-marine, the type of guy who used to cut Vietcong throats with his thumbnail." Ross ran the story anyway, detailing Colombia's growing heroin epidemic, but North told his superiors that the story was nothing more than "fabrications, including trumped-up fake Mexican file footage."
Released after Powderburns and partially reprinted in the Washington Post and the Virginia Pilot, 534 pages of North's personal diaries mention drug trafficking. The July 9, 1984 entry states, "wanted aircraft to go to Bolivia to pick up paste, want aircraft to pick up 1,500 kilos." The July 12, 1985 entry reads, "$14 million to finance Supermarket came from drugs." The "Supermarket" was an Honduran weapons depot used by private arms merchants to supply the Contras. North is currently under investigation by the DEA for arms smuggling, according to DEA file number GF GD 91/93. North has denied any involvement with narcotics trafficking, stating in his autobiography Under Fire, "Very little in my life has angered me as much as the allegations that I or anyone else involved with the resistance had a drug connection."
North claims that when he heard of narcotics trafficking in Central America, he dutifully reported it to the DEA and CIA. DEA director Jack Lawn, DEA spokesman John Hughes and agent Castillo, who would have been assigned to investigate such information, denied that North ever supplied them with narcotics tips.
Oliver North has been no stranger to mayhem. After serving as a Marine combat officer in Vietnam, North had difficulties readjusting to American society. In 1974, according to Parade magazine (Nov 13, 1994), North spent an evening running through a suburban neighborhood naked, waving his .45 automatic pistol and screaming, "I'm no good!" North mentions his subsequent three week stay at Bethesda Naval Medical Center's psychiatric ward in his autobiography, but cites marital difficulties and depression over the failing war as causes for his stay there.
North has Castillo largely to blame for his recent loss in the 1994 Virginia senate race. Embarking on a fifty day journey through Virginia prior to the election, Castillo went on several radio and television talk shows and made public appearances throughout the state. Usually addressing die-hard Ollie fans, Castillo's town meetings invariably ended the same way: angry patriots deflated by their hero's involvement in narcotics. Despite millions of dollars in support from Reverend Sun Myung Moon's Freedom Alliance, Ollie still managed to lose the election.
GEORGE BUSH: A TELLING GRIN George Bush visited Guatemala City in January of 1986 for the inauguration of newly-elected president Cerezo. Castillo later compiled evidence that Cerezo's brother and top aides were involved in drug trafficking, but was instructed by Stia not to "embarrass the Guatemalan government" by pursuing the case. During Cerezo's inauguration party at US Ambassador Piedra's home, Castillo voiced his suspicions about Ilopango's drug activity. "There's some funny things going on at Ilopango with the Contras," he told Bush. Bush merely grinned and kept ominously silent. Later that day, Bush met with Oliver North at the Embassy to discuss the Contra operation.
"PROJECT DEMOCRACY" EXPOSED Castillo constantly threatened his superiors that if they stifled his reports on "Project Democracy", as the Contra resupply operation was called, it would "come back and bite them in the butt." A Sandanista surface-to-air-missile provided the fangs they so desperately feared. On October 5, 1986, a C-123 airplane left Ilopango laden with munitions for the Contras. The plane was shot down and Eugene Hasenfus, the lone survivor, admitted to television news cameras after a few days of captivity that "the CIA did most of the coordination for flights and oversaw all of our housing, transportation, also refueling and some flight plans."
According to North's autobiography, after the Hasenfus affair, then-CIA director Bill Casey ordered North to "shut it down and clean it up," regarding the Contra resupply operation. Casey conveniently died on the second day of the Iran-Contra hearings.
DEA BRASS COMES DOWN HARD Throughout his investigations, Castillo was warned to ignore Ilopango and the Contras, yet he persisted. Stia's original warning to Castillo came true when representatives from the DEA's Office of Professional Responsibility (OPR) flew in from Washington to investigate Castillo and Stia for violations of DEA rules.
Despite their problems, Stia had always respected Castillo, recommending him for a bonus and promotion in 1987. Castillo repeated every detail of his investigations to the OPR agents, constantly amazed at how little interest was shown in the contra-cocaine connection. OPR had no interest in stopping the sordid dealings of Ollie North's mob, but were looking for anything to nail Castillo so he could be discredited and removed from the agency.
Finding a series of minor violations, including socializing with an informant, receiving and soliciting gifts, possession of an automatic weapon, and misappropriation of government property, Castillo was suspended for thirty five days, then transferred back to the States. The charges stemmed not from Castillo's lack of bureaucratic integrity, but from some paperwork snafus "routinely committed by every agent in the field." Other violations, such as the routine aerial spraying of food crops, rivers, and bodies with the deadly chemical Roundup, were never investigated.
Regarding Castillo's claims, DEA spokesman John Hughes told the SHADOW, "Most of what you have is not confirmable. He may have written the reports you mention; we just don't have them in this office." CIA spokesman David French told the San Francisco Bay Guardian that Castillo's allegations, "are not something we can comment on." Despite the death threats, Castillo receives on his answering machine each week, Hughes assured the SHADOW that, "No one at the DEA bears any ill will against Cele." Ironically, Hughes added, "This is a good story and it deserves to be told."
AUSA BOB MERKLE article about Lehder getting a dealhttp://www.fear.org/carlos1.htmlhttp://www.sptimes.com/News/112899/Floridian/Carlos_Lehder_Rivas__.shtmlhttp://tamara-inscoe-johnson.com/work2.htm
By ROBERT MERKLE
© St. Petersburg Times, published November 28, 1999
From his jail cell in Danbury, Conn., where he was doing time for importing marijuana, Carlos Lehder Rivas saw massive cultural upheaval, crumbling social and moral constraints, and diminishing respect for the dignity of the individual.
To Lehder, it all added up to one thing: an opportunity to import and distribute cocaine to the American consumer on a massive scale.
A founding member of the infamous Medellin Cartel, Lehder knew America could not resist the exciting drug if it were affordable and readily available. Much as Henry Ford transformed the automobile industry through mass production, Lehder and his colleagues created a river of cocaine where only a trickle had gone before.
Lehder, who idolized Adolf Hitler, labeled his packaged kilos with swastikas and murdered anyone who got in his way. He commanded an armed garrison on a Bahamian island replete with hangars and a jet-capable runway. Twenty-four hours a day, his pilots injected cocaine by the ton into the United States. The cartel invested its immense profits in American goods and services or shipped them by Learjet to safe banking havens throughout Latin America and Europe.
In just a few years, the cartel succeeded in wreaking lasting injury to our society. Children dropped out of school. Men and women dropped out of jobs. Marriages were ruined. Morgues and emergency rooms swelled with the victims of drug-related street crime. Violence escalated everywhere. Businesses suffered from employee absenteeism, theft and incompetence.
Predictably, the reaction of our social institutions was overly broad and misdirected. Instead of taking a reasoned approach focused on shrinking the drug market, America declared "war" on Lehder and his ilk. We built prisons and toughened laws to the point of absurdity. Public fear and anger, fueled by political demagoguery, created a senseless national hunger for capital punishment.
The law enforcement ranks grew exponentially, with no discernible effect. A "bend the rules" mentality infected the police, eroding our civil liberties. Forfeiture laws were routinely abused, with personal property seized on the thinnest of allegations. Decisions previously vested in the presumed wisdom and experience of judges were now entrusted to inexperienced and ambitious prosectors.
Carlos Lehder was a destructive force, rendered effective by our own apathy and ignorance. We can thank him, his henchmen, his bankers, his lawyers, his financial advisers, and ultimately ourselves for higher taxes, threatened civil liberties, diminished national potential, an increasingly arrogant political class, and a deepening national cynicism.
Before his capture, Lehder sat on a throne in the jungle of Colombia and bragged of his attack on the cultural heart of this nation. His money, power and machine guns were only as strong as the American appetite for cocaine. That appetite flourished in a society slowly abandoning any sense of culture, history or tradition.
We were never really at war with Carlos Lehder. We were, and are still, at war with ourselves in those places where our national unity and strength begin.
Former U.S. Attorney Robert Merkle, now in private practice, prosecuted Lehder for drug trafficking in 1987-88. Lehder was convicted and sentenced to life plus 135 years in prison. He later struck a deal to testify in the drug trafficking trial of former Panamanian leader Manuel Noriega. Lehder's whereabouts are a government secret.
Hunted down, then protected
With business skills as strong as his taste for violence, Lehder had turned Colombia's chaotic cocaine trade into the Medellin Cartel, an efficient and murderous operation responsible for 80 percent of the cocaine that came into this country a decade ago.
So when Lehder was finally captured in a Colombian jungle in 1987 after almost four years in hiding, then-U.S. Attorney General Edwin Meese hailed it as a major victory in the war on drugs. Lehder would be extradited, officials announced, and become the first foreign drug lord to face the full force of American justice.
Not mentioned in the burst of publicity surrounding the arrest was one curious fact: Lehder had already begun cutting a deal from his remote hideaway, a deal that would eventually land him in the federal witness protection program.
How could the man who ran the world's biggest drug operation, a man wanted for years by the American government, wind up as a federally protected witness?
Because the Justice Department desperately wanted Panamanian President Manuel Noriega, a smaller player in the drug trade but a bigger political fish.
In exchange for his testimony against Noriega in 1992, the U.S. government cut Lehder's sentence from life plus 135 years to 55 years. Lehder now claims he had an additional deal that would have further reduced his sentence and made him eligible for deportation and freedom. This deal, he complains, the government reneged on.
The Lehder case illustrates how far the federal government's use of the witness protection program has moved from its original intent of protecting innocent victims or informants who testify against major crime figures. Lehder was rewarded for turning in someone who was in effect an underling in his operation.
For his testimony, he got special treatment in prison, a drastically reduced sentence, and protection in this country for his family. And, only a small fraction of his $2.5 billion cocaine-built fortune was seized. The man originally in charge of Lehder's prosecution believes the deal between the government and Lehder was a travesty.
Robert Merkle contends that Noriega would have been convicted without Lehder.
"First of all, Lehder's testimony was entirely gratuitous and unnecessary for a conviction of Noriega. Secondly, they gave a deal to the guy who was directing the bad activities to convict someone who was following directions.
Merkle, U.S. attorney in Tampa at the time, is appalled by the Lehder case. "I never contemplated any kind of deal with Carlos Lehder," he said. "It never entered my head to even think about it."
But Merkle was overruled by his Justice Department bosses in Washington intent on putting away Noriega.
Born in the United States of a German father and Colombian mother, Lehder began his life of crime as a low-level drug dealer in Michigan. After doing time for a drug-related car theft, Lehder decided to seek his fortune in Colombia.
Barely eking out a living as a car dealer, Lehder decided to cash in on the burgeoning demand for cocaine in the United States in the early 1980s. Using an efficient, high-tech approach to cocaine smuggling that facilitated shipment of the drug in mass quantities, Lehder was soon a rising star. He found a remote landing strip at the southern tip of the Bahamas, Norman Cay, which he secured by bribing Bahamian officials and running off its inhabitants. Jets loaded with cocaine would travel to Norman Cay. The drugs would be reloaded onto smaller planes and dispatched to northern Florida, Georgia and the Carolinas. These unexpected destinations made evasion easier because U.S. authorities were watching only the country's southern borders.
The smuggling operation was an overnight success. Court papers show the first load Lehder shipped in 1982 reaped a $1 million profit for two days of work.
Shortly thereafter, Lehder talked other drug lords into forming a cooperative that became a cartel based in the northwestern industrial city of Medellin.
At the peak of the cartel's power, every hour of every day a jet loaded with as much as 300 kilograms would roll into the Bahamian air strip.
Court papers say Lehder earned $250 to $300 million a year in the early 1980s. He owned 15 cars and trucks, three airplanes, a helicopter, 12 haciendas, an apartment building and nine other properties, including a huge Bavarian-style tourist complex in Colombia's Armenia City, as well as assets throughout the world.
By 1987, his net worth was estimated at more than $2.5 billion.
Violence was as crucial to the cartel's succes