Monthly Archives: November 2014

REQUIRED READING – A BRIEF HISTORY OF THE CIA’S INVOLVEMENT WITH DRUG SMUGGLING – PART 2

The CIA’s Involvement with Drug Smuggling

by Dark Politics (Post 2008) – Part 2 

Map_of_Communist_Base_Areas,_as_used_in_Operation_Menu

The Pegasus Program

The Pegasus program, initiated by President Harry Truman to spy on other CIA units, revealed numerous illegal activities within the agency. Since the time of its inception, the role of Pegasus substantially changed. Pegasus became an integral part of a drug trafficking operation.

Gene “Chip” Tatum was initially recruited as a member of the top secret Pegasus unit during the Vietnam War. He and 13 others were assigned to Operation Rock, a covert action to secretly enter Phnom Penh, Cambodia in January 1971. The unit received its briefings from various CIA operatives as well as from General Alexander Haig and CIA Saigon Chief William Colby. The objective of Pegasus was to destabilize the Cambodian government by sabotaging the city’s airport. They captured and murdered some unarmed North Vietnamese military personnel. Tatum claimed that he and the other 13 members of Operation Red Rock were also to be killed by Montagnard tribesmen under orders of the CIA. Then their bodies were to be “disappeared.” Thus, American involvement in Cambodia could be denied. However, this CIA plot was not carried out, and the members of Operation Red Rock survived.

CIA Director William Colby

CIA Director William Colby

A copy of the “Pegasus files” was given to Congressman Larry McDonald, a member of the Joint Armed Services Committee between 1976 and 1982. McDonald stated that he would reveal startling evidence about the CIA, but ironically, he was killed when KAL 007 was shot down over the Sakhalin Islands.Tatum continued to serve as a CIA operative for the next 20 years. He continued as a member of Pegasus, becoming a deep-cover CIA pilot involved in covert operations, trafficking cocaine during the contra war. Between the early 1980s and 1990 Tatum became directly involved in the drugs-for-arms scam. He claimed that the marked-up arms, which were sold to Iran, were traded for cocaine which was flown back to American bases, especially to Arkansas, Ohio and Colorado.

As a CIA pilot, he was told that he would be contacted by “a man called North.” Col.  Oliver North, who covertly helped to arm the Contras as well as being one of the principle conduits for drug trafficking. Tatum claimed that North’s operation not only involved the Colombian cartels, but it also involved the shipments of cocaine into the United States. In 1985 Tatum flew out of Palmerola Air Base in Honduras. On one flight in February, he was instructed to contact Felix Rodriguez who was a pivotal player in Iran-Contra. Rodriguez informed Tatum that he was to support covert Pegasus missions.

Col Oliver North

Col Oliver North

When Tatum returned to his home base, he contacted North to advise him of the cocaine. North replied that it was “a trophy of war” and that it was not the Contras — but the “Sandinistas … selling it to fund the military.” North added by stating that “the cocaine was bound for the world courts as evidence” against the Sandinistas. Two years earlier, Tatum had flown similar containers, which were labeled “Medical Supplies,” into Little Rock Air Force Base, and the crates were picked up by Dan Lasater, a close friend of the Governor Clinton. Tatum admitted that he flew several missions out of the American base in Honduras and picked up cocaine containers regularly, sometimes violating Nicaraguan airspace. At this time Tatum began to document all Pegasus trips on the back of his flight logs.

Not long after his association with North, Tatum was transferred to New York to set up a money-laundering operation for funds from the Iran-Contra cocaine pipeline. He was named president of three proprietary construction companies: American National Home Builders, American Constructors, and American Homes.In addition to North and Rodriguez, Tatum was to take orders from Amiram Nir, a former Mossad agent and advisor to Vice President Bush. Tatum was ordered to fly a 200 pound sealed cooler, marked “Vaccine,” to a Contra camp on the Honduran border. When the cooler was being transferred to an Air Force C-130 transport plane, it accidentally broke and 100 bags of cocaine were exposed. Not surprised by this discovery, Tatum stated that he had suspected that the CIA was involved in trafficking cocaine two years earlier.

George Bush Sr.

George Bush Sr.

Pegasus also involved the “neutralizing” of pivotal government leaders during the Contra war. For example, a struggle for power emerged among some Contra leaders. The United States supported Adolfo Calero, while Enrique Bermudez also sought a prominent position in the Contra hierarchy. When Bermudez threatened to expose the role of Vice President Bush in drug trafficking, Tatum claimed that Bush ordered Bermudez assassinated. Another assassination was carried out by Pegasus against Honduran General Gustavo Alvarez Martinez, the commander-in-chief of the armed forces. When Alvarez demanded a bigger split of the cocaine profits, he was murdered in 1989. Tatum also admitted his involvement in the assassination of Amiram Nir, a former Israeli Mossad agent. After Nir was called to testify before a Senate subcommittee, his plane was shot down by missiles from Tatum’s helicopter.

Chamorro

Chamorro

Another Pegasus operation occurred soon after the 1990 Nicaraguan elections. President Bush hand-picked Violetta Chamorro to be the new “president,” and it took a 15 party coalition and $12 million from the Bush administration to defeat Sandinista president Daniel Ortega. After Chamorro’s victory, Tatum stated that another Contra leader, whom he would not name, requested that Bush give him a key position in the new government. By refusing to place him in the Chamorro government, Bush put himself in a vulnerable position. This Contra leader could expose Bush’s involvement in drug trafficking. Thus, a Pegasus unit was assigned to disgrace him in early 1990. Pegasus used the odorless and tasteless drug scopolaphine, which would prevents one from recalling anything which occurred while under its spell. Tatum stated that the former Contra leader was invited to a luxury hotel as a guest of Bush. After the CIA administered the drug, the Contra leader was introduced to an attractive “blonde,” and the two went into a bedroom where a hidden video camera recorded their sexual activity. It turned out that the “blonde” was a male prostitute from New York, and he was later killed that evening. According to Tatum, the scopolaphine worked. Weeks later, the Contra leader was given a copy of the video tape which revealed his homosexual acts.

Tatum claimed that in 1992 Bush instructed him to “neutralize,” presidential contender Ross Perot, but he refused to do so. Tatum turned over a copy of an incriminating tape to Bush, explaining that it would not be publicized as long as the plot was not carried out. As recently as 1994, Tatum was contacted by North, Felix Rodriquez, and CIA director William Colby and was told to surrender all documents and tapes. Tatum refused to do so. Tatum had turned whistle blower. The next year, he was charged with treason. At his trial his attorney refused to call even one of the 80 witnesses Tatum had requested. Later, the attorney admitted that he had been pressured by the Department of Defense. The charge of treason was subsequently changed to that of fraud. Tatum was found guilty and was sentenced to serve a 15 month sentence. In March 1996, an additional charge – conspiring to embezzle – was brought against him. Found guilty once again, Tatum was sentenced to a 27 month concurrent sentence.

THE CIA-CONTRA COCAINE TRAIN

CIA Chief Ted Shackley

CIA Chief Ted Shackley

After George Bush succeeded William Colby as the head of the CIA under President Ford, Bush appointed Shackley to be his “Chief of Covert Operations Worldwide.” As the Vietnam War was ending Shackley left Southeast Asia in 1972 to head CIA activities in the Western Hemisphere. One of Shackley’s first assignments was to sent Ed Wilson and Manuel Artime to meet with right-wing dictator Anastasio Somoza of Nicaragua. However, Somoza’s totalitarian regime lasted only another seven years before being overthrown by the Sandinistas.

Guatemala Narco Routes

Guatemala Narco Routes

In the 1980s, 150 tons of cocaine a year were flowing through Latin America. That generated a business of $29 billion a year and was 12 to 13 times more than America’s largest corporations. Prior to the creation of the Contra drug pipeline, the first to profit from drug trafficking were Bolivia’s “cocaine coup” government of 1980-82. They werte followed by the Medellin cartel, the Panamanian government, the Honduran military and Miami-based anti-Castro Cubans. Two months after Reagan’s inauguration in 1981 the CIA launched its secret war in an attempt to overthrow the Sandinista government. Soon thereafter, the arms-drug caper began. The drug of choice in the 1960s and 1970s was heroin — imported from Southeast Asia. Then in the 1980s, the primary addicting drug became cocaine, and its source was Latin America, the new hub of CIA activities.

Richard Armitage - Bush Crony

Richard Armitage – Bush Crony

In December 1981, Vice President Bush met with the National Security Planning Group in the White House. They discussed and approved a $19 million expenditure to Argentina for the creation of a 500 man anti-Sandinista Contra force. In April 1982, Bush met with Australian Labor leader Hayden to discuss the CIA’s involvement with the Nugan Hand Bank in Australia. Nugan Hand was a money-laundering machine for the Southeast Asia heroin operation that began during the Vietnam War. Defense Department spokesman Richard Armitage acted as bagman, carrying cash from Bangkok, Thailand, to Australia.

The first publicly known case of contra cocaine shipments appeared in government files in an October 22, 1982 cable from the CIA’s Directorate of Operations. The cable passed on word that American law enforcement agencies were aware of “links between (a United States religious organization) and two Nicaraguan counter-revolutionary groups (which) involve an exchange in (the United States) of narcotics for arms.” The material in parentheses was inserted by the CIA as part of its declassification of the cable. The name of the religious group remained secret. Over the next several years of the Reagan administration, the CIA learned of other suspected links between the Contras and drug trafficking. Ironically, “the war on drugs” became an important part of Reagan’s domestic agenda. While the United States sent military aid southward to its surrogates fighting the Sandinista government, the rate of cocaine being transported northward into the states quickly escalated. The CIA was involved in a variety of ways — by air, land, and sea — in bringing cocaine into the United States.

George Bush w/ Crack Bag

George Bush w/ Crack Bag

CIA operative Gunther Russbacher, who was highly opposed to drug capers, stated that he was at high level meetings which involved drug dealers in Colombia. Russbacher stated that drug kingpins divided their territory into two large groups, the Cali and Medellin cartels. Operation Snow Cone was the CIA’s primary trafficking operation in Latin America. Under this umbrella, Operation Watch Tower was formed. This consisted of low frequency radio beacons which allowed aircraft, loaded with cocaine, to navigate undetected at low altitudes between Colombia and Panama. The CIA used both Boeing 727s and C-130s which were flown by CIA or commercial pilots. According to Russbacher, two captains from United Airlines and one Pan American pilot supplemented their base salaries by flying drugs into the United States.

In 1984, CIA Inspector General Richard Hitz reported that the CIA even intervened with the Justice Department to block a criminal investigation into a suspected Contra role in a San Francisco-based drug ring. In December 1985, Robert Parry and Brian Barger wrote the first news article disclosing that virtually every Nicaraguan contra group had links to drug trafficking. In that Associated Press dispatch they noted that the CIA knew of at least one case of cocaine profits filtering into the Contra war effort, but that DEA officials in Washington claimed they had never been told of any Contra tie-in. After the AP story was released, the Reagan administration attacked it as unfounded and the article was largely ignored by the rest of the Washington press corps. However, it did help spark an investigation by Kerry. Years later in 1995 the Clinton administration quietly rescinded Casey’s narcotics exemption.

THE CONGRESSIONAL SELECT COMMITTEES.

kerry

In 1987, a year after the Iran-Contra scandal broke, two committees convened on Capitol Hill. In February John Kerry of Massachusetts persuaded the Senate Foreign Relations Committee, of which he was a member, to launch an official investigation under the auspices of the Subcommittee on Terrorism, Narcotics, and International Operations which came to be known as the Kerry committee. Kerry also was able to expand the probe to include the possible role of foreign governments in drug trafficking.

In addition the Senate Select Committee, chaired by Senator Daniel Inouye of Hawaii, also investigated alleged illegalities during the Contra War. The committee called very few witnesses, and those who were called were usually asked superficial questions. American military personnel, business people, and mercenaries kept the Contras supplied while the Boland Amendment forbade military assistance after 1984. However, many of these important players never testified before the Iran-Contra committee. According to Florida federal public defender John Mattes, who investigated the resupply network, the Iran-Contra committee made a mistake in questioning only the high officials and did not talk to the lower echelon personnel who aided in the resupply effort. Mattes said that the Congressional committees went to the conspirators North and Poindexter and merely asked if they did anything wrong or if they were guilty of a crime. They never interviewed any mercenaries to question them whom they worked for.

THE COSTA RICA CONNECTION

Sandanistas

Sandanistas

The arms-for-drugs operation also thrived in Costa Rica. When the Southern Front against the Sandinista government was established in 1983, Costa Rica was ill equipped to deal with the threat posed by the Colombian drug cartels. Costa Rica had no military and its law enforcement remained limited. Its radar system was so poor that contra planes could fly in and out undetected. The government of Costa Rica only employed civil guards who were underpaid and easily bought. By 1985, Associated Press was running stories which stated that the CIA and contras were involved in drug trafficking. Two years later in 1987, CIA chief for Central America, Alan Fiers, testified that numerous people were involved in drug trafficking. Fiers was largely responsible for cutting off CIA aid to Eden Pastora in 1984 when it appeared impossible that he would fall in with the rest of the contras. Fiers testified before a Congressional committee in 1991 that other higher up military and White House personnel were well aware of drug trafficking by the Contras. Fiers testified: “With respect to (drug trafficking) by the Resistance Forces. … It is not a couple of people. It is a lot of people.”

Costa Rica Narco Routes

Costa Rica Narco Routes

The 144-page report included a litany of drug operations out of various Latin American countries. Most of the narcotic traffic was directed by Contra and CIA officials. Morales testified before the Kerry committee that Gary Betzner, his best pilot, flew arms to the Contras from the Fort Lauderdale Airport to Costa Rica. Morales stated that his planes returned frequently loaded with “about 400 or so kilograms of cocaine.” Morales rewarded the Contras with $400,000 in cash and checks in October 1984. By the end of 1985, he swore that cash contributions to the Contras were $4 million to $5 million. When Kerry asked about the origin of the cash, Morales said that “about 100 percent” was drug money. The Kerry report concluded: “There was substantial evidence of drug smuggling through war zones on the part of the Contras, Contra suppliers, Contra pilots, mercenaries who worked for the Contras, and Contra supporters throughout the region.”

El Salvador Civil War

El Salvador Civil War

A number of Costa Ricans also became drug traffickers for the Contras. Jaime “Pillique” Guerra owned a crop dusting service as well as an aircraft business in northern Costa Rica. He refueled and repaired planes which originated in Panama and were carrying weapons to the El Salvador regime in its civil war against the FMLN. These planes carried narcotics as well as weapons. Werner Lotz, one of the pilots, was subsequently convicted of drug smuggling. He explained that the drug traffickers were competing over their share of the profits. He stated that the government guards could be easily bought off. Another Costa Rican pilot was Gerardo Duran, who flew a number of missions for the Contras’ Southern Front. However, the United States eventually severed ties with him after he was indicted for narcotics trafficking. In 1987 he was convicted and imprisoned in Costa Rica.

At a 1986 Costa Rican drug trial, CBS News reported that the United States government presented wiretapped telephone conversations with contra leader Huachen Gonzalez. He discussed the large amounts of cocaine which the contras were sending from Costa Rica to the United States. Also in 1986 the Costa Rican government arrested a Cuban exile carrying 204 kilograms of cocaine from an airstrip. He denied any role in these operations but stated that the Contras had asked him to smuggle in arms.

THE JOHN HULL CONNECTION

Contra War - 1980s

Contra War – 1980s

Hull’s 8,000 acre ranch, located in northern Costa Rica and just south of the Nicaraguan border, was a refueling and storing place for cocaine which originated from the Medellin and Cali cartels in Colombia. Hull was given a $375,000 “loan” to a build a lumber mill on his ranch. He owned six airstrips which served as a base for the shipment of narcotics. He kept the Contras fed and housed. He also claimed that he could account for the Contra money which was handed down by Contra leader Adolfo Calero. In July 1983, Hull traveled to Washington, D.C. to convince members of Congress that Pastora could not be trusted since he was a front for the FDN. One of the offices which he visited was that of Senator Dan Quayle of Indiana He was introduced to Quayle’s assistant, Robert Owen, and to North. Subsequently, Owen resigned from his position with Quayle and started the United Nicaraguan Opposition (UNO).

Contra War

Contra War

One of Pastora’s former pilots, Geraldo Duran, told the Kerry committee that he had been arrested in 1986 in Costa Rica for flying drugs to the United States. When the CIA dropped Pastora in 1984, it had to find another source through which to work. That turned out to be Jorge Morales who conspired with an American, John Hull, who owned a multi-acre farm in northern Costa Rica. A leadership struggle within the FDN developed early in the Contra war. Eventually Pastora, leader of the southern front operating out of Costa Rica, broke ranks with Adolfo Calero who was the White House’s choice to run the Contras. As a result of a leadership struggle in the FDN, Pastora soon fell out of good grace with the umbrella Contra organization which operated out of Honduras.

Honduras Narco Routes

Honduras Narco Routes

Hull was also aided by two Americans, William Crone and Ian Kniloch, the chief of the Contra’s air logistics. Both worked with a paramilitary group known as Huerta Norte. Another Hull neighbor was Bruce Jones who owned a 55-acre ranch next door. Jones testified that Hull received 5,000 rifles, 5 million rounds of ammunition, hand grenades, mines, and mortars from the contras. Jones was a liaison between the CIA and Contras for whom he was supplying millions of dollars in arms. He testified that between May 1982 and May 1984 approximately 100 deliveries of arms and supplies were coordinated by him and Hull. These supplies were kept on Hull’s ranch. Jones maintained that when the planes arrived, he would help unload the drugs and arms in five or ten minutes.

Gen. Richard V Secord

Gen. Richard V Secord

In the 1960s, Ronald Martin worked for the CIA in Miami along with James McCoy, another ex-attaché to Nicaragua. When Contra aid was legally cut by the Boland Amendment in 1984, Martin began organizing North’s role in raising arms for the Contras. However, Martin was shut off when North began to use Richard Secord as the arms broker. According to Calero, Martin and McCoy received $2,095,000 for arms from North. Martin’s attorney stated that the amount was closer to $15 million or $20 million. At least five witnesses testified to the Kerry committee that cocaine was loaded onto planes at John Hull’s ranch. The committee also was told that Hull received $10,000 a month as a courtesy from Oliver North. Yet the Justice Department took no action against Hull for either obstruction of justice or for drug trafficking. In 1989 Hull was arrested in Costa Rica, but the charges against him for trafficking 2,500 kilograms of cocaine were dropped. He was declared a persona non grata and moved to Miami. After 1988 the Justice Department reluctantly indicted some people working for Hull, but soon afterwards these too were dropped.

Felipe Vidal - Cuban Assassin

Felipe Vidal – JM Wave Cuban Assassin

Felipe Vidal and Rene Corvo were Cuban-Americans involved in transporting arms to Hull’s ranch in return for drugs. Revenue from the cocaine was used to purchase military equipment, ammunition, and explosives for the Contras. Corvo testified to the Justice Department that paramilitary supplies were stored in the home of Frank Chanes in Miami and in the garage of Corvo. However, no charges were ever brought against Corvo. Witnesses testified that Corvo stored loaded guns on his premises and that he told friends that he flew clothing and medical supplies to refugees in El Salvador.

Ex-CIA agent Jose Fernandez testified to the Kerry committee that Vidal and Corvo were agency operants. He stated that both were involved in the illicit drug business and that the CIA’s duty was to protect them. Vidal was called a CIA contract agent who had been arrested numerous times in Miami on narcotics and weapons charges. All this evidence gave the Kerry committee adequate evidence to implicate Vidal, Corvo, North, and others as being part of an arms-for-drugs conspiracy. Between 1983 and 1986, numerous pilots made flights out of Hull’s ranch and returned to the United States with millions of dollars in drugs. Many flights landed at Ilopango Air base in El Salvador and at Hull’s ranch. A convicted drug smuggler admitted flying 500 kilograms of cocaine from Hull’s ranch to the United States. “It was arms down, cocaine back . . . with full knowledge of the CIA and DEA.”

John Hull

John Hull

According to the Kerry report, the main front set up by the CIA that operated out of Florida was SETCO Air. This was a CIA-operated company which ran arms down to Honduras and returned with cocaine. The Kerry report stated that SETCO was the principal company used by the contras to transport supplies and personnel to the FDN, carrying at least a million rounds of ammunition, food, supplies, uniforms, and other military supplies for the Contras from 1983 through 1985. Peter Glibbery, a mercenary hired by Hull to train contras on his ranch, told a Costa Rican court that he was arrested after Hull asked him to set up a Contra training camp on his ranch. He was convicted and imprisoned for violating Costa Rican neutrality laws and illegal possession of explosives. Glibbery said that Hull informed him of a proposed bombing plot at the American embassy in San Jose. According to Glibbery, Hull claimed that mines were needed to do the job. However, Glibbery’s account of his experience on the Hull ranch changed. During a trial in a suit brought by Hull against the two American journalists Avirgan and Honey, Glibbery refused to discuss Hull’s involvement in the assassination plot. Glibbery told a Costa Rican court that he had met Hull and Posey in March 1985. The next day, Glibbery said that he flew to Costa Rica with Hull and the mercenaries. He said Hull identified himself as the liaison officer between the CIA and the FDN. Glibbery told Honey and Avirgan that in April 1987 that Hull had threatened to kill him if he did not repudiate the evidence which he had given to the United States federal investigators.

In May 1987, an Iran-Contra select committee team went to San Jose, Costa Rica but failed to interview Hull. It turned out that they merely called him on the telephone from San Jose, just 30 miles from his ranch. Hull never testified to either congressional committee. However, he could have told the congressional committee who ran the operation and who authorized it. Hull could also have responded to allegations that those running the supply lines through his ranch were engaged in drug trafficking. Hull received $10,000 a month from Contra leader Calero, according to public testimony by Owen. Hull also received $800 a month from the CIA to pay for bodyguards during a time the agency was prohibited from using funds to supply the Contras. Thus, no legitimate congressional investigation was ever launched.

CELERINO CASTILLO

Celerino Castillo III - Former DEA Agent

Celerino Castillo III – Former DEA Agent

In 1979, Castillo was hired by the DEA, and after a successful conviction, he was transferred to Central America. After Reagan launched his war against the Sandinistas two years later, Castillo immediately became involved with numerous drug dealers, most of whom were also hired to run arms to the Contras. Castillo’s first encounter was with Socrates Amaury Sofi-Perez, a former Bay of Pigs veteran, who operated a shrimp business in Guatemala City. He smuggled drugs packed in frozen shrimp into Florida and laundered the profits for the Contras. Castillo also had ties to Gerard Latchinian, an international arms dealer. In 1984 Latchinian was arrested for using proceeds from a $10 million cocaine deal to help finance the assassination of Honduran President Roberto Suarez Cordoba. Latchinian’s partner was General Jose Bueso Rosa who helped train Contra soldiers in Honduras.

Luis Posada Carriles

Luis Posada Carriles

Another associate was Luis Posada Carriles who was arrested in the 1970s for carrying out murders while he was an agent for Venezuela’s DISIP or secret police. After bribing himself out of prison in 1985, Posada was flown by the CIA to El Salvador and paid $3,000 a month by the agency. Posada arranged for pilots to fly weapons to Contra bases in El Salvador and Costa Rica as well to bring drugs on their return trips into the United States. Posada also worked with Luis Rodriquez who operated Costa Rica’s Frigoficos de Puntarenas, a shrimp business which was used as a front to provide $260,000 in aid to the Contras.

El Salvador Narco Routes

El Salvador Narco Routes

Hugo Martinez was yet another one of Castillo’s friends who helped to develop flight plans for contra resupply missions. He informed Castillo that most of the pilots bringing weapons into Ilopango as well as to Contra camps in Honduras and Costa Rica were involved in smuggling drugs back to the United States. One such pilot was Carlos Alberto Amador who had a long record of drug trafficking. Another was Carlos Cabezas whose drug runs had been published in the CIA Inspector General’s report which was published in January 1998. At a December 1981 meeting with members of the inspector general’s staff in San Jose, Costa Rica, Cabeza explained how he raised cocaine money for the contras. Present at that meeting was Julio Zavala, involved in the San Francisco “frogman” case where 430 pounds of cocaine were seized near the Golden Gate Bridge. Zavala asked Castillo to be a middle man in collwecting money from San Francisco drug dealers and flying it back to Central America. Cabezas also set up a network of Contra “mules,” such as airline stewardesses, to bring small quantities of cocaine into the United States. Another drug dealer attendung the December 1981 meeting in San Jose, was Troilo Sanchez who instructed Cabezas to deliver drug money to help feed Contra troops and to support their families.

El Salvador

El Salvador

Castillo met with Vice President Bush at a Guatemalan embassy reception in January 1986. Bush asked what his business was in Central America, and he replied that he was investigating cocaine trafficking. He informed Bush that drug trafficking was occurring at Ilopango in El Salvador. Bush responded by smiling as he shook his hand, and then he walked away. In a February 1989 memo to his DEA superior in Guatemala, Castillo detailed how known traffickers with DEA files used two hangars at the American military installation and how they obtained United States visas despite their backgrounds. According to Castillo, the CIA owned one hangar and the NSC ran the other. In 1994 Castillo said that large quantities of cocaine were being brought into the United States to support the Contras. We claimed that he witnessed cocaine shipments and boxes full of money. Castillo maintained that he knew the names of traffickers as well as their destinations, flight paths, tail numbers, and the date and time of each flight. According to the Kerry report a March 1987 memorandum stated that a number of people, who supported the Contras and who participated in contra activity in Texas, Louisiana, California, and Florida, as well as in Honduras, Nicaragua, and Costa Rica, claimed that cocaine was being smuggled into the United States. They stated that it was part of the same infrastructure which procurred and transported weapons for the Contras.

THE GEORGE MORALES CONNECTION

bushsr

In the early 1980s, Morales was a well known contra drug trafficking, transporting cocaine and marijuana from Latin America northward into the United States. In May 1986, Morales was to meet with Vice President Bush to discuss a secret operation. However, the appointment was canceled when the Iran-Contra scandal was about to leak to the public. Morales was dismissed from the CIA and was later was indicted. Morales testified before the Kerry committee that he was well known to Colombian drug traffickers and that his ranch was the key base of an operation which sent cocaine to Miami in exchange for contras arms. Morales also testified that he had delivered 40 M-79 grenade launchers which were flown from Miami to Ilopango Air Base in El Salvador.

Morales also told the Kerry committee that he sent approximately $4 million in drug money to the contras. Morales’ story is corroborated by his pilots such as Gary Betzner who made several runs in 1984 from Florida to airstrips in Costa Rica. On one occasion, Betzner unloaded weapons for Pastora’s Contras and proceeded to load his plane with “seventeen duffle bags and five or six two-foot-square boxes filled with cocaine.” Additionally, pilots Geraldo Duran and Marcos Aquado flew arms missions into Costa Rica between 1982 and 1985 and both cited examples of Morales’ drug connections. In 1986 Duran was arrested in Costa Rica for exporting drugs to the United States. Another pilot who was recruited by Morales was Fabio Ernesto Carrasco who was subpoenaed to testify in a drug trial in Oklahoma City in 1990. Carrasco said that between 1984 and 1985, he flew over five drug missions for Morales and that he carried between 300 and 400 kilos of cocaine into the United States on each flight. Carrasco also testified that he and Betzner flew down weapons for the Contras from Florida and that they returned from Costa Rica loaded with cocaine which had been purchased by Contra leaders Octaviano Cesar and Mario Calero. Many of these missions from the United States ended at the Costa Rican ranch of Hull who Morales said was heavily involved in drug smuggling. Carrasco also said that Morales gave millions of dollars in drug money on 30 to 40 different occasions to Contra leader Adolfo “Popo” Chamorro, the nephew of Violetta Chamorro who was later elected president of Nicaragua. Morales also testified that he gave airplanes and cash to the Contras because Popo Chamorro promised to help him with his legal bills in the United States. Morales offered Popo Chamorro an old DC-3 to carry food, arms, boots, and uniforms to Pastora’s Contra soldiers who were isolated in Costa Rica and needed air support to receive supplies. Pastora was desperate, since Calero and White House had severed relations with him in his struggle for power within the FDN. In 1986, Morales was convicted in prison and died five years later.

THE FELIX RODRIQUEZ CONNECTION

Felix Rodriguez

Felix Rodriguez

Rodriquez began his CIA career in the late 1950s in Florida. After the aborted Bay of Pigs invasion, he was moved to Vietnam where he worked for Gregg and Shackley. Rodriquez returned to the Western Hemisphere in the early 1980s when Reagan launched his covert war in Nicaragua. He was assigned to oversee the Contra supply effort in El Salvador from 1982 to 1986.

In November 1982, Ramon Milan Rodriquez, involved with the Colombian cocaine cartels, made a $3,690,000 payment to the Contras at the request of Felix Rodriguez, in exchange for protection from prosecution. The next year, Gustave Villolda received a letter of recommendation from Gregg as “combat advisor” to the Contras. Villolda worked along side Rodriguez during the Bay of Pigs invasion and the CIA track down and execution of Che Guevara in Bolivia. In 1984 Gerald Latchinian, co-director with Rodriguez of Giro Aviation, a CIA proprietary airline, was arrested for smuggling $10.3 million in cocaine to finance the assassination of Honduran President Roberto Suazo Cordova. Latchinian contended that this was a CIA operation.

RAMON MILIAN RODRIQUEZ

Ramon Milian Rodriguez

Ramon Milian Rodriguez

Rodriquez was a Cuban exile and was the principal accountant for the Medellin cartel, handling $200 million a month in drug profits. His business took him from Colombia to Panama and Florida. He claimed that in the 1972 he carried $200,000 in cash from CIA operant Manuel Artime to some of the burglars arrested at the Watergate Hotel. In 1982 he was recruited by Felix Rodriquez to join the contra network for which he contributed approximately $10 million between 1982 and 1985. When Milian Rodriquez was arrested in 1985, his financial papers were seized. In a column under the heading of “CIA,” Rodriquez had recorded $3.69 million in expenditures. Rodriquez used his Ocean Hunter frozen shrimp company, based in Florida, but owned exclusively by his Costa Rican Frigorificos de Puntanenas firm, to move around about $200,000 in this time frame.

THE SANCHEZ FAMILY CONNECTION AND THE SAN FRANCISCO “FROGMAN”

The Sanchez family first involvement in drug trafficking dated back to the San Francisco “frogman” case in 1983. This operation netted 430 pounds of cocaine from a freighter outside of San Francisco Bay. Its crew admitted that it was running drugs from the Contras in Costa Rica. One was an ex-Somoza air force officer who stated that the profits belonged to the Contras. Another stated that he had given thousands of dollars from the drug smuggling to Costa Rican Contra groups and helped to arrange for the shipment of arms to a small Contra group headed by Fernando Chamorro. The United States returned $36,020, which was seized as drug money, after one of the defendants, Zavala, submitted letters from Contra leaders claiming that the funds were really their property.

The Kerry committee found that two of those arrested had ties to the Contras and had received the cocaine from Colombian sources. The committee report implicated higher up Contra leaders who were involved in narcotics traffic. Several members of the Sanchez family were indicted. Court records showed that the cocaine ring’s source of supply included one of the family members, Troilo Sanchez. He was a relative of Aristides, a member of the FDN directorate who earlier had been caught trafficking cocaine. The “frogman” case resulted in the demise of the Sanchez family.

THE HONDURAS CONNECTION

Area of accused DEA murders

Area of accused DEA murders

 

Honduras had been the classic example of a banana republic. Most of its economy was controlled by United Fruit and Standard Fruit. New Orleans ran its economy, and soon banana trade routes became drug routes. In 1975, Honduran president General Oswaldo Lopez Arellano received $1.5 million in bribes from the American multinational companies, and in return never paid export taxes amounting to $7.5 million.In the 1980s, Honduras accounted for approximately 20 percent of the cocaine imported by the United States. Costa Rica supplied about 10 percent of America’s cocaine. Between 1982 and 1987, the Reagan administration pumped in $335 million in military aid and $836 million in “economic” aid to Honduras. A Christian Democrat in Honduras’ congress stated that Washington would merely ignore any questions about drug trafficking.

Honduras Narco Routes

Honduras Narco Routes

Reagan administration officials interceded on behalf of Jos Bueso Rosa, a Honduran general who was heavily involved with the CIA’s Contra operations and faced trial for his role in a massive drug shipment to the United States. In 1984, Bueso and co-conspirators plotted to assassinate Honduran President Roberto Suazo Cordoba This was to be financed with a $40 million cocaine shipment to the United States, which the FBI intercepted in Florida. According to declassified e-mail messages North led an effort to seek leniency for Bueso. The messages indicated the efforts of American officials to “cabal quietly” to get Bueso a “pardon, clemency, deportation, (or) reduced sentence.” Eventually they succeeded in getting Bueso a short sentence in “Club Fed,” a white collar prison in Florida. The Kerry committee report reviewed the case and noted that Bueso was involved in a conspiracy that the Justice Department deemed the most significant case of narco-terrorism ever discovered.

THE MATTA-SETCO-CALERO CONNECTION

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This arms for drugs caper emerged in 1983 when Calero was placed in charge of the contras operating out of Honduras. It was at this time that Eden Pastora in Costa Rica was cut off the CIA payroll. Juan Ramon Matta Ballesteros was a well-known drug dealer who spent part of the 1970s in a Colombian prison. He returned to Honduras in 1986 after bribing his way out of jail with $2 million. The DEA knew about Matta by 1978 when he was arrested at Dulles airport with 54 pounds of cocaine. However, by 1983 SETCO Matta’s air freight company was used by the Contras to run arms to the Contras in Honduras. According to the Kerry report SETCO was being used as the Contras’ main supplier of weapons in 1984. For these services, Matta was paid by North. The Kerry report also stated: “One of the pilots selected to fly Contra mission for the FDN (Contras) for SETCO was Frank Moss, who was under investigation as an alleged drug trafficker since 1979.” Two years after Iran-Contra broke in the United States the Justice Department extradited Matta who was a suspect in the murder of DEA agent Enrique Camarena in Mexico.

In July 1985, Michael Tolliver, a convicted American drug smuggler who was at a Georgia halfway house, was contacted by Barry Seal. Seal had contacts with the CIA and was released from prison early. He was told that he would receive $75,000 a trip if he were to fly arms from Miami’s airport into Honduras. According to Tolliver, Seal had 28,000 pounds of marijuana when he arrived at Homestead Air Base in Florida. Upon returning from Central America, Seal met “Hernandez” at the Fountainbleau Hotel and was paid $75,000. In October, FBI agents seized 763 pounds of cocaine with a wholesale value of $10 million in southern Florida. Among those arrested was Honduras’ former chief of staff of the army, General Bueso Rosa. In 1987, United States officials confiscated two shipments of cocaine weighing 6.7 tons. United States government investigators stated that it went directly to the doorstep of the Honduran military. The cocaine originated from the Cali cartel with whom Matta dealt directly. In 1987, the DEA had information which linked five top Honduran military officers with drug trafficking but was persuaded not to act since it may have endangered Honduran cooperation in the Contra war. By 1987, it was estimated that Honduras accounted for 20 to 50 percent of all cocaine which entered the United States from Latin America.

THE CUBAN-AMERICAN CONNECTION.

Bay of Pigs

Bay of Pigs

Several groups of Miami-based Cuban-Americans provided direct or indirect support to the Contras when it was prohibited by the Boland Amendment. Rene Corbo was one who provided supplies and training with funds in part from drug money. Two other Cuban exiles, Mario Rejas Lavas and Ubaldo Hernandez Perez, were captured by Sandinistas in 1986. They were reportedly members of UNO/FARN which was headed by Fernando “El Nego” Chamorro. When the Kerry committee requested information on these Cuban-Americans, the Justice Department refused to provide any information on the grounds that the committee was merely carelessly rambling through its open investigations. The Justice Department advised this committee that the matter had been fully investigated and that the committee’s allegations were untrue. In May 1986, members of the Kerry committee met with CIA officials who categorically denied that weapons had been shipped to the Contras on planes involving Corvo. Yet the FBI had learned that Cuban-American supporters had shipped weapons from south Florida to Ilopango Air Base in Honduras as well as to John Hull’s ranch in Costa Rica.

THE DAN QUAYLE-ROBERT OWEN CONNECTION

Dan Quayle

Dan Quayle

Hull came to the United States in 1983 to convince Congress that Pastora should not be supported since he had allied himself with the Sandinista government. Hull met with Senator Quayle and Owen, his legislative aide. A year later Owen switched jobs and began to work for the Washington D.C. lobbying firm of Gray and Company. He was approached by Contra leader Calero who asked him to take on the task of raising money in the United States through non-profit organizations and companies for the Contras.Owen researched the financial and military needs of the Contras and passed the information on to North. Owen reported that between $1 million and $1.5 million was required on a monthly basis to keep the Contras equipped. In July 1984 purchased weapons from South Africa and returned to the United States where he met with Hull and Calero. Owen promised to provide Calero with $2,500 a month and Hull with $10,000 a month.

Owen also worked primarily with Neil Livingstone, who was responsible to Ed Wilson of the CIA. Additionally, he was North’s liaison, delivering Swiss bank account numbers to Taiwanese government officials who in turn made contributions to the Contras. In April 1985 Owen warned North that Costa Rican-based Contra leader Jose Robelo had the “potential involvement in drug running” and that another Contra, Sebastian Gonzalez, was “involved in drug running out of Panama.” In August 1985 North told Owen that the “DC-6 which is being used for runs out of New Orleans is probably being used for drug runs into the United States.” In February 1986 Owen informed North that another Contra DC-4 was “used at one time to run drugs, and part of the crew had criminal records. Nice group the Boys (the CIA) chose.” Frank Castro, an ex-Cuban and Bay of Pigs veteran, was indicted in the 1970s for smuggling more than a million pounds of marijuana to the United States. Owen stated that Castro was heavily into drugs and that he had furnished Pastora with a DC-3 plane. Castro also hade visited Hull’s ranch in Costa Rica. The Kerry report also corroborated the allegations linking together North and Castro as part of a conspiracy to both gunrunning and drug trafficking.

THE EL SALVADOR CONNECTION

Col. James Steele

Col. James Steele

Colonel James Steele was the chief American military adviser in El Salvador and senior officer in charge of United States military operations which provided the Contras with weapons out of Ilopango airport. In December 1984, National Security adviser Gregg met with Felix Rodriguez and was given a position in El Salvador as a contra military advisor. The next month Rodriguez met with Bush to discuss the Contra job. In the summer of 1985 Rodriguez flew to Washington D.C. to meet with Gregg and Steele. According to Rodriquez’s testimony before the Kerry committee in 1987, Steele was in contact with Rodriguez from September 1985 through summer 1986. A North memorandum stated that Steele made Rodriguez his deputy and allowed him to use a military car as well as a KL-43 encrption device for secure telephone conversations. In March 1986, Steele met in Honduras with Rob Owen, North’s associate directing the Contra resupply operation from bases in Costa Rica. In a memo to North after the meeting, Owen suggested stockpiling weapons for the contras in Costa Rica at “Cincinnati,” a code word for the United States air base at Ilopango, El Salvador, where Steele was the American commander.

According to a crew member aboard a flight dropping supplies to the Contras in April 1986, Steele helped guide the mission. Nine days later after approximately 10 flights dropped arms and equipment to the southern front, Steele met with North, Secord and retired Colonel Richard Gadd in El Salvador. Gadd stated that Steele’s role suggested that higher officials in the Pentagon may have known and participated in the resupply effort. Mattes claimed that Steele could have testified as to whose authority that he operated in assisting the Contras during a time when the Boland Amendment was in place. Attorneys for the select committees deposed Steele in April 1987, but he was not called to the witness table.

THE PANAMA CONNECTION

Noriega in Call of Duty

Noriega in Call of Duty

Before he seized power as head of state, Manuel Noriega was first recruited by the United States Defense Intelligence Agency in 1959 while studying in Peru. By 1967 he was placed on the CIA payroll. At this time, he worked in conjunction with the United States military, which used Panama as a listening post in Latin America. After a failed coup in 1971 General Omar Torillos, who later became dictator, fled to Miami where he stated that Noriega had “operational control” of the narcotics trade through Panama.The Justice Department dropped the idea to attempt to indict Noriega. In 1976 Noriega was placed on the CIA payroll again, this time at $110,000 a year. When Carter was elected, Noriega was again dropped from the CIA. Carter’s major objective was to pass the Panama Canal Treaty, so all allegations against Noriega were suppressed. However, once the treaty was ratified by the Senate, the Panamanians got the word that America was open for drug trade. In 1980 Noriega was given full control over a special Panamanian intelligence unit. Noriega supplied at least seven pilots to run arms down from Florida. The pilots returned with cocaine.

The real Noriega

The real Noriega

Panama Narco Routes

Panama Narco Routes

When Reagan took office in 1981, Noriega was immediately brought back by the CIA. His salary was increased, and his salary jumped to $185,000 a year, and by 1985 it reached $200,000. The CIA deposited Noriega’s illegal payoffs in the Bank of Credit and Commerce International (BCCI), whose name made front page news in the summer of 1991 for laundering money. CIA Director Casey began meeting with Noriega in 1981. Noriega was paid $100,000 for the use of Panama as a middle country to run drugs from Colombia to the United States. His personal pilot, Floyd Carlton, stated that he received $400 per kilogram to run cocaine from Colombia into Panama. However, things turned sour for Carlton in 1985 when $3 million in cocaine was missing on flights into Costa Rica.Noriega supplied pilots and urged Pastora to unite with the Contra organization in Honduras. By 1985, Noriega promised to train Contras in Panama. Noriega met with North in London to discuss plans to set up training for booby trapping, night operations, and sabotage activities against Nicaraguan targets. Noriega stated that he would try to obtain Israeli commandos to work with the Contras. The Kerry report stated: “Noriega put his pilots to work flying weapons from Panama to Costa Rica for the Contras. …Many of the pilots moved mixed cargoes of guns and drugs to bases in Costa Rica, dropped off the guns and flew on to the United States with drugs.”

Invasion of Panama

Invasion of Panama

In 1986 the Iran-Contra scandal broke, now making Noriega expendable. The next year his personal pilot, Carlton, was extradited to the United States. In 1988 Noriega himself was indicted by the Justice Department and was linked to drug trafficking for the first time. The following year the United States invaded Panama, and Noriega was kidnapped and taken to Miami for his trial. The CIA never turned his files over to the Justice Department. After Noriega was brought to the United States, the Bush administration placed Guillermo Endara in power. Endara was director and secretary of Banco Interoceanico which had been targeted by the DEA and FBI, and he named Carlton as a major person who laundered money through that bank from the Medellin and Cali cartels. The CIA also used Banco de Ibereoamerica as a front through which to launder money in Panama. Through this dummy company, North purchased arms from a Syrian drug and arms dealer, Manzer al-Kasser, who had ties to the Medellin cartel.

Bush and Noriega

Bush and Noriega

THE VENEZUELA CONNECTION

Davila

Davila

In 1988, the CIA hired General Ramon Guillen Davila to investigate Venezuela’s drug enterprises, primarily the Cali cartel. With the help of the CIA, Guillen set up a drug smuggling operation which involved Venezuelan National Guardsmen. They purchased cocaine from the Cali cartel in Colombia, imported it to Venezuela, and stored it in warehouses which were run by Guillen and funded by the CIA. One CIA agent said “let the dope walk;” that is, to ship it northward into the United States. Another agent, Mark McFarlin, testified in Miami federal court in 1989 that he had informed the Caracas CIA agent chief that 3,000 pounds of cocaine had just been shipped to the United States. When the agent chief was informed that the DEA was unaware of the operation, he responded by telling McFarlane, “Let’s keep it that way.”

map-drug-traffic-624

Between 1989 and 1992, 22 tons of cocaine flowed from the Guillen network into the Miami. In 1990, DEA agents in Caracas were informed of the illicit activity and made no attempt to intervene. Finally in 1992, United States Customs in Miami terminated the operation when they seized an 800 pound cocaine shipment. One of Guillen’s dealers, Adolfo Romero, was arrested and convicted on drug conspiracy charges. No action was taken against Guillen’s organization, and he simply dropped out of contact with the CIA. In November 1996, the Justice Department indicted Guillen on charges of importing cocaine into the United States. Guillen headed Venezuela’s anti-drug unit while smuggling over 22 tons of Cali and Bogata cartel cocaine into the United States and Europe. After he learned of his indictment, he went into seclusion in Caracas where he received a federal pardon. Guillen contended that Venezuelan cocaine shipments to the United States were authorized by the CIA. He said, “Some drugs were lost and neither the CIA nor the DEA want to accept any responsibility for it.”

EUGENE HASENFUS

Eugene Hasenfus

Eugene Hasenfus

CIA operant Hasenfus was a “kicker” on a C-123 cargo plane which ran shipments to the Contras over Nicaragua. He would “kick out” the cargo which then parachuted down to the Contras in the field. When the plane was shot down by a hand-held surface-to-air missile, Hasenfus was able to parachute out. The plane’s crew also consisted of a Contra radio operator, American pilot Bill Cooper, and copilot Wallace “Buzz” Sawyer. Sawyer had in his possession the White House phone number of Vice President Bush. Telephone logs from the phone company in El Salvador for the “safe houses” used by the plane crew showed many calls to North’s White House office. Bush’s office was the first place notified after the C-123 crashed. Hasenfus claimed that this was done with the knowledge and approval of Bush. Telephone logs from the phone company in El Salvador used by the plane crew showed many calls to North’s White House office.

It was discovered that the plane was the same C-123 which had been used by Seal to run drugs into the United States. Earlier in 1983, Harry Doan had sold the C-123 to Seal who flew it to Rickenbacker Air Force Base in Ohio. It was there that it was outfitted with hidden cameras by the CIA. Seal then piloted the aircraft to Nicaragua and returned with 1,472 pounds of cocaine. The cameras filmed Federico Vaughan, who was an employee of the Nicaraguan Interior Ministry, helping load cocaine into the plane. Also, the plane’s logs indicated it had flown out of Colombia, home to the Medellin and Cali drug cartels. Flight logs in the plane indicated that it had made trips between Barranquilla, Colombia and Florida in 1985.

Only days after the downing of the aircraft Hasenfus told Nicaraguan authorities that “there were two Cuban nationalized Americans that worked for the CIA that did most of the coordination of the flights and overseeing all operation projects, transportation… also refueling and…flight plans.” Hasenfus identified the two as Felix Rodriguez and Ramon Medina. After Hasenfus was released by the Sandinistas several weeks later, he returned to the United States and testified that he worked for the CIA and that he reported to Gomez (alias Felix Rodriguez) and Medina (alias Luis Posada Carriles) with the knowledge and approval of Bush.

A Reagan administration official, who was familiar with contra activities, claimed that the crew of the C-123 was flying supply missions for the State Department’s Nicaraguan Humanitarian Assistance Office, which was responsible for providing $27 million in nonlethal aid to the Contras earlier in 1985.The Kerry committee learned that Southern Air Transport of Miami had provided the plane. Southern Air denied any knowledge, and no charges were brought against this front. The CIA denied any knowledge of Hasenfus and also stated that he was working outside the jurisdiction of the federal government. After several weeks, Hasenfus was released and returned to the United States where he subsequently received no aid or support by the government.

– The Green Chazzan 

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Required Reading – A Brief History of The CIA’s Involvement With Drug Smuggling – Part 1

**EDITOR: This piece starts to bring the whole room together. As one can see, it was OSS China that initiated the global narcotics trade after World War II and sustained it for decades to come using their influence over CIA covert action and US foreign policy.

The CIA’s Involvement with Drug Smuggling by Dark Politics (Post 2008) – Part 1 

Opium Finds Its Way To Asia

Chinese Opium Den

Chinese Opium Den

The origin of opium can be traced back to the Middle East region of Mesopotamia circa 3100 B.C. Centuries later Alexander the Great exported the narcotic eastward to India in 330 B.C. By 400 A.D. it became a large market in China where it was introduced by Arab traders.

Southeast Asia got its first dose of opium in 1500 when Portuguese, while trading along the East China Sea, initiated the smoking of opium. Within two centuries the Dutch were exporting shipments of Indian opium to China and the islands of Southeast Asia. In 1729, Chinese emperor Yung Cheng issued an edict which prohibited the smoking of opium and its domestic sale, except under license for use as medicine. Nevertheless, the use of opium increased, and by 1750 the British East India Company assumed control of Bengal and Bihar, the opium-growing districts of India. British shipping dominated the opium trade out of Calcutta to China. By 1767, opium exports by the British East India Company to China reached a staggering two thousand chests of opium per year. In 1793, the British East India Company established a monopoly on the opium trade. All poppy growers in India were forbidden to sell opium to competitor trading companies.

In 1799, Chinese emperor Kia King banned opium completely, making trade and poppy cultivation illegal. Foreign merchants then turned to smuggling. Charles Cabot, a smuggler from Boston, Massachusetts, attempted to purchase opium from the British and then smuggle it into China under the auspices of British smugglers. Another American, John Cushing, acquired his wealth from smuggling Turkish opium to Canton. For example, John Jacob Astor of New York City and owner of the American Fur Company purchased ten tons of Turkish opium which he shipped on to Canton.

The First Opium War

The First Opium War

In 1839, the first Opium War broke out, and the Chinese ordered all foreign traders to surrender their opium. The British responded by sending warships to China. Two years later, the Chinese were defeated by the British which demanded heavy reparations, including the cession of Hong Kong to Great Britain The Second Opium War erupted in 1856, and the British again demanded indemnities from China, forcing the emperor to legalize opium. By the turn of the century and after 150 years of failed attempts to rid the country of opium, the Chinese finally convinced the British to dismantle the India-China opium trade. In the 1850s, British merchants began importing Indian opium to Burma and selling it through a government-controlled monopoly. In 1886, the British acquired Burma’s northeast region, Shan state. Production and smuggling of opium along the lower region of Burma thrived despite British efforts to maintain a strict monopoly on the opium trade.

By the turn of the century, the French joined the British in monopolizing opium in Southeast Asia. In the 1940s, the ‘Golden Triangle’ — Burma, Laos, and Thailand — became a major player in the profitable opium trade. During the early years of World War II, opium trade routes were blocked and the flow of opium from India and Persia was cut off. Fearful of losing their opium monopoly, the French encouraged Hmong farmers to expand their opium production. After Burma gained its independence from Britain in the 1940s, opium cultivation and trade flourished in the Shan states.

Early Complicity in Drug Trafficking

oss-office-of-strategic-services-78641357

The “multinational” business of drug trafficking can be traced back to the 1940s, even before the CIA was created following World War II. Before the creation of the CIA in 1947, Allen Dulles assembled the Flying Tigers, an inner clique within the Office of Strategic Services (OSS). Dulles had close ties with Eastern billionaire families, and he was able to run clandestine operations out of the White House. The OSS-mafia alliance emerged soon after the agency was formed. The OSS was first headed by Earl Brennan who helped plan the Allied invasion of Sicily and Italy in World War II. During the war, He had close ties with the head of the Vatican’s Vessel Operation, Monsignor Giovanni Batista Montini who was also an aid to Pope Pius XII. Montini suggested that Brennan recruit Italian exiles such as Masons business leaders, and mafia members to corroborate with the Allies in their invasion. In 1963, Montini become Pope Paul VI.

Colonel Paul Hellwell of the OSS began to smuggle heroin from Burma and sold it in ghettos in the United States. Grown in Burma and processed in Shanghai, OSS agents ran across this bonanza while attempting to bolster the right wing regime of Chiang Kai-shek and to prevent Mao Tse Tung from ascending to power. Flying Tigers were OSS mercenaries who were financed with secret funds. Hellwell observed how Chiang sold opium to Chinese addicts and used the revenue to purchase weapons for his troops. Hellwell created Sea Supply, an OSS proprietary company, out of Miami and used it to carry guns across the ocean to China. The opium was grown in Burma, so Hellwell moved on to Southeast Asia in order to consolidate his operation.

Chief of OSS China - Paul Helliwell

Chief of OSS China – Paul Helliwell

In the late 1940s, Hellwell was named the Burmese consulate in Miami and was able to secure a monopoly on opium in Burma. From there, opium was processed in Shanghai, and then it was exported to the United States on Sea Supply boats. In return, Hellwell shipped guns back to China. The OSS used the mob to distribute heroin in big cities throughout the United States. Another OSS connection was the German Gestapo. Dozens of leading Gestapo figures and SS spies were used. Their spy networks and personal war records could be used to survey and control the Soviet Union. After these Nazis arrived in Georgetown, they were used by the newly created CIA in a drug running role. They were educated at Fort Benning and then used extensively in Latin America by local militaries. They were partially funded by the revenue generated from Burmese heroin exported to China for refining, and then exported to ghettos in the United States. After Mao solidified his power in 1949 revolution, drug trafficking in China began to diminish, partially because the death penalty was carried out against convicted dealers.

The OSS did not confine itself only to the Far East. While the bulk of American heroin originated in Asia, smaller amounts were produced in Marseille by the Corsican syndicates in the 1940s. Drug trafficking was certainly not at a premium during World War II. Transoceanic shipping was disrupted during the war years as a result of submarine warfare. Consequently, the power of Marseilles’ Corsican syndicates was weakened. In addition, Sicily’s mafia was smashed by two decades of Mussolini’s repressive regime.

The Marseilles Syndicate

The Marseilles Syndicate

After World War II, the OSS created a situation which helped revive the Sicilian-American mafia and the Corsican underworld. The alliance with the mafia was maintained by the CIA in order to check the growing strength of the Italian Communist Party. For example, the Corsicans in Marseilles smuggled raw opium from Turkey and refined it into high grade heroin for export to the United States. Marseilles relied on a handful of expert chemists who were able to produce high grade number four heroin. After the transformation of the OSS into the CIA, Marseille’s Corsicans fell under the protection of the French intelligence service which allowed heroin trafficking to operate for another 20 years. By 1965, Marseilles syndicates were able to double their production and operated between 20 and 25 laboratories which produced 50 to 150 kilograms of heroin each month. It was estimated that 4.8 tons of pure heroin was exported to the United States in 1965 alone.

The American government was concerned that both the French and Italian communist parties would rise to power in free elections in their respective countries. On the homefront, the government was concerned of the rising strength of the New York longshoremen’s union and a series of strikes which threatening to erupt a year after World War II ended. To counter the communist parties’ influence in France and Italy as well as to stamp out the longshoremen’s power in New York, the newly formed CIA turned to the mafia’s drug traffickers. The mafia connection assured the CIA the resources which they critically needed: hit-men to help carry out their illicit operations and additional funds to help finance their activities.

Santo Trafficante

Santo Trafficante

After spending 10 years of a 30-to-50 year sentence in prison for drug trafficking, New York’s mafia leader Lucky Luciano given clemency and released from Albany’s Great Meadows Prison in 1946. In exchange, he promised to cooperate with American authorities. He returned to Italy and was able to build a black market which had been abandoned by the Genovese family. He then expanded his operations by forging close ties with the Marseilles syndicate. He imported raw opium from the Middle East and processed it in laboratories in Italy. Luciano’s top deputy was Meyer Lansky who had first contacted Cuban dictator Fulgencio Batista. Luciano initially purchased 200 kilos of heroin and shipped it on to Cuba. Lansky was given a monopoly on Cuba’s gambling operations plus assurances that Sicilian heroin could be shipped from Marseilles to Havana and on to the United States. In return Batista and his assistants received half the profits from the casinos. Lansky and Luciano chose Sicilian-born Santos Trafficante of Florida to run the Cuban gambling and drug business. Luciano made sure that Havana’s prostitutes were addicted to heroin and paid them with diluted forms of the drugs as well.

Meyer Lansky

Meyer Lansky

The CIA armed and funded the Corsican syndicates to break up longshoremen’s strikes in 1947 and 1950. Harry Bridges had been known for his leadership in general strikes in San Francisco in 1934, and he moved on to New York City where he worked to unionize dock workers. The CIA paid the mafia to assault and harass union leaders and workers. Some were even murdered. The CIA also used psychological warfare against the unions. Anti-union pamphlets, radio broadcasts, and posters discouraged workers from continuing the strike. Meanwhile in Europe, the CIA continued to work with drug traffickers in its war to thwart the election of communists in democratic elections. By the late 1940s, Marseilles had become the postwar heroin capital of the Western world. And Italy’s mafia still maintained its strength as the most powerful component in Europe.

The CIA’s protection of the Corsican syndicate continued into the 1970s. Frank Matthews, one of the East Coast’s prime heroin dealers, brought in $130 million annually. In 1973, he was finally arrested for drug trafficking in Las Vegas. Matthews was released on $325,000 bail and returned to New York with $20 million in cash. According to the Justice Department charges against nine of his suppliers were dropped at the insistence of the CIA which contended that prosecutions would jeopardize national security interests.

From Florida to Asia

Allen Dulles

Allen Dulles

The Italian mafia continued to maintain a stronghold in the United States. In the 1950s, the CIA once again turned to the mafia to foil communism — this time in Cuba. The very year that the right wing Batista government was overthrown, Operation 40 was organized as an assassination unit to kill Fidel Castro. Organized crime leaders Santo Trafficante and John Roselli, with the knowledge of Vice President Nixon, were heavily involved in importing drugs from Laos. After the failure at the Bay of Pigs two years later, Operation 40 was replaced by Operation Mongoose, a larger scale paramilitary organization. Its purpose was also to overthrow the Castro regime. The CIA officials who directed Operation Mongoose were Theodore Shackley and Thomas Clines. Felix Rodriguez, a Cuban refugee, was hired to be a member of a special assassination team. Rodriguez worked under Shackley in Miami, Florida. After the Bay of Pigs fiasco, dozens of anti-Castro sympathizers were indicted for drug trafficking.

CIA Chief Ted Shackley

CIA Chief Ted Shackley

After the defeat of the French at Dienbienphu in 1954, the United States quickly moved to fill the void. In that decade, over a thousand tons of opium was being cultivated in the Golden Triangle — Laos, Burma, and Thailand. This amounted to 70 percent of the entire world’s illicit opium supply. In addition, this marked the first time that number three heroin (three to six percent pure) was being refined. As a result, the Thai government launched an opium suppression campaign which compelled most of the planters to switch to heroin. In the 1960s large quantities of number three heroin were being refined in Bangkok and northern Thailand. It was during this decade that both Shackley and Clines were transferred from Florida to run CIA operations in the heart of Southeast Asia as well as in the heart of the world’s largest heroin region.

During the Vietnam War, the White House drug team was headed by Lucien Conein who once had ties to Corsican drug dealers in Southeast Asia and Marseilles. The CIA urged Conein and the White House to accept a plan to carry out a series of assassinations against drug kingpins. According to a White House memo, “With 150 key assassinations the entire heroin-refining industry can be thrown into chaos.” However, the CIA’s list included a hand-full of names of drug dealers in Southeast Asia, and none of them were the principal players. Additionally, the White House decided to concentrate in Turkey where less than 5 percent of the world’s opium supply was grown.

The Golden Triangle

Opium in the Golden Triangle

Opium in the Golden Triangle

During the heated cold war in Southeast Asia in the 1950s, large scale decisions were made by the CIA in its Langley, Virginia headquarters. The agency’s operants were given a large scale of autonomy in the field. The agency did not ask questions as long as those on the payroll produced results. One of the major objectives of these factions was to gain control of opium trade in their regions. A large amount of duplicity, which included tortures and murders, occurred among various groups: CIA headquarters, its operatives in the field, and drug lords.

After World War II the French returned to Indo-China and became directly involved in drug trade with the Hmong tribesmen in the highlands of Laos. At first, the French attempted to eliminate opium addiction in 1946. However, desperately short on funds, French intelligence and paramilitary organizations became involved in opium trafficking in order to finance their covert operations against Ho Chi Minh in the north. By 1951, French intelligence controlled most of the opium trade in the region. The French started top secret Operation X which resulted in a steady supply of Hmong opium into the dens of cities such as Saigon and Danang.

In 1950 President Truman implemented the Office of Policy Coordination (OPC) which approved a CIA invasion into southern China. This meant that CIA operants need to infiltrate various local tribal units particularly in the Golden Triangle — Burma, Laos, and Thailand. The CIA recruited agents such as William Colby who years later was elevated to CIA director. When CIA operants moved into the Shan states in the Golden Triangle region of northern Burma, opium growers operated only randomly. However, the region soon was transformed into one of the largest growing opium regions in the world. The CIA needed an alliance with the KMT, which had just been driven out of China by Mao Tse-tung a year before, and the Thai police in order to bolster its position in the region.

CIA Director William Colby

CIA Director William Colby

The KMT exported their opium harvests usually by mule train across the mountains or by unmarked American C-47 transportation planes to Thailand for processing. Some was flown on to Taiwan. In 1950 the CIA purchased bankrupt Civil Air Transport (CAT) for $950,000 and used their fleet of planes to run weapons to KMT General Li Mi in Shan province, and the planes returned to Bangkok filled with opium. Shortly afterwards, CAT was renamed Air America. General Phao Siyanan, head of the Thai police since a CIA orchestrated coup overthrew General Phin Choohannan in 1948, purchased most of this opium. Thus, the KMT became a pivotal force in opium trade in Southeast Asia. With CIA support, the KMT remained in northern Burma until 1961 when the Burmese army finally drove the right wing army into Laos and Thailand.

In 1951, Operation Paperclip, a joint CIA-KMT effort to reconquer China’s Yunnan province, was approved. The CIA’s first objective was to accomplish an intelligence-gathering mission inside China. In addition, the CIA trained and funded 10,000 KMT forces. Unmarked C-46 and C-47 transport planes began making supply drops into northern Burma. The next year KMT troops and some CIA operants crossed 60 miles into China but were forced to turn back after facing fierce resistance. The CIA also realized the importance of funding other smaller factions in the Shan states, so that no one element could consolidate absolute power in that region. Maintaining instability in the Golden Triangle prevented any one group from controlling and regulating opium trade.

General Khun Sa

General Khun Sa

However, American aid to the KMT soon dropped off significantly when drug lord Khun Sa began to extend his influence in the mountainous region of the Shan states just south of China. Khun Sa began his military career with the KMT when he was 18 years old and was trained in both arms and opium by the CIA-supported army. As Khun Sa extended his influence into the Shan states, the CIA was slowly edged out along the Burma-China border, and were no longer able to use that area too stage subsequent attacks into Yunnan province.

In the 1960s, thousands of KMT mercenaries made their way across the mountains of the Golden Triangle to eastern Burma. Khun Sa’s army was defeated by KMT General Ouane Rattikone in the 1967 Opium War, and his troops fled into central Laos. Khun Sa was arrested and released at a later date, but by that time the size of his army had dwindled to about one thousand. Khun Sa not only lost major casualties among his troops, but he also lost his monopoly on opium trade in the Shan states.The Opium War left Rattikone and the KMT in control of 80 percent of the opium trade in Burma. During the duration of the KMT’s dominance in northern Burma — from the end of World War II to 1960s — his CIA subsidized army increased opium production by nearly 500 percent from 80 tons to 500 tons annually. The Golden Triangle provided approximately 33 percent of the world’s illicit opium trade.

The severe drought of 1978-80 took a heavy toll on illicit drug trafficking in the Golden Triangle. However, by the 1980s, opium trade became the most prosperous ever in that region. Even though Thai and Burmese military operations increased, heroin laboratories in the mountains in the two countries managed to operate without serious incidents. The Shan leaders became more splintered, and the Burmese Communist Party (BCP) collapsed. This opened the door for Khun Sa to return to the Shan states.

General Lo Hsing Han of Burma

General Lo Hsing Han of Burma

By the early 1970s, he recovered his lost territory in the central Shan states, but the BCP quickly moved into the mountain areas just south of the China border, posing a large threat to Khun Sa expansionist policy. Three factions began to position themselves: Khun Sa, Chinese warlord Lo Hsing-han, and the Shan State Army (SSA). Like Khun Sa, Lo Hsing-han began his army career in the KMT and emerged as one of the principle opium dealers in Shan province. In 1972, the Nixon administration branded him the “kingpin of the heroin traffic in Southeast Asia.” After Khun Sa was defeated in the 1967 Opium War, Lo Hsing-han became the largest single opium merchant in the province. The SSA was founded in 1958 and was political in nature. Its chief concern was to regain Ragoon and to abolish Shan authority in that region. It was not directly involved in opium trade. The size of its army was 2,700 and the troops were armed with American weapons which were purchased on the black market.

TOR-Routes-chinoises-et-indiennes

Golden Triangle – North

 

In 1973, the Burmese government disbanded its militia groups in Shan province. In an effort to consolidate his power in the region, Lo Hsing-han turned to moderate elements in the SSA for support in controlling. The two groups proposed that officials at the American embassy in Bangkok be informed that they intended to sell 400 tons of Shan opium for $20 million. The two groups also requested American support for the purchase of all opium controlled by smaller Shan factions in the Golden Triangle at a fixed price. They insisted that this would eliminate all heroin trade in the area. However, Lo Hsing-han was arrested in 1973 by Burmese officials and charged him with — not drug trafficking — but high treason and rebellion. The following year, the Burmese government released Khun Sa, who had spent five years in solitary confinement, and returned him to his troops in Shan province. Now Khun Sa easily replaced Lo Hsing-han as the drug kingpin in the Golden Triangle.

TOR-Routes-Nord-Thaïlande

Golden Triangle Center

 

Khun Sa forged ahead by forming an alliance with the conservative factions of the SSA and was involved in skirmishes with the revitalized KKT. Khun Sa once again he proposed that he purchase the entire Shan province opium crop. This request was rejected by the State Department after Congressional hearings took place in 1975. In 1975, the SSA broke into two factions. The larger and more moderate group broke away from the conservative faction and joined the BCP. The other faction joined forces with fragments of the KMT and formed the Tai-Land Revolutionary Council. Furthermore, to complicate issues, several rightist independent armies combined to form the National Democratic Front (NDF), an anti-communist coalition which was made up of 13 groups.

Golden Triangle

Golden Triangle

In 1977, an agreement regarding the division of opium trade in the Golden Triangle was reached between Khun Sa and the leader of the revitalized KMT. Khun Sa was allowed to maintain a base inside Thailand, and this served as his headquarters for control of 40 percent of Burma’s opium exports and the annual collection of $850,000 in transit fees from others who crossed through the region. Between 1976 and 1978, the Burmese government, using American helicopters, began a series of military operations aimed at destroying the Shan armies and their opium operations. Government forces were able to destroy some poppy fields, but they did not enter BCP-controlled regions. The BCP controlled one-third of the area, and even though they were not involved in opium trade, they did allow private dealers to cultivate opium.

TOR-Routes-Sud-Thaïlande

Golden Triangle South

 

Opium production plummeted after 1975. After the United States withdrew from Vietnam, black market operations dwindled, making it difficult for Shan rebels to purchase weapons. In addition, between 1978 and 1980 the Golden Triangle was hit with two droughts. This was followed by two seasons of intense monsoon rains, reducing the region’s opium production to a record low. The usual 600 ton opium harvests were cut to 160 tons in 1978 and 240 tons in 1979. Recovering from this two year failure, the region began to produce a bumper crop in the 1980s.

Richard Armitage - Bush Crony

Richard Armitage – Bush Crony

Khun Sa stated that Richard Armitage, at that time an envoy in the American embassy, financed drug smuggling in Vietnam and Bangkok from 1975 to 1979. CIA agents Daniel Arnold and Jerry Daniel trafficked weapons and drugs with Khun Sa. The operation was believed to be at its peak in 1975 and 1976 under George Bush. In a letter to George Bush, Gritz maintained that Khun Sa claimed that he had once engaged in narcotics transactions with Richard Armitage, who later became the Assistant Secretary of Defense, Shackley, as well as other American officials. Bush was head of the CIA in 1976 when Khun Sa said that he was selling drugs to top CIA officials. Gritz says that, strangely, nobody in the American government was interested in an investigation. Gritz later testified before the House Foreign Affairs Committee’s International Narcotics Control Task Force.

By 1983, Khun Sa strengthened his forces, and opium production was on the rebound. With Hong Kong chemists and over ten refineries, Khun Sa increased his holdings, controlling 75 percent of Golden Triangle opium production. Khun Sa was able to defeat KMT forces, and he destroyed numerous heroin facilities. With a virtual monopoly on opium trade in the Golden Triangle, Khun Sa was only briefly attacked by Thai and Burmese government forces which were able to secure a small area. Khun Sa was forced to evacuate some of his heroin laboratories, but he merely moved them into Laos.

Khun Sa had eliminated all his rebel rivals, and by 1986 he was refining 80 percent of the opium harvest in the Golden Triangle. The king of opium trade, Khun Sa had risen to become the world’s largest single heroin trafficker by controlling 60 percent of the world’s illicit opium supply.

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In 1986, Bo Gritz went to Burma with White House approval to meet with Khun Sa who supposedly had information on American MIAs. Khun Sa said that he wanted to end the opium and heroin traffic in his territory and to expose American officials involved in the drug smuggling. Gritz claimed that he took this message to the United States government and was told by Tom Harvey of the National Security Council that “there is no interest here” in the Khun Sa overture. Gritz had in his possession 40 hours of video tape of Khun Sa who “charged American officials, both past and present, with being the chief buyers of drugs produced in that part of the world.” He also claimed that he wanted to stop drug trafficking, but that the United States government would not let him. Khun Sa said that the CIA were some of his best customers. He offered support to the DEA to alert them of drug movements, but this was rejected at the headquarters level. In 1988, the government of Burma fell into the hands of the State Law and Order Restoration Council (SLORC). Its goal was to bolster the nation’s economy by doubling opium exports, and within two years 60 percent of the world’s heroin — valued at $40 billion a year — was exported from Burma.

Also in 1988, the single largest heroin seizure was made in Bangkok. The 2,400-pound shipment of heroin, en route to New York City, originated from Khun Sa in the Golden Triangle. Two years later in a meaningless gesture an American court indicted Khun Sa in absentia on heroin trafficking. He was charged with importing 3,500 pounds of heroin into New York City over the course of 18 months, as well as holding him responsible for the source of the heroin seized in Bangkok. Specifically, he was charged with being the owner of a 2,400 pound shipment which was intercepted in Bangkok en route to New York City in 1988. This was the largest single heroin seizure ever. In 1990, Lo Hsing-han was released from prison and was welcomed back by the same factions which had driven him out. He met with Burmese government officials and soon thereafter opened 17 new heroin factories in the Golden Triangle.

By 1995, the Golden Triangle region of Southeast Asia remained the leader in opium production, yielding 2,500 tons annually. According to American drug experts, new drug trafficking routes from Burma through Laos, to southern China, Cambodia and Vietnam were drawn up. In 1996, the SLORC cut a deal with Khun Sa. He had been indicted by the United States Justice Department six years before, but SLORC refused to extradite him. Instead, he was given the Burma-to-Thailand taxi concession and a 44 acre ranch where his son plans to build a gambling and shopping complex. The agreement also reportedly included a deal allowing him to retain control of his opium trade in exchange for ending his 30 year old war against the government. Underground activist groups, operating along the Indo-Burma border, have continued to purchase arms and ammunition from Khun Sa’s soldiers.

Laos

Col. Lucien Conein (rear)

Col. Lucien Conein (rear)

In Laos the CIA’s complicity in drug trafficking resulted from its alliance with the Hmong tribes who, since the 1950s, had been used by the French to fight Vietnamese leftists. As early as 1959, CIA operative Lucien Conein stated that eight teams were training Hmong tribesmen on the Plain of Jars. In 1960 the CIA began recruiting units to patrol the border with China and even to send Yao and Lahu tribesmen into Yunnan province to monitor traffic and to tap telephone lines. Operating out of Vientiane, the CIA also sent recruits to the patrol the Vietnam border as well as to send Green Beret commando units into North Vietnam to sabotage the Ho Chi Minh Trail. By far the largest goal of the CIA was to wage its secret war against the Pathet Lao in northern Laos. From 1960 to 1974, the CIA maintained a secret army of approximately 30,000 tribesmen in the mountains of northern Laos. This originated with Vientiane CIA station chief Shackley and his Clines, his assistant.

The first mission of the CIA was to place a puppet in power. The CIA needed to forge alliances with tribes and warlords inhabiting the northern Laos. In order to maintain its relationship with the warlords while continuing to fund the struggle against nationalistic Marxist movements in Laos and North Vietnam, the CIA first had to choose a career military official. The agency decided upon a career military leader, Lieutenant Vang Pao. Next, the CIA used several tactics to gain respect and support among the Hmong. Immediately elevated to a general, Vang Pao’s power had to be solidified in order for him to gain political support among the tribesmen in Laos’ scattered villages. First, the agency found a way for Vang Pao’s son and daughter to marry the children of Touby Lyfoung, a prominent and popular Hmong cabinet member. Second, the CIA usually chose a popular Hmong leader, with whom the agency could work, for every tribal area as its commander.

Gen. Vang Pao

Gen. Vang Pao

To gain support from the Hmong, the CIA supplied the tribesmen with rice. This enabled them to concentrate on growing the cash crop of opium. The Hmong relied on support from Air America for their rice supplies. Thus, the air power became the essential factor which allowed the CIA to keep Vang Pao in power. After Vang Pao was able to consolidate his power, the CIA helped him to sustain an army of 30,000 men from a tribe of only 250,000 people. The CIA relied on the villagers to supply the manpower to continue to replace the wounded and killed. By the early 1970s 30 percent of the Hmong recruits were 14 years old; another 30 percent were 15 and 16; and the remaining 40 percent were over 45.

Opium Traffic in Asia

Opium Traffic in Asia

In return for providing recruits, the Hmong opium growers received CIA support and their economy flourished. Also, Vang Pao’s control over the opium industry gave him more authority, especially when he needed to recruit young soldiers. Thus, the CIA relied on Vang Pao to supply soldiers in its secret war, and the CIA supplied his tribesmen with rice while opium was grown and frequently flown on CIA planes.CIA operant Tony Poe was assigned as the chief adviser to Vang Pao and to supervise his secret army’s operations. Poe promised Hmong soldiers one dollar for a Pathet Lao’s ear and ten dollars for a severed head. On the one hand, Poe frequently refused to allow opium to be transported on Air American planes. On the other hand, he ignored the prospering heroin factories and never stopped any of Vang Pao’s officers from using American facilities to manage illicit drugs.

CIA Chief Ted Shackley

CIA Chief Ted Shackley

Another CIA operant, Edgar Buell, was assigned to the Plain of Jars where a large portion of the secret army was trained. Buell became in charge of dispatching Air America planes to drop rice and other necessities to the Hmong. In addition Buell used his expertise in agriculture to improve the Hmongs’ skills in the cultivation and production of opium. While the United States was at its peak involvement in the Vietnam War, morphine base was being processed in the Golden Triangle and then exported to Hong Kong and Europe. In 1968 Shackley met in Saigon with Trafficante, Clines, and warlord Vang Pao, setting up a heroin smuggling ring to the United States. A Green Beret official speaking to Green Beret officers stated that “Shackley had been responsible for 250 political killings in Laos.”

None of the opium refineries mastered the technique to produce high-grade number four heroin which is 90 to 99 percent pure. By 1969 expert chemists from Hong Kong were imported into the Golden Triangle region, and they produced limited amounts of high grade heroin for tens of thousands of American GIs in South Vietnam. By 1970 the amount of heroin available to Americans was unlimited. The opium harvests were transported by Vang Pao’s officers and then flown on Air America UH-1H helicopters to processing plants in Vientiane and Long Tieng.

Nixon

Nixon

However, with the beginning of Nixon’s Vietnamization policy in the months to follow, the market for heroin drastically dropped. Then Chinese, Corsican, and American syndicates began sending large shipments of number four heroin directly to the United States. As a result of these massive exports to the United States, the wholesale price for a kilogram of number four heroin in the processing plants in the Golden Triangle actually increased by 44 percent — from $1,240 to $1,780 — in less than one year. At the same time, the price of raw opium in the villages jumped from $24 to $45 per kilogram. In 1970 the number of heroin addicts in the United States reached 750,000. More than a thousand tons of opium was being raised in the Golden Triangle.

By 1973, the United States was losing in Vietnam and in Laos as well. The CIA was forced to import approximately 20,000 Thai mercenaries in order to replenish the exhausted Hmong troops who could not provide additional recruits. That yea,r the Laotian government signed a truce with the Pathet Lao, ostensibly ending the CIA’s secret war. Slowly, the CIA abandoned over 300 landing strips and turned over its aircraft to the Laotian government. In 1974 on orders from the Laotian government, Air America abandoned its facilities. As Pathet Lao soldiers increased their presence in Laos, Vang Pao’s military and dwindled to 6,000 troops. Usually, Vang Pao retreated rather than to fight, and eventually the Pathet Lao marched into Vientiane. Vang Pao finally agreed to flee to Thailand, and the CIA provided transportation for him and his top officers.

Afghanistan and Pakistan

opium-poppies-afghanistan

After World War II, very little opium was being produced in Afghanistan. However, right wing dictatorships in neighboring countries thrived on opium production. In neighboring Iran, the powerful American and Anglo oil companies and drug dealers shared many of the country’s resources. Intelligence agencies estimated that Iran was producing 600 tons of opium a year and had 1.3 million opium addicts. When Mohammed Mossadegh was elected prime minister and the shah was forced to flee, the new populist government moved to suppress opium trade. However, after a CIA coup placed the shah back on the throne, drug trafficking once again prospered until 1979 when an Islamic revolution brought Ayatollah Khomeini into power.

Opium Traffic Afghanistan

Golden Crescent East

In Pakistan under King Mohammed Zahir, feudal estates scattered throughout the country maintained small opium fields. However, after a 1978 coup Mohammed Daoud seized power, and opium traffic began to expand rapidly. He was followed by Noor Mohammed Taraki, a reformer who worked to phase out the poppy fields and replace them with consumption crops. Opium production began to plummet, but Taraki was killed in a military coup in 1979. General Zia ul-Haq ascended to power, and he created the Inter-Service Intelligence (ISI) to oversee intelligence on the Afghan-Pakistani border.

Afghan_Opium_Production_2005_2007

The ISI pressured the CIA into accepting Zia’s policies with the Mujaheddin across his border in Afghanistan. The ISI brokered a deal which brought about an alliance between the CIA and Gulbuddin Hekmatyar, the leader of a small guerrilla unit in Afghanistan with close ties to the Pakistani government. In the next ten years half of American aid to Afghanistan went to this group. Hekmatyar eventually proved himself brutal and corrupt, becoming one of the premier drug dealers in that region.

Golden Crescent South

Islamabad CIA station chief John Reagan met with Hekmatyar in May 1979, seven months before the Soviets moved into Kabul, and agreed to make the first of many shipments of arms to the rebel army. Over the next two years, CIA covert aid increased tremendously. Islamabad soon became the largest foreign CIA station to run a covert war. Within ten years the United States had funneled in $3 billion in aid to the Mujaheddin, and the CIA had provided the rebels with $2 billion in covert aid. Sixty percent of those funds were given directly to Hekmatyar who purchased weapons in order to protect his opium fields. Pakistani General Fazle Huq was assigned to overlook military operations near the Afghan border. Huq ensured that Hekmatyar received the bulk of CIA arms shipments, and he also protected his 200 heroin laboratories. In 1982 Interpol identified Huq as a principal catalyst in Afghan-Pakistani opium trade.

Very little heroin was refined in Pakistan before the rise of the Mujaheddin emerged in 1979. Then the guerrillas began to expand their opium production and shipped the raw drug to Pakistan border refineries for processing into heroin. They sold it to Pakistani refiners who operated under the protection of General Fazle Hug, the governor of the province near the Khyber Pass and adjacent to Afghanistan. Trucks from the Pakistan arm’s National Logistics Cell (NLC) arrived with CIA arms from Karachi and returned loaded with heroin. They were protected by the ISI and therefore protected from vehicle searches.

Zia al-Haq

Zia al-Haq

The Reagan and Bush administrations frequently placed the blame for opium trade on the Soviets. However, it was the Mujaheddin and Pakistanis who were directly involved in trafficking drugs. Zia’s personal physician, Dr. Hisayoshi Maruyama, was arrested in Holland with 17.5 kilos of high grade heroin. Haji Ayub Afridi, one of Zia’s associates who had served in the Pakistani General Assembly, purchased large quantities of opium from the Mujaheddin. Another Zia ally, Hamid Hasnain, vice president of one of Pakistan’s largest banks, also ran a drug ring.

By the 1980s, American aid to Afghan rebels declined, so their leaders expanded opium production in order to maintain their armies. In southern Afghanistan, Nasim Akhundzada controlled the most fertile and irrigated areas. He became known as the “King of Heroin” and controlled most of the 250 tons of opium in his province. Meanwhile, Pakistan became one of the world’s largest addict populations in the 1980s.

Gulbadeen Hekmatyar

Gulbadeen Hekmatyar

When the Mujaheddin first emerged in Afghanistan in 1979, there were about 200,000 drug addicts in the United States. As poppy fields quickly expanded in the areas which they controlled, that number had jumped to 450,000 by 1981. In 1989 Afghanistan and Pakistan produced and shipped 50 percent of all the heroin in the world. Between one-third and one-half of the heroin used by addicts in the United States was imported from heroin growers in Mujaheddin controlled areas. The annual consumption of these Afghan narcotics amounted to roughly three tons, and it was valued in the billions of dollars. Hekmatyar’s chief rival in the opium business was a fellow Mujaheddin, Mullah Nassim. In 1989, Hekmatyar successfully plotted his assassination and consolidated his position as the principal Afghan drug lord.

Golden Crescent North

Golden Crescent North

In 1990 Time magazine ran a story claiming that the United States “was embarrassed by the widely bruited connections between the drug trade and the elements of the insurgents, including such fundamentalist Islamic groups as Gulbuddin Hekmatyar Hezbi-I Islami.” Then the Washington Post printed a story charging that American officials had refused to investigate charges against Hekmatyar and Pakistan’s ISI. Yet the CIA ignored the allegations since it would have diminished their effectiveness in running covert operations in the region.

Mullah Omar

Mullah Omar

Civil war has raged since the 1989 withdrawal of Soviet forces. Although the United States government withdrew military support for the Mujaheddin, various Afghan ethnic and political factions have competed for power. In 1994 the extreme fundamentalist Sunni sect known as Taliban emigrated from Pakistan and settled in Afghanistan’s outlying mountains around Kabul. Supported by the United States, Taliban captured the capitol and declared Afghanistan an Islamic state in September 1996. The Taliban sect under Mullah Omar immediately imposed a campaign of tyranny in the areas under its control. The Taliban continued to thrive on the opium business which amounted to twice the size of the government’s budget.

In addition to Taliban’s influence in Afghanistan, large areas of the north were controlled by another warlord, Abdurashid Dostum. In May 1997, a coup within Dostum’s forces led by General Abdul Malik led to Dostum fleeing the country. They immediately announced a peace agreement had been reached to reunify Afghanistan under Taliban control, and a delegation of 60 Taliban leaders arrived to sign a peace treaty. The Taliban victory was celebrated by Pakistan. In addition, corrupt factions within Pakistan’s security forces benefitted by the opium trade which increased under Taliban rule. Taliban has been hostile to Russia, Shiite Muslim Iran, the moderate Sunni Islamic republics of Turkmenistan, Uzbekistan, and Tajikistan, and Turkey.

Golden Crescent West

Golden Crescent West

The Australia Connection

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In the 1970,s drug profits from the secret war in Laos were funneled into the Nugan Hand Bank. Shackley denied that he maintained a secret account in this Australia-based bank, which was founded Michael John Hand and four officials from CIA-owned Air America. In Chiang Mai Thailand’s branch office, the director of the bank claimed that he handled $2.6 million in drug revenues in less than six months. He maintained that the money was laundered for Laotian Meo tribesman and other heroin dealers. According to the Australian Royal Commission, Nugan Hand was the principle conduit for laundering the money for major narcotics transactions from the Golden Triangle and importing heroin into Australia in the 1970s. The Nugan Hand bank also moved money globally for the CIA. In 1980 the Nugan Hand Bank collapsed, $5 billion in debt.

Helio_U-10D_Air_America_Laos_1970

The Nugan Hand Bank had several branches in Saudi Arabia, Europe, Thailand, and South America. Several of the bank’s officials had CIA connections. The larger Bangkok office was run by the former CIA chief of that city. In Sydney it was a CIA bank in all but name. Among its officers were a network of United States generals, admirals and CIA employees, including former CIA Director William Colby, who served as one of its attorneys. Some of its branch managers included Air Force General LeRoy Manor, who later corroborated with Air Force General Richard Secord and Colonel Oliver North on covert actions to liberate the 52 American hostages taken in Iran in 1979. In addition Patry Loomis, a CIA operative who worked under CIA station chief Shackley in Saigon, was a close associate of Nugan Hand’s representative to Saudi Arabia, Bernie Houghton. Loomis also helped Ed Wilson, later to be implicated in Iran-Contra, recruit Green Berets to train Libyans. Wilson was also an associate of Houghton. In the mid-1970s Wilson used the Nugan Hand Bank and worked with Houghton to supply 3,000 weapons and 10 million rounds of ammunition to the CIA-backed rebels in Angola.

Civil War in Angola

Civil War in Angola

In 1975, Wilson went to work for Task Force 157 was set up to attempt to topple the left-leaning Labour government of Gough Whitlam. Task Force 157 was set up by Henry Kissinger as a mini-CIA. It was actually separate from the CIA and probably was set up by Kissinger so he could deny any connection between what the Task Force 157 was doing and the CIA. The personnel of Task Force 157 included Wilson with his numerous connections to Nugan Hand Bank officials and Shackley. Michael Hand, an ex-American Green Beret, went on from the Green Berets to work in intelligence work for the United States government.The concept of Task Force 157 were two-fold: first, to set up operations against the Whitlam government. Second, to go ahead with using Australia as a base for certain clandestine United States operations such as arms dealing and smuggling of contraband goods and using the Nugan Hand Bank as the cover.

Australian PM Tony Abbot

Australian PM Tony Abbot

On two occasions Admiral Bobby Inman, former deputy director of the National Security Agency and deputy director of the CIA, said on that he expressed deep concern that investigations of Nugan-Hand would lead to disclosure of a range of dirty tricks played against the Whitlam government. CIA operant Christopher Boyce said: “If you think what the agency did in Chile was bad, in which they spent 80 million dollars overturning the government of Chile there, the Allende government, you should see what they are doing in Australia.”

In April 1982, Bush met with Australian Labor leader Hayden to discuss the CIA’s role in the Nugan Hand Bank. Many Australians could not understand why the CIA wanted to bring down the government of a loyal ally, whose Labour party was striving to make social reforms, especially since it was the war-time Labour administrations which had built up the special relationship with America.

To be continued…

– The Green Chazzan 

 

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The Bay of Pigs & Operation J/M-Wave – Part 2

The Bay of Pigs & Operation J/M-Wave        

The Bay of Pigs and The Kennedy Assassination by Dr. Webster Tarpley (1992)

Presidential Portrait of JFK

Presidential Portrait of JFK

“…JM/WAVE …proliferated across [Florida] in preparation for the Bay of Pigs invasion. A subculture of fronts, proprietaries, suppliers, transfer agents, conduits, dummy corporations, blind drops, detective agencies, law firms, electronic firms, shopping centers, airlines, radio stations, the mob and the church and the banks: a false and secret nervous system twitching to stimuli supplied by the cortex in Clandestine Services in Langley. After defeat on the beach in Cuba, JM/WAVE became a continuing and extended Miami Station, CIA’s largest in the continental United States. A large sign in front of the […] building complex reads: US GOVERNMENT REGULATIONS PROHIBIT DISCUSSION OF THIS ORGANIZATION OR FACILITY.

Donald Freed, Death in Washington (Westport, Connecticut, 1980), p. 141.

The review offered so far of George Bush’s activities during the late 1950′s and early 1960′s is almost certainly incomplete in very important respects. There is good reason to believe that Bush was engaged in something more than just the oil business during those years. Starting about the time of the Bay of Pigs invasion in the spring of 1961, we have the first hints that Bush, in addition to working for Zapata Offshore, may also have been a participant in certain covert operations of the US intelligence community.

Bush Sr.

Bush Sr.

Such participation would certainly be coherent with George’s role in the Prescott Bush, Skull and Bones, and Brown Brothers, Harriman networks. During the twentieth century, the Skull and Bones/Harriman circles have always maintained a sizable and often decisive presence inside the intelligence organizations of the State Department, the Treasury Department, the Office of Naval Intelligence, the Office of Strategic Services, and the Central Intelligence Agency. Indeed, the Harriman and related Anglophile financier factions of Wall Street have generally regarded those parts of the state apparatus dealing with intelligence and covert operations as their own very special property, property which had to be kept seeded with control networks in order to be effectively steered from above. For George Bush to interface with the intelligence community while ostensibly engaged in his business career would be coherent with that well-established pattern.

A body of leads has been assembled which suggests that George Bush may have been associated with the CIA at some time before the autumn of 1963. According to Joseph McBride of The Nation, “a source with close connections to the intelligence community confirms that Bush started working for the agency in 1960 or 1961, using his oil business as a cover for clandestine activities.” 1 By the time of the Kennedy assassination, we have an official FBI document which refers to “Mr. George Bush of the Central Intelligence Agency,” and despite official disclaimers there is every reason to think that this is indeed the man in the White House today. The mystery of George Bush as a possible covert operator hinges on four points, each one of which represents one of the great political and espionage scandals of postwar American history.

These four cardinal points are:

  1. The abortive Bay of Pigs invasion of Cuba, launched on April 16-17, 1961, prepared with the assistance of the CIA’s “Miami Station” (also known under the code name JM/WAVE). After the failure of the amphibious landings of Brigade 2506, Miami station, under the leadership of Theodore Shackley, became the focus for Operation Mongoose, a series of covert operations directed against Castro, Cuba, and possibly other targets.
  2. The assassination of President John F. Kennedy in Dallas on November 22, 1963, and the coverup of those responsible for this crime.
  3. The Watergate scandal, beginning with an April, 1971 visit to Miami, Florida by E. Howard Hunt on the tenth anniversary of the Bay of Pigs invasion to recruit operatives for the White House Special Investigations Unit (the “Plumbers” and later Watergate burglars) from among Cuban-American Bay of Pigs veterans.
  4. The Iran-contra affair, which became a public scandal during October-November 1986, several of whose central figures, such as Felix Rodriguez, were also veterans of the Bay of Pigs.

BayofPigs (1)

George Bush’s role in both Watergate and the October surprise/Iran-contra complex will be treated in detail at later points in this book. Right now it is important to see that thirty years of covert operations, in many respects, form a single continuous whole. This is especially true in regard to the dramatis personae. Georgie Anne Geyer points to the obvious in a recent book: “…an entire new Cuban cadre now emerged from the Bay of Pigs. The names Howard Hunt, Bernard Barker, Rolando Martinez, Felix Rodriguez and Eugenio Martinez would, in the next quarter century, pop up, often decisively, over and over again in the most dangerous American foreign policy crises. There were Cubans flying missions for the CIA in the Congo and even for the Portuguese in Africa; Cubans were the burglars of Watergate; Cubans played key roles in Nicaragua, in Irangate, in the American move into the Persian Gulf.”  Felix Rodriguez tells us that he was infiltrated into Cuba with the other members of the “Grey Team” in conjunction with the Bay of Pigs landings; this is the same man we will find directing the contra supply effort in central American during the 1980′s, working under the direct supervision of Don Gregg and George Bush.  Theodore Shackley, the JM/WAVE station chief, will later show up in Bush’s 1979-80 presidential campaign.

CIA Chief Ted Shackley

CIA Chief Ted Shackley

To a very large degree, such covert operations (and the great political scandals attendant upon them) have drawn upon the same pool of personnel. They are a significant extent the handiwork of the same crowd. It is therefore revealing to extrapolate forward and backward in time the individuals and groups of individuals who appear as the cast of characters in one scandal and compare them with the cast of characters for the other scandals, including the secondary ones that have not been enumerated here. Howard Hunt, for example, shows up as a confirmed part of the overthrow of the Guatemalan government of Jacobo Arbenz in 1954, as an important part of the chain of command in the Bay of Pigs, as a person repeatedly accused of having been in Dallas on the day Kennedy was shot, and as one of the central figures of Watergate. (One wonders what secrets, after all, were contained in Howard Hunt’s safe, the contents of which were so conventiently “deep sixed” by FBI Director Patrick Gray.)

E Howard Hunt

E Howard Hunt

George Bush is demonstrably one of the most important protagonists of the Watergate scandal, and was the overall director of Iran-contra. Since he appears especially in Iran-contra in close proximity to Bay of Pigs holdovers, it is surely legitimate to wonder when his association with those Bay of Pigs Cubans might have started.

1959 was the year that Bush started operating out of his Zapata Offshore headquarters in Houston; it was also the year that Fidel Castro seized power in Cuba. Officially, as we have seen, George was now a businessman whose work took him at times to Louisiana, where Zapata had offshore drilling operations. George must have been a frequent visitor to New Orleans. Because of his family’s estate on Jupiter Island, he would also have been a frequent visitor to the Hobe Sound area. And then, there were Zapata Offshore drilling operations in the Florida Strait. On all of these activities, the official “red Studebaker” biographical material and the Zapata Offshore annual reports are extremely cryptic.

Prescott Bush

Prescott Bush

The Jupiter Island connection and father Prescott’s Brown Brothers, Harriman/Skull and Bones networks are doubtless the key. Jupiter Island meant Averell Harriman, Robert Lovett, C. Douglas Dillon and other Anglophile financiers who had directed the US intelligence community long before there had been a CIA at all. And, in the back yard of the Jupiter Island Olympians, and under their direction, a powerful covert operations base was now being assembled, in which George Bush would have been present at the creation as a matter of birthright.

During 1959-60, Allen Dulles and the Eisenhower Administration began to assemble in south Florida the infrastructure for covert action against Cuba. This was the JM/WAVE capability, later formally constituted as the CIA Miami station. JM/WAVE was an operational center for the Eisenhower regime’s project of staging an invasion of Cuba using a secret army of anti-Castro Cuban exiles organized, armed, trained, transported, and directed by the CIA. The Cubans, called Brigade 2506, were trained in secret camps in Guatemala, and they had air support from B-26 bombers based in Nicaragua. This invasion was crushed by Castro’s defending forces in less than three days.

Allen Dulles

Allen Dulles

Before going along with the plan so eagerly touted by Allen Dulles, Kennedy had established the pre-condition that under no circumstances whatsoever would there be direct intervention by US military forces against Cuba. On the one hand, Dulles had assured Kennedy that the news of the invasion would trigger an insurrection which would sweep Castro and his regime away. On the other, Kennedy had to be concerned about provoking a global thermonuclear confrontation with the USSR, in the eventuality that N.S. Khrushchev decided to respond to a US Cuban gambit by, for example, cutting off US access to Berlin.

According to some accounts, the code name for the Bay of Pigs was Operation Pluto. 4 But Bay of Pigs veteran Howard Hunt scornfully denies that this was the code name used by JM/WAVE personnel; Hunt writes: “So perhaps the Pentagon referred to the Brigade invasion as PLUTO. CIA did not.” But Hunt does not tell us what the CIA code name was, and the contents of Hunt’s Watergate era White House safe, which might have told us the answer, were of course “deep-sixed” by FBI Director Patrick Gray. One code name frequently used by CIA Miami Station personnel appears to have been “Don Eduardo,” roughly the Spanish equivalent of “Mr. Edward” or perhaps “Mr. Ed.” According to reliable sources and published accounts, the CIA code name for the Bay of Pigs invasion was Operation Zapata, and the plan was so referred to by Richard Bissell of the CIA, one of the plan’s promoters, in a briefing to President Kennedy in the Cabinet Room on March 29, 1961.  Does Operation Zapata have anything to do with Zapata Offshore?

Formerly Zapata

Formerly Zapata

More on Zapata & George Bush : http://en.wikipedia.org/wiki/Harbinger_Group

Then there is the question of the Brigade 2506 landing fleet, which was composed of five older freighters bought or chartered from the Garcia Steamship Lines, bearing the names of HoustonRio EsondidoCaribeAtlantic, and Lake Charles. In addition to these vessels, which were outfitted as transport ships, there were two somewhat better armed fire support ships, the Blagar and the Barbara. (In some sources Barbara J.) 8 The Barbara was originally an LCI (Landing Craft Infantry) of earlier vintage. Our attention is attracted at once to the Barbara and the Houston, in the first case because we have seen George Bush’s habit of naming his combat aircraft after his wife, and, in the second case, because Bush was at this time a resident, booster, and Republican activist of Houston, Texas. But of course, the appearance of names like “Zapata,” Barbara, and Houston can by itself only arouse suspicion, and proves nothing.

After the ignominious defeat of the Bay of Pigs invasion, there was great animosity against Kennedy among the survivors of Brigade 2506, some of whom eventually made their way back to Miami after being released from Castro’s prisoner of war camps. There was also great animosity against Kennedy on the part of the JM/WAVE personnel.

David Atlee Phillips

David Atlee Phillips

During the early 1950′s, E. Howard Hunt had been the CIA station chief in Mexico City. As David Atlee Phillips (another embittered JM/WAVE veteran) tells us in his autobiographical account, The Night Watch, Howard Hunt had been the immediate superior of a young CIA recruit named William F. Buckley, the Yale graduate and Skull and Bones member who later founded the National Review. In his autobiographical account written during the days of the Watergate scandal, Hunt includes the following tirade about the Bay of Pigs: “No event since the communization of China in 1949 has had such a profound effect on the United States and its allies as the defeat of the US-trained Cuban invasion brigade at the Bay of Pigs in April 1961.”

OSS China

OSS China

Out of that humiliation grew the Berlin Wall, the missile crisis, guerrilla warfare throughout Latin American and Africa, and our Dominican Republic intervention. Castros’ beachhead triumph opened a bottomless Pandora’s box of difficulties that affected not only the United States, but most of its allies in the Free World. These bloody and subversive events would not have taken place had Castro been toppled. Instead of standing firm, our government pyramided crucially wrong decisions and allowed Brigade 2506 to be destroyed. The Kennedy administration yielded Castro all the excuse he needed to gain a tighter grip on the island of Jose Marti, then moved shamefacedly into the shadows and hoped the Cuban issue would simply melt away.9

Hunt was typical of the opinion that the debacle had been Kennedy’s fault, and not the responsibility of men like Allen Dulles and Richard Bissell, who had designed it and recommended it. After the embarrassing failure of the invasion, which never evoked the hoped-for spontaneous anti-Castro insurrection, Kennedy fired Allen Dulles, his Harrimanite deputy Bissell, and CIA deputy Director Charles Cabell (whose brother was the mayor of Dallas at the time Kennedy was shot).

During the days after the Bay of Pigs debacle, Kennedy was deeply suspicious of the intelligence community and of proposals for military escalation in general, including in places like South Vietnam. Kennedy sought to procure an outside, expert opinion on military matters. For this he turned to the former commander in chief of the Southwest Pacific Theatre during World War II, General Douglas MacArthur. Almost ten years ago, a reliable source shared with one of the authors an account of a meeting between Kennedy and MacArthur in which the veteran general warned the young president that there were elements inside the US government who emphatically did not share his patriotic motives, and who were seeking to destroy his administration from within. MacArthur’s warned that the forces bent on destroying Kennedy were centered in the Wall Street financial community and its various tentacles in the intelligence community.

General Douglas MacArthur

General Douglas MacArthur

It is a matter of public record that Kennedy met with MacArthur in the latter part of April, 1961, after the Bay of Pigs. According to Kennedy aide Theodore Sorenson, MacArthur told Kennedy, “The chickens are coming home to roost, and you happen to have just moved into the chicken house.” 10 At the same meeting, according to Sorenson, MacArthur “warned [Kennedy] against the committment of American foot soldiers on the Asian mainland, and the President never forgot this advice.” 11 This point is grudgingly confirmed by Arthur M. Schlesinger, a Kennedy aide who had a vested interest in vilifying MacArthur, who wrote that “MacArthur expressed his old view that anyone wanting to commit American ground forces to the mainland [of Asia] should have his head examined.” 12 MacArthur restated this advice during a second meeting with Kennedy when the General returned from his last trip to the Far East in July, 1961.

Kennedy valued MacArthur’s professional military opinion highly, and used it to keep at arms length those advisers who were arguing for escalation in Laos, Vietnam, and elsewhere. He repeatedly invited those who proposed to send land forces to Asia to convince MacArthur that this would as good idea. If they could convince MacArthur, then he, Kennedy, might also go along. At this time, the group proposing escalation in Vietnam (as well as preparing the assassination of President Diem) had a heavy Brown Brothers, Harriman/Skull and Bones overtone: the hawks of 1961-63 were Harriman, McGeorge Bundy, William Bundy, Henry Cabot Lodge, and some key London oligarchs and theoreticians of counterinsurgency wars. And of course, George Bush during these years was calling for escalation in Vietnam and challenging Kennedy to “muster the courage” to try a second invasion of Cuba. In the meantime, the JM/WAVE-Miami station complex was growing rapidly to become the largest of Langley’s many satellites. Its center was at the former Richmond Naval Air Station south of Miami, which had been a base for antisubmarine blimps during World War II. During the years after the failure of the Bay of Pigs, this complex had as many as 3,000 Cuban agents and subagents, with a small army of case officers to direct and look after each one. According to one account, there were at least 55 dummy corporations to provide employment, cover, and commercial disguise for all these operatives. There were detective bureaus, gun stores, real estate brokerages, boat repair shops, and party boats for fishing and other entertainments. There was the clandestine Radio Swan, later renamed Radio Americas. There were fleets of specially modified boats based at Homestead Marina, and at other marinas throughout the Florida Keys. Agents were assigned to the University of Miami and other educational institutions.

Henry Cabot Lodge - Ambassador to Vietnam

Henry Cabot Lodge – Ambassador to Vietnam

The raison d’être of the massive capability commanded by Theodore Shackley was now Operation Mongoose, a program for sabotage raids and assassinations to be conducted on Cuban territory, with a special effort to eliminate Fidel Castro personally. In order to run these operations from US territory, flagrant and extensive violation of federal and state laws was the order of the day. Documents regarding the incorporation of businesses were falsified. Income tax returns were faked. FAA regulations were violated by planes taking off for Cuba or for forward bases in the Bahamas and elsewhere. Explosives moved across highways that were full of civilian traffic. The Munitions Act, the Neutrality Act, the customs and immigrations laws were routinely flaunted. 13 Above all, the drug laws were massively violated as the gallant anti-communist fighters filled their planes and boats with illegal narcotics to be smuggled back into the US when they returned from their missions. By 1963, the drug-running activities of the covert operatives were beginning to attract attention. JM/WAVE, in sum, accelerated the slide of south Florida towards the status of drug and murder capital of the United States it achieved during the 1980′s, when it became as notorious as Chicago during Prohibition.

It cannot be the task of this study to even begin to treat the reasons for which certain leading elements of the Anglo-American financial oligarchy, perhaps acting with certain kinds of support from continental European aristocratic and neofascist networks, ordered the murder of John F. Kennedy. The British and the Harrimanites wanted escalation in Vietnam; by the time of his assassination Kennedy was committed to a pullout of US forces. Kennedy, as shown by his American University speech of 1963, was also interested in seeking a more stable path of war avoidance with the Soviets, using the US military superiority demonstrated during the Cuban missile crisis to convince Moscow to accept a policy of world peace through economic development. Kennedy was interested in the possibilities of anti-missile strategic defense to put an end to that nightmare of mutually assured destruction which appealed to Henry Kissinger, a disgruntled former employee of the Kennedy administration whom the president had denounced as a madman. Kennedy was considering moves to limit or perhaps abolish the usurpation of authority over the national currency by the Wall Street and London interests controlling the Federal Reserve System. If re-elected to a second term, Kennedy was likely to have re-asserted presidential control, as distinct from Wall Street control, over the intelligence community. There is good reason to believe that Kennedy would have ousted J. Edgar Hoover from his self-appointed life tenure at the FBI, subjecting that agency to presidential control for the first time in many years. Kennedy was committed to a vigorous expansion of the space program, the cultural impact of which was beginning to alarm the finance oligarchs. Above all, Kennedy was acting like a man who thought he was president of the United States, violating the collegiality of oligarchical trusteeship of that office that had been in force since the final days of Roosevelt. Kennedy furthermore had two younger brothers who might succeed him, putting a strong presidency beyond the control of the Eastern Anglophile Liberal Establishment for decades. George Bush joined in the Harrimanite opposition to Kennedy on all of these points.

JFK

JFK

After Kennedy was killed in Dallas on November 22, 1963, it was alleged that E. Howard Hunt and Frank Sturgis had both been present, possibly together, in Dallas on the day of the shooting, although the truth of these allegations has never been finally established. Both Hunt and Sturgis were of course Bay of Pigs veterans who would later appear center stage in Watergate. There were also allegations that Hunt and Sturgis were among a group of six to eight derelicts who were found in boxcars sitting on the railroad tracks behind the grassy knoll near Dealey Plaza, and who were rounded up and taken in for questioning by the Dallas police on the day of the assassination. Some suspected that Hunt and Sturgis had participated in the assassination. Some of these allegations were at the center of the celebrated 1985 defamation case of Hunt v. Liberty Lobby, in which a Florida federal jury found against Hunt. But, since the Dallas Police Department and County Sheriff never photographed or fingerprinted the “derelicts” in question, it has so far proven impossible definitively to resolve this question. But these allegations and theories about the possible presence and activities of Hunt and Sturgis in Dallas were sufficiently widespread so as to compel the Commission on CIA Activities Within the United States (the Rockefeller Commission) to attempt to refute them in its 1975 report. 14

According to George Bush’s official biography, he was during 1963 a well-to-do businessman residing in Houston, the busy president of Zapata Offshore and the chairman of the Harris County Republican Organization, supporting Barry Goldwater as the GOP’s likely 1964 presidential candidate, while at the same time actively preparing his own 1964 bid for the US Senate. But during that same period of time, Bush may have shared some common acquaintances with Lee Harvey Oswald.

Republican Super-Racist - Barry Goldwater

Republican Super-Racist – Barry Goldwater

Between October, 1962 and April, 1963, Lee Harvey Oswald and his Russian wife Marina were in frequent contact with a Russian emigré couple living in Dallas: these were George de Mohrenschildt and his wife Jeanne. During the Warren Commission investigation of the Kennedy assassination, de Mohrenschildt was interviewed at length about his contacts with Oswald. When, in the spring of 1977, the discrediting of the Warren Commission report as a blatant coverup had made public pressure for a new investigation of the Kennedy assassination irresistible, the House Assassinations Committee planned to interview de Mohrenschildt once again. But in March, 1977, just before de Mohrenschildt was scheduled to be interviewed by Gaeton Fonzi of the House committee’s staff, he was found dead in Palm Beach, Florida. His death was quickly ruled a suicide. One of the last people to see him alive was Edward Jay Epstein, who was also interviewing de Mohrenschildt about the Kennedy assassination for an upcoming book. Epstein is one of the writers on the Kennedy assassination who enjoyed excellent relations with the late James Angleton of the CIA. If de Mohrenschildt were alive today, he might be able to enlighten us about his relations with George Bush, and perhaps afford us some insight into Bush’s activities during this epoch.

George de Mohrenschildt

George de Mohrenschildt

Jeanne de Mohrenschildt rejected the finding of suicide in her husband’s death. “He was eliminated before he got to that committee,” the widow told a journalist in 1978, “because someone did not want him to get to it.” She also maintained that George de Mohrenschildt had been surreptitiously injected with mind-altering drugs. 15 After de Mohrenschildt’s death, his personal address book was located, and it contained this entry: “Bush, George H.W. (Poppy) 1412 W. Ohio also Zapata Petroleum Midland.” There is of course the problem of dating this reference. George Bush had moved his office and home from Midland to Houston in 1959, when Zapata Offshore was constituted, so perhaps this reference goes back to some time before 1959. There is also the number: “4-6355.” There are, of course, numerous other entries, including one W.F. Buckley of the Buckley brothers of New York City, William S. Paley of CBS, plus many oil men, stock brokers, and the like. 16

In 1957, de Mohrenschildt was approved by the CIA Office of Security to be hired as a US government geologist for a mission to Yugoslavia. Upon his return he was interviewed by one J. Walter Moore of the CIA’s Domestic Contact Service, with whom he remained in contact. During 1958, de Morhenschildt visited Ghana, Togo, Dahomey; during 1959 he visited Africa again and returned by way of Poland. In 1959 he married Jeanne, his fourth wife, a former ballet dancer and dress designer who had been born in Manchuria, where her father had been one of the directors of the Chinese Eastern Railroad. During the summer of 1960, George and Jeanne de Mohrenschildt told their friends that they were going to embark on a walking tour of 11,000 miles along Indian trails from Mexico to Central America. One of their principal destinations was Guatemala City, where they were staying at the time of the Bay of Pigs invasion in April, 1961, after which they made their way home by way of Panama and Haiti. After two months in Haiti, the Mohrenschildts returned to Dallas, where they came into contact with Lee Harvey Oswald, who had come back to the United States from his sojourn in the Soviet Union in June, 1962. By this time de Mohrenschildt was also frequenting Admiral Henry C. Bruton and his wife, to whom he introduced the Oswalds. Admiral Bruton was the former director of naval communications, and had superintended a comprehensive modernization and reorganization of the navy’s means of keeping in touch with ships, planes, missiles, submarines, and the like.

Oswald

Oswald

It is established that between October, 1962 and late April, 1963, de Mohrenschildt was a very important figure in the life of Oswald and his Russian wife. Despite Oswald’s lack of social graces, de Mohrenschildt introduced him into Dallas society, took him to parties, assisted him in finding employment, and much more. It was through de Mohrenschildt that Oswald met a certain Volkmar Schmidt, a young German geologist who had studied with Professor Wilhelm Kuetemeyer, an expert in psychosomatic medicine and religious philosophy at the University of Heidelberg, who compiled a detailed psychological profile of Oswald. Jeanne and George helped Marina move her belongings during one of her many estrangements from Oswald. According to some accounts, de Mohrenschildt’s influence on Oswald was so great during this period that he could virtually dictate important decisions to the young ex-marine simply by making suggestions. Oswald was in awe of de Mohrenschildt, according to some.

According to some versions, de Mohrenschildt was aware of Oswald’s alleged April 10, 1963 attempt to assassinate the well-known right-wing General Edwin Walker. According to Marina, de Mohrenschildt once asked Oswald, “Lee, how did you miss General Walker?” On April 19, George and Jeanne de Mohrenschildt went to New York City, and on April 29 the CIA Office of Security found that it had no objection to de Mohrenschildt’s acceptance of a contract with the Duvalier regime of Haiti in the field of natural resource development. De Mohrenschildt appears to have departed for Haiti on May 1, 1963. In the meantime Oswald had left Dallas and traveled to New Orleans. According to Mark Lane, “there is evidence that de Mohrenschildt served as a CIA control officer who directed Oswald’s actions.” Much of the extensive published literature on de Mohrenschildt converges on the idea that he was a baby sitter, handler, case officer, or control agent for Oswald on behalf of some intelligence agency.  De Mohrenschildt’s pedigree evokes haunting parallels to the typical figures of the PERMINDEX networks of Georges Mandel, Ferenc Nagy, Max Hagerman, Max Seligman, Carlo d’Amelio, Lewis Mortimer Bloomfield, and Clay Shaw, to which public attention was called during the investigations of New Orleans district attorney James Garrison. It is therefore highly interesting that George Bush’s name turned up in the personal address book of George de Mohrenschildt. The Warren Commission went to absurd lengths to cover up the fact that George de Mohrenschildt was a denizen of the world of the intelligence agencies. This included ignoring the well-developed paper trial on de Mohrenschildt as Nazi and communist sympathizer, and later as a US asset abroad.

Photo of Bush at CIA

Photo of Bush at CIA

 

The Warren Commission concluded:

The Commission’s investigation has developed no signs of subversive or disloyal conduct on the part of either of the de Mohrenschildts. Neither the FBI, CIA, nor any witnesses contacted by the Commission has provided any information linking the de Mohrenschildts to subversive or extremist organizations. Nor has there been any evidence linking them in any way with the assassination of President Kennedy.

On the day of the Kennedy assassination, FBI records show George Bush as reporting a right-wing member of the Houston Young Republicans for making threatening comments about President Kennedy. According to FBI documents released under the Freedom of Information Act and related FBI documentation, Bush received a highly sensitive, high-level briefing from the Bureau:

Date: November 29, 1963
To: Director Bush

Bureau of Intelligence and Research
Department of State
From: John Edgar Hoover, Director
Subject: ASSASSINATION OF PRESIDENT JOHN F. KENNEDY NOVEMBER 22, 1963

Our Miami, Florida, Office on November 23, 1963 advised that the Office of Coordinator of Cuban Affairs in Miami advised that the Department of State feels some misguided anti-Castro group might capitalize on the present situation and undertake an unauthorized raid against Cuba, believing that the assassination of President John F. Kennedy might herald a change in US policy, which is not true.

Our sources and informants familiar with Cuban matters in the Miami area advise that the general feeling in the anti-Castro Cuban community is one of stunned disbelief and, even among those who did not entirely agree with the President’s policy concerning Cuba, the feeling is that the President’s death represents a great loss not only to the US but to all Latin America. These sources know of no plans for unauthorized action against Cuba.

An informant who has furnished reliable information in the past and who is close to a small pro-Castro group in Miami has advised that those individuals are afraid that the assassination of the President may result in strong repressive measures being taken against them and, although pro-Castro in their feelings, regret the assassination.”

Castro

Castro

 

This FBI document identifying George Bush as a CIA agent in November, 1963 was first published by Joseph McBride in The Nation in July, 1988, just before Bush received the Republican nomination for president. McBride’s source observed: “I know [Bush] was involved in the Caribbean. I know he was involved in the suppression of things after the Kennedy assassination. There was a very definite worry that some Cuban groups were going to move against Castro and attempt to blame it on the CIA.” 20 When pressed for confirmation or denial, Bush’s spokesman Stephen Hart commented: “Must be another George Bush.” Within a short time the CIA itself would peddle the same damage control line. On July 19, 1988 in the wake of wide public attention to the report published in The Nation, CIA spokeswoman Sharron Basso departed from the normal CIA policy of refusing to confirm or deny reports that any person is or was a CIA employee. CIA spokeswoman Basso told the Associated Press that the CIA believed that “the record should be clarified.” For the CIA to volunteer the name of one of its former employees to the press was a shocking violation of traditional methods, which are supposedly designed to keep such names a closely guarded secret.

This revelation may have constituted a violation of federal law. But no exertions were too great when it came to damage control for George Bush. It makes perfect sense for George Bush to be called in on a matter involving the Cuban community in Miami, since that is a place where George has traditionally had a constituency. George inherited it from his father, Prescott Bush of Jupiter Island, and later passed it on to his own son, Jeb.

Bush and Noriega

Bush and Noriega

– The Green Chazzan 

 

 

 

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Required Reading – The Bay of Pigs & Operation J/M-Wave – Part 1

The Bay of Pigs & Operation J/M-Wave        

Inside the CIA’s Miami Training Camps by Jorge Varona (1977)

Bay of Pigs - Captured Agents

Bay of Pigs – Captured Agents

All four of the former agents I talked to had joined the CIA either before or during the Bay of Pigs training period. Two were in the invasion; and two were in the Cuban underground. One of them said: “I don’t know when they will need me again”.

When Cuban exiles began arriving in the United States in 1959 many thought the best way to go back to their country was a war in which a powerful ally was needed. The ally was there in the form of a sympathetic United States government which sponsored the ill-fated Bay of Pigs invasion – an invasion which had an end result, the consolidation of the government of Prime Minister Fidel Castro.

Cubans in general have had a dichotomous attitude toward the United States: traditionally Cubans have distrusted the “Colossus of the North” while expressing great admiration for American political stability and know-how. The failure of the Bay of Pigs invasion was easily blamed by many on the inexperience and ‘lack of guts’ of the late President John F. Kennedy; the disgruntled exiles, however, kept alive their hopes of getting control of their homeland by joining up with an arm of the government which was sympathetic and powerful: The Central Intelligence Agency.

Not all Cubans who fought against Castro were CIA followers, but those days in the camps in Guatemala had seen strong friends grow between the trainees and the CIA instructors. When the invaders came back, many gravitated to the US Army and others stayed close to the intelligence community in the Miami Area.

Carlos Prio Socarras

Carlos Prio Socarras

CIA recruitment of operatives and agents began even before Cuban dictator Fulgencio Batista was overthrown. Watergate burglar Frank Sturgis has admitted he was recruited to work for the CIA while he was ferrying weapons to Cuban rebels under the direction of former Cuban president Carlos Prio Socarras. The CIA maintained a large network of operatives on the island nation up to the 1961 U.S. sponsored invasion, when most of them were arrested and neutralized by the Cuban secret police (known as G-2). Those agents who were not caught had to go into hiding, and were, for the most part, neutralized.  Only a small hardy group survived and still may be working today.

But it is the Miami based CIA groups, the ones functioning in Miami that grew and were used by American intelligence to form an intelligence network which extended through Latin America and Europe in the 1960’s and 1970’s. Following the Bay of Pigs invasion, the CIA began a recruitment drive in Miami among Cuban exiles and trained many of them in the commando raid tactics which were used in the 18-month period between the invasion and the October 1962 missile crisis.

bay-of-pigs

Following the crisis, CIA Cuba activities became more covert, since the ‘understanding’ reached by American President John F. Kennedy and Soviet Premier Nikita Khrushchev precluded any direct invasion of Cuba. To gather the information in this article; four former CIA agents were interviewed; two of these were Principal Agents who acted under direct orders from the CIA. CIA headquarters were located at the J/M-WAVE, a number of offices buildings and warehouses located at the University of Miami’s south campus. J/M-WAVE operated under the guise of Zenith Technological Services, an electronics firm which was supposed to have been engaged in doing weapons research for the Department of Defense. Even though The Company has denied it, Sturgis confirmed he was involved in assassination plots against Castro and other Latin leaders, many of these operations were hatched from J/M-WAVE.

All agents interviewed had first come in contact with the CIA either before or during the Bay of Pigs training period. Two participated in the invasion and two were members of the Cuban underground. They will be known only by their first names since they do not wish to compromise their lives. One of them said “I do not know when they will need me again”.William R. Amlong described the CIA Miami operation in the March 9, 1975 Miami Herald as “the largest anywhere in the world outside of the Langley Headquarters in Virginia”. During the height of the CIA Cuban operation over 400 officers of the CIA connected with propaganda, paramilitary and infiltration operations worked out of there. At this headquarters, the activities of more than 1,500 Cuban Exile operatives were coordinated. These operatives according to ‘Rolando’, one of the agents, operated freely in Miami, Venezuela, Colombia, Chile, Spain, France, West Germany and Italy.

assassination-targets

With the conclusion of the missile crisis and the return of the Bay of Pigs invaders to American soil, the CIA operation began to enter the infiltration and harassment of Cuba phase in which small teams went to Cuba to deliver radios, explosives, and weapons to underground elements. This was the apogee of the Cuban operation, which lasted with official sanction until early 1965, when Lyndon Johnson brought his own political clout to the White House.

The recruitment of Cuban Exiles was described by the agents as follows: Immigration and Naturalization Service authorities screening exiles would tip off the CIA as to whom they though could be an effective agent. Local exiles already working for the CIA would in turn go to visit them and invite the new arrivals to visit one of the many safe-houses that “La Compania” had in Miami. One of these was the Old Revolutionary Council house just north of downtown Miami. The CIA tried to recruit farmers and fisherman who knew the coast and who could help the infiltration teams get into Cuba without being seen. Training began with classes in Miami, where the recruits began learning about tactics and weapons. These classes were usually held at the house of the Principal Agents. Most of the time the CIA tried to have the Cuban PA’s very visible in from of the Cuban recruits in order to gain their confidence.

Those recruits who would actually become agents and not just operatives would be sent up for further training at Eglin Air Force Base in Pensacola, Florida (where, perhaps not coincidentally, the Watergate burglars would be imprisoned in 1974). Some of the training in guerilla warfare took place in the Okeefenokee Swamp in the Florida panhandle and southern Georgia. The recruits stayed for one month at this base. From here the recruits went to several bases near the CIA headquarters in Virginia, where they received further training in commando tactics, raids and weapons. Training at these bases lasted for a month.

J/M-Wave, Florida

J/M-Wave, Florida

According to ‘Roland’: “From here we were taken in closed planes to another base. We did not know where this base is. There we took training in explosives and demolition”. This type of training was held regularly until at least 1968.

At least two of the agents confirmed about 300 men received training in demolitions. The training varied while some were taught demolition on dry land, others learned all about underwater charges. This phase of operation ceased in large scale right after Lyndon Johnson took over in 1965. The 1965-1968 period saw an increase in the infiltrations for the purpose of gathering intelligence and rescuing agents inside Cuba. It is also believed that in this period some more of the assassination plots against Castro were hatched in Miami. While official U.S. policy at the time was one of ‘hands off’ Cuba, local authorities often looked the other way when Cuban Exiles, especially CIA agents or operatives, were caught breaking the neutrality laws.

“I remember when we caught one of these guys who had a lot of explosives and weapons in his house” said a former Dade County policeman who is now self-employed. “The Feds came in and took everything we had, saying that they were going to draw up federal charges against this man. They took everything, the weapons, the explosives, everything. We told them that we needed something so that we could bring our own charges against the man (who was active in anti-Castro activities) and federal agents left the State Attorney a case of hand grenades. Well, as it turned out, there was no regulation in Dade or Miami covering possession of hand grenades, so we had to let him go.”

Since Cuba could not be the object of a massive CIA operation, the Cia began using the recruited exiles to check on pro-Castro activity in Europe and Latin America. Already well known is the manhunt of Ernesto ‘Che’ Guevara in Bolivia, in which at least 2 of the agents interviewed participated in minor roles. Exiles also participated in the covert propaganda work in Chile which helped to defeat Salvador Allende in 1964.

Salvadore Allende

Salvadore Allende

The CIA operation in Miami was divided into ubiquitous cells. Normally, one cell did not know what the other was doing, in case one of the groups was caught in Cuba. There was also another reason for this: usually members of one cell were political enemies of another cell. There were cells of people connected with former President Prio, other cells consisted of former allies of Batista, and other cells were comprised of former members of Castro’s revolutionary army. Men who would normally not be able to work together because of irreconcilable political conflicts worked this way together. This way, with Machiavellian precision, the CIA did for exiles what they could never do: band together to fight Castro.

The same political division was used by the CIA to keep any of the groups from reaching a position of relative strength. A good example of this was the campaign of vituperation against Manolo Ray, a liberal center-left former Castro minister who headed a powerful and popular exile group. Ray was accused of being a ‘Fidelista sin Fidel’ or one who liked the revolution but hated Castro, and his campaign lost much influence over the affair.

Nixon

Nixon

The CIA usually kept informants as members of most groups and managed to control even the most fanatical nationalists. As the anti-Castro activity began to be more closely controlled with the election of Richard Nixon in 1968, the CIA kept on its payroll a ‘secret police’ in Miami, which numbered anywhere from 200 to 300 Cuban Exiles. Men like Watergate burglar Eugenio Rolando ‘Muscalito’ Martinez belonged to this group. The CIA and some of the agents claim the group was officially disbanded in 1972, though most of the men remained on retainer as ‘consultants’. Martinez was still collecting $100-a-month from the CIA when he was caught in the Democratic National Headquarters. Members of this group trained at the J/M-WAVE facility. Others took training courses at the ‘School of the Americas’ in Fort Gulick at the Panama Canal Zone.

In Miami the cloak-and-dagger activities of the CIA quickly became mixed up in the narcotics traffic since many of the operatives were dealing heroin and marijuana. These dealers had what amounted to official protection because of the work they did. Part of the official protection the CIA had in Miami extended to the Miami Police Departments and also to the Dade County Sheriff’s office. Former Miami Police Chief Bernard Garmire provided some of the official protection the CIA operatives needed. This extended to having the CIA operatives keep a close eye on independent Anti-Castro groups; they usually busted their members when it appeared they were about to execute freelance raids on Cuba. During the 1972 Republican and Democratic National Conventions in Miami Beach, CIA operatives infiltrated most anti-Castro groups and often set them off against each other or against left-wing groups protesting the convention.

The CIA also sponsored front companies which served as support for the Company. An example of this is the Hialeah Egg Factory in which many of these operatives worked, among them Jose Antonio Prat, who mysteriously ‘killed himself’ in Miami in early February of 1976. One of the front men of the factory is a retired CIA agent known as Richard ‘El Americano’ who spent 12 years in Castro’s dungeons for espionage.

Up to 60 of these front companies grew around Miami; often they had names similar to real companies and would even sell similar products. Unsuspecting calls to them would invariably bring excuses about ‘not having the material available’. The receptionists would lie about the whereabouts of salesmen and even to credit ex-employees confirming former employment and salaries. Many of these corporations were not officially registered with the state of Florida but were seldom ever prosecuted or brought to the public’s attention.

The same is true of a number of used car lots which opened up in Miami and were run by some of the Cuban Exiles in the 1960s. U.S. Representative William Lehman, a used car dealer in North Miami, told the Rockefellar Commission that he believed there was some unfair competition from the CIA because their dealerships undersold the market. Cuban Exiles who normally worked other jobs preferred to work this way and were paid directly, to seldom sell a few cars while plotting Anti-Castro activities in air conditioned offices.

Cuban Exiles in Miami

Cuban Exiles in Miami

Although the CIA activities slowed down in 1972, along with the agents claim that recruitment has stopped altogether, a legacy has remained in Miami. The trainees did not quite stop working after the CIA cooled them down. Many set up their own training schools and as late as 1973, they kept training other exiles in the use of weapons and explosives. A paramilitary Parachute Club, the ‘Golden Falcons’ was the place where Humberto Lopez Jr., the convicted terrorist and Rolando Otero Hernandez, another terrorist now in Chile, first joined together and learned about bomb making under the CIA.

At a small office near SW I Street on 22 Avenue, CIA operatives trained in explosives and booby traps by the special forces taught young Cubans how to handle most weapons in the American military as well as Russian and Eastern European weapons. Training in booby-traps and grenades were held under the direction of Conrado Rodriguez. Usually the classes were well illustrated with weapons and taught by four expert marksmen. Even though many agents have claimed to stop these activities, men like Max Gorman Gonzalez are still reluctant to speak with reporters, afraid of compromising their business relationship with the CIA. It is interesting to note that while Frank Sturgis claims to have stopped the CIA activities, he was seen training the Exiles on how to recruit among their own for forces in Angola.

“When Bernard Barker, one of the Miami Watergate burglars, entered federal prison, he encountered an old Bay of Pigs comrade jailed for violating US neutrality laws in a freelance raid against Cuba. Chico, as he was nicknamed complained that America wasn’t what it used to be…”

In Hialeah, the Egg Factory is still working and the Power Chemical and Paper Corporation still operates with salesmen doubling as agents. At 1800 NW River Drive, CIA operatives are still recruiting forces to fight in Angola as early as the Spring of 1976.

A man crosses the Central Intelligence A

– The Green Chazzan

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Required Reading – The Merchants of Death

EDITOR: This excerpt details the history of the Bush family and how they rose to prominence within the American upper class during World War I and World War II. Senator Prescott Bush, a notorious anti-Roosevelt Republican and convicted traitor in World War II, would set the stage for his son, George HW Bush to one day emerge as leader of the Consortium and President of the United States.

The Merchants of Death

Excerpts from ‘George Bush’ by Dr. Webster Tarpley (1992)

Prescott Goes to War

Prescott Bush

Prescott Bush

 

President George Herbert Walker Bush was born in 1924, the son of Prescott S. Bush and Dorothy Walker Bush. We will begin the George Bush story about a decade before his birth, on the eve of World War I. We will follow the career of his father, Prescott Bush, through his marriage with Dorothy Walker, on the path to fortune, elegance and power.

Prescott Bush entered Yale University in 1913. A native of Columbus, Ohio, Prescott had spent the last five years before college in St. George’s Episcopal preparatory school in Newport, Rhode Island.Prescott Bush’s first college year, 1913, was also the freshman year at Yale for E. Roland ( “Bunny” ) Harriman, whose older brother (Wm.) Averell Harriman had just graduated from Yale. This is the Averell Harriman who went on to fame as the U.S. ambassador to the Soviet Union during World War II, as a governor of New York State, and as a presidential advisor who was greatly responsible for starting the Vietnam War.

The Harrimans would become the sponsors of the Bushes, to lift them onto the stage of world history. In the spring of 1916, Prescott Bush and “Bunny” Harriman were chosen for membership in an elite Yale senior-year secret society known as Skull and Bones. This unusually morbid, death-celebrating group helped Wall Street financiers find active young men of “good birth” to form a kind of imitation British aristocracy in America.

Averall Harriman

Averall Harriman

World War I was then raging in Europe. With the prospect that the U.S.A. would soon join the war, two Skull and Bones “Patriarchs” , Averell Harriman (class of 1913) and Percy A. Rockefeller (class of 1900), paid special attention to Prescott’s class of 1917. They wanted reliable cadres to help them play the Great Game, in the lucrative new imperial era that the war was opening up for London and New York moneycrats. Prescott Bush, by then a close friend of “Bunny” Harriman, and several other Bonesmen from their class of 1917 would later comprise the core partners in Brown Brothers Harriman, the world’s largest private investment bank. World War I did make an immense amount of money for the clan of stock speculators and British bankers who had just taken over U.S. industry. The Harrimans were stars of this new Anglo-American elite.

Averell’s father, stock broker E.H. Harriman, had gained control of the Union Pacific Railroad in 1898 with credit arranged by William Rockefeller, Percy’s father, and by Kuhn Loeb & Co.’s British-affiliated private bankers, Otto Kahn, Jacob Schiff and Felix Warburg. William Rockefeller, treasurer of Standard Oil and brother of Standard founder John D. Rockefeller, owned National City Bank (later “Citibank” ) together with Texas-based James Stillman. In return for their backing, E.H. Harriman deposited in City Bank the vast receipts from his railroad lines. When he issued tens of millions of dollars of “watered” (fraudulent) railroad stock, Harriman sold most of the shares through the Kuhn Loeb company.

The First World War elevated Prescott Bush and his father, Samuel P. Bush, into the lower ranks of the Eastern Establishment. As war loomed in 1914, National City Bank began reorganizing the U.S. arms industry. Percy A. Rockefeller took direct control of the Remington Arms company, appointing his own man, Samuel F. Pryor, as the new chief executive of Remington. The U.S entered World War I in 1917. In the spring of 1918, Prescott’s father, Samuel P. Bush, became chief of the Ordnance, Small Arms and Ammunition Section of the War Industries Board. The senior Bush took national responsibility for government assistance to and relations with Remington and other weapons companies.

Bernard Baruch

Bernard Baruch

This was an unusual appointment, as Prescott’s father seemed to have no background in munitions. Samuel Bush had been president of the Buckeye Steel Castings Co. in Columbus, Ohio, makers of railcar parts. His entire career had been in the railroad business– supplying equipment to the Wall Street-owned railroad systems. The War Industries Board was run by Bernard Baruch, a Wall Street speculator with close personal and business ties to old E.H. Harriman. Baruch’s brokerage firm had handled Harriman speculations of all kinds.

In 1918, Samuel Bush became director of the Facilities Division of the War Industries Board. Prescott’s father reported to the Board’s Chairman, Bernard Baruch, and to Baruch’s assistant, Wall Street private banker Clarence Dillon. Robert S. Lovett, President of Union Pacific Railroad, chief counsel to E.H. Harriman and executor of his will, was in charge of national production and purchase “priorities” for Baruch’s board. With the war mobilization conducted under the supervision of the War Industries Board, U.S. consumers and taxpayers showered unprecedented fortunes on war producers and certain holders of raw materials and patents. Hearings in 1934 by the committee of U.S. Senator Gerald Nye attacked the “Merchants of Death” — war profiteers such as Remington Arms and the British Vickers company –whose salesmen had manipulated many nations into wars, and then supplied all sides with the weapons to fight them.

Percy Rockefellar

Percy Rockefellar

Percy Rockefeller and Samuel Pryor’s Remington Arms supplied machine guns and Colt automatic pistols; millions of rifles to Czarist Russia; over half of the small-arms ammunition used by the Anglo-American allies in World War I; and 69 percent of the rifles used by the United States in that conflict. Samuel Bush’s wartime relationship to these businessmen would continue after the war, and would especially aid his son Prescott’s career of service to the Harrimans.

Now, arms production in wartime is by necessity carried on with great security precautions. The public need not know details of the private lives of the government or industry executives involved, and a broad interrelationship between government and private-sector personnel is normal and useful. But during the period preceding World War I, and in the war years 1914-1917 when the U.S. was still neutral, interlocking Wall Street financiers subservient to British strategy lobbied heavily, and twisted U.S. government and domestic police functions. Led by the J.P. Morgan concern, Britain’s overall purchasing agent in America, these financiers wanted a world war and they wanted the United States in it as Britain’s ally. The U.S. and British arms companies, owned by these international financiers, poured out weapons abroad in deals not subject to the scrutiny of any electorate back home. The same gentlemen, as we shall see, later supplied weapons and money to Hitler’s Nazis.

The Great Game

01908-hamburg-amerika-linie

On May 1, 1926, Prescott Bush joined W.A. Harriman & Co. as its vice president, under the bank’s president, Bert Walker, his father-in-law and George’s maternal grandfather–the head of the family. Bush would demonstrate strong loyalty to the firm he joined in 1926. And the bank, with the scope and power of many ordinary nations, could amply reward its agents. George Bush’s Grandfather Walker had put the enterprise together, quietly, secretly, using all the international connections at his disposal. Let us briefly look back at the beginning of the Harriman firm–the Bush family enterprise–and follow its course into one of history’s darkest projects.

The firm’s first global lever was its successful arrangement to get into Germany by dominating that country’s shipping. Averell Harriman announced in 1920 that he would re-start Germany’s Hamburg- Amerika Line, after many months of scheming and arm-twisting. Hamburg-Amerika’s commercial steamships had been confiscated by the United States at the end of the First World War. These ships had then become the property of the Harriman enterprise, by some arrangements with the U.S. authorities that were never made public.

The deal was breathtaking; it would create the world’s largest private shipping line. Hamburg-Amerika Line regained its confiscated vessels, for a heavy price. The Harriman enterprise took “the right to participate in 50 percent of all business originated in Hamburg” ; and for the next twenty years (1920-1940), the Harriman enterprise had “complete control of all activities of the Hamburg line in the United States.” Harriman became co-owner of Hamburg-Amerika. The Harriman-Walker firm gained a tight hold on its management, with the not-so-subtle backing of the post-World War I occupation of Germany by the armies of England and America.

GEX14980z

Just after Harriman’s public statement, the St. Louis press celebrated Bert Walker’s role in assembling the money to consummate the deal:

“Ex-St. Louisan Forms Giant Ship Merger”

The story celebrated a “merger of two big financial houses in New York, which will place practically unlimited capital at the disposal of the new American-German shipping combine….” Bert Walker had arranged a “marriage” of J.P. Morgan credit and Harriman family inherited wealth.

W.A. Harriman & Co., of which Walker was president and founder, was merging with the Morton & Co. private bank–and Walker was “[p]rominent in the affairs of Morton & Co.,” which was interlocked with the Morgan-controlled Guaranty Trust Co. The Hamburg-Amerika takeover created an effective instrument for the manipulation and fatal subversion of Germany. One of the great “merchants of death,” Samuel Pryor, was in it from the beginning. Pryor, then chairman of the executive committee of Remington Arms, helped arrange the deal and served with Walker on the board of Harriman’s shipping front organization, the American Ship and Commerce Co.

Walker and Harriman took the next giant step in 1922, setting up their European headquarters office in Berlin. With the aid of the Hamburg-based Warburg bank, W.A. Harriman & Co. began spreading an investment net over German industry and raw materials. From the Berlin base, Walker and Harriman then plunged into deals with the new dictatorship of the Soviet Union. They led a select group of Wall Street and British Empire speculators who re-started the Russian oil industry, which had been devastated by the Bolshevik Revolution. They contracted to mine Soviet manganese, an element essential to modern steelmaking. These concessions were arranged directly with Leon Trotsky, then with Felix Dzerzhinsky, founder of the Soviet dictatorship’s secret intelligence service (K.G.B), whose huge statue was finally pulled down by pro-democracy demonstrators in 1991.

USGA-United-States-Golf-Association-logo

With the bank launched, Bert Walker found New York the ideal place to satisfy his passion for sports, games and gambling. Walker was elected president of the U.S. Golf Association in 1920. He negotiated new international rules for the game with the Royal and Ancient Golf Club of St. Andrews, Scotland. After these talks he contributed the three-foot-high silver Walker Cup, for which British and American teams have since competed every two years. Bert’s son-in-law Prescott Bush was later secretary of the U.S. Golf Association, during the grave political and economic crises of the early 1930s. Prescott became USGA President in 1935, while he was otherwise embroiled in the family firm’s work with Nazi Germany.

USGA Walker Cup

USGA Walker Cup

In 1925, Bert Walker and Averell Harriman headed a syndicate which rebuilt Madison Square Garden as the modern Palace of Sport. Walker was at the center of New York’s gambling scene in its heyday, in that Prohibition era of colorful and bloody gangsters. The Garden bloomed with million-dollar prize fights; bookies and their clients pooled more millions, trying to match the pace of the speculation-crazed stock and bond men. This was the era of “organized” crime–the national gambling and bootleg syndicate structured on the New York corporate model.

By 1930 Walker was New York State Racing Commissioner. The vivid colors and sounds of the racing scene must have impressed little George as much as his grandfather. Bert Walker bred race horses at his own stable, the Log Cabin Stud. He was president of the Belmont Park race track. Bert also personally managed most aspects of Harriman’s racing interests.

After the firm’s 1931 merger with the British-American banking house Brown Brothers, Prescott Bush became managing partner of the resulting company: Brown Brothers Harriman. This was ultimately the largest and politically the most important private banking house in America. Financial collapse, world depression and social upheaval followed the fevered speculation of the 1920s. The 1929-31 crash of securities values wiped out the small fortune Prescott Bush had gained since 1926. But because of his devotion to the Harrimans, they “did a very generous thing,” as Bush later put it. They staked him to what he had lost and put him back on his feet.

Depression Era Hemp Farm

Depression Era Hemp Farm

Prescott Bush described his own role, from 1931 through the 1940s, in a confidential interview:

I emphasize … that the Harrimans showed great courage and loyalty and confidence in us, because three or four of us were really running the business, the day to day business. Averell was all over the place in those days … and Roland was involved in a lot of directorships, and he didn’t get down into the “lift- up-and-bear-down” activity of the bank, you see– the day- to-day decisions … we were really running the business, the day to day business, all the administrative decisions and the executive decisions. We were the ones that did it. We were the managing partners.”

But of the “three or four” partners in charge, Bush was effectively at the head of the firm, because he had taken over management of the gigantic personal investment funds of Averell and E. Roland “Bunny” Harriman. In those interwar years, Prescott Bush made the family fortune which George Bush inherited. He piled up the money from an international project which continued until a new world war, and the action of the U.S. government, intervened to stop him.

Control of Nazi Commerce

adolf-hitler-b

 

Bert Walker had arranged the credits Harriman needed to take control of the Hamburg-Amerika Line back in 1920. Walker had organized the American Ship and Commerce Corp. as a unit of the W.A. Harriman & Co., with contractual power over Hamburg-Amerika’s affairs. As the Nazi project went into high gear, Harriman-Bush shares in American Ship and Commerce Corp. were held by the Harriman Fifteen Corp., ran by Prescott Bush and Bert Walker.

In many ways, Bush’s Hamburg-Amerika Line was the pivot for the entire Nazi project.

Averell Harriman and Bert Walker had gained control over the steamship company in 1920 in negotiations with its post-World War I chief executive, Wilhelm Cuno, and with the line’s bankers, M.M. Warburg. Cuno was thereafter completely dependent on the Anglo-Americans, and became a member of the Anglo-German Friendship Society. In the 1930-32 drive for a Hitler dictatorship, Wilhelm Cuno contributed important sums to the Nazi Party. Albert Voegler was chief executive of the Thyssen-Flick German Steel Trust for which Bush’s Union Banking Corp. was the New York office. He was a director of the Bush-affiliate BHS Bank in Rotterdam, and a director of the Harriman-Bush Hamburg-Amerika Line. Voegler joined Thyssen and Flick in their heavy 1930-33 Nazi contributions, and helped organize the final Nazi leap into national power.

ThyssenKrupp_logo

Thyssen Steel

 

The Schroeder family of bankers was a linchpin for the Nazi activities of Harriman and Prescott Bush, closely tied to their lawyers Allen and John Foster Dulles. Baron Kurt von Schroeder was co-director of the massive Thyssen-Huautte foundry along with Johann Groeninger, Prescott Bush’s New York bank partner. Kurt von Schroeder was treasurer of the support organization for the Nazi Party’s private armies, to which Friedrich Flick contributed. Kurt von Schroeder and Montagu Norman’s protégé Hjalmar Schacht together made the final arrangements for Hitler to enter the government. Baron Rudolph von Schroeder was vice president and director of the Hamburg-Amerika Line. Certain actions taken directly by the Harriman-Bush shipping line in 1932 are ranked among the gravest acts of treason in this century.

The U.S. embassy in Berlin reported back to Washington that the “costly election campaigns” and “ the cost of maintaining a private army of 300,000 to 400,000 men ” had raised questions as to the Nazis’ financial backers. The constitutional government of the German republic moved to defend national freedom by ordering the Nazi Party private armies disbanded. The U.S. embassy reported that the Hamburg-Amerika Line was purchasing and distributing propaganda attacks against the German government, for attempting this last-minute crackdown on Hitler’s forces.

IG Farben

IG Farben

Thousands of German opponents of Hitlerism were shot or intimidated by privately armed Nazi Brown Shirts. In this connection we note that the original “Merchant of Death, ” Samuel Pryor, was a founding director of both the Union Banking Corp. and the American Ship and Commerce Corp. Since Mr. Pryor was executive committee chairman of Remington Arms and a central figure in the world’s private arms traffic, his use to the Nazi project was enhanced as the Bush family’s partner in Nazi Party banking and trans-Atlantic shipping. The U.S. Senate arms-traffic investigators probed Remington after it was joined in a cartel agreement on explosives to the Nazi firm I.G. Farben. Looking at the period leading up to Hitler’s seizure of power, the Senators found that “German political associations, like the Nazi and others, are nearly all armed with American … guns…. Arms of all kinds coming from America are transshipped in the Scheldt to river barges before the vessels arrive in Antwerp. They then can be carried through Holland without police inspection or interference. The Nazis and Communists are presumed to get arms in this manner. The principal arms coming from America are Thompson submachine guns and revolvers. The number is great. ”

The beginning of the Hitler regime brought some bizarre changes to the Hamburg-Amerika Line. Prescott Bush’s American Ship and Commerce Corp. notified Max Warburg of Hamburg, Germany, on March 7, 1933, that Warburg was to be the corporation’s official, designated representative on the board of Hamburg-Amerika. Max Warburg replied on March 27, 1933, assuring his American sponsors that the Hitler government was good for Germany: “ For the last few years business was considerably better than we had anticipated, but a reaction is making itself felt for some months. We are actually suffering also under the very active propaganda against Germany, caused by some unpleasant circumstances. These occurrences were the natural consequence of the very excited election campaign, but were extraordinarily exaggerated in the foreign press. The Government is firmly resolved to maintain public peace and order in Germany, and I feel perfectly convinced in this respect that there is no cause for any alarm whatsoever. ”

Ships Built by UBS Loans

Ships Built by UBC Loans

This seal of approval for Hitler, coming from a famous Jewish business magnate, was just what Harriman and Bush required, for they anticipated rather serious “ alarm ” inside the U.S.A. against their Nazi operations. On March 29, 1933, two days after Max’s letter to Harriman, Max’s son, Erich Warburg, sent a cable to his cousin Frederick M. Warburg, a director of the Harriman railroad system. He asked Frederick to “use all your influence ” to stop all anti-Nazi activity in America, including “ atrocity news and unfriendly propaganda in foreign press, mass meetings, etc. ” Frederick cabled back to Erich: “ No responsible groups here [are] urging [a] boycott [of] German goods[,] merely excited individuals. ” Two days after that, On March 31, 1933, the American-Jewish Committee, controlled by the Warburgs, and the B’nai B’rith, heavily influenced by the Sulzbergers (New York Times), issued a formal, official joint statement of the two organizations, counseling “that no American boycott against Germany be encouraged, ” and advising “ that no further mass meetings be held or similar forms of agitation be employed. ”

The executive board of the Hamburg Amerika Line (Hapag) met jointly with the North German Lloyd Company board in Hamburg on Sept. 5, 1933. Under official Nazi supervision, the two firms were merged. Prescott Bush’s American Ship and Commerce Corp. installed Christian J. Beck, a long-time Harriman executive, as manager of freight and operations in North America for the new joint Nazi shipping lines (Hapag-Lloyd) on Nov. 4, 1933. According to testimony of officials of the companies before Congress in 1934, a supervisor from the Nazi Labor Front rode with every ship of the Harriman-Bush line; employees of the New York offices were directly organized into the Nazi Labor Front organization; Hamburg-Amerika provided free passage to individuals going abroad for Nazi propaganda purposes; and the line subsidized pro-Nazi newspapers in the U.S.A., as it had done in Germany against the constitutional German government.

OLYMPUS DIGITAL CAMERA

In mid-1936, Prescott Bush’s American Ship and Commerce Corp. cabled M.M. Warburg, asking Warburg to represent the company’s heavy share interest at the forthcoming Hamburg-Amerika stockholders meeting. The Warburg office replied with the information that “we represented you ” at the stockholders meeting and “ exercised on your behalf your voting power for Rm [gold marks] 3,509,600 Hapag stock deposited with us. ” The Warburgs transmitted a letter received from Emil Helfferich, German chief executive of both Hapag-Lloyd and of the Standard Oil subsidiary in Nazi Germany: “ It is the intention to continue the relations with Mr. Harriman on the same basis as heretofore…. ” After the meeting with the Zeppelin passenger, the Harriman-Bush office replied: “ I am glad to learn that Mr. Hellferich [sic] has stated that relations between the Hamburg American Line and ourselves will be continued on the same basis as heretofore. ”

Two months before moving against Prescott Bush’s Union Banking Corporation, the U. S. government ordered the seizure of all property of the Hamburg-Amerika Line and North German Lloyd, under the Trading with the Enemy Act. The investigators noted in the pre-seizure report that Christian J. Beck was still acting as an attorney representing the Nazi firm. In May 1933, just after the Hitler regime was consolidated, an agreement was reached in Berlin for the coordination of all Nazi commerce with the U.S.A. The Harriman International Co., led by Averell Harriman’s first cousin Oliver, was to head a syndicate of 150 firms and individuals, to conduct all exports from Hitler Germany to the United States.

Prescott Bush

Prescott Bush

This pact had been negotiated in Berlin between Hitler’s economics minister, Hjalmar Schacht, and John Foster Dulles, international attorney for dozens of Nazi enterprises, with the counsel of Max Warburg and Kurt von Schroeder. John Foster Dulles would later be U.S. Secretary of State, and the great power in the Republican Party of the 1950s. Foster’s friendship and that of his brother Allen (head of the Central Intelligence Agency), greatly aided Prescott Bush to become the Republican U.S. Senator from Connecticut. And it was to be of inestimable value to George Bush, in his ascent to the heights of “covert action government, ” that both of these Dulles brothers were the lawyers for the Bush family’s far-flung enterprise.

John Foster Dulles

John Foster Dulles

Throughout the 1930s, John Foster Dulles arranged debt restructuring for German firms under a series of decrees issued by Adolf Hitler. In these deals, Dulles struck a balance between the interest owed to selected, larger investors, and the needs of the growing Nazi war-making apparatus for producing tanks, poison gas, etc. Dulles wrote to Prescott Bush in 1937 concerning one such arrangement. The German-Atlantic Cable Company, owning Nazi Germany’s only telegraph channel to the United States, had made debt and management agreements with the Walker-Harriman bank during the 1920s. A new decree would now void those agreements, which had originally been reached with non-Nazi corporate officials. Dulles asked Bush, who managed these affairs for Averell Harriman, to get Averell’s signature on a letter to Nazi officials, agreeing to the changes. Dulles wrote:

Sept. 22, 1937

Mr. Prescott S. Bush

59 Wall Street, New York, N.Y.

Dear Prescott,

I have looked over the letter of the German-American [sic] Cable Company to Averell Harriman…. It would appear that the only rights in the matter are those which inure in the bankers and that no legal embarrassment would result, so far as the bondholders are concerned, by your acquiescence in the modification of the bankers’ agreement.

Sincerely yours,

John Foster Dulles

Dulles enclosed a proposed draft reply, Bush got Harriman’s signature, and the changes went through.In conjunction with these arrangements, the German Atlantic Cable Company attempted to stop payment on its debts to smaller American bondholders. The money was to be used instead for arming the Nazi state, under a decree of the Hitler government. Despite the busy efforts of Bush and Dulles, a New York court decided that this particular Hitler “law ” was invalid in the United States; small bondholders, not parties to deals between the bankers and the Nazis, were entitled to get paid.

Trading With The Enemy

 

Brown_Brothers_Harriman_Logo_1.svg

In October 1942, ten months after entering World War II, America was preparing its first assault against Nazi military forces. Prescott Bush was managing partner of Brown Brothers Harriman. His 18-year-old son George, the future U.S. President, had just begun training to become a naval pilot. On Oct. 20, 1942, the U.S. government ordered the seizure of Nazi German banking operations in New York City which were being conducted by Prescott Bush.

Under the Trading with the Enemy Act, the government took over the Union Banking Corporation, in which Bush was a director. The U.S. Alien Property Custodian seized Union Banking Corp.’s stock shares, all of which were owned by Prescott Bush, E. Roland “ Bunny ” Harriman, three Nazi executives, and two other associates of Bush. The order seizing the bank “ vests ” (seizes) “ all of the capital stock of Union Banking Corporation, a New York corporation, ” and names the holders of its shares as:

“ E. Roland Harriman–3991 shares ”
[chairman and director of Union Banking Corp. (UBC); this is “ Bunny ” Harriman, described by Prescott Bush as a place holder who didn’t get much into banking affairs; Prescott managed his personal investments]

“ Cornelis Lievense–4 shares ”
[president and director of UBC; New York resident banking functionary for the Nazis]

“ Harold D. Pennington–1 share ”
[treasurer and director of UBC; an office manager employed by Bush at Brown Brothers Harriman]

“ Ray Morris–1 share ”

[director of UBC; partner of Bush and the Harrimans]

“ Prescott S. Bush–1 share ”
[director of UBC, which was co-founded and sponsored by his father-in-law George Walker; senior managing partner for E. Roland Harriman and Averell Harriman]

“ H.J. Kouwenhoven–1 share ”
[director of UBC; organized UBC as the emissary of Fritz Thyssen in negotiations with George Walker and Averell Harriman; managing director of UBC’s Netherlands affiliate under Nazi occupation; industrial executive in Nazi Germany; director and chief foreign financial executive of the German Steel Trust]

“ Johann G. Groeninger–1 share ”
[director of UBC and of its Netherlands affiliate; industrial executive in Nazi Germany, subordinate of Fritz Thyssen]

On Oct. 28 1942, the government issued orders seizing two Nazi front organizations run by the Bush-Harriman bank: the Holland-American Trading Corporation and the Seamless Steel Equipment Corporation.  U.S. forces landed under fire near Algiers on Nov. 8, 1942; heavy combat raged throughout November. Nazi interests in the Silesian-American Corporation, long managed by Prescott Bush and his father-in-law George Herbert Walker, were seized under the Trading with the Enemy Act on Nov. 17, 1942. In this action, the government announced that it was seizing only the Nazi interests, leaving the Nazis’ U.S. partners to carry on the business.

Thyssen with Hitler

Thyssen with Hitler

These and other actions taken by the U.S. government in wartime were, tragically, too little and too late. President Bush’s family had already played a central role in financing and arming Adolf Hitler for his takeover of Germany; in financing and managing the buildup of Nazi war industries for the conquest of Europe and war against the U.S.A.; and in the development of Nazi genocide theories and racial propaganda, with their well-known results.

President Franklin Roosevelt’s Alien Property Custodian, Leo T. Crowley, signed Vesting Order Number 248 seizing the property of Prescott Bush under the Trading with the Enemy Act. The order, published in obscure government record books and kept out of the news, explained nothing about the Nazis involved; only that the Union Banking Corporation was run for the “ Thyssen family ” of “ Germany and/or Hungary ”–“ nationals … of a designated enemy country. ”

By deciding that Prescott Bush and the other directors of the Union Banking Corp. were legally front men for the Nazis, the government avoided the more important historical issue: In what way were Hitler’s Nazis themselves hired, armed and instructed by the New York and London clique of which Prescott Bush was an executive manager? Let us examine the Harriman-Bush Hitler project from the 1920s until it was partially broken up, to seek an answer for that question.

Fritz Thyssen and his business partners are universally recognized as the most important German financiers of Adolf Hitler’s takeover of Germany. At the time of the order seizing the Thyssen family’s Union Banking Corp., Mr. Fritz Thyssen had already published his famous book, I Paid Hitler, admitting that he had financed Adolf Hitler and the Nazi movement since October 1923. Thyssen’s role as the leading early backer of Hitler’s grab for power in Germany had been noted by U.S. diplomats in Berlin in 1932. The order seizing the Bush-Thyssen bank was curiously quiet and modest about the identity of the perpetrators who had been nailed.

Frtiz Thyssen

Frtiz Thyssen

But two weeks before the official order, government investigators had reported secretly that “ W. Averell Harriman was in Europe sometime prior to 1924 and at that time became acquainted with Fritz Thyssen, the German industrialist. ” Harriman and Thyssen agreed to set up a bank for Thyssen in New York. “ [C]ertain of [Harriman’s] associates would serve as directors…. ” Thyssen agent “ H. J. Kouwenhoven … came to the United States … prior to 1924 for conferences with the Harriman Company in this connection…. ”

When exactly was “ Harriman in Europe sometime prior to 1924 ”? In fact, he was in Berlin in 1922 to set up the Berlin branch of W.A. Harriman & Co. under George Walker’s presidency. The Union Banking Corporation was established formally in 1924, as a unit in the Manhattan offices of W.A. Harriman & Co., interlocking with the Thyssen-owned Bank voor Handel en Scheepvaart (BHS) in the Netherlands. The investigators concluded that “ the Union Banking Corporation has since its inception handled funds chiefly supplied to it through the Dutch bank by the Thyssen interests for American investment. ”

Thus by personal agreement between Averell Harriman and Fritz Thyssen in 1922, W.A. Harriman & Co. (alias Union Banking Corporation) would be transferring funds back and forth between New York and the “ Thyssen interests ” in Germany. By putting up about $400,000, the Harriman organization would be joint owner and manager of Thyssen’s banking operations outside of Germany.

How important was the Nazi enterprise for which President Bush’s father was the New York banker?

Vereinigte Stahlwerke

Vereinigte Stahlwerke

The 1942 U.S. government investigative report said that Bush’s Nazi-front bank was an interlocking concern with the Vereinigte Stahlwerke (United Steel Works Corporation or German Steel Trust) led by Fritz Thyssen and his two brothers. After the war, Congressional investigators probed the Thyssen interests, Union Banking Corp. and related Nazi units. The investigation showed that the Vereinigte Stahlwerke had produced the following approximate proportions of total German national output:

50.8% of Nazi Germany’s pig iron
41.4% of Nazi Germany’s universal plate
36.0% of Nazi Germany’s heavy plate
38.5% of Nazi Germany’s galvanized sheet
45.5% of Nazi Germany’s pipes and tubes
22.1% of Nazi Germany’s wire
35.0% of Nazi Germany’s explosives.@s8

Prescott Bush became vice president of W.A. Harriman & Co. in 1926. That same year, a friend of Harriman and Bush set up a giant new organization for their client Fritz Thyssen, prime sponsor of politician Adolf Hitler. The new German Steel Trust, Germany’s largest industrial corporation, was organized in 1926 by Wall Street banker Clarence Dillon. Dillon was the old comrade of Prescott Bush’s father Sam Bush from the “ Merchants of Death ” bureau in World War I. In return for putting up $70 million to create his organization, majority owner Thyssen gave the Dillon Read company two or more representatives on the board of the new Steel Trust.

Thus there is a division of labor: Thyssen’s own confidential accounts, for political and related purposes, were run through the Walker-Bush organization; the German Steel Trust did its corporate banking through Dillon Read.

The Walker-Bush firm’s banking activities were not just politically neutral money-making ventures which happened to coincide with the aims of German Nazis. All of the firm’s European business in those days was organized around anti-democratic political forces. In 1927, criticism of their support for totalitarianism drew this retort from Bert Walker, written from Kennebunkport to Averell Harriman: “ It seems to me that the suggestion in connection with Lord Bearsted’s views that we withdraw from Russia smacks somewhat of the impertinent…. I think that we have drawn our line and should hew to it. ”

Bert Walker

Bert Walker

Averell Harriman met with Italy’s fascist dictator, Benito Mussolini. A representative of the firm subsequently telegraphed good news back to his chief executive Bert Walker: “ … During these last days … Mussolini … has examined and approved our c[o]ntract 15 June. ”

The great financial collapse of 1929-31 shook America, Germany and Britain, weakening all governments. It also made the hard-pressed Prescott Bush even more willing to do whatever was necessary to retain his new place in the world. It was in this crisis that certain Anglo-Americans determined on the installation of a Hitler regime in Germany. W.A. Harriman & Co., well-positioned for this enterprise and rich in assets from their German and Russian business, merged with the British-American investment house, Brown Brothers, on January 1, 1931. Bert Walker retired to his own G.H. Walker & Co. This left the Harriman brothers, Prescott Bush and Thatcher M. Brown as the senior partners of the new Brown Brothers Harriman firm. (The London, England branch of the Brown family firm continued operating under its historic name–Brown, Shipley.)

Robert A Lovett

Robert A Lovett

Robert A. Lovett also came over as a partner from Brown Brothers. His father, E.H. Harriman’s lawyer and railroad chief, had been on the War Industries Board with Prescott’s father. Though he remained a partner in Brown Brothers Harriman, the junior Lovett soon replaced his father as chief executive of Union Pacific Railroad. Brown Brothers had a racial tradition that fitted it well for Hitler. Brown Brothers, with offices in the U.S.A. and in England, had carried on their ships fully 75 percent of the slave cotton from the American South over to British mill owners. Now in 1931, the virtual dictator of world finance, Bank of England Governor Montagu Collet Norman, was a former Brown Brothers partner, whose grandfather had been boss of Brown Brothers during the U.S. Civil War. Montagu Norman was known as the most avid of Hitler’s supporters within British ruling circles, and Norman’s intimacy with this firm was essential to his management of the Nazi project.

A 1935 Harriman Fifteen Corporation memo from George Walker announced an agreement had been made “in Berlin ” to sell an 8,000 block of their shares in Consolidated Silesian Steel. Nazi tanks and bombs “settled” business with the invasion of Poland, beginning World War II. The Nazi army had been equipped by Flick, Harriman, Walker and Bush, with materials essentially stolen from Poland by Flick. There were probably few people at the time who could appreciate the irony, that when the Soviets also attacked and invaded Poland from the East, their vehicles were fueled by oil pumped from Baku wells revived by the Harriman/Walker/Bush enterprise.

Nazi Invasion in Poland

Nazi Invasion in Poland

Three years later, nearly a year after the Japanese attack on Pearl Harbor, the U.S. government ordered the seizure of the Nazis’ share in the Silesian-American Corporation under the Trading with the Enemy Act. Enemy nationals were said to own 49 percent of the common stock and 41.67 percent of the preferred stock of the company. The order characterized the company as a “business enterprise within the United States, owned by [a front company in] Zurich, Switzerland, and held for the benefit of Bergwerksgesellschaft George von Giesche’s Erben, a German corporation….

Bert Walker was still the senior director of the company, which he had founded back in 1926 simultaneously with the creation of the German Steel Trust. Ray Morris, Prescott’s partner from Union Banking Corp. and Brown Brothers Harriman, was also a director. The investigative report prior to the government crackdown explained the “ NATURE OF BUSINESS: The subject corporation is an American holding company for German and Polish subsidiaries, which own large and valuable coal and zinc mines in Silesia, Poland and Germany. Since September 1939, these properties have been in the possession of and have been operated by the German government and have undoubtedly been of considerable assistance to that country in its war effort. ” The report noted that the American stockholders hoped to regain control of the European properties after the war.

bush-salute

– The Green Chazzan

 

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Required Reading – Operation Jedburgh and OSS China – Part 4

EDITOR: The mysterious Paul Helliwell was the Station Chief of OSS China, the leader of the renegade commando group and the original architect of the CIA drugs-for-arms trade that would be the center of the Consortiums power. He was one of the top operatives for the CIA, the Mob and the Consortium, helping expand narcotics operations worldwide. Helliwell also controlled the finances of Operation J/M-Wave, the main CIA team picked from former Jedburgh Elite that was to conduct the Bay of Pigs assassination program. William Pawley was also key CIA figures in expanding the global narcotics trade in Central and South America. He was Tommy Corcoran’s main partner in Air America. He played a significant role in the Bay of Pigs and Operation J/M-Wave. Operation J/M-Wave was the CIA operation to assassinate Castro and recover the Consortium assets through the overthrow of Cuban communism.

Excerpts from Operation Jedburgh

by John Simkin (1997) – Part 4

Jedburgh Team Profiles

Paul Helliwell

Paul Helliwell (Left)

Paul Helliwell (Left)

Paul Lional Edward Helliwell was born in 1915. He was a lawyer before he joined the United States Army during the Second World War. Later he was transferred to the Office of Strategic Services (OSS) where he served under William Donovan. Helliwell was sent to China where he worked with Ray S. Cline, Richard Helms, E. Howard Hunt, Jake Esterline, Mitchell WerBell, John K. Singlaub, Jack Anderson, Robert Emmett Johnson and Lucien Conein. Others working in China at that time included Tommy Corcoran, Whiting Willauer and William Pawley.

OSS Patch

OSS Patch

In 1943 Colonel Paul Helliwell became head of the Secret Intelligence Branch of the OSS in Europe. Helliwell was replaced in this post by William Casey in 1945. Helliwell became chief of the Far East Division of the War Department’s Strategic Service Unit, an interim intelligence organization formed after OSS was closed down. In 1947 Helliwell joined the Central Intelligence Agency. In May 1949, General Claire Chennault had a meeting with Harry S. Truman and advocated an increase in funds for Chaing Kai-shek and his Kuomintang Army (KMT) in his war in China. Truman dismissed the idea as impractical. However, Frank Wisner, was more sympathetic and when Mao Zedong took power in China in 1950, he sent Helliwell to Taiwan.

China 1947

China 1947

Early 1949

Early 1949

China Advances on Opium Producing Regions (1949)

China Advances on Opium Producing Regions (1949)

Helliwell’s main job was to help Chaing Kai-shek to prepare for a future invasion of Communist China. The CIA created a pair of front companies to supply and finance the surviving forces of Chaing’s KMT. Paul Helliwell was put in charge of this operation. This included establishing Civil Air Transport (CAT), a Taiwan-based airline, and the Sea Supply Corporation, a shipping company in Bangkok. It was Helliwell’s idea to use these CIA fronted companies to raise money to help support Chaing Kai-shek. According to Joseph Trento (Prelude to Terror): “Through Sea Supply, Helliwell imported large amounts of arms for the KMT soldiers to keep the Burmese military from throwing them out of the country. The arms were ferried into Burma on CAT airplanes. CAT then used the “empty” planes to fly drugs from Burma to Taiwan, Bangkok, and Saigon. There the drugs were processed for the benefit of the KMT and Chiang Kai-shek’s corrupt government on Taiwan.”

Civil Air Transport (CAT), later renamed Air America, provided the CIA with the air power needed to sustain its covert operations for the next twenty-five years. Helliwell was to play an important role in running these covert, and often illegal operations. By the late 1950s it became clear that Chaing Kai-shek would never be strong enough to invade China. The main focus changed to stopping the spread of communism to countries like Burma, Thailand, Vietnam and Laos. At the time, the main group fighting communism in the region were the large private armies controlled by the drug lords. For example, General Vang Pao was employing his 30,000-man army to help the Pathet Lao. In return for joining the CIA, Helliwell helped Vang Pao to modernize the drug trade. William Corson claims that: “Portable heroin processing facilities were brought in. It was a creation of the CIA’s technical services division.” Some of these profits went to help CIA run some unofficial covert operations.

Gen. Vang Pao (Laos)

Gen. Vang Pao (Laos)

In 1960 Paul Helliwell was transferred to provide business cover for the CIA’s Cuban operations. According to Peter Dale Scott (The Iran Contra Connection) Helliwell worked with E. Howard Hunt, Mitch WerBell and Lucien Conein on developing relationships with drug-dealing Cuban veterans of the Bay of Pigs invasion. It was during this period that Helliwell met Ted Shackley and Thomas Clines. Helliwell later became CIA paymaster for JM/WAVE. In this way, Shackley was able to finance unofficial CIA operations against Cuba.

OSS_117,_Le_Caire_nid_d'espions_poster

After the assassination of John F. Kennedy, Helliwell was sent by the CIA to the Bahamas where he set up offshore banks for CIA use. At first he established the Mercantile Bank and Trust Company and then the Castle Bank and Trust Company. Helliwell also ran the American Bankers Insurance Company based in Galveston, Texas. This provided insurance cover for businessmen who cooperated with the CIA. Helliwell also created the Intercontinental Holding, a company in the Cayman Islands that owned the Lear jet used by Barry Seal for his drug running activities. Helliwell also established a Miami office for the Sea Supply Corporation. According to Joseph Trento (Prelude to Terror): “The primary objective of Helliwell’s operations in Florida was to cement the CIA’s relationship with organized crime.” This included Santos Trafficante, who had a common business interest in Asia, the “successful exportation of Chinese white heroin.”

According to Daniel Hopsicker (Barry and the Boys), Helliwell ran Red Sunset Enterprises in Miami. Hopsicker claims it was a CIA front company set up to recruit frogmen and explosives experts for Operation Mongoose. In 1973 the Internal Revenue Service began an investigation called Operation Trade Winds. During its investigation it discovered that some major organized crime figures such as Morris Dalitz, Morris Kleinman and Samuel A. Tucker were using the Castle Bank and Trust Company. It soon became clear that the bank was laundering CIA funds and drug profits. The IRS eventually announced that it was dropping its investigation of Castle Bank because of “legal problems”. According to the Wall Street Journal, the reasons for this was “pressure from the Central Intelligence Agency”.

Gangster Moe Dalitz

Gangster Moe Dalitz

The CIA now needed a new bank. Later that year, Frank Nugan, an Australian lawyer, and Michael Hand, a former CIA contract operative, established the Nugan Hand Bank. Another key figure in this venture was Bernie Houghton, who was closely connected to CIA officials, Ted Shackley and Thomas G. Clines. Nugan ran operations in Sydney whereas Hand established a branch in Hong Kong. This enabled Australian depositors to access a money-laundering facility for illegal transfers of Australian money to Hong Kong. According to Alfred W. McCoy, the “Hand-Houghton partnership led the bank’s international division into new fields – drug finance, arms trading, and support work for CIA covert operations.” Hand told friends “it was his ambition that Nugan Hand became banker for the CIA.”

Helliwell continued to work as a lawyer in Miami and served as legal counsel to a Panamanian holding company that controlled a Bahamian gambling casino connected with Meyer Lansky. Paul Helliwell died from emphysema on 24th December, 1976.

oss_sabotage

Paul Helliwell, instructions to all agents of the Secret Intelligence Branch of the OSS in Europe (26th January, 1943)

“Psychological warfare is the employment of all moral and physical means other than orthodox military operations which tend to: destroy the will and ability of the enemy to resist; deprive him of the support of his allies and neutrals; increase in our own troops and allies the will to victory. This must be consonant with national policy and coordinated with orthodox military operations. The implements of psychological warfare include open propaganda, black propaganda, subversion, and sabotage, special phases of economic and political pressure, and cultural contacts. Since psychological warfare can be waged successfully only when supplemented by adequate intelligence, it becomes necessary that a flow of information regarding the psychological state of mind of groups and populations in both enemy and neutral countries, and their reaction to psychological warfare conducted by our agencies and those of our allies, be available to this office. Therefore, supplementary to your present activities, it is desired by the Director that you secure and send reports regarding the vulnerabilities of enemy groups, both civil and military, and neutral populations which can be exploited for psychological warfare.”

OSS Structure

OSS Structure

Paul Helliwell, Instructional Memorandum on Intelligence Operations (1943)

“Relatively accurate facts can be secured as to the activities of the civil government, and the parties or political groups exercising power at the moment, and these reports should be in considerable detail. The more difficult task of securing accurate information as to minority political groups and subversive political organizations constitutes a very real challenge to the Director. He must develop contacts within such groups, or place loyal agents in such groups as members. Such opposition forces should be assisted in every possible way in their aim to interfere with the functioning of the government in power. Financial support should be offered and, if accepted, should be given in such a way that that future actions of the group can be controlled. This can best be accomplished by requiring that one of our agents be given a high position in the organization and that he exercise control over the finances. … Efforts should be made to foment social unrest in the hostile national by agitating the current social problems and pitting one class against the other. A sub-Director who is thoroughly acquainted with the history of the hostile nation and its peoples should be assigned to study this problem and direct a planned campaign. … In studying his territory the Director will know the key points in the enemy installations but generally such points will be carefully protected and sabotage of such point must be the act of “desperate” men who have been especially selected and especially trained. … Propaganda should be divided into two categories, one being the Propaganda Reconnaissance Agent and the other the Propaganda Distributing Agent…”

“Orders to employees must always be verbal, definite and understandable. It is best to repeat orders, and to have the employee repeat the order, until it is positive that it is clearly understood. Orders should never be given in writing… The disposition to be made of an employee who proves to be unsatisfactory or disloyal should be a part of the Director’s plan. If the employee proves to be disloyal and is in possession of dangerous information, he should probably be killed…”

“Informers should be made available to known hostile agents and false or misleading information furnished. These informers may be either unwitting individuals or agents engaged (in a) deliberately planned campaign. The activities of known enemy organizations or agents might be embarrassed by rendering anonymous reports to police authorities and thus subjecting them to embarrassing inquiries. When possible their activities might be made the subject of reports to newspapers and thus secure them unfavorable publicity. The wives and relatives of known hostile agents should be given scandalous information, and embarrassing information of this type should be disseminated so that it reaches the ears of the superiors of a hostile agent.”

Opium

Opium

Jonathan Kwitny, The Crimes of Patriots (1987)

“So the CIA began supplying the KMT through two front companies: Civil Air Transport, headquartered in Taiwan, and Sea Supply Corporation, headquartered in Bangkok. Only a few people with top security clearance knew that both companies were covertly owned by the U.S. Government. They are important, not only for what they did in the 1950s, but also because they were precursors of organizations that touch directly on Nugan Hand in the 1970s.

After China was given up on, the focus of U.S. efforts in East Asia shifted to Indochina. Civil Air Transport was then transformed into (among several successor entities) Air America. That was the airline Michael Hand worked closely with as a CIA contract agent. Many of the CIA associates whose money first helped Hand get started in business in Australia were Air America employes.Sea Supply Corporation, for its part, was founded and run by a lawyer and CIA operative named Paul Helliwell.

During World War II, Helliwell had been chief of special intelligence in China for the OSS. Colleagues from those days told the Wall Street Journal’s Jim Drinkhall that Helliwell, then a colonel, regularly used to buy information with five-pound shipments of opium (“three sticky brown bars,” one man said). Drinkhall also reported being told that Helliwell ran an operation code-named “Deer Mission,” in which OSS personnel secretly parachuted into Indochina to treat Ho Chi Minh for malaria. After the heyday of Sea Supply in the 1950s, Helliwell moved to Miami and became an important figure in the Bay of Pigs invasion and the CIA’s other battles against Castro. His Castle Bank both funneled money for the CIA and, privately, operated as a profitable tax-cheat business. Its unexpected demise in the mid-1970s directly coincided with the growth of Nugan Hand. Considering the gaggle of brass from the U.S. intelligence community who helped push Nugan Hand into orbit in the late 1970s, there has been understandable speculation that Nugan Hand was Castle Bank’s successor.”

Largest Heroin Producing Regions After 1950

Largest Heroin Producing Regions After 1950

 

William Pawley

William Pawley

William Pawley

 

William Douglas Pawley was born in Florence, South Carolina, on 7th September, 1896. His father was a wealthy businessman based in Cuba and Pawley attended private schools in both Havana and Santiago. He later returned to the United States where he studied at the Gordon Military Academy in Georgia. In 1925 Pawley began work as an estate agent in Miami. Two years later he began working for the Curtiss-Wright Corporation. In 1928 Pawley returned to Cuba to become president of the Nacional Cubana de Aviacion Curtiss. He held this post until the company was sold to Pan American Airways in 1932.

Pawley now became president of the Intercontinent Corporation based in New York. The following year he moved to China where he became president of the China National Aviation Corporation. Over the next five years he built three aircraft factories for the Chinese government of Chiang Kai-shek. Pawley also formed a business relationship with Tommy Corcoran. In 1940, President Franklin D. Roosevelt had asked Corcoran to establish a private corporation to provide assistance to the nationalist government in China. Roosevelt even supplied the name of the proposed company, China Defense Supplies. He also suggested that his uncle, Frederick Delano, should be co-chairman of the company. Chiang nominated his former finance minister, Tse-ven Soong, as the other co-chairman.

foto-thommy_the_cork

Corcoran

For reasons of secrecy, Corcoran took no title other than outside counsel for China Defense Supplies. William S. Youngman was his frontman in China. Corcoran’s friend, Whitey Willauer, was moved to the Foreign Economic Administration, where he supervised the sending of supplies to China. In this way Corcoran was able to create an Asian Lend-Lease program. Pawley also worked closely with Claire Lee Chennault, who had been working as a military adviser to Chiang Kai-shek since 1937. Chennault told Tommy Corcoran that if he was given the resources, he could maintain an air force within China that could carry out raids against the Japanese. Corcoran returned to the United States and managed to persuade Franklin D. Roosevelt to approve the creation of the American Volunteer Group.

William Pawley became involved and he arranged for one hundred P-40 fighters, built by the Curtiss-Wright Corporation, that had been intended for Britain, to be redirected to Chennault in China. Pawley also arranged for the P-40 to be assembled in Rangoon. It was Tommy Corcoran’s son David who suggested that the American Volunteer Group should be called the Flying Tigers. Chennault liked the idea and asked his friend, Walt Disney, to design a tiger emblem for the planes. On 13th April, 1941, Franklin D. Roosevelt signed a secret executive order authorizing the American Volunteer Group to recruit reserve officers from the army, navy and marines. Pawley suggested that the men should be recruited as “flying instructors”.

In July, 1941, ten pilots and 150 mechanics were supplied with fake passports and sailed from San Francisco for Rangoon. When they arrived they were told that they were really involved in a secret war against Japan. To compensate for the risks involved, the pilots were to be paid $600 a month ($675 for a patrol leader). In addition, they were to receive $500 for every enemy plane they shot down. The Flying Tigers were extremely effective in their raids on Japanese positions and helped to slow down attempts to close the Burma Road, a key supply route to China. In seven months of fighting, the Flying Tigers destroyed 296 planes at a loss of 24 men (14 while flying and 10 on the ground).

Flying Tigers

Flying Tigers

In 1944 Pawley became president of the Industan Aircraft Manufacturing Company in Bangalore, India. Pawley was responsible for building India’s first ammonium-sulfate plant in Trannvanacore. After the war Pawley became a diplomat. In 1945 Harry S. Truman appointed Pawley as U.S. Ambassador to Peru. Soon afterwards left-wing newspapers in Lima began to claim that Pawley was making “lucrative deals” for himself in Peru. This involved transporting unspecified goods in and out of Peru.

In 1948 Pawley became Ambassador to Brazil. During this time he became a FBI informant. He passed information to J. Edgar Hoover claiming that Spruille Braden, the Ambassador to Argentina was under the control of communist advisers such as Gustavo Duran and George Michanowsky. In a document dated the 7th September, 1948, Pawley suggested that Braden was attempting to expose “non-existant and imagery Nazis in Latin America” as a cover for his communist sympathies. Pawley also claimed that William A. Wieland, who worked as a press officer for the embassy in Brazil, held “anti-capitalist” views.

Pawley continued to be involved in various business projects. He was a close friend of President Rafael Trujillo and together with George Smathers, had invested in the bauxite industry in the Dominican Republic. He was also extremely friendly with Fulgencio Batista and in 1948 he established Autobuses Modernos in Cuba. A company he later sold to Batista.

Chiang Kai Shek

Chiang Kai Shek

On 7th November, 1949, Pawley sent a memorandum to the State Department suggesting that a small group of Americans should be sent to Formosa in order to help protect the government of Chiang Kai-shek. Pawley claimed that Dean Acheson rejected the idea after consulting with advisers such as Owen Lattimore, John C. Vincent and John Davis. In February, 1951 Pawley became special assistant to Acheson. Later that year he held a similar post under Robert A. Lovett. However, he discovered that the State Department considered him to be a reactionary and he was denied access to secret documents concerning Latin America.

Pawley was an active member of the Republican Party. A close friend of both President Dwight Eisenhower and CIA director Allen W. Dulles, he took part in a policy that later become known as Executive Action (a plan to remove unfriendly foreign leaders from power). Pawley played a role Operation Success, a CIA plot to overthrow the Guatemalan government of Jacobo Arbenz in 1954 after he introduced land reforms and nationalized the United Fruit Company. John Foster Dulles decided that he “needed a civilian adviser to the State Department team to help expediate Operation Success”. Dulles selected William Pawley. In his book Peddling Influence (2005), David McKean argues that Pawley’s most important qualification for the job was his “long association with right-wing Latin America dictators.”

Fulgencio Batista

Fulgencio Batista

Gaeton Fonzi points out in his book, The Last Investigation: “Pawley had also owned major sugar interests in Cuba, as well as Havana’s bus, trolley and gas systems and he was close to both pre-Castro Cuban rulers, President Carlos Prio and General Fulgencio Batista. (Pawley was one of the dispossessed American investors in Cuba who early tried to convince Eisenhower that Castro was a Communist and urged him to arm the exiles in Miami.)”

In March 1958, President Dwight Eisenhower, disillusioned with Batista’s government, insisted he held elections. This he did, but the people showed their unhappiness with his government by refusing to vote. Over 75 per cent of the voters in the capital Havana boycotted the polls. In some areas, such as Santiago, it was as high as 98 per cent. Some members of the State Department came to the conclusion that it would be in America’s best long-term interest in Cuba to be seen as opposing Batista. William A. Wieland, Director of the Caribbean and Central American Affairs, was against America providing support for the Cuban dictator. As the U.S. Ambassador of Cuba, Earl E. T. Smith was later to tell a Senate Committee: “He (Wieland) believed that it would be in the best interest of Cuba and the best interest of the world in general when Batista was removed from office.”

Wieland was not the only one who took that view. According to Pawley and Smith, Roy R. Rubottom, Assistant Secretary of State for Latin American Affairs, John L. Topping, Chief of the Political Section and the Chief of the CIA Section, held similar opinions. Pawley and Smith also identified Herbert L. Matthews of the New York Times as being an important figure in providing support for the idea of regime change in Cuba. Smith pointed out that “Matthews wrote three articles on Fidel Castro, which appeared on the front page of the New York Times, in which he eulogized Fidel Castro and portrayed him as a political Robin Hood.

On 9th December, 1958, Pawley had a meeting with Fulgencio Batista. Pawley told Batista that he was losing the support of the American government. Pawley suggested that the Cuban dictator should resign and allow an anti-Castro and anti-Batista caretaker junta to take over. Batista rejected the idea and on 14th December, William A. Wieland, speaking for the State Department instructed Earl E. T. Smith, to inform Batista that he no longer had the support of the US government and that he should leave Cuba at once. On 1st January, 1959, Batista fled to the Dominican Republic.

Cuban Revolution

Cuban Revolution

Pawley later told a Senate Committee on Latin American Affairs: “I believe that the deliberate overthrow of Batista by Wieland and Matthews, assisted by Rubottom, is almost as great a tragedy as the surrendering of China to the Communists by a similar group of Department of State officials fifteen or sixteen years ago and we will not see the end in cost of American lives and American recourses for these tragic errors.” After Batista was overthrown by Fidel Castro, Pawley pressurized President Dwight Eisenhower to provide military and financial help to anti-Castro Cubans based in the United States. Recently released FBI files suggest he worked closely with Manuel Artime in efforts to overthrow Castro.

In the winter of 1962 Eddie Bayo claimed that two officers in the Red Army based in Cuba wanted to defect to the United States. Bayo added that these men wanted to pass on details about atomic warheads and missiles that were still in Cuba despite the agreement that followed the Cuban Missile Crisis. Bayo had originally fought with Fidel Castro against Fulgencio Batista. He disagreed with Castro’s policies after he gained power and moved to Miami and helped establish Alpha 66. His story was eventually taken up by several members of the anti-Castro community including Gerry P. Hemming, John Martino, Felipe Vidal Santiago and Frank Sturgis. Pawley became convinced that it was vitally important to help get these Soviet officers out of Cuba. To help this happen he communicated with James Eastland, the chairman of the Senate Internal Security Subcommittee, about this story.

CIA Chief Ted Shackley

CIA Chief Ted Shackley

Pawley also contacted Ted Shackley, head of the CIA’s JM WAVE station in Miami. Shackley decided to help Pawley organize what became known as Operation Tilt. He also assigned William (Rip) Robertson, a fellow member of the CIA in Miami, to help with the operation. David Sanchez Morales, another CIA agent, also became involved in this attempt to bring out these two Soviet officers. In June, 1963, a small group, including Pawley, Eddie Bayo, William (Rip) Robertson, John Martino, and Richard Billings, a journalist working for Life Magazine, secretly arrived in Cuba. They were unsuccessful in their attempts to find these Soviet officers and they were forced to return to Miami. Bayo remained behind and it was rumored that he had been captured and executed. However, his death was never reported in the Cuban press.

William Pawley died of gunshot wounds in January, 1977. Officially it was suicide but some researchers believe it was connected to the investigations being carried out by the House Select Committee on Assassinations. However, a relative Cash Pawley, has argued: “Bill Pawley had acquired a severe case of Shingles years earlier, which had progressed across his entire body (even the soles of his feet). He had been unable to lay down, stand or become comfortable in any position. The pain was excruciating, and there was no modern medicine(s) for a cure or even proper pain management at the time. Therefore, Mr. Pawley suffered day in and day out, until he just could not do it anymore. This was the reason for his suicide.”

Bay of Pigs

Bay of Pigs

 

Operation J/M-Wave

Location of J/M-Wave

Location of J/M-Wave

JM WAVE was the Central Intelligence Agency station in Florida. Located south of Miami in a heavily wooded 1,571-acre tract. The numerous buildings were said to belong to Zenith Technological Enterprises.

After the Bay of Pigs disaster President John F. Kennedy created a committee (SGA) charged with overthrowing Castro’s government. The SGA, chaired by Robert F. Kennedy (Attorney General), included John McCone (CIA Director), McGeorge Bundy (National Security Adviser), Alexis Johnson (State Department), Roswell Gilpatric (Defence Department), General Lyman Lemnitzer (Joint Chiefs of Staff) and General Maxwell Taylor. Although not officially members, Dean Rusk (Secretary of State) and Robert S. McNamara (Secretary of Defence) also attending meetings.

At a meeting of this committee at the White House on 4th November, 1961, it was decided to call this covert action program for sabotage and subversion against Cuba, Operation Mongoose. Attorney General Robert F. Kennedy also decided that General Edward Lansdale (Staff Member of the President’s Committee on Military Assistance) should be placed in charge of the operation.

The CIA JM WAVE station in Miami served as operational headquarters for Operation Mongoose. The head of the station was Ted Shackley and over the next few months became very involved in the attempt to overthrow Fidel Castro. One of Lansdale’s first decisions was to appoint William Harvey as head of Task Force W. Harvey’s brief was to organize a broad range of activities that would help to bring down Castro’s government. By the spring of 1962, JM/WAVE employed more than 200 CIA officers. They in turn ran over 2,200 Cuban agents. JM/WAVE had a navy of over 100 craft, including the 174-foot Rex,that had the latest electronic equipment and 40-millimeter and 20-millimeter cannons. The CIA station also had a large number of V-20 Swift craft and access to F-105 Phantoms from nearby Homestead Air Force Base.

Gen. Edward Lansdale

Gen. Edward Lansdale

William Harvey was ordered to activate an assassination plot against Fidel Castro. This became known as the ZR/RIFLE project. Harvey arranged for David Sanchez Morales to move from Mexico City to join the project based at the JM WAVE station. In the winter of 1962 Eddie Bayo claimed that two officers in the Red Army based in Cuba wanted to defect to the United States. Bayo added that these men wanted to pass on details about atomic warheads and missiles that were still in Cuba despite the agreement that followed the Cuban Missile Crisis.

Bayo’s story was eventually taken up by several members of the anti-Castro community including William Pawley, Gerry P. Hemming, John Martino, Felipe Vidal Santiago and Frank Sturgis. Pawley became convinced that it was vitally important to help get these Soviet officers out of Cuba.

William Pawley contacted Ted Shackley, the head at JM WAVE. Shackley decided to help Pawley organize what became known as Operation Tilt. He also assigned Rip Robertson, a fellow member of the CIA in Miami, to help with the operation. David Sanchez Morales, another CIA agent, also became involved in this attempt to bring out these two Soviet officers. In June, 1963, a small group, including William Pawley, Eddie Bayo, Rip Robertson, John Martino, and Richard Billings, a journalist working for Life Magazine, secretly arrived in Cuba. They were unsuccessful in their attempts to find these Soviet officers and they were forced to return to Miami. Bayo remained behind and it was rumoured that he had been captured and executed. However, his death was never reported in the Cuban press.

– The Green Chazzan 

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Required Reading – Operation Jedburgh and OSS China – Part 3

EDITOR: Thomas Corcoran was the original bagman for the Jedburgh Teams and was their main connection to members of the oligarchical establishment. He was the creator of OSS China and masterminded the opium-for-guns trade out of Southeast Asia. Corcoran had very strong political connections in both the Democratic and Republican parties and was often able to use the CIA to support his war profiteering and drug trafficking efforts. Corcoran was also one of the main operatives behind the notorious United Fruit Company in Central America and also shared an active role in the Bay of Pigs.

Excerpts from Operation Jedburgh

by John Simkin (1997) – Part 3

Jedburgh Team Profiles

Tommy Corcoran

Tommy Corcoran

Tommy Corcoran

Thomas Corcoran, the son of a lawyer, was born in Rhode Island on 29th December, 1899. He was educated at Brown University and Harvard Law School. Corcoran’s most important influence at university was Professor Felix Frankfurter. He wrote that Corcoran was “struggling very hard with the burden of inferiority imposed on him because of his Irish Catholicism”. Frankfurter was impressed with Corcoran’s progress and introduced him to his close friend, Supreme Court Justice Oliver Wendell Holmes. After graduating in 1926 he was invited by Holmes to become his legal clerk.

In 1927 Corcoran joined the law firm established by William McAdoo. At the time it was run by George Franklin and Joseph Cotton. In 1932 Eugene Meyer, chairman of the Federal Reserve Board, was looking for a general counsel for the newly established Reconstruction Finance Corporation. After talks with Franklin he appointed Corcoran to this post. Meyer resigned in 1933 and was replaced by Jesse H. Jones. After Franklin D. Roosevelt defeated Herbert Hoover he asked Felix Frankfurter to assemble a legal team to review the nation’s securities laws. Frankfurter selected Corcoran, Benjamin Cohen and James Landis for the task. Corcoran, a member of the Democratic Party, readily accepted the post. Together they drafted the legislation that created the Securities and Exchange Commission.

us-securities-_-exchange-commisssion-seal-plaque-l_1

William E. Leuchtenburg, the author of Franklin D. Roosevelt and the New Deal (1963), has pointed out: “Corcoran was a new political type: the expert who not only drafted legislation but maneuvered it through the treacherous corridors of Capitol Hill.” Ray S. Cline added: “Corcoran… says that his greatest contribution to government in his long career was helping infiltrate smart young Harvard Law School products into every agency of government. He felt the United States needed to develop a highly educated, highly motivated public service corps that had not existed before Roosevelt’s time.”

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Corcoran also became involved in advising Franklin D. Roosevelt over foreign policy. Although he had liberal views on domestic issues, Corcoran was passionately anti-communist. This was partly because of his Roman Catholicism. Roosevelt initially favoured giving help to the Republican government in Spain. However, Corcoran was a supporter of the fascist movement led by General Francisco Franco. As Drew Pearson and Jack Anderson pointed out in their book, The Case Against Congress: A Compelling Indictment of Corruption on Capitol Hill: “Long before Pope John and Pope Paul made it clear they were not in sympathy with the Catholic hierarchy of Spain, the reactionary wing of the Catholic Church in the United States had been conducting one of the most efficient lobbies ever to operate on Capital Hill. It was able to reverse completely American policy on Spain. During the Spanish Civil War, Thomas G. Corcoran, a member of the Roosevelt brain trust, worked effectively at the White House to keep an embargo on all U.S. arms to both sides.”

Corcoran knew that Adolf Hitler and Benito Mussolini would continue to provide both men and arms to Francisco Franco. Roosevelt’s decision enabled fascism to win in Spain and become entrenched in Europe. Roosevelt later told his cabinet that he had made a “grave mistake” with respect to neutrality in the Spanish Civil War. Roosevelt was angry with Tommy Corcoran over his advice on Spain. He also began to see that Corcoran was becoming a problem for the administration. He had upset a lot of powerful figures in Congress with his arm twisting tactics. Corcoran had also tried to unseat those who attempted to resist Franklin D. Roosevelt. For example, Walter George of Georgia claimed that Corcoran had the “power of saying who shall be a senator and who shall not be a senator.”

Franklin Delano Roosevelt

Franklin Delano Roosevelt

One day in early October 1940, Franklin D. Roosevelt told Corcoran that he wanted him to resign from the administration. He wanted him to carry out a covert mission and it was “too politically dangerous” to do this while serving in his government.

Roosevelt believed that the best way of stopping Japanese imperialism in Asia was to arm the Chinese government of Chiang Kai-shek. However, Congress was opposed to this idea as it was feared that this help might trigger a war with Japan. Therefore, Roosevelt’s plan was for Corcoran to establish a private corporation as OSS China to provide assistance to the nationalist government in China. Roosevelt even supplied the name of the proposed company, China Defense Supplies. He also suggested that his uncle, Frederick Delano, should be co-chairman of the company. Chiang nominated his former finance minister, Tse-ven Soong, as the other co-chairman. For reasons of secrecy, Corcoran took no title other than outside counsel for China Defense Supplies. William S. Youngman was his frontman in China. Corcoran’s friend, Whitey Willauer, was moved to the Foreign Economic Administration, where he supervised the sending of supplies to China. In this way Corcoran was able to create an Asian Lend-Lease program.

stilwellroadmap1

Tommy Corcoran had originally been an isolationist. However, he now knew that he could make a fortune out of the arms trade. His first major client was Henry J. Kaiser, a successful businessman from California. Corcoran had helped Kaiser obtain lucrative government contracts while working for the Reconstruction Finance Corporation. Kaiser paid Corcoran a retainer of $25,000 a year. Corcoran then introduced Kaiser to William S. Knudsen, head of the Office of Production Management. Over the next few years Kaiser obtained $645 million in building contracts at his ten shipyards. Kaiser’s two main business partners were Stephen D. Bechtel and John A. McCone. Kaiser had worked with Bechtel in the 1930s to build many of the major roads throughout California. In 1937 McCone became president of Bechtel-McCone. On the outbreak of the Second World War McCone joined forces with Kaiser and Bechtel to establish the California Shipbuilding Company. With the help of Corcoran, the company obtained large government contracts to build ships. In 1946 it was reported that the company had made $44 million in wartime profits.

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Corcoran’s work with China Defense Supplies caused some disquiet in Roosevelt’s administration. Henry Morgenthau was a prominent critic. He argued that in effect, Corcoran was running an off-the-books operation in which a private company was diverting some of the war material destined for China to a private army, the American Volunteer Group. Resistance also came from General George Marshall and General Joseph Stilwell, the American commander in Asia. Marshall and Stilwell both believed that Chiang Kai-shek was completely corrupt and needed to be forced into introducing reforms. Stilwell complained about Corcoran’s ability to present Chiang in the best possible light with Roosevelt. Stilwell wrote to Marshall that the “continued publication of Chungking propaganda in the United States is an increasing handicap to my work.” He added, “we can pull them out of this cesspool, but continued concessions have made the Generalissimo believe he has only to insist and we will yield.”

Chiang Kai-Shek

Chiang Kai-Shek

Corcoran was also coming under pressure from the work he was doing for Sterling Pharmaceutical. His brother, David worked for the company and was responsible for getting Corcoran the contract. However, it was revealed in 1940 that Sterling Pharmaceutical had strong links with I. G. Farben. The FBI discovered that Sterling had conspired with Farben to control the sale of aspirin. In other words, had formed an aspirin cartel. According to one FBI report, Sterling were employing Nazi sympathizers in its offices in Latin America. Rumours began to circulate that Burton Wheeler would announce that he was appointing a subcommittee to investigate the relations between American and German firms. Assistant Attorney General Thurman Arnold announced he was ready to prosecute any American company aiding and abetting a German company in any part of the world. On 10th April, 1941, the Department of Justice issued subpoenas to Sterling Pharmaceutical. Soon afterwards newspapers began to run negative stories about the company. One claimed that Sterling was helping the Nazi propagandist Joseph Goebbels fulfill his pledge that “Americans would help Hitler win the Americas.”

On 2nd June, 1941, Roosevelt appointed Francis B. Biddle as his new Attorney General. Biddle was a close friend of Corcoran’s. The day after his appointment, Biddle accepted a settlement offer from Sterling in which the company would pay a fine of five thousand dollars. Later, it was agreed that Sterling would abrogate all contracts with I. G. Farben. In Congress there was speeches made calling for an investigation into the role played by Corcoran in protecting the interests of Sterling Pharmaceutical. Senator Lawrence Smith argued: “It is common gossip in government circles that the long arm of Tommy Corcoran reaches into many agencies; that he has placed many men in important positions and they in turn are amenable to his influences.”

IG Farben

IG Farben

After the United States entered the war against Japan, Germany and Italy, President Franklin D. Roosevelt established the Office of Strategic Services (OSS). Roosevelt selected Colonel William Donovan as the first director of the organization, who had spent some time studying the Special Operations Executive (SOE), an organization set up by the British government in July 1940. The OSS had responsibility for collecting and analyzing information about countries at war with the United States. The OSS gradually took over the activities that Corcoran had helped set up in China. In 1943 OSS agents based in China included Paul Helliwell, E. Howard Hunt, Mitch Werbell, Lucien Conein, John Singlaub and Ray Cline. According to an article in the Wall Street Journal, some OSS members in China were paid for their work with five-pound sacks of opium.

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One month after the dropping the atom bomb on Hiroshima and Nagasaki, Tommy Corcoran joined with David Corcoran and William S. Youngman to create a Panamanian company, Rio Carthy, for the purpose of pursuing business ventures in Asia and South America. Soon afterwards, Claire Lee Chennault and Whiting Willauer approached Corcoran with the idea of creating a commercial airline in China to compete with CNAC and CATC. Corcoran agreed to use Rio Cathy as the legal vehicle for investing in the airline venture. Chiang Kai-shek agreed that his government would invest in the airline. Corcoran anticipated he would own 37% of the equity in the airline, but Chennault and Willauer gave a greater percentage to the Chinese government, and Corcoran’s share dropped to 28%.

Civil Air Transport (CAT) was officially launched on 29th January, 1946. Corcoran approached his old friend Fiorella LaGuardia, the director general of the United Nations Relief and Rehabilitation Administration (UNRRA). He agreed to award a $4 million contract to deliver relief to China. This contract kept them going for the first year but as the civil war intensified, CAT had difficulty maintaining its routes. The OSS had been disbanded in October 1945 and was replaced by the War Department’s Strategic Service Unit (SSU). Paul Helliwell became chief of the Far East Division of the SSU. In 1947 the SSU was replaced by the Central Intelligence Agency.

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CAT needed another major customer and on 6th July, 1947, Corcoran and Claire Lee Chennault had a meeting with Roscoe H. Hillenkoetter, the new director of the CIA. Hillenkoetter arranged for Corcoran to meet Frank Wisner, the director of the Office of Policy Coordination. Wisner was in charge of the CIA’s covert operations. On 1st November, 1948, Corcoran signed a formal agreement with the CIA. The agreement committed the agency to provide up to $500,000 to finance an CAT airbase, and $200,000 to fly agency personnel and equipment in and out of the mainland, and to underwrite any shortfall that might result from any hazardous mission. Over the next few months CAT airlifted personnel and equipment from Chungking, Kweilin, Luchnow, Nanking, and Amoy.

In 1948, Lyndon B. Johnson decided to make a second run for the U.S. Senate. His main opponent in the Democratic primary (Texas was virtually a one party state and the most important elections were those that decided who would be the Democratic Party candidate) was Coke Stevenson. Johnson was criticized by Stevenson for supporting the Taft-Hartley Act. The American Federation of Labor was also angry with Johnson for supporting this legislation and at its June convention the AFL broke a 54 year tradition of neutrality and endorsed Stevenson. Johnson asked Tommy Corcoran to work behind the scenes at convincing union leaders that he was more pro-labor than Stevenson. This he did and on 11th August, 1948, Corcoran told Harold Ickes that he had “a terrible time straightening out labor” in the Johnson campaign but he believed he had sorted the problem out.

Jorge Ubico

Jorge Ubico

In 1949 Sam Zemurray asked Corcoran to join the United Fruit Company as a lobbyist and special counsel. Zemurray had problems with his business in Guatemala. In the 1930s Zemurray aligned United Fruit closely with the government of President Jorge Ubico. The company received import duty and real estate tax exemptions from Ubico. He also gave them hundreds of square miles of land. United Fruit controlled more land than any other individual or group. It also owned the railway, the electric utilities, telegraph, and the country’s only port at Puerto Barrios on the Atlantic coast. Ubico was overthrown in 1944 and following democratic elections, Juan Jose Arevalo became the new president. Arevalo, a university professor who had been living in exile, described himself as a “spiritual socialist”. He implemented sweeping reforms by passing new laws that gave workers the right to form unions. This included the 40,000 Guatemalans who worked for United Fruit.

Zemurray feared that Arevalo would also nationalize the land owned by United Fruit in Guatemala. He asked Corcoran to express his fears to senior political figures in Washington. Corcoran began talks with key people in the government agencies and departments that shaped U.S. policy in Central America. He argued that the U.S. should use United Fruit as an American beachhead against communism in the region.

Chief of OSS China - Paul Helliwell

Chief of OSS China – Paul Helliwell

In January, 1950, Civil Air Transport (CAT) relocated its base of operations to the island of Formosa, where Chiang Kai-shek had established his new government. The following month, the Soviet Union and China signed a mutual defense pact. Two weeks later, President Harry S. Truman signed National Security Directive 64, which stated that “it is important to United states security interests that all practical measures be taken to prevent further communist expansion in Southeast Asia.”

The support of the government in Formosa was to become a key aspect of this policy. In February 1950, Frank Wisner began negotiating with Corcoran for the purchase of CAT. “In March, using a ‘cutout’ banker or middleman, the CIA paid CAT $350,000 to clear up arrearages, $400,000 for future operations, and a $1 million option on the business. The money was then divided among the airline’s owners, with Corcoran and Youngman receiving more than $100,000 for six years of legal fees, and Corcoran, Youngman, and David Corcoran dividing approximately $225,000 from the sale of the airline.” Paul Helliwell was put in charge of this operation. His deputy was Desmond FitzGerald. Helliwell’s main job was to help Chiang Kai-shek to prepare for a future invasion of Communist China. The CIA created a pair of front companies to supply and finance the surviving forces of Chiang’s KMT. Helliwell w as put in charge of this operation. This included establishing the Sea Supply Corporation, a shipping company in Bangkok.

The CIA now launched a secret war against China. An office under commercial cover called Western Enterprises was opened on Taiwan. Training and operational bases were established in Taiwan and other offshore islands. By 1951 Chiang Kai-shek claimed to have more than a million active guerrillas in China. However, according to John Prados, “ United States intelligence estimates at the time carried the more conservative figure of 600,000 or 650,000, only half of whom could be considered loyal to Taiwan.”

After the war Tommy Corcoran continued his work as a paid lobbyist for Sam Zemurray and the United Fruit Company. Zemurray became concerned that Captain Jacobo Arbenz, one of the heroes of the 1944 revolution, would be elected as the new president of Guatemala. In the spring of 1950, Corcoran went to see Thomas C. Mann, the director of the State Department’s Office of Inter-American Affairs. Corcoran asked Mann if he had any plans to prevent Arbenz from being elected. Mann replied: “That is for the people of that country to decide.”

Allen Dulles

Allen Dulles

Unhappy with this reply, Corcoran paid a call on the Allen Dulles, the deputy director of the CIA. Dulles, who represented United Fruit in the 1930s, was far more interested in Corcoran’s ideas. “During their meeting Dulles explained to Corcoran that while the CIA was sympathetic to United Fruit, he could not authorize any assistance without the support of the State Department. Dulles assured Corcoran, however, that whoever was elected as the next president of Guatemala would not be allowed to nationalize the operations of United Fruit.”

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However, political groups continued to resort to violence and in 1949 Major Francisco Arana was murdered. The following year Arbenz defeated Manuel Ygidoras to become Guatemala’s new president. Arbenz, who obtained 65% of the votes, took power on 15th March, 1951. Corcoran then recruited Robert La Follette to work for United Fruit. Corcoran arranged for La Follette to lobby liberal members of Congress. The message was that Arbenz was not a liberal but a dangerous left-wing radical.This strategy was successful and Congress was duly alarmed when on 17th June, 1952, Arbenz announced a new Agrarian Reform program . This included expropriating idle land on government and private estates and redistributed to peasants in lots of 8 to 33 acres. The Agrarian Reform program managed to give 1.5 million acres to around 100,000 families for which the government paid $8,345,545 in bonds. Among the expropriated landowners was Arbenz himself, who had become into a landowner with the dowry of his wealthy wife. Around 46 farms were given to groups of peasants who organized themselves in cooperatives.

In March 1953, 209,842 acres of United Fruit Company’s uncultivated land was taken by the government which offered compensation of $525,000. The company wanted $16 million for the land. While the Guatemalan government valued $2.99 per acre, the American government valued it at $75 per acre. As David McKean has pointed out: This figure was “in line with the company’s own valuation of the property, at least for tax purposes”. However, the company wanted $16 million for the land. While the Guatemalan government valued it at $2.99 per acre, the company now valued it at $75 per acre.

Anastasio Somoza

Anastasio Somoza

Corcoran contacted President Anastasio Somoza and warned him that the Guatemalan revolution might spread to Nicaragua. Somoza now made representations to Harry S. Truman about what was happening in Guatemala. After discussions with Walter Bedell Smith, director of the CIA, a secret plan to overthrow Arbenz (Operation Fortune) was developed. Part of this plan involved Tommy Corcoran arranging for small arms and ammunition to be loaded on a United Fruit freighter and shipped to Guatemala, where the weapons would be distributed to dissidents. When the Secretary of State Dean Acheson discovered details of Operation Fortune, he had a meeting with Truman where he vigorously protested about the involvement of United Fruit and the CIA in the attempted overthrow of the democratically elected President Jacobo Arbenz. As a result of Acheson’s protests, Truman ordered the postponement of Operation Fortune.