Wednesday, March 9, 2011

Land and Loot: A How-To on Money Laundering - Part 2

Ships, Planes and Mules:  Getting Drugs to their 
Destination and Banking the Cash

Copyright 2011 by Linda Minor, all rights reserved

In his ground-breaking book, Masters of Paradise, published in 1991, Alan A. Block wrote:
[I]t is the separation between organized and white-collar crime that most often puzzles me. I wonder which category to invoke when considering crimes such as loan sharking committed in tandem by racketeers and bankers; or how to define criminality associated with the looting of union pension and welfare funds, in which cabals of organized criminals, government and private lawyers, and accountants are prominent? Which term is appropriate when analyzing financial schemes designed to evade taxes and "launder" money for corporate executives, mobsters, drug smugglers, politicians, attorneys, etc., carried out in offshore banks in tax-haven countries such as The Bahamas, the Netherlands Antilles, Panama, and the Cayman Islands? Clearly such situations involve organized criminals often doing white-collar-type crimes, and white collar criminals frequently acting like racketeers.
Block's book was newly published when I first discovered it in the early days of my research into allegations pertaining to whether a government official was engaged in crimes that seemed not to fit into an easily defined category. Those allegations were eventually set out in a 1992 book written by former Houston journalist Pete Brewton.
Paul Helliwell, "Mr. Republican" in 1952 Florida
Paul Helliwell Had Role in Banking Scheme.
In 1961 Paul Helliwell became “paymaster” for operatives working covert intelligence operations in the Bay of Pigs, although the methods he used to obtain and disperse funds are not clearly apparent. However, in late 1963, according to Alan A. Block's book, All Is Clouded by Desire, at page 40, Helliwell was involved with a bank in the Bahamas called Bank of the Caribbean, Ltd. This bank was “picked up” in 1965 by one of Helliwell's clients, a CIA-connected “insurance conglomerate,” and three years later the bank’s name was changed to Underwriters Bank Limited (UBL), its new directors being Helliwell; a man named Anthony James Tullis Gooding, who moved in 1973 to St. Peter Port, Guernsey, in the Channel Islands; May Gilmour; and Ernest J. Foster, a British subject who had also lived in Argentina.[1] UBL was registered by Inge Gordon Mosvold, a Norwegian shipbuilder, who may have been a front for an even wealthier man named Daniel K. Ludwig, for whom Mosvold had chartered the Mercantile Bank and Trust in Freeport in January 1962. 

The corporate shareholders of the Mercantile Bank were Cayship Investment Company, Inc. (Panama); Security (Bahamas) Limited; and Cia. de Navegacion Mandinga S.A. (Panama); as well as two nominees. Mercantile Bank was parent company for the now-famous Castle Bank & Trust formed by Helliwell, alleged to be “one of the CIA’s finance channels for operations against Cuba,” being managed from Andros Island in The Bahamas beginning in 1964.[2]

Daniel Ludwig was a Michigan-born shipowner who built a fortune in the 1930s before the repeal of Prohibition. Little is known about Ludwig, since he “deliberately avoid[ed] public notice, attempting to blend, chameleonlike, into the background,”[3] except that he was a partner in real estate ventures and horse racing with Edward Plunkett Taylor, founder in Canada of Argus Corporation (which later became the Toronto-based media company, Hollinger Corporation). Taylor allegedly associated with a network of persons involved in Permindex and the 1001 Club, and Ludwig may have made his initial fortune shipping whiskey for the Bronfmans to the Purple Gang during Prohibition--according to LaRouche associates' research.

After World War II, when huge profits were to be made by the "Seven Sisters" on oil imported from the Middle East, Ludwig began to face competition from Aristotle Onassis and Stavros Niarchos, who received encouragement to become shipbuilders who were given short-term loans from National City Bank of New York and long-term loans from Metropolitan Life Insurance Co. Onassis’ first oil tankers were built in Maryland and Massachusetts in 1947, but ships dating from 1953 were assembled in Hamburg, Germany, where wages were cheaper.[4]

Pete Brewton became familiar with some of the names mentioned above as he investigated a strange transaction Houston land developers made in the mid 1980s with Florida land development companies and their bankers. Attorney Lawrence Freeman's law clerk, for example, was named president of a somewhat ephemeral corporation called "Panhandle Coast," which assigned its contractual right to purchase land owned by St. Joe Paper Co. to a joint venture composed of a Houston developer, Mike Adkinson, and Southmark. One week later, Lawrence Freeman was indicted for laundering drug money for a pilot named Jack DeVoe, whom U.S. Customs accused of smuggling Colombian cocaine into the landing strip at Opa-Locka Airport in Miami owned by Key Largo's Ocean Reef Club (at that time being operated by Carl Lindner’s American Financial Corp. of Cincinnati). According to a government report issued, The President's Commission on Organized Crime, 1986:
The Devoe organization's methods for avoiding interdiction between South America and the United States were relatively simple and typical of such smuggling operations. A Devoe pilot learned the frequencies of DEA surveillance aircraft on one occasion by "acting like a helicopter buff" inspecting a DEA Cobra pursuit helicopter parked near the Devoe hangar. Inside the helicopter the pilot copied the frequencies from a clipboard hanging on the instrument panel. As the pilot explained to the Commission:
By [subsequently] using our scanner and our knowledge of the frequencies in use, we could monitor the activities of DEA planes . . . we could learn not only the activities of the planes, but also go up and check the plane out. By learning what types of aircraft DEA was using we could plan our own strategy more effectively... [See other amazing government reports on America's drug habits.]
Within a month after the DeVoe's indictment, Atkinson's partner, Southmark, was prohibited by the FSLIC from obtaining financing for its purchases from subsidiary, San Jacinto Savings, of Houston. Alternative financing was considered from Hill Financial Savings of Red Hill, Pennsylvania and BancPlus Savings of Pasadena, Texas. BancPlus (controlled by Houstonian Kenneth Schnitzer) eventually dropped out, to be replaced by Vision Banc Savings, an institution acquired by Robert L. Corson (mentioned in Part 1) in February of 1986 and declared insolvent four months later to the tune of about $60 million. Corson would later be linked by investigator/author Cheri Seymour to a top-secret drug running spooky organization which she traced back to the death of journalist Danny Casolaro. According to Seymour's book, The Last Circle:
An Associated Press news story entitled, "Deaths Linked to Spy Network," published in the Merced Sun Star newspaper, outlined the death of Ian Stuart Spiro, 46, who was found dead of cyanide poisoning in the Anza Borrego desert on November 8, 1992, one week after his wife and children were found shot to death in their Rancho Santa Fe home.
The news story, originating from the Oceanside Blade Citizen, noted that "documents and U.S. intelligence sources implicated Spiro in the Iran Contra arms-for-hostages affair and an alleged Justice Department conspiracy to pirate software from a private company and sell it to foreign intelligence agencies."

Spiro's name also appeared in Lt. Col. Oliver North's personal notebooks documenting the Iran-Contra affair, according to the National Security Archives in Washington D.C. Former hostage David Jacobsen told the Blade Citizen shortly after Spiro's death that Spiro helped negotiate the release of hostages in the Middle East. After obtaining a copy of a follow-up Blade Citizen article dated June 3, 1993, entitled, "Spiro Probers Want to Talk to North" by Wade Booth, Stacy Finz and Michael Williams, I learned that Ian Spiro lived in Beirut, Lebanon during the 1970's and 1980's where he "made contacts with Lebanese religious leaders and the Islamic Jihad."

Greg Quarton, Spiro's [Canadian-born] brother-in-law, told reporters at the Blade Citizen that Spiro maintained communication with Lebanese business associates until the time of his death, but investigating officers had possession of Spiro's phone bills, and as of this writing, they had not released them.

San Diego sheriff's Capt. Jim Marmack said detectives were investigating allegations by Spiro's relatives that his file cabinets and business papers were missing.

The week of the Spiro family's death, Robert Corson, a business associate of Spiro's indicted in a savings and loan scam, was found dead in an El Paso, Texas, motel room. Corson, who reportedly worked for the CIA, died of a heart attack, officials said. The Blade Citizen reported that Corson once carried money to South America in a deal to deliver covert weapons. Corson also allegedly associated with California investor Wayne Reeder who was seen at a Wackenhut/Contra meeting in Riverside county...

The newspaper article went on to say that Alan Michael May, age 50, (a former Northern California field director in Richard Nixon's presidential campaign and attorney for Nixon's brothers Donald and Edward) was found dead in his San Francisco home on June 19, 1991, four days after a newspaper story in the Napa Sentinel outlined his role in an alleged plot by Republican Party officials to bribe Iranian officials to delay the release of U.S. hostages until after President Reagan's inauguration.
A Los Angeles Times story November 13, 1992 revealed:
Lt. John Tenwolde of the sheriff's homicide detail said Thursday that detectives completed their search of Spiro's vehicle "and found several grams of granular sodium cyanide in a bag between the front seats."
...After a memorial service for the family Wednesday at the St. James-by-the-Sea Episcopal Church in La Jolla, Gail Spiro's brother, Ken Quarton, told reporters he believed that all of the family members, including Ian Spiro, were murdered.

Quarton said he believed the deaths were linked to threatening telephone calls that Ian Spiro said he was receiving less than a week before the deaths.


Quarton quoted Spiro as saying: "Something has come back to haunt me, and if you want to know what it is, read the book by Terry Waite."
Spiro would have been referring to a book being written by former Anglican Church envoy Terry Waite, who worked to release Western hostages held in Lebanon before he was taken captive in 1987. London newspapers have reported that Spiro worked for the CIA and British intelligence in Lebanon in the 1980s and assisted Lt. Col. Oliver North and Waite in attempts to free hostages.




[1] Authorized signatories for the Castle Bank account at American National Bank in Chicago were A. Aliprnati, A.R. Bickerton, L.A. Freeman, E.J. Foster, M.S. Gilmour, A.J.T. Gooding, H.M. Wolstencroft, Burton W. Kanter, and Helliwell.  Block, p. 162.
[2] Wall Street Journal, April 18, 1980.
[3] Ferdinand Lundberg, The Rich and the Super-Rich:  A Study in the Power of Money Today (New York:  Lyle Stuart, Inc. 1968), p. 51.
[4] Nicholas Fraser, Philip Jacobson, Mark Ottaway and Lewis Chester, Aristotle Onassis (Philadelphia & New York:  J.B. Lippincott Co., 1977), p. 90. 

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