Showing posts with label War on Drugs. Show all posts
Showing posts with label War on Drugs. Show all posts

Saturday, February 8, 2014

Conclusion of The Great Heroin Coup - Chapter 20

Henrik Kruger ended his study of the 1970's coup, designed to replace the "French Connection" with a Latin American one which his experts in the CIA believed they could control, with the final chapter which follows these observations. Chapter 20 provides a glimpse into what was to come: the American war on terror. Modern wars, of course, are not fought with spears or swords, nor even with nuclear bombs. Warriors must have assault rifles, tanks, grenades, Swat gear, night goggles, ballistic and anti-ballistic missiles, and all the latest in a myriad of new technology ever being developed.
Photo credit to ACLU

My own personal point of view tends to relegate much of what happens in politics and government to an issue of money. I will elaborate after posting this chapter with a separate essay to explain my thinking, but will briefly summarize those ideas here.

Richard Nixon crawled away from politics in 1962 after losing the 1960 election for President and the 1962 election for governor of California. He told the newsmen at his concession press conference, "You won't have Nixon to kick around any more." But he was so wrong.

Two wealthy businessmen, in particular, sought Nixon out, believing they could succeed in getting him elected him in 1968. These corporate executives who financed Nixon were clients of Mudge, Rose, Guthrie and Alexander, when they convinced the law firm to bring in Nixon as its senior partner in 1963.

Elmer Bobst and Donald Kendall would pour hundreds of thousands of dollars into Nixon's election campaign in 1968, but what did they expect in return? Bobst, it appears, especially wanted passage of the National Cancer Act to fund cancer research, to benefit his company, Warner Lambert Pharmaceuticals. And as for Kendall, who headed Pepsi Cola, he may have considered profits that went from heroin sales, using the Pepsi bottling center in Laos as a cover, according to Alfred McCoy, The Politics of Heroin in Southeast Asia:
Rather than buying heroin through a maze of middlemen, [Vietnam's Air Vice-Marshal Nguyen Cao] Ky's apparatus deals directly with a heroin laboratory operating somewhere in the Vientiane region. According to a U.S. police adviser stationed in Vientiane, this laboratory is supposed to be one of the most active in Laos, and is managed by a Chinese entrepreneur named Huu Tim Heng. Heng is the link between one of Laos's major opium merchants, Gen. Ouane Rattikone (former commander in chief of the Laotian army), and the air transport wing heroin ring.

From the viewpoint of the narcotics traffic, Huu Tim Heng's most important legitimate commercial venture is the Pepsi-Cola bottling factory on the outskirts of Vientiane. With Prime Minister Souvanna Phourna's son, Panya, as the official president, Heng and two other Chinese financiers began construction in 1965-1966. Although the presence of the prime minister's son at the head of the company qualified the venture for generous financial support from USAID (U.S. Agency for International Development), the plant has still not bottled a single Pepsi after five years of stop-start construction.


The completed factory building has a forlorn, abandoned look about it. While Pepsi's competitors are mystified at the company's lackadaisical attitude, the U.S. Bureau of Narcotics has an answer to the riddle. Bureau sources report that Heng has been using his Pepsi operation as a cover for purchases of chemicals vital to the processing of heroin, such as ether and acetic anhydride, and for large financial transactions.
That Kendall knew how this bottling factory was being used has not been proven, though his complicity in the CIA overthrow of Salvador Allende in 1973 is documented by both Seymour Hersh and Thomas Powers. The message conveyed by Nixon and his administration was that power was for sale to the highest bidder. The old adage that money doesn't smell rang true in his case.

Nevertheless, the rationalization was that the stored gold which had been discovered and stockpiled at the close of WWII had run out, and in 1971 Nixon had to hide behind Treasury Secretary John Connally when the announcement was made that the Bretton Woods Agreement was no longer the rule; they "closed the gold window." The bankers knew there were two main reasons this step had to be taken: First, too many U.S. dollars were being spent abroad for heroin, which went primarily to French refiners; and second, the French demanded payment of deficits in gold rather than in U.S. currency. French heroin pushers would no longer be able to trade U.S. dollars for gold.

At the same time these events were taking place, OPEC (the oil trading countries' cartel) was plotting a way to prevent the collapse of oil prices. The Nixon administration, at the instigation of American- based international oil companies, agreed to send a high-ranking State Department official (Irwin Commission) to negotiate with the OPEC nations, led by Colonel Muammar Qaddafi and the Shah of Iran. Nixon and Kissinger "caved in" to the Shah's demands, to the dismay of the Saudis. Once Nixon resigned, the Saudis apparently cut a deal with Gerald Ford. According to a review of Andrew Scott Cooper's book, The Oil Kings... explained Nixon's motivation as follows:

By late 1969, Nixon was so friendly with the shah that he had granted the leader his own special oil quota. In exchange, the shah pledged to spend every cent of those additional oil revenues on US military and intelligence hardware. This worried Nixon's aides. "It was one thing to fly the flag for the West," Cooper writes, "another to arm it to face down Iraq, India and regional rebellions, pacifying a vast swath of the Middle East and Indian Ocean. Rearmament on the scale proposed by the shah," Cooper adds, "had the potential to bankrupt Iran."

Still, Nixon persisted, advising Iran's lead diplomat, Ardeshir Zahedi to "tell the shah you can push [us] as much as you want [on oil prices] ..." In short, the shah could "raise oil prices at will and pressure western oil companies and consumers" - all via a back channel implemented without cost assessment or risk analysis. Who cared what happened to the real Iranians not benefiting from oil dollars? The US had its precious outpost in the Middle East.
Why did Nixon agree to these terms, which, Cooper says, led directly to the Iranian hostage crisis in 1980 and to the need for a war on terror? We will reserve our comments about this for the time being. Nevertheless, serious students of the war on drugs and terrorism need to be aware that nothing is ever as simple as we would like it to be.
~~~~~~~~~~~~~~

 Selected Excerpts from 
THE GREAT HEROIN COUP - DRUGS, INTELLIGENCE AND INTERNATIONAL FASCISM
By Henrik Kruger; Jerry Meldon, Translator
South End Press©1980: Box 68 Astor Station, Boston, MA 02123
ISBN 0-89608-0319-5
240pps - one edition - out-of-print; Orginally published in Danish
Smukke Serge og Heroien; Bogan 1976


Previous chapters:

Chapters 18 and 19


CHAPTER TWENTY

GUNS FOR DRUGS

In August 1976 Lucien Conein's chum Mitch WerBell III (whose B.R. Fox Company had shared a Washington office with Conein's DEA Special Operations Group) was brought before a Miami federal court on charges of conspiracy to smuggle 50,000 pounds of marijuana a month from Colombia to the United States. He and several co-conspirators had allegedly hatched the plot in the summer of 1975, just when Alberto Sicilia‑Falcon was arrested in Mexico. Multi‑ton marijuana loads were to have been flown from Colombia to an isolated ranch in the Florida Everglades near the cowtown of Okeechobee.[1]

[See Editor's notes below.]

The star prosecution witness at the trial for Mitchell WerBell was scheduled to be the convicted cocaine and marijuana smuggler Kenneth Gordon Burnstine. However, weeks before he was to give testimony, he died in the mysterious crash of his P‑51 Mustang at an air show in the Mohave Desert. Without his corroboration, most of the vital tape recordings and films of meetings he had with WerBell and other defendants were not admissible as evidence in the trial.
Click to enlarge. See more Editor's Notes about Burnstine below.
WerBell's defense was that his role in the plot had been as an undercover agent for Conein. Both Conein and [Nixon aide] Egil Krogh were to have been witnesses on his behalf. But Krogh testified that he didn't know WerBell had worked for the DEA's Special Operations Branch, and Conein wasn't called at all. Another defense witness was the soldier of fortune Gerry Hemming, whose private army of Cuban exiles and Americans, the International Penetration Force [Interpen], appears, from Hemming's description of its missions, to have played an active role in Operation 40. During the trial, Hemming would stay late into the night in WerBell's hotel room.[2]

WerBell was found innocent and released, just like the Thai opium smuggler/CIA agent Puttaporn Khramkhruan before him in 1973. He went home to Georgia to pursue his weapons business and law enforcement training camp. According to writer Hank Messick, in 1978 he was involved in far Right politics with the likes of Major General John K. Singlaub (who had been relieved of his command in Korea after outspoken criticism of President Carter) and members of the American Security Council[3] — the key U.S. link to the far Right's international umbrella organization, the World Anti‑Communist League (WACL). As reported recently in the New York Times, the beneficiaries of his anti-terrorist training have included members of the far Right, anti‑Semitic U.S. Labor Party.[4] [Here, author Henrik Kruger is succinctly referring to Dennis King's revelations about Lyndon LaRouche, who contracted with Mitch WerBell to teach his organization about how to protect itself from being bugged or infiltrated and to provide security against an alleged threat on LaRouche's life. An excerpt from that book (highlighted in color) gives an insight into what WerBell was doing in the early 80's, shortly before his death:
If LaRouche and his followers wanted to meet some real live spooks, WerBell was willing to oblige. He arranged several meetings that included CIA personnel. "You're damn right he did--I was there," said Gordon Novel, a New Orleans private investigator who lived for several months at the Farm in 1977.
Editor's Note: Jim Garrison claimed he had proof during his prosecution of Clay Shaw in 1967 that Gordon Novel worked for CIA:
Novel’s own lawyer, Stephen Plotkin, has admitted that his client is a CIA agent. On May 23, 1967, Plotkin was quoted in the New Orleans States–Item as saying that “his client served as an intermediary between the CIA and anti–Castro Cubans in New Orleans and Miami prior to the April 1961 Bay of Pigs invasion.” And that same day, the Associated Press, which has hardly served as my press agent in this case, reported: “When Novel first fled from New Orleans, he headed straight for McLean, Virginia, which is the Central Intelligence Agency suburb. This is not surprising, because Gordon Novel was a CIA employee in the early Sixties.” There is no doubt that Gordon Novel was a CIA operative.
Jim Hougan recalls attending two meetings in an apartment at the Crystal City Marriott near Washington--referred to as a "safe house" by WerBell--where the LaRouchians explained their theories about British control of the narcotics traffic to former and active-duty CIA men.

WerBell invited LaRouche and his top aides down to the Farm to regale them with stories about Vietnam and introduce them to more spooks. One of these contacts was Major General John K. Singlaub (U.S. Army), who had spent a large portion of his career assigned to CIA covert operations in Asia and had once been CIA deputy station chief in Seoul. He first met with them while stationed in Georgia. After his retirement in 1978 they showed up at his lectures around the country and at a ceremony where he and WerBell were given medals by the Taiwanese government.

Although Singlaub dropped the LaRouchians after learning of their extremism, some of WerBell's friends were less fastidious. Ex-CIA agent Mackem advised them on the international drug traffic in 1978 while they were writing Dope, Inc., and continued to help them off and on. By 1986 they were paying him over $1,000 a month. ...

At the outset WerBell learned that being LaRouche's handler could be a nerve-wracking job. LaRouche was persuaded in August 1977 that German terrorists were out to kill him. WerBell sent a Powder Springs police officer, Larry Cooper, to Wiesbaden to reorganize LaRouche's personal security. Cooper sat in on a political discussion with LaRouche and several top NCLC members during which LaRouche suddenly brought up the idea of assassinating President Carter, National Security Adviser Zbigniew Brzezinski, NATO general secretary Joseph Luns, and David Rockefeller. It could be done, LaRouche argued, with remote-controlled radio bombs activated from public pay phones.

WerBell had told Cooper that guarding LaRouche was a CIA contract job, and that Cooper therefore would be serving his country. But Cooper now realized that WerBell had not told him the entire truth. He called the Farm in a panic, and said he was coming home on the next flight and contacting the FBI. Gordon Novel was in the room with WerBell, and recalls that "the general went through the ceiling, immediately started calling Washington and canceling a lot of things and generated a kind of propaganda story, a cover story, to completely suppress the affair." Indeed, WerBell had cause for worry--his name had been connected with a radio-bomb assassination scheme once before: During the Nixon administration he had worked with a secret Drug Enforcement Administration unit under Lucien ("Black Luigi") Conein that had planned to assassinate Latin American drug dealers. As a consultant, he had devised remote-control bombs and had provided a business cover for Conein's unit. The plan was scotched when Senator Lowell Weicker found out about it and called hearings. WerBell refused to answer questions before the committee, earning the nickname "Mitch the Fifth" in right-wing circles. Apparently LaRouche had taken this incident and transmuted it in his own spy novel-saturated imagination into something that could land them both in deep trouble.

WerBell decided he'd better get LaRouche into a "reality state" fast or there'd never be an "accommodation between the CIA and LaRouche," Novel said. Shortly afterward, Novel had a falling-out with WerBell and left Powder Springs, He says he told the FBI about the Wiesbaden incident, but they showed no interest.
WerBell owns eight companies, most of them dealing in firearms used by law enforcement and intelligence units. One of the firms, Studies in the Operational Negation of Insurgents and Counter‑Subversion (SIONICS), specializes in the production of M10 and M11 silenced machine pistols. The latter two weapons, designed by Gordon Ingram and WerBell, are about the ultimate weapons for terror and extermination. Their sales agent was WerBell's Military Armament Corporation.[5]

Together with the anti‑Castro Cuban arms dealers Anselmo Alliegro and the mercenary Gerry Hemming, WerBell founded the Parabellum Corporation in 1971 in Miami.[6] [Editor's Note: Parabellum's office was in Room 305 of Jose Marti Building at the corner of S.W. 3rd Avenue and S.W. 8th Street. Room 309 of this building was in 1968 headquarters of Orlando Bosch, founder of CORU.] Parabellum was licensed to sell arms in Latin America. It was also the firm from which Watergate burglar Frank Sturgis planned to obtain weapons for Cuban exiles who were going to (but eventually did not) disrupt the 1972 Miami conventions.[7]

In 1974 WerBell-‑according to a motion filed by his own lawyer when WerBell, his son and his company Defense Services, Inc. were charged with illicit weapons sales-‑was involved in a "conspiracy among the CIA, Robert Vesco, and various corporations to finance clandestine guerilla activities in Latin America."[8] Vesco wanted to purchase WerBell's stock of 2000 silenced M10 machine pistols. When WerBell failed to secure an export license, he devised a plan to smuggle the weapons to Vesco. The two later negotiated the construction of a factory in Costa Rica which would be licensed to fabricate the pistols.[9]

Sicilia-Falcon
Intriguingly, in that same period someone was negotiating with a U.S. firm for rights to fabricate, in Mexico, fully automatic weapons for clandestine guerilla actions in Latin America. That someone was Mexico's Cuban exile heroin czar, Alberto Sicilia‑Falcon,[10] and among the weapons he was inspecting was the Ingram M10, 9 mm Parabellum.[11]

Although the M10 and M11 could be acquired legally only with the special permission of U.S. officials, large numbers of silenced M10s turned up in the hands of European fascist terrorists in 1976‑77. when Pierluigi Concutelli, a leader of the Italian terrorist group Ordine Nuovo, was arrested in Rome in February 1977, police found in his apartment the silenced M10 which he had used to murder the Rome magistrate Vittorio Occorsio. [12] Occorsio had been shot down on the streets of Rome in July 1976 after announcing he would expose the close collaboration between Fascist terror groups and the Mafia.[13]

However, it was among Spanish terrorists in particular that WerBell's machine pistols appeared in quantity.[14] Most notably, a sizable consignment of M10s, sent to Spain under license from U.S. authorities, had been purchased by Spanish intelligence agency DGS,[15] which has allegedly coordinated the actions of Fascist terrorists.[16]

The fugitive IOS billionaire Vesco employed a large contingent of Cuban exiles in his Costa Rica sanctuary.[17] Moreover, his weapons negotiations coincided with the efforts of the fanatic anti­Castro Cuban leader Orlando Bosch to assemble Cuban exile groups into an army of terror, CORU, that would later carry out assassina­tions and other dirty work for several Latin American regimes. [Editor's Note: Recall from above that WerBell's Parabellum office was in Room 305 of Jose Marti Building in Miami, while Room 309 of this building was Orlando Bosch's office.] During Bosch's 1974‑75 drive, a wave of murder struck Miami's Cuban exile haven. Most victims had been opposed to Bosch. With the obstacles to his plan removed, CORU was established in June 1976.[18]

While Vesco and WerBell were hatching their weapons deal Bosch's base of operation just happened to be Vesco's kingdom of Costa Rica, and Mafia heroin boss Santo Trafficante, Jr. was also reportedly there between January 1974 and the summer of 1975. Journalist Jim Hougan speculates in his book Spooks that the three might have joined forces in a CIA conspiracy to escalate anti‑Communist terror in Latin America.[19]

In 1973 some of the details began to surface in a series of scandals linking these individuals. DEA undercover agent Frank Peroff charged Vesco with financing extensive heroin smuggling. For his initiative Peroff was fired summarily and his life was threatened. Before the Senate Investigations Subcommittee could probe deeply the case was squelched through the intervention of the White House. The Oval Office had already helped Vesco-‑a friend of the Nixon family-‑in his run‑in with the Securities and Exchange Commission, which had sought his prosecution for the trail of swindle he had left in the world of international finance. Midway through the subcommittee investigation of the heroin charges, the DEA announced the disappearance of its Vesco file.[20]

One year later, as the subcommittee investigated WerBell's weapons deal with Vesco, it learned that Vesco had once employed government narcotics agents. In 1972 two bugging specialists from the BNDD flew from Los Angeles to New Jersey to sweep Vesco's home and office of surveillance devices. According to the subcommittee, the sweeping tour had been arranged by an admitted friend of Vesco's who was also involved in supplying the fugitive with 2000 machine guns and helping him establish a factory for the weapons in Costa Rica.[21] Guess who.
[Editor's Note: Douglas Valentine avers that BNDD and CIA were working together in a program called BUNCIN — the Bureau of Narcotics Covert Intelligence Network. Valentine's books are must-reads to get full story of the "War on Drugs".]

and

That was not the last heard of Robert Vesco in connection with drugs. In the summer of 1977 police uncovered the smuggling of large quantities of heroin and cocaine to Rhode Island. In one of the involved ships they discovered a ledger in which it was written: "to Vesco/6 million/he picked up w. shrimper (Lansky)/'Curier' beat UP. "[22]

Several things point to Vesco involvement in the long‑standing partnership of the CIA, the Lansky/Trafficante syndicate and the Cuban exiles, in a drugs‑for‑guns‑for‑terror deal to step up armed suppression and anti‑communism in Latin America. Journalist Hougan ventures that the conspirators might have used such go‑betweens and couriers as the beautiful Patricia Richardson Martinson. According to her ex‑husband, the former army intelligence agent William Spector, Ms. Martinson had very close relationships with almost everyone of importance in the drug business: Yussef Beidas, the Lebanese founder and managing director of INTRA Bank, known as one of the major financiers of the heroin traffic; Paul Louis Weiller, a French financier similarly alleged to be behind the narcotics trade; Eduardo Baroudi, a big‑time heroin and gun smuggler suspected of having arranged Beidas' mysterious death in Switzerland; Christian "Beau Serge" David; Conrad Bouchard, a top heroin trafficker heavily involved in Frank Peroff's Vesco heroin allegations; and Marcel Boucan, the skipper of the Caprice du Temps, which was seized in 1972 with 425 kilos of pure heroin.[23]


Yet another likely intermediary among the apparent conspirators is the CIA contract agent/arms dealer/art dealer Fernand Legros. In 1971 the CIA helped get Vesco released from Saint‑Antoine prison in Geneva, where he had been arrested in the Bernard Cornfeld/Investors Overseas Service case. Legros was in that same prison and spoke with Vesco. In January 1973 the two were reunited in Nassau.[24]

Legros was seen in the company of Beidas in Geneva and Rio de Janeiro. His closest friend was the convicted heroin trafficker Andre Labay, a close associate of Haiti's Duvalier dynasty. In Geneva Legros also met frequently with Evelyne Hirsch, the wife of the im­prisoned bankroller Andre Hirsch, whose South American heroin contact had been Christian David. Just as the U.S. put the screws on the Paraguayan government for the extradition of Auguste Ricord, Legros was in Paraguay to close out a weapons deal with President Stroessner. Later, when Legros was placed in protective confinement in Brazil, newspapers speculated on his involvement in the David Mob's narcotics deals.

Recent years' investigations into the CIA/organized crime connection have resulted in an epidemic of sudden deaths. In the CIA/DEA/ Vesco/ Syndicate scheme alone one can mention Kenny Burnstine [see below]; WerBell associate Colonel Robert F. Bayard, who was shot down in an Atlanta parking lot in July 1975;[25] another WerBell associate and codefendant in his marijuana case, John Nardi, who was shot [sic] in Cleveland;[26] and Vesco's security chief Bobby Hall, who was shot to death in his Los Angeles home in July 1976.

After the Senate Investigations Subcommittee's attempted probe into the Vesco heroin case was sabotaged from the highest quarters, committee chairman Henry Jackson asked: 
"Did the U.S. govern­ment wish to keep Vesco out of this country for some reason? Did he have some special information which he could supply to explain, in part, the national nightmare we have just lived through? "

One Senate investigator offered an answer: "More than any single person, Vesco has information which, if he talked, would make Watergate look like a picnic."[27]

pps.181-187

Notes

1. T. Dunkin: "The Great Pot Plot," Soldier of Fortune, Vol. 2, No. 1, 1977.

2. Ibid. According to an interview with Hemming published in the April 1976issue of Argosy magazine, Hemming settled in Florida after contacting theCIA to tell the agency all he knew about Castro's operations. There he founded Interpen, which specialized in training anti‑ Castro Cuban exiles in special camps in Florida for long‑range guerilla warfare against the Castro regime. Thus began a long and friendly advisory relationship not only with the CIA, but with the Mob, the Hughes empire and other wealthy and influential Americans as well. About the financing of Interpen, Hemming said, "There were dribs and drabs from people connected with organized crime, some from the right wing, and even from some quite liberal sources." Hemming also said: "In 1961, some Mob people wanted my group to do a couple of jobs in Canada" — emphasis added — (against a ship with machinery for Cuba). . . "John Roselli I knew — but I didn't know who he was" . . . and about CIA/ Cuban terror in Latin America: "All this was a kind of Operation Phoenix for Latin America. There's a guy I know in Miami who worked on this more than once. Evidently he's now had a falling out with some Cubans involved in narcotics. He's a close friend of Bebe Rebozo, and Rebozo's interested in protecting him." Interpen reportedly disbanded in 1964.

3. H. Messick: Of Grass and Snow: The Secret Criminal Elite (Prentice‑Hall, 1979).

4. New York Times, 7 October 1979. According to the magazine Soldier of Fortune ["Terrorists Beware! - Werbell's Cobray School" by T. Dunkin] January 1980), WerBell established Cobray International, Inc., an antiterrorist school primarily for business executives, in Georgia in 1979. Its acting president, Col. Barney Cochran (USAF retired), served as "deputy commander for the Joint Unconventional Warfare Task Force EUROPE " in 1970‑74, and has also been chief of the Unconventional Warfare Branch and special assistant for counterinsurgency and special activities organization of the Joint Chiefs of Staff. In the latter post he was responsible for development of "hardware" for Global Special Operations and unconventional warfare. The school's chief marksmanship instructor, Bert Waldron, holds the record for sniper killings in Vietnam — 113.

5. J. Hougan: Spooks (William Morrow, 1978).

6. Ibid.; see also Gerry Hemming's interview in Argosy, April 1976.

7. Argosy, op. cit.

8. Documents of the U.S. District Court, Northern District of Georgia, Atlanta Division, in criminal case no. CR 74‑471 A (cited in Hougan, op. cit.).

9. Hougan, op. cit.

10. "Die gefahrlichen Geschafte des Alberto Sicilia," Der Spiegel, No. 20,1977.

11. U.S. Congress, Senate, Committee on Government Operations, Illicit Traffic in Weapons and Drugs Across the United States‑Mexican Border, Hearings,‑ 95th Cong., 1st Session (1977).

12. Time, 2 February 1977; F. Laurent: L'Orchestre Noir (Stock, 1978).

13. Time, op. cit.

14. Cambio 16, 20 February 1977. 15. Laurent, op. cit.

16. P. Chairoff: Dossier B ... comme Barbouzes (Alain Moreau, 1975); L. Gonzalez‑Mata: Cygne (Grasset, 1976).

17. Hougan, op. cit.

18. According to the November 1977 issue of the Dominican Republic Task Force Newsletter (cited in the January‑February 1978 NACLA Report), the Bonao, Dominican Republic site of the CORU founding was a club for executives of the Falconbridge Nickel Company, which is controlled by the Keck family of Houston, Texas. There is, however, some confusion about the date, which the same source indicated was June 1975. Counterspy, Vol. 3, No. 2 listed the date as June 1974. The summer 1976 date, however, is that used by Bernard Cassen in Le Monde Diplomatique of February 1977, by an anonymous contributor to the Nation of 19 March 1977, and by Blake Fleetwood in New Times of 13 May 1977. Bosch, incidentally, like Vesco and WerBell, was associated with narcotics, insofar as his daughter and son‑in‑law were arrested in 1977 for smuggling cocaine.

19. Hougan, op. cit. Vesco had his own contact in the Lansky Syndicate — Dino Cellini, with whom he had met secretly at Rome's Fiumicino Airport in 1972.

20. L.H. Whittemore: Peroff (Ballantine, 1975).

21. Ibid.

22. Messick, op. cit.; Boston Globe, 30 September 1977. 23. Hougan, op. cit.

24. R. Peyrefitte: La Vie Extraordinaire de Fernand Legros (Albin Michel, 1976).

25. Dunkin, op. cit. 26. Messick, op. cit. 27. Whittemore, op. cit. Somewhere among Robert Vesco's memorabilia floats the strange affair of the Brotherhood of [Eternal] Love. Through it thousands of potential activists were stoned for years on LSD, and enormous profits from the sales of tablets were reinvested through the Investors Overseas Service controlled Fiduciary Trust Company (Der Spiegel, No. 39, 1974). 

In the same connection, it is interesting to note that when, in the fall of 1978, Italian police investigated the American Ronald Stark's close involvement with Italian terrorists, they discovered he had been heavily involved in the Brotherhood of Love until 1971, and had run one of its LSD labs in California. In his terrorist period Stark was closely in touch with the U.S. embassy in London, which had opened a letter to him with "Dear Ron" (Panorama, 31 October 1978).

----------------
Editor's notes
The land on all sides of Lake Okeechobee, a hundred miles or so south of today's Disney World, has teemed with military or covert intelligence operations since Fidel Castro first seized power, and there is a long and sordid history in this area of real estate used as a destination for smugglers, according to a November 21, 1986 article by Jean Dubail in the Sun Sentinel:
Drug smuggling, after all, has become a leading industry in the sparsely populated counties bordering Lake Okeechobee. Wide, flat meadows and long, lonely stretches of road make ideal landing strips for light planes. Because there are so few people around, it's easy to unload planeloads of contraband without being seen. Glades County Sheriff Russell Henderson illustrates the problem this way:

"One time we took a map of Glades County," he says. "Every known strip we marked in red. The map was just about red when we got through."

Assistant U.S. Attorney Jim McAdams compares the lakeside counties with Everglades City and the Ten Thousand Islands, where smugglers have eluded customs agents for generations.

"What Everglades City was to the small go-fast boats, that area is to the small twin-engine aircraft," says McAdams, who works with the Miami-based Drug Enforcement Task Force. "Unless they happen to be trailed in by customs, they`re going to be able to land, dump their load, take off and mingle with the general public."

"It's always tough," says J.E. "Buck" Buchanan of the Florida Department of Law Enforcement. "A lot of smuggling going on, wide open spaces and damn few of us."

The problem is not a new one, Buchanan says. Smugglers have been bringing drugs to the lakeside counties since the early 1970s, when large two- and four-engine planes flew tons of marijuana directly from Colombia.

"We were eaten up with aircraft smugglers at one time," Buchanan says. "They were falling out of the sky."

Such planes, however, were relatively easy to spot and track. Buchanan says that fact -- plus increased demand for less bulky and more valuable cocaine -- led smugglers to start using small planes. Because these craft have a shorter range, smugglers began using the Bahamas as a jumping-off point. Lake Okeechobee is less than 125 miles due west of West End.]
Burnstine had been born in Chicago in 1933, to Ralph A. and Dolores Edison Burnstine. Ralph was the son of Isador Burnstine, owner of an automobile dealership in Chicago. Isador's parents were born in Germany, and his wife (Ralph's mother) had immigrated from Latvia with her parents in 1890. Both Ralph and his brother Herman worked in their family's car sales business, founded by Isador and his brother Isaac:
The Riviera Motor Sales Company remained a Chrysler automobile dealership under the ownership of the Burnstine family through the 1930s, as did the Burnstines’ Capitol Motor Sales Company on W. Lawrence. Isadore Burnstine then acquired another Chrysler franchise and opened the Burnstine Motor Sales Co. in 1928 at 2524 N. Milwaukee Ave. in the Logan Square neighborhood. He died in 1936 and his son Ralph took over control of the family’s automobile dealerships. The Riviera Motor Sales Company operated out of the building until at least 1937 during the Great Depression. That year the Burnstine family turned over ownership of the building to the Lincoln National Life Insurance Co. Building, which owned the building until 1942, when it was sold to the 1211 Elmdale Corporation.
 The 1940 census showed Kenneth and his younger brother, Irving, living with their mother in Tucson, Arizona, but we are told by Jack R. Swike that Kenneth graduated from college in Chicago's Northwestern University, before enlisting in the Marine Corps in 1954. Data available at Ancestry.com informs us that he was selected for training as a Pfc to the First Training Battalion in Quantico, Va. and, by July 1954, had the rank of 2nd lieutenant. From there he went to El Toro, the permanent center of Marine aviation on the west coast as a member of the Service Squadron of the Air Fleet Marine Force of the Pacific (Trans Section Servron AirFMFPac). Within a few months Burnstine was promoted to 1st Lieutenant and sent to the U.S. Naval Sea Cadet Corps in Great Lakes, Illinois. His name appeared on a Unit Diary on Jan. 18, 1956, addressed to MRI, El Toro, for Unit H and MS-11, MAG-ll, 1stMAW, FMF, location Japan. Under his name was the following: "Acc temp attp as 1Lt MCR rk 2Jan56 auth CMC 1tr DHD2742-kab of 3Jan56." His MOS was 0210, summarized in today's Marine Occupations Specialties Manual as follows:
Counterintelligence (CI) warrant officers serve in both CI and HUMINT billets. They conduct technical surveillance counter measures (TSCM), provide expertise in advanced foreign CI, and advise tactical commanders in force protection operations. Duties include serving as a CI assistant platoon commander and HUMINT Exploitation Team (HET) Commander within the HUMINT Company, service on a MEF staff, Naval Criminal Investigative Service, and serving as a CI representative to unified commands and national-level agencies. CI limited duty officers function as supervisors, advisors and coordinators of counterintelligence activities and human intelligence collection operations. Duties may include serving as CIHO at the MEF or MARFOR headquarters, service with the Naval Criminal Investigative Service, serving as staff officers within the CI/HUMINT Branch, HQMC, and serving as a CI representative to national-level agencies.
The history of this MOS 0210 during the Korean War is described under Section 2 of a website called Counterintelligence History. A new duty sheet dated 9 Apr 56 addressed to Quantico, gave him a new assignment with MOS 7399 (IRC ATT) to the Naval Training Center at Great Lakes, Illinois. These codes could have been abbreviations or acronyms for a variety of possible meanings, as set out in the Department of Defense Dictionary. The first two digits (73) of the new MOS, however, indicates navigation officer or enlisted flight crews, and the 99 designated that he was a flight student
Strangely enough, after all the Marine Corps' expense of training him, Burnstine resigned his commission on 16 Apr 56, based on unit diary from Great Lakes NTC to Quantico. However, Jack Swike tells us there were some very strange things going on with Burnstine at this time.

In 1956 he married Ann Mitchell and moved to Mobile, AL, where he became the treasurer of her father's real estate office, Gulf Coast Realty Co., later called the The Mitchell Company, Inc. Ann and her brothers, Mayer and Abe, were children of Joseph Benjamin Mitchell, son of a Russian Jews born in Germany who had immigrated to New York in 1889. Ann's grandfather, Meyer Mitchell, had worked in a factory that made knee pants in 1900, but had relocated with his young family, including her then-infant father, to Mobile in about 1901 and worked as a peddler of dry goods.

Joseph Mitchell, Burnstine's father-in-law, was also a co-owner in the Gulf Coast Tobacco Company with his sister Anne and her husband Samuel J. Ripps, who were prosecuted by Truman's Justice Department for tax evasion between the years 1940-45 and each man received jail time. The case was publicized in 1951 when the U.S. Attorney in charge of the tax division, T. Lamar Caudle, was fired and later investigated for taking bribes from taxpayers to prevent prosecution. Two years earlier Drew Pearson had mentioned the case:
Joe Mitchell and his brother-in-law, Sam Ripps, organized the Gulf Coast Tobacco company during the war and sold millions of dollars worth of jewelry to army post exchanges. The boys in the Army camps would buy almost anything those days and Ripps and Mitchell made a killing. Then, a couple of years later, alert treasury agents caught them keeping two sets of books, and after long investigation, recommended criminal prosecution....Treasury agents claimed they owed a minimum of $700,000; perhaps as much as $1,200.000.

When Ann's brother, Mayer Mitchell, died in 2007, a resolution was read in the Alabama state senate stating that he had been "born in New Orleans in 1933 and grew up in Mobile, AL. He earned his bachelor of science degree in economics at the University of Pennsylvania's Wharton School of Finance in 1953. He then served as an Army first lieutenant in Korea, earning a commendation ribbon with medal pendant for meritorious service. Returning home to Mobile with his wife Arlene in 1958, Mayer founded, with his brother Abe, the Mitchell Company, a commercial and residential real estate development firm. He went on to serve as its chairman and chief executive officer for the next three decades, selling his interest in the Mitchell Company in 1986."

By 1958 Kenneth's parents, Ralph and Dolores Burnstine, had moved to Miami Beach with Kenneth's brother Irving, who enlisted in the Marines that year. Calling himself "Moe" Burnstine, Kenneth and his wife Ann were also in Miami Beach where he worked as purchasing agent for the Carillon Hotel at 6801 Collins Avenue. He and Ann divorced in 1966, and he quickly married Carole Sue Tolbert in Broward County, Florida, but they divorced in 1974. Less than two years later his plane crashed, leaving nothing but a severed finger to identify him.

Sunday, January 12, 2014

The Great Heroin Coup - Chapters Eighteen and Nineteen

Changing the Middleman
by Linda Minor

President Nixon had already announced the concern of the United States in fighting drugs by the summer following his initial inauguration in 1969. Needing an excuse to take federal action against what was essentially a state crime, he told Congress:
Effective control of illicit drugs requires the cooperation of many agencies of the Federal and local and State governments; it is beyond the province of any one of them alone. At the Federal level, the burden of the national effort must be carried by the Departments of Justice, Health, Education, and Welfare, and the Treasury. I am proposing ten specific steps as this Administration's initial counter-moves against this growing national problem.
Since three Cabinet officials were cooperating in this effort, a committee of those officials was created September 7, 1971, called the Cabinet Committee on International Narcotics Control (CCINC). The timing of this occurred almost simultaneously with President Nixon's revelation that he was considering a devaluation of the dollar as well as cutting the connection of the value of gold from the value of the dollar. (See article at bottom of this post.) The two issues--international narcotics trade and protecting the American trade balance were, in fact, inextricably intertwined, and the Central Intelligence Agency worked covertly on both issues through the various agencies administered by the executive branch of the U.S. government.

The history of how the new drug enforcement agency's need for intelligence about international drug traffickers began to draw upon the resources of other federal agencies was recounted to Chairman Otis Pike's Select Committee on Intelligence by Jerry N. Jenson, whose testimony began on November 13, 1975. When DEA developed its intelligence division, it first incorporated the Office of National Narcotics Intelligence set up in 1972 under former FBI agent William Sullivan. It also had at its disposal the Customs Agency's facilities along the border with Mexico, called El Paso Intelligence Center (EPIC), as well as Federal Aviation Administration's air intelligence. Jensen implied that once the CCINC was created, the DEA began to cooperate with the Central Intelligence Agency in acquiring information about international narcotics trafficking.

The truth, however, is that even more than the concern about the health and safety of drug users, the United States was much more anxious about how the organization of the drug traffic routes was affecting the international monetary structure. The following excerpt from an article by Christopher Matthew appeared in December 1971 of a magazine styled European Community:

The concern is clear. Every month $10 million was being sent from the United States to the French treasury and was helping to to create a devastating drain of America's dwindling gold supply into France. It was significant enough for the International Monetary Fund and World Bank to become involved in the issue of narcotics traffic since it was resulting in the collapse of the Bretton Woods system created in 1944.

As the United Nations, pursuant to 1532(XLIX) of 24 July 1970, began to take concerted action on 11 November 1970 to control international drug abuse, it acknowledged the need to establish a fund the UN could draw upon. To establish the fund, it added to its resolution a request to then Secretary General U Thant of Burma:
in keeping with the recommendation of the Commission on Narcotic Drugs, to establish, as an initial measure and as a matter of urgency, a United Nations fund for drug-abuse control to be made up from voluntary contributions, such fund to be initially used for the purposes which were approved by the Commission and administered by the Secretary-General pending the development and consideration by the Council of the proposed long-term plan of action, including permanent arrangements for administration and financing...
President Nixon found himself as soon as he took office having to deal with a persistent deficit in the balance of payments, which did not fluctuate or disappear despite several actions which had been taken to alleviate it. His war against heroin was not technically an effort to end the drug trade per se. That would have meant ending the anti-Communist military actions in Indo-China, which were financed by opium produced there. Rather, President Nixon's administration was working toward changing the middleman from French heroin refineries to those controlled by Americans, i.e. through CIA proprietaries.

It's what I refer to as "following the money."

~~~~~~~~~~~~~~~~~~~
Selected Excerpts from
THE GREAT HEROIN COUP - DRUGS, INTELLIGENCE AND INTERNATIONAL FASCISM
By Henrik Kruger; Jerry Meldon, Translator
South End Press©1980: Box 68 Astor Station, Boston, MA 02123
ISBN 0-89608-0319-5
240pps - one edition - out-of-print; Orginally published in Danish
Smukke Serge og Heroien; Bogan 1976

Previous chapters:

CHAPTER EIGHTEEN

ONE MORE COVER‑UP

In early 1973 the Department of Health, Education and Welfare estimated the number of U.S. heroin addicts at 600,000. By the end of that year, Dr. Robert Egebjerg, director of the Alcohol, Drug Abuse and Health Administration, placed the number at 300,000. And in June 1974 DEA international operations chief John T. Cusack, testifying before the House Committee on International Narcotics Control, said that the addict population was down to 200,000.[1]

This giant cover‑up hid the fact that Nixon's heroin war was no more than window‑dressing. On 7 October 1974, six weeks after Nixon's resignation, the head of the White House Special Action Office on Drug Abuse Prevention, Dr. Robert Dupont, was pressured to release a secret report that the number of addicts had in fact risen, reaching even into formerly untouched middle class suburbs.[2]

On 27 April 1976 President Gerald Ford said in a message to Congress: "By mid‑1973 many were convinced that we had turned the corner on the drug problem. Unfortunately, while we had won an important victory, we had not won the war on drugs. By 1975 it was clear that drug use was increasing, that the gains of prior years were being lost, that in human terms narcotics had became a national tragedy. Today, drug abuse constitutes a clear and present danger to the health and the future of our Nation."

In February 1977 the House Select Committee on Narcotics Abuse and Control reported that the addict population totalled some 800,000. And in 1978 New York City's special narcotics prosecutor, Sterling Johnson, spoke of a heroin epidemic worse than that of the late sixties and early seventies.[3] But the cover‑up hadn't stopped in 1974.

DEA Lied about Source of Heroin

Cusack targeted the French, who made all the money.
From 1975 until the end of 1978 the DEA consistently maintained that between 80 and 90 percent of the heroin consumed in the U.S. was Mexican. However, the claim doesn't stand up against the following facts: 
  1. 80 percent of the world's heroin--exactly the figure exported from Marseille until 1972 --was, at least until late 1976, produced from opium harvested in the Golden Triangle and distributed via Bangkok, Singapore, and Hong Kong;[4] 
  2. the number of arrests of couriers en route from Southeast Asia increased steadily after 1973;[5] 
  3. reports from New York and other big cities testified to the arrival of large shipments of white heroin from Southeast Asia
  4. the market's supply of heroin did not dwindle despite aerial destruction of an estimated 60 percent of Mexico's poppy fields in early 1976;[6] 
  5. an effective tidal wave of Golden Triangle heroin began flooding Europe in 1973, while many couriers en route to the U.S. and Canada were nabbed by European police; 
  6. the DEA was aware of Santo Trafficante's dealings in Southeast Asia, as well as the later Mafia summit in Palermo where large sums of money were set aside for investment in the Golden Triangle; 
  7. it was easy to verify the narcotics flow from Mexico, since the border was subject to close surveillance, but to conclude that most of the heroin on the U.S. market originated in Mexico was a stretch of logic.
Even the DEA had to admit the tenuousness of its claims. On 24 February 1976, the DEA's John Cusack admitted that his agency's estimate that only 8 percent of U.S. heroin came from Southeast Asia was surprising, considering the region's prolific opium production. He added:
Jack Cusack, 1955
"We are also concerned about our detection during 1975 of substantial quantities of white no. 4 heroin moving directly from Bangkok to the United States. In December, for example, forty‑six kilograms of heroin were seized in Bangkok, concealed in the household effects shipment of a returning U.S. serviceman. Follow‑up investigation in the development of an extensive conspiracy prosecution has identified twelve additional shipments entering the United States since 1974."
Twelve such shipments meant 552 kilos, or more than the entire 470 kilos confiscated in the U.S. in 1975 ‑and from only one of many Southeast Asian smuggling networks. Cusack went even further:
 "It appears almost certain that the bulk of the white heroin found during 1975 in the inner‑city areas of our eastern cities has been Asian no. 4 smuggled from Bangkok."[7]
Why then did the DEA continue to overstate Mexico's role and minimize Southeast Asia-‑even after the publication, in 1972, of Alfred McCoy's The Politics of Heroin in Southeast Asia? Perhaps to justify the great expenditure in support of right wing military and police forces in Latin America. (The later boom in Colombian cocaine would also provide justification.) Southeast Asia was downplayed so as not to jeopardize relations with America's loyal, if corrupt, allies — most of all Thailand, Taiwan, and the latter's overseas agents. They were allowed to profit from opium and heroin in relative peace.

Another reason: the DEA could not expose the Southeast Asia connection without compromising the CIA. A secret 1977 House Government Operations subcommittee report accused the CIA of helping an Asian opium ring smuggle drugs into the United States and then lying about it to Congress. Puttaporn Khramkhruan, a Thai national, was arrested in 1973 for smuggling fifty‑nine pounds of pure opium into the U.S. via JFK airport. Citing national security interests, the agency had the case squelched, and Khramkhruan was sent back home. However, the House subcommittee eventually established that he was a CIA operative in Thailand.[8] In fact, he was on the payroll of a CIA proprietary using the Agency for International Development (AID) as a cover for training the corrupt Thai border police.[9] Furthermore, Khramkhruan told a DEA investigator that he had been an officer in the KMT army and guarded opium mule caravans. His CIA contact was the U.S. consul in Chiang Mai, Thailand.[10] In its report, the House Committee stated: "It was ironic that the CIA should be given the responsibility of narcotics intelligence, particularly since they are supporting the prime movers."[11]

The Thai Connection Origins
[Editor's Note: To understand the history of CIA action in Thailand, we turn to Dr. Peter Dale Scott. The following is an excerpt from his Operation Paper:
The United States Helps Rebuild the Postwar Drug Connection

To appreciate the significance of the connection we are discussing, we must keep in mind that, by 1956, the KMT had been driven from the Chinese mainland and that Chinese production of opium, even in remote mountainous Yunnan, had been virtually eliminated. The disruptions of a world war and revolution had created an opportunity to terminate the opium problem in the Far East. Instead, U.S. covert support for the Thai and KMT drug traffickers converted Southeast Asia, for more than two decades, into the world’s major source of opium and heroin.

The origins of the U.S. interface with these drug traffickers in Thailand and Burma are obscure. They appear, however, to have involved principally four men:
  • his British ally Sir William Stephenson, the organizer with Donovan of the World Commerce Corporation (WCC);
  • Willis Bird (both veterans of OSS China). After World War II, Sir William Stephenson’s WCC “became very active in Bangkok,” and Stephenson himself established a strong personal relationship with King Rama IX.31 [footnotes at bottom of paper]
Stephenson recruited James Thompson, the last OSS commander in Bangkok, to stay on in Bangkok as the local WCC representative. This led to the WCC’s financing of Thompson’s Thai Silk Company, a successful commercial enterprise that also covered Thompson’s repeated trips to the northeastern Thai border with Laos, the so-called Isan, where communist insurrection was most feared and where future CIA operations would be concentrated.32 One would like to know whether WCC similarly launched the import-export business of Willis Bird, of whom much more shortly.
In the same postwar period, Paul Helliwell, who earlier had been OSS chief of Special Intelligence in Kunming, Yunnan, served as Far East Division chief of the Strategic Service Unit, the successor organization to OSS.33 In this capacity he allegedly “became the man who controlled the pipe-line of covert funds for secret operations throughout East Asia after the war.”34 Eventually, Helliwell would be responsible for the incorporation in America of the CIA proprietaries, Sea Supply Inc. and Civil Air Transport (CAT) Inc. (later Air America), which would provide support to both Phao Sriyanon of the Northern Army in Thailand and the KMT drug camps in Burma. It is unclear what he did before the creation of OPC in 1948. Speculation abounds as to the original source of funds available to Helliwell in this earlier period, ranging from the following:

    1.  The deep pockets of the overworld figures in the WCC. Citing Daniel Harkins, a former USG investigator, John Loftus and Mark Aarons claimed that Nazi money, laundered and manipulated by Allen Dulles and Sir William Stephenson through the WCC, reached Thailand after the war. When Harkins informed Congress, he “was suddenly fired and sent back [from Thailand] to the United States on the next ship.”35

    2.  The looted gold and other resources collected by Admiral Yamashita and others in Japan36 or of the SS in Germany.

    3.  The drug trade itself. Further research is needed to establish when the financial world of Paul Helliwell began to overlap with that of Meyer Lansky and the underworld. The banks discussed in the chapter 7, which are outward signs of this connection (Miami National Bank and Bank of Perrine), were not established until a decade or more later. Still to be established is whether the Eastern Development Company represented by Helliwell was the firm of this name that in the 1940s cooperated with Lansky and others in the supply of arms to the nascent state of Israel.37

Of these the best available evidence points tentatively to Nazi gold. We shall see that Helliwell acquired a banking partner in Florida, [Edward Philip] E. P. Barry, who had been the postwar head of OSS Counterintelligence (X-2) in Vienna, which oversaw the recovery of SS gold in Operation Safehaven.38 And it is not questioned that in December 1947 the National Security Council (NSC) created a Special Procedures Group “that, among other things, laundered over $10 million in captured Axis funds to influence the [Italian] election [of 1948].”39 Note that this authorization was before NSC 10/2 of June 18, 1948, first funded covert operations under what soon became OPC.
E. P. Barry and Helliwell
What matters is that, for some time before the first known official U.S. authorizations in 1949–1950, funds were reaching Helliwell’s former OSS China ally Willis Bird in Bangkok. There Bird ran a trading company supplying arms and materiel to Phin Chunhawan and Phin’s son-in-law, Phao Sriyanon, who in 1950 became director-general of the Thai Police Department. By 1951 OPC funds for Bird were being handled by a CIA proprietary firm, Sea Supply Inc., which had been incorporated by Paul Helliwell in his civilian capacity as a lawyer in Miami. As noted earlier, Helliwell also became general counsel for the Miami bank that Meyer Lansky allegedly used to launder proceeds from the Asian drug traffic.
Some sources claim that in the 1940s, Donovan, whose link to the WCC was by 1946 his only known intelligence connection, also visited Bangkok.40 Stephenson’s biographer, William Stevenson, writes that because MacArthur had cut Donovan out of the Pacific during World War II, Donovan “therefore turned Siam [i.e., Thailand] into a base from which to run [postwar] secret operations against the new Soviet threat in Asia.”41
William Walker agrees that by 1947–1948, the United States increasingly defined for Thailand a place in Western strategic policy in the early cold war. Among those who kept close watch over events were William J. Donovan, wartime head of the OSS, and Willis H. Bird, who worked with the OSS in China. . . . After the war, Bird, . . . still a reserve colonel in military intelligence, ran an import-export house in Bangkok. Following the November [1947 Thailand coup] Bird . . . implored Donovan:
Willis Bird
“Should there be any agency that is trying to take the place of O.S.S., . . . please have them get in touch with us as soon as possible. By the time Phibun returned as Prime Minister, Donovan was telling the Pentagon and the State Department that Bird was a reliable source whose information about growing Soviet activities in Thailand were [sic] credible.42
Bird’s wishes were soon answered by NSC 10/2 of June 18, 1948, which created the OPC. Washington swiftly agreed that Thailand would play an important role as a frontline ally in the Cold War. In 1948, U.S. intelligence units began arming and training a separate army under General Phao, which became known as the Thai Border Police (BPP). The relationship was cemented in 1949 as the communists captured power in China. The generals demonstrated their anticommunist credentials by echoing U.S. propaganda and killing alleged leftists. At midyear a CIA [OPC] team arrived in Bangkok to train the BPP for covert support of the Kuomintang in its continuing war against the Chinese communists on the Burma-China border. Later in the year the United States began to arm and train the Thai army and to provide the kingdom general economic aid.43
Walker notes how the collapse of the KMT forces in China led Washington to subordinate its anti-narcotics policies to the containment of communism: By the fall of 1949 . . . reports reached the State Department about the inroads communism was making within the Chinese community in Thailand as well as the involvement of the Thai army with opium. Since the army virtually controlled the nature of Thailand’s security relationship with the West, foreign promotion of opium control had to take a back seat to other policy priorities.44
On March 9, 1950, when Truman was asked to approve $10 million in military aid for Thailand, Acheson’s supporting memo noted that $5 million had already been approved by Truman for the Thai “constabulary.”45 This presumably came from the OPC’s secret budget: I can find no other reference to the $5 million in State Department published records, and two years later a U.S. aid official in Washington, Edwin Martin, wrote in a secret memo that the Thai Police force under General Phao “is receiving no American military aid.”46 [footnotes at bottom of paper]
Read this and other books by Alan A. Block.

In March 1977 the DEA began to speak of "major maneuvers in the international Asian narcotics market for a share of the U.S. drug scene" and of a "coalition between the U.S. Mafia, the Corsicans and the Chiu Chao Chinese Triad."[12] The coalition had, in reality, existed at least since 1970 and perhaps as early as Trafficante's 1968 journey to the East and it had functioned effectively, shipping large amounts of heroin to the U.S., since 1972‑73. The difference was that the Corsican arm of the coalition, their own umbrella organization having been smashed, was now essentially reduced to some 100 men working with the U.S. Mafia and the Chinese, most of them as chemists in Thailand's mobile heroin labs.[13]

Who has controlled the Golden Triangle opium traffic and heroin production since the establishment of the Mafia‑Chinese coalition — besides the CIA, that is? The answer is the Kuomintang (KMT) Chinese and overseas Chiu Chao syndicatemen such as Chang Chifu [Khun Sa], Lo Hsing‑han, Tsai Chien Cheng and older, more familiar figures like General LiMi.[14] Still head of what's left of the KMT forces, General Li resides in luxury outside Chiang Mai and received official visits there from the United States as recently as late 1976.[15]


In 1976‑77 a minor war was about to erupt over the control of the region's opium traffic and mobile refineries. Potential combatants were Chu Chi‑fu's United Shan Army (of rebels against the Burmese regime) and KMT forces under General Li. However, the opposing leaders were brought together by a senior Thai officer and an agreement was reached on the marketing of drugs and supply of arms to fight Communist forces in Burma's Shan states.[16] Again we see the connection between narcotics and anti‑Communist paramilitary operationsalbeit Chu Chi‑fu later pulled out of the agreement, was arrested in Thailand, and eventually extradited to Burma.

The DEA's Golden Triangle unit, SNO, [Special Narcotics Operation] made many whole and half‑hearted attempts to eradicate the narcotics plague. All failed. Production has been great, the world's heroin market having multiplied in the seventies. SNO won't say outright that the CIA is undermining them, nor that politics underlies their constant failures. A SNO agent, nevertheless, came close to doing so in this 1976 statement to Alfred McCoy:
"If they were selling shares in Golden Triangle Heroin, Inc. in five, ten and twenty‑year bonds, I would put my money on a twenty‑year bond. The only thing that would end the whole Golden Triangle business would be a communist takeover in Thailand. If that happened, I'd sell my stock."[17]
Southeast Asia was initially the sole supplier to the rapidly growing European market. Until 1972 heroin abuse was essentially an American problem. But since the heroin shift from Marseille to Southeast Asia, the European habit has rapidly worsened. In 1972 ten kilos of Golden Triangle "brown sugar" were confiscated in Europe. By 1975 the figure was up to 227 kilos. The country hardest hit has been West Germany, where the large U.S. troop concentration serves as a magnet for heroin, where it is estimated that some 60‑80,000 Germans use hard drugs, and where there were over 500 hard drug-related deaths in 1979.

In the summer of 1977, we might note, the administration of Jimmy Carter rejected a proposal by a consortium of rebel army leaders in northern Burma that the U.S. spend $36 million over a sixyear period to purchase and destroy the Southeast Asia opium crop.[18]

Among the official explanations was the alleged policy of the United States to deal only with recognized local governments — a policy which in its time had found a number of exceptions, like the overseas Kuomintang Chinese.[19]

pps. 171-176

Notes

1. 1. Frank and G. Richardson: "Epidemic," Penthouse, September 1977.

2. Ibid. In light of recent years' revelations of CIA mind control experimentation with LSD, it's worth noting the enormous spread of the hallucinogen in 1971‑72. Behind it was the cover organization, Brotherhood of Love, whose backers, like Gulf Oil heir William Mellon Hitchcock, exploited and manipulated self‑styled LSD prophets like Timothy Leary. The Brotherhood was directly connected to the Robert Vesco‑controlled Fiduciary Trust Company of the Bahamas. LSD proceeds were laundered through the usual Syndicate banks in Geneva. See Der Spiegel, No. 39, 1974.

3. B. Herbert: "The Fleetwood Kids," Penthouse, August 1978.

4. A. McCoy: "The New Politics of Heroin in Southeast Asia," Oui, December 1976.

5. F. Robertson: Triangle of Death (Routledge and Keagan Paul, 1977).

6. Politiken, 27 March 1976.

7. Drug Enforcement, Spring 1976.

8. J. Anderson and L. Whitten, Boston Globe, 3 October 1977.

9. J. Hougan: Spooks (William Morrow, 1978).

10. J. Burgess: "The Thailand Connection," Counterspy, Vol. 2, No. 4, 1976.

11. Anderson and Whitten, op. cit.

12. San Francisco Examiner, 9 December 1977; Robertson, op. cit.

13. Robertson, op. cit.

14. Lo Hsing‑han and his supporters at one time aided the Burmese government in its fight against Communist insurgents in northwest Burma. However, when the government asked him to disband his organization in 1973, Lo Hsing‑han refused and signed a pact with the rebels. The Burmese army eventually pushed him and his army into Thailand where he was arrested and extradited back to Burma. In the fall of 1977 he lost his final appeal to Burma's highest court to quash a death penalty for treason. (New York Times, 7 November 1977).

15. McCoy, op. cit.

16. Far Eastern Economic Review, 15 April 1977.

17. McCoy, op. cit.

18. New York Times, 13 July 1977.

19. According to High Times magazine (April 1980), the Shan States rebels have long been subsidized by Taiwan intelligence. Moreover, the article goes on, intelligence sources in Burma have suggested that the DEA, in an aboutface attempt to weld together a local force against right wing opium armies, has approached Burmese Communist guerillas — who, having been abandoned by the current, less revolution‑minded Peking regime, had themselves taken steps toward moving in on the opium trade.
=====

CHAPTER NINETEEN

THE MEXICAN CONNECTION

The exaggeration of Mexico's and the downplaying of Southeast Asia's roles as suppliers of heroin to the United States does not mean that Mexico was unimportant. But the DEA and the U.S. press compound the distortion by constantly asserting that the production and smuggling of heroin in Mexico is strictly a Mexican business. No U.S. Mafia is supposedly involved, other than customers on the other side of the border. Heroin shipments are allegedly controlled by seven large Mexican families: the Herreras, the Maciaces, the Romeros, the Favelas, the Sicilia‑Falcons, the Valenzuelas, and the Aviles‑Quinteros. [1] Let's take a look at one of them.

Alberto Sicilia‑Falcon, leader of the Sicilia‑Falcons, is not a Mexican at all; he was born in Matanzas, Cuba. He and his family left the island immediately after Castro's takeover to become part of Miami's Cuban exile milieu. After the Bay of Pigs invasion he was trained by the CIA at Fort Jackson for Operation 40.[2] From there his trail is faint for several years. However, according to Mexican police, he was in Chile helping the CIA to undermine the government of Salvadore Allende.

In mid‑1973 he turned up in Mexico, where in record time he established a gigantic heroin and marijuana ring. According to DEA director Peter Bensinger, in 1975 the ring numbered more than 1600, including film stars and international businessmen. Sicilia‑Falcon himself resided in villas in Tijuana and San Diego. Heroin was transported to San Diego from a warehouse in Culiacan, marijuana from a processing plant in Mexicali to a U.S. distribution center in Coronado Kays.

In late 1973 one of Sicilia‑Falcon's truckers was stopped on his way back to Mexico. The truck was loaded with arms bound for Nicaragua. According to a later report of the Bureau of Alcohol, Tobacco and Firearms, one illegal weapons dealer in Brownsville, Texas alone supplied Sicilia‑Falcon with 12 million rounds of ammunition in 1974.

The guns‑for‑drugs traffic proceeded unhindered until early 1975, when the government of then President Luis Echeverria discovered that Sicilia‑Falcon's weapons shipments went to groups in Mexico. "External forces are attempting to destabilize our country," said Echeverria in a 1975 speech, in obvious reference to his neighbor to the north.

Then the Mexicans began an intense surveillance of Sicilia-Falcon, who, they learned, often met and conversed by telephone with a mystery man in Cuernavaca, some ninety kilometers south of Mexico City. When a lemonade bottle bearing the man's fingerprints was sent to the FBI, the bureau informed Mexican authorities that the man was Sam Giancana, the Chicago Mafia capo, heroin trafficker, and CIA collaborator. The Mexicans agreed to a French extradition request for Giancana, but when his Paris‑bound plane stopped over in Houston, Giancana was whisked away by U.S. agents. Soon thereafter he was found murdered in his Chicago mansion. Mexican interior ministry officials claimed the CIA had done all it could to prevent the mobster's extradition.

On 2 July 1975 Sicilia‑Falcon was arrested. Under rough interrogation he claimed to be an agent of the CIA, and that his drug ring had been set up on orders from and with the support of the agency. Part of his profits were to go towards the purchase of weapons and ammunition for distribution throughout Central America for the destabilization of "undesirable" governments. If true, U.S. heroin addicts were again footing the bill for clandestine paramilitary operations and anti-Communist terror campaigns. And Sicilia‑Falcon and his Syndicate associates were not short of funds. In his possession police found two Swiss bank books to the tune of $260 million.

Still, the strange testimony of Alberto Sicilia‑Falcon did not end with his confession. His family's heroin and arms shipments continued and, on 26 April 1976, he and three of his lieutenants escaped from Lecumberri prison through an electrically lit, 100‑yard long tunnel dug from outside. They were recaptured three days later, at which time Sicilia‑Falcon, fearing for his life at the hands of the CIA, requested transfer to another prison and additional security.[3]

Echeverria and Sicilia‑Falcon each were right about the destabilization program. FBI documents released later disclosed that between 1970 and 1976 the FBI served as a secret link between the U.S.  embassy in Mexico City and the U.S. Border Patrol in California and Texas, "in order to help destabilize" the government of President Echeverria. J. Edgar Hoover had believed that Echeverria had surrounded himself with "old Communists and Communist Party sympathizers.[4] A memo from Hoover to the U.S. legal attache praises "the detonation of strategic and effective bombs in Mexico City" and "the wave of night machine‑gunnings to divide subversive leaders."[5]

Besides Echeverria's progressive attitude, another reason for U.S. hostility towards his government was the Mexican president's refusal to approve World Bank and International Monetary Fund plans for the exploitation of Mexico's newly discovered oil reserves. The first order of business of his successor Jose Lopez Portillo in 1976 was approval of the same plans. And the newspaper El Sol de Mexico wrote shortly after the latter's inauguration that year: "The new government is not interested in publicity regarding the Sicilia‑Falcon case. It will quietly extradite him to the U.S. as soon as the new extradition agreement between the two countries comes into effect."

In the Sicilia‑Falcon case the DEA and CIA struggled bitterly against one another. It was symptomatic of a split within the DEA's own ranks, a split rooted in the effective control of its narcotics intelligence division by transplanted agents of the CIA.

Since the DEA's emergence many of its agents have resigned in disgust with its modus operandi. Long‑standing conflicts between the CIA and BNDD and between the BNDD and Customs did not evaporate when all the narcotics agents were pooled in the DEA. Moreover, the CIA seems still to be guided by political interests incompatible with drug enforcement.

A 1975 Narcotics Control Action Plan for Mexico, drafted by the DEA, CIA and State Department, opened the way for new appropriations for fighting narcotics in Mexico through INC. Thirty helicopters as well as other aircraft and computer terminals were brought in, and extensive training programs were initiated. The notorious Operation Condor began in January 1976 with an army of DEA‑trained Mexican narcotics agents and their U.S. supervisors, mobilized to fight the drug traffic in the countryside. Reports of the operation reveal that U.S. taxpayers' money has in fact been used for political extermination; that DEA helicopters are used by private landowners to attack peasant revolutionaries with rockets, small‑arms fire and napalm;[6] that large groups of farmers and independent narcotics dealers have been murdered or tortured while the major narcotics families have been protected.[7]

House subcommittee investigators went to Mexico in 1975 to determine how organized internal corruption and payoff rings within the DEA had made possible the monopoly of Mexican heroin by a few powerful crime families. According to writer Ron Rosenbaum: "Some critics of DEA go even further than the subcommittee investigators and charge the protection of heroin profiteers is not caused by internal corruption but is, in fact, the true function of the agency under the present narcotics laws."[8]

DEA‑supervised killing and torture had not stopped as of 1978, when the Mexican Bar Association documented eighteen forms of torture applied by Mexican narcotics agents. Prisoners and Mexican agents alike affirmed that DEA agents not only knew of the torture, but at times were also present at the interrogations.[9]

pps. 177-180

Notes

1. D. Rosen: "The Mexican Connection," Penthouse, February 1977.

2. "Die gefahrlichen Geschafte des Alberto Sicilia," Der Spiegel, No. 20,1977. Much of the following story comes from this account.

3. Ibid.

4. High Times, August 1978.
5. Ibid.
6. Ibid.
7. C. Pyes: "Legal Murders," Village Voice, 4 June 1979.
8. R.Rosenbaum: "The Decline and Fall of Nixon's Drug Czar," New Times, 5
September 1975.
9. Pyes, op. cit.