Wednesday, September 29, 2010

Covert Banker: Colonel Russell Hermann

The story of Colonel Russell Hermann (aka Herrmann) is almost as interesting as that of Leo Wanta. Both held covert funds on behalf of the U.S. government. Both seem to have concluded that the funds they held should be used for the benefit of the people of the United States rather than for dubious black operations. Wanta remains alive, but Herman may have died as a result of his efforts to hang on to funds.

Born in Lansing Illinois on July 2, 1927, Russell Hermann served in the military for 53 years, beginning with a stint in the Coast Guard when he wa far under age. Mostly he worked mostly for the Office of Naval Intelligence. He attempted to retire in 1990-1991 and was refused. Like Army Colonel Al Carone, he became a banker for the C.I.A. using military cover. He was also a C.I.A. paymaster and a launderer of money. Don Hughes was another of these government bag men. According to Herman’s widow, V.K. Durham, he once had a meeting with Vincent Foster in Marion, Illinois, and he was tasked with overseeing 175 secret accounts. He once couriered $30 million to Mexico for Ed Meese to acquire TIAS 12087 "Multilateral Inter-American Investment Corporation securities. Twelve years later, a TIAS 12087 GROUP bought space at One Worlds Trade Center. Durham Limited had five shares in the venture. Mrs. Herman said she gave the account numbers to Senator Charles Grassley and Representative Dan Burton.

Herman held some US government funds and securities through Cosmos Investment Corporation and Cosmos Seafood Energy Marketing in Nevada..V.K. Durham, claimed that , without her permission, Secretary of State James Baker used her Hereditary Owner Bonus 3392-181 as collateral for some Brady Bonds. Her owner bonus 3392-181 was based on gold certificates issued by the treasury under the Transcontinental Agreement of 1875, to some Latin American countries The Treasury thought it had redeemed all the certificates and considered them cancelled. . The U.S. government used this instrument and other non-performing foreign instruments to issue ten-year Brady Bonds, which in turn were used as collateral to acquire currencies, including dollars. The Brady Bonds were to come due September 12, 2001 and be redeemed through the auspices of the trustee, Cantor Fitzgerald. It is difficult to determine whether the government or the Hermans were owners of land and water rights in their name in California.

Hermann had been involved with the C.I.A. in the 1980s and had objected to the murder of women and children. He was tossed into a Latin American jail, but with the help of Chiapas Indians made his way back to the United States. Herman’s widow claimed that he had spent two years looking into the involvement of the G.H. Bush administration and Bill Clinton in the laundering of drug money. The Clinton involvement was about whether Governor Clinton permitted the C.I.A. to fly drugs into Mena, Arkansas. Mena is a town of about 5,000 was an extraordinarily large Interregional Mountain Airport. The arms and drug trafficking was called Operation Black Eagle. An Arkansas Republican Congressman carried on the same investigation but produced nothing on Clinton. Russell Welch, an Arkansas State Police investigator, says his doctor believes he was exposed to weapons grade anthrax because he would not ignore the drug shipments.

Colonel Herman was sprayed with something while mowing his lawn on July 1, 1993. He later found it was SERINE. He was never well after that. Herman was kidnapped on October 28, 1993. He was found at St. Mary’s Hospital , Clayton, Missouri in a wing occupied by ONI personnel. There is no evidence he was held in the Springfield, Missouri prison hospital where whistle blowers and dissidents are often sent. When he saw his wife, he told about how he had been tortured. At a Marion, Illinois Veteran’s Health Care Center, He complained that the hospital fed him rotten chicken and mashed potatoes cooked in water. He was being asked to sign over some securities, including her Bonus 3392-181, which was held in the Durham Family Trust. He claimed that high governmentofficials, including former President Bush, Alan Greenspan, and Oliver North came to the hospital to urge him to sign over the accounts. She claimed that when exiting an elevator, she saw the three men leave his room and go down the hall to another elevator.

On or about August 29,1994 Colonel Herman died. Mrs. Herman obtained the opinion of a second coroner who showed her the signs of torture and offered the opinion that Herman had been frozen to death. Grisly pictures of his tortured corpse are posted on the internet.

Subsequently, Nevada Secretary of State Frankie Sue Del Papa changed the names of the board of directors for his holdings there. Still later, the couple’s signatures were forged on a Goldman-Sach account certification.

Mrs. Hermann was denied widow’s benefits on the grounds they were married two days less than necessary. They had lost their 1987 Mexican marriage certificate and were remarried in 1993. She went to her Illinois Congressman for help, and a staffer shouted at her: RUSSELL HERMAN had no right to break his CODE OF SILENCE. RUSSELL HERMAN was U.S. Treasury. He had no right to break his CODE OF SILENCE!" There is other evidence, including his will, that he may have been an employee of the Secret Service, like Wanta. Later the Department of Health and Human Services dealt with her request for disability due to an auto accident and other factors by claiming she was “deceased.”

Monday, September 27, 2010

Clandestine Intelligence Bankers: Leo Wanta

Leo Emile Wanta, a 63 year-old Appleton, Wisconsin native, is acknowledged to be a very effective commodities trader and international financier. Los Angeles commodities trader and Democratic operative Tom Hanneghan is no fan of Wanta but called him a Abrilliant engineer " with a lots of technical skills." Wanta worked for the U.S. intelligence agencies@ and helped bring down the Soviet communist government." His government service included working for the U.S. Treasury, the C.I.A., and the NSC. He worked for the 1988 Bush campaign and raised $50,000 for Bush’s reelection. His activities as a US government operative are shrouded in mystery, but what little is known about them reveals that there is a vast world of clandestine activity that powerfully effects events.

Wanta claimed to be Ronald Reagan’s favorite “junkyard dog. “ He went to work for the US government in 1963 , working for the DEA and C.I.A., and became a Republican operative in 1965. In 1988, the Associated Press carried stories about his selling 30,000 automatic pistols to Manuel Noriega. It has been speculated that the guns had homing devices that later enabled the US to find Noriega’s security people. He was known to travel frequently with General Vernon Walters, an US ambassador to the UN, and visited F.B.I. head William Sessions through the secret entrance to his office.

While fronting various Treasury operations abroad, he accumulated a fortune for himself. A prime front for the Treasury was his Aneko Credit PTE, LTD in Singapore. He also conducted business for the C.I.A. through a front named Miracle Investments and AmeriTech, which seems to be partly owned by the C.I.A.. He has been accused of working covertly to drive down the price of gold on the international market, but there is very little information on it. His 1992 tax documents listed his net wealth at $432 billion. It is likely he was fronting much of that for the government. He was a specialist in currency swaps and in selling and trading arbitraged guaranteed currency deposits called “prime bank guarantees” to banks for the US Treasury. Unfortunately, his funds and those of the Treasury were commingled, and the government continued to use his funds after he was no longer in a position to direct their use.

His great accomplishment was destabilizing the Russian currency in 1990-1991. One of his firms was New Republic/USA Financial Group Ltd was used in this operation. US journalist Claire Sterling, who has a record of being friendly to the C.I.A., described the Great Ruble Scam in Thievs" World ( Simon and Shuster, 1994). Wanta came off as a scoundrel but a highly effective one.

In fact, he was working in cooperation with Israel and China and used the services of the Russian mafiya to acquire vast amounts of counterfeit rubles. He started with over a hundred billion dollars from the U.S. Treasury, money he repaid with interest. The idea was to accumulate rubbles and then present them for redemption as payment to debts owed the Soviet Union of for redemption other currencies or gold. Speculation with real currency against the rubble was also involved. Marc Rich, an Israeli agent and US citizen was also involved. The Chinese and Israelis helped him accumulate rubles on the black market. The accumulated funds were used to bring down the ruble and were used in part by the Chinese to pay debts. Some rubles were sold to east European countries, who also paid down their debts. Still others were used to buy 2000 tons of Russian gold. The rubble was pegged at $1.20 to a rubble, but they could not be legally purchased. Wanta and others started with more than a hundred billion from the US treasury and other funds and bought the currency at about .28 and sold them to people with debts to Russia at .88.

Rich received his commission, but George W. Bush prevented Wanta from getting his commission. Wanta made the great mistake of talking about how he was cheated and saying that + Bush wanted to divert a large portion of the $70 billion profits into his own accounts and Wanta refused to help. Later, Wanta said Bush had managed to seize some of his commission and place it in his own accounts abroad. This money was sent to accounts in the Republic pf Vanuatu, about 500 miles west of Fiji, where many world intelligence agencies have accounts. Some of that money was then sent to the South Pacific Islands Bank, LTD. of the Philippines. At the same time that gold was reported missing from the Russian central bank, 2000 tons of soviet gold was routed to Algemene Bank in the Netherlands, now known as ABN-Amro. That bank used its share of the profit to allow its American flagship, La Salle National in Chicago, to establish 15 branches and buy out a number of other big banks.

The profits from these operations were estimated at $27.5 trillion in 1992 and about $70 trillion in 2006. Comprised of many accounts, it is called the Global Security Fund. Wanta was insisting in 2006 that the money should go to the US treasury. Eventually, international banks decided that these funds could be used to solve various liquidity problems and opposed the money being used. According to Wanta, US intelligence agencies have been able to get control of some of the money. Dark motives have been ascribed to George H.W. Bush and Bill Clinton, but it seems Clinton only wanted to use some of it to buy peace in the Middle East by bribing various Israeli, Palestinian, and Arab leaders.

Wanta agreed to divert one billion to an account in Spain for the use of George H.W. Bush and he reported that he was co-trustor of another $210 billion which Bush wanted under his sole control. Although the Bush did not get control of this money, his family was able to siphon off $100 billion through the use of various banking connections. They laundered it through Pilgrim Investments. Marc Rich was able to steal a similar amount, and he gave half a billion to Neil Bush . It is assumed that the senior Bush and Rich were acting on behalf of the C.I.A. and Mossad respectively. In all, he claims that $745 billion hs been taken from the accounts over which he claims to be “trustor.”

Wanta had worked for the NSC, C.I.A., and the Treasury and was also a White House operative for Ronald Reagan, who called him his favorite “junkyard dog.” Apparently, his main employment then was as a Secret Service agent. Close friend and traveling companion of Vernon Walters, a longtime government operative. Wanta claimed to have foiled a plot to assassinate his friend “Dutch.” In 1988, he was caught trying to sell 30,000 machine pistols to Manuel Noriega for his by his security force. It has been speculated that the weapons carried devices that would enable the US to later locate Noriega loyalists.

Wanta used to visit F.B.I. director William Sessions by accessing the office through J. .Edgar Hoover’s secret tunnel, called “back of the stage.” While there he also met with the two agents charged with enforcing RICO statute against organized crime.

V.K. Durham has traced ten massive transfers of money made by Wanta after F.B.I. raided BCCI’s false front, the Banco Lavoro Nazionale’s branch in Atlanta. The feds found that the bank had loaned $4 billion to Saddam Hussein. All of Wanta’s transfers were routed through BANCO EXTERIOR DE ESPANA ~ MALAGA. Of course, he was not the only person moving massive amounts of money after that event. What is interesting is that federal authorities apparently permitted him to move the money for some reason, but he was still not in control of the funds. Some of the money went to a London house controlled by Marc Rich, to Switzerland, Monaco, China and Panama, but the bulk went to US firms such as Chase, Prudential Bache, Morgan, and several trust attorney firms.

The roughly $70 trillion held by Wanta as trustor is held in accounts around the world and are held by Title 18 , Section 6 US intelligence community corporations. Wanta is now trying to recover more than $200 billion he claims deposited abroad. He is also claiming that the huge amounts the federal government has deposited abroad should be brought home and that he be given the 1% customary finders fee. In 2005 and 2006 Wanta and an tried to access $4.5 trillion which they wanted to put to use for the American people. They believed that they had an agreement with the White House that allowed them to distribute this money in return for his giving up trusteeship for a much larger amount that Wanta thought belonged to the people of the United States. His legal efforts to access the money were blocked.

A German party source reported that a German bank twice attempted to honor Wanta’s request for payment and was prevented from doing so by Herman Paulson, Secretary of the Treasury.

This led to unbelievable reports that Germany issued an arrest warrant for Paulson. There were also press reports that Treasury Secretary Herman Paulson asked the German Chancellor to turn the money over to him. The press insisted he was briefly held. None of this is believable. It is known that by the end of the week chancellor met with President bush in the White House, and she did not look happy. As for the rest of the story, there will never be enough information to verify it.

Two interesting memos -- November 2, and December 14, 2001-- from Ambassador Leo Wanta to Vice President Dick Cheney have turned up in which Wanta indicates that he knew that ten crates of cash and other valuables were moved from the Philippines several weeks after 9/11. He suggested the money was going to several U.S. law firms . Wanta also said that a “family” is demanding repayment for funds advanced for black operations. The “family” must be a cod name for something Three of the men named in moving the crates worked for the F.B.I.’s Division Five. Fake savings certificates, covered in Business World (May 30, 2001), were also mentioned. There is no way to know what black op may have been involved .

Sunday, September 19, 2010

Covert Finance: The S and L Sacandal and More

Many write that the C.I.A. and its cronies, some of whom were mafia, took down the savings and loan industry all by themselves. That cannot be proven Organized crime figures Mario Renda, Carlos Marcello of New Orleans, and Santos Trafficante of Tampa were involved. It is said that the F.B.I. obtained hundreds of hours of tape from Marcello’s prison cell, and that Carlos told an informant that he was involved in the assassination of JFK.

F.B.I. documents indicated that he claimed on three different occasions to having been involved in the death of President Kennedy. Trafficante once made the same admission. These men were involved in US efforts to kill Castro since the last days of the Eisenhower administration, and they managed to become involved in a Robert F. Kennedy plan to orchestrate a palace coup against Castro. RFK and gone to great lengths to keep them out of the operation, but somehow they infiltrated it. Their involvement in the planned’second invasion,” made it possible for them to cover tracks in the assassination of JFK. Dean Rusk later confirmed that there was a planned second invasion in the works.

It is believed that more than a million assassination records have been kept secret to protect people in Cuba who were involved. However, Castro uncovered the key figure in 1990 and appears to have forgiven him.

The names of C.I.A.-connected drug movers keep turning up in the various investigations. .We know that 21 of the failed institutions were involved in laundering C.I.A. drug money. One of the most troublesome cases was that of the First National Bank of Maryland, which was looted by a C.I.A. front company. Robert Maxwell, a former executive of the bank, tried to make public what was happening and ended up taking the blame and going to prison. The presiding judge refused to permit him to introduce information about the C.I.A. front company.

The industry was in serious trouble since the 1970s, and deregulation under Reagan seemed to encourage abuses. The Garn-St. Germain Act of 1982 may well have been written with a view to making it easier to lopot savings and loans. Moreover, the administrators Reagan appointed did not pursue many deep audits. As early as July, 1987 Edwin Gray, chairman of the Federal Home Loan and Bank Board lost his job because he was warning of corruption in the savings and loan industries and an impending crisis. He was replaced by a crony of Senator Jake Garn. Eventually the scandal would cost the taxpayers $500 billion.

The taxpayers have had to put out 32 billion a year for thirty years since the crisis became public knowledge in 1989. How much was looted by the C.I.A. and allies like Neil bush will never be known. There was much corruption Associated with the “clean-up” of the savings and loans, as well connected individuals bought failed institutions for very little and then received huge federal subsidies. . . With his partners, Neil Bush controls about 40 real estate operations. He was deeply involved in what has been called the “St. Joseph Paper Land Deal,” perhaps the largest real estate fraud in US history. When the press started reporting it, CocaCola poured $150 into it to settle the matter and protect the Bushes. Coca-Cola chairman Bob Goizueta was a close friend of the Bushes. Over $70 million in taxpayer funds were also used to make things right for investors.

In the Gloryhole Mining scandal in Colorado, investors lost $150 million. In all these fraudulent schemes, it does not seem that Neil came away with a great deal of money for himself--perhaps as much as $4 that can be found. He may have been doing most of this work to benefit the nation’s illegal covert operations.

The government- protected fraud has moved from real estate developments and shady securities deals to matters where much more money is involved. In 1991, the C.I.A. established the Blackstone Investment Group, which included many old Bush hands including Richard Armitage and Frank Carlucci. Carlucci had been deputy director of the C.I.A. from 1978 to 1981 and Deputy Secretary of Defense , 1987-1989. Blackstone’s purpose is to open more trade routes with the former Soviet Union. Its main objective has been buying up nuclear weapons and production equipment. However, most of this has been resold to China. They have developed various scams to garner funds intended to bail out the Russian economy. In 1994 and 1995, they entered Mexico to sop up more bail-out money. In adition, they bought many businesses dirt cheap, spent a little to make them look healthy, and then peddled them to unwise US investors. Armitage was so close to General Colin Powell, that the general called him “my white son” in 1995.

The Alfa Group is probably a front for the Russian mob or an ally. It has been connected to drug smuggling, but its main activity is oil development. It has also been connected to money laundering, through Alfa Bank, for the Latin American cartels. The Russian FSB ( similar to our F.B.I.) has claimed that Alfa Group has been a link in moving drugs into Western Europe. It is a business partner of Halliburton, and its lead Washington attorney was a major Bush fundraiser in 2000. Halliburton is a partner in Alfa’s Russian oil fields. These could all be coincidences.

Thursday, September 16, 2010

Covert Finances: Rewards for Politicians

It is difficult to nail down how CIA and Pentagon money is routed to politicians, but we know it happens. Not long ago, a senior CIA official resigned in part because he was present at parties where politicians were entertained by prosatitutes. A contractor who helped sponsor the parties was getting money from the CIA and Pentagon and was routing some of it back to Republicans. The scandal was not thoroughly investigated and the California US Attorney who was pursuing the matter was unceremoniously fired. Then her investigative team was dismantled.

John Meier, a Howard Hughes assistant, has written about how the C.I.A. asked Hughes to make contributions to its favorite politicians, among whom were Wallace Bennett, John Tower, James Eastland, Gerald Ford, and Strom Thurmond. Here is the list that appeared in Playboy.

Paul J. Fannin, Arizona
Wilbur D. Mills, Arkansas
Craig Hosmer, California
Robert L. Leggett, California
Gordon L. Allott, Colorado
J. Herbert Burke, Florida
Hiram L. Fong, Hawaii
Larry Winn, Jr., Kansas
Joe D. Waggonner, Jr., Louisiana
Gerald R. Ford, Michigan
James 0. Eastland, Mississippi
William J. Randall, Missouri
Paul Laxalt, Nevada
Howard W. Cannon, Nevada
Norris Cotton, New Hampshire
James R. Grover, New York
William H. Harsha, Ohio
Frank T. Bow, Ohio
John N. Camp, Oklahoma
Strom Thurmond, South Carolina
Dan H. Kuykendall, Tennessee
James H. Quillen, Tennessee
James M. Collins, Texas
Olin E. Teague, Texas
Omar Burleson, Texas
Abraham Kazen, Texas
John G. Tower, Texas
Wallace F. Bennett, Utah
W. C. Daniel, Virginia
Robert C. Byrd, West Virginia
Vernon W. Thomson, Wisconsin

Al Martin, a former intelligence operative who specialized in financial operations, wrote that intelligence operatives routinely made payments to Republican office holders in the states where they operated and to Republicans in Congress. He thought that a few Democrats were involved supporting illegal operations in Central America. He mentioned Senators Bumpers and Prior, but he did not say whether they received pay-offs. Martin said he made payments to the dentist husband of the governor of Kentucky and to an aid to Illinois Governor Jim Thompson. He thought Texas Senator John Tower was paid through his involvement in Houston Energy Partners, which was run by James Baker III. Tower later headed the Tower Commission , which looked into the Iran-Contra scandal. When Tower mysteriously died in a plane crash, Department of Defense agents arrived at the scene before the FAA people removed Tower’s metal briefcase briefcase. Tower’s daughter Penny had copies of some of his files and leaked a bit of information to the Atlanta Constitution. She then gave her papers to someone in government and her $85,000 mortgage was paid off. The check came from a corporation in the Netherland Antilles.

At a 1995 White House press briefing, Sarah Mc Clendon asked press secretary Mike Mc Curry if President Clinton was going to do anything about drug money being funnelled into both parties. She said that Vice President Albert Gore learned about it and demanded that Clinton do something to stop it. Clinton did not know this was going on. McCurry dismissed her question with “That sounds like the plot of a very good novel," but she insisted it was the truth. McCurry promised to report back but he never again addrerssed the subject.

People involved in the efforts to raise money for the contras called their operation “The Enterprise” or “The Cause.” They were intensely committed to what they were doing. Over time, however, it seems they thought that funneling money to Newt Gingrich’s GOPAC or other Republican entity was as important as helping the Contras. It was expected that some of the money raised through various government-protected fraud be channeled to the party. However, there is no evidence that money from drug running went to the party. . Martin described how he mad $135, 000 using government created shell corporations to participate in taking down a financial corporation. In this instance he was permitted to keep half the proceeds if he gave the rest to Republican organizations.

Tuesday, September 14, 2010

The Bush Family and Covert Finances

Al Martin and some others have written that the Bush family was active in intelligence community financial opertions. Some have implied that they may have prfitted in some way, as did other people tied to intelligence work.

Jeb Bush was particularly adept in real estate schemes, but Al Martin, a former Office of Naval Intelligence operative, recalled Bush discussing with him how he was going to take down M Corporation. Martin also claimed that Bush had caused Broward Savings and Loan to write off $3.85 million in loans to Bush Realty. His partner was Armando Codina, a Cuban exile. Bush used the money to purchase a building which was later reevaluated by FDIC at $505,000. The balance of the loan was not repaid.

They bought the downtown office building in 1984 for seven million, using Edward Houston to front the deal and contribute $4.56 millikon. He borrowed the money from Broward Federals Savings. When the $1.7 for renovations and the $1 million reserve is added, the total cost is over $9 million. In the end, the $4.56 loan was closed out for $505,000 . Yet, Bush and Cordina paid the IRS $1.3 million, an acknowledgement that the building was worth a lot more than $505,000. Nothing was done about their use of a “straw borrower,” but ordinary folks playing this trick would have had endless legal problems. The Great American Bank and Trust Company of Marvin Warner also lost $9 million in a deal that involved Bush.

Jeb Bush was also involved in the Marine Research and Development Corporation. It was involved in many things, including direct trade with Cuba through licenses held by two Hungarian intelligence operatives that Jeb claimed not to have known. It also moved drugs and limited partnership securities. When the prime minister of Turks and Caicos Islands tried to interfere with a drug shipment, his parliament lifted the sovereign immunity that went with his office and he was tried in the US for moving drugs. Securities deals were used to entrap Democrats.

After first experiencing a good deal from MRDC, the Dems would buy into a bad deals. Then they faced loss of their funds if the investigated some things too closely or the eventual return of their money. Among them were Congressmen Bill Alexander , Ron Dellums , Steve Solarz, and Senators Dale Bumpers and David Prior. General Secord said that “If a Democrat doesn’t have a problem that we can control him with, we"ll create one for him” Dellums, who already had financial problems, was given another--cocaine addiction. Senator David Boren was entrapped in a gay relationship on an agriculture subcommittee trip in 1984 and became a solid backer of the intelligence community.

Jeb Bush was also involved in Gulf Oil Drilling Supply Company, a former C.I.A. proprietary firm or cut-outs. It held some old, pumped out wells. This scam involved several hundred millions in useless securities and even cost some big New York Banks and Merrill Lynch.

Neil was mainly involved in real estate schemes in several states Neil Bush was a director of Silverado Savings, whose crash cost the taxpayers about $1.6 billion. However, Bush was only responsible for a little less than $200 million in losses. He became a director of the bank at age 30 and helped two people who had invested in his energy company obtain large loans. He did not disclose his business relationship with either or the fact that he received a salary for serving on one of those boards. Bush survived the mess with a $50,000 fine. Five directors of the bank were banned for life from involvement in federally insured institutions, Bush was just told to refrain from unsafe financial practices.

Neil Bush faced charges of defrauding Silverado Savings and Loan of millions of dollars. The daughter of Judge Richard Matsch was mysteriously murdered, and Bush was freed of all of the charges with the proviso that he could no longer serve as a bank director. ( The same judge later got the Timothy McVeigh case.) The Silverado collapse cost the American taxpayers over one billion dollars.

Much evidence suggests that Neil continues to handle the day to day affairs of the Bush family throughout the world. The late Sherman Skolnick insisted that he uses his far flung accounts to launder drug money and funds from illicit weapons sales and gold smuggling. He and Jeb often pass funds through the Chicago unit of the major French bank, Credit Lyonnais. When Florida Secretary of State, Katherine Harris was in a position to help the Bushes launder money because she had the ability to hide records of shell corporations. This “laundrylady” worked through another French banking house, Banque Paribas.

George W. Bush participated at a distance in family real estate ventures. He had good connections with American International Group and other insurance providers and arranged to provide insurance and/or guaranty fidelity instruments for the deals. At worst it amounted to skirting the law, unless it could be proven he knew what his brothers were up to. The deals were often based on assets fraudulently obtained from HUD or options to buy land rather than land actually held. On a few occasions, banks got burned. But this was fairly rare.

Banks here and abroad were used to unload the shares, and they were assured they would be made whole along with god profits. When prices plunged, something would be done to pump up prices so tht banks could recover losses and make a profit. Stock would be “back doored@ to the bankers and marketers at this point. Another round of profit-taking for the insiders occurred when there was a “Areverse split” of the stock. Insiders gained profits without making an investment and sometimes big GOP contributors were enabled to participate in the same way.One of these deals involved the refinancing of a HUD backed property along the Overtown, Hialeah bodder. There were 830 apartments inbaibted by Blacks and Hispanics. The operation was called “Blackboard” and involves seven refinancing that the usual circle, but Secord’s code name was “Blackbird.” Each time HUD lost money. Not one penny was used to improve these places.

Another profitable program was the processing of fraudulent HUD loan applications. There is no evidence that the Bush family was involved in this, but it has been suggested that the intelligence community used this one to raise money for its operations. To do this well required recruiting some licensed real estate brokers. Of course, the cooperation of state and federal attorneys and a few judges was also required. The most effective of these scams operated out of the Denver HUD office. Several billion dollars was involved in this fraud. Eventually one man went to prison and two federal judges were discredited. At lest 17 cases of fraud against HUD by government operatives have come to light since the mid-1980s.

Friday, September 10, 2010

Covert Finances: Financing the Contras

Intelligence operatives of the special operation group undertook to raise money for right wing insurgents in Central America by in many ways. They used the records of the Republican National Committee and GOPAC, Newt Gingrich’s political action committee, to solicit donations. There was a long term program to raise money by defrauding banks, savings and loans, brokerage houses, and insurance firms. In several instances in the early 1980s, the agency bilked several Greyhound entities out of at lest $120,000,000.

In most cases officers of the banks and insurance companies knew what was occurring and went along. Frequently, FDIC or another federal agency entered these situations and repaired much of the damage at the expense of the tax-payers. The great advantage they had in perpetrating various frauds was the certainty that the Department of Justice would not come after them. Eventually, some of the agents learned that this was not quite true. If they were considered unreliable or possessing too much information, they did eventually spend time in prison. Al Martin, a low level operative, best stated his motives and those of his colleagues: “at least I can say I did so to help my country, which was the truth. And to line my own pockets.”

Economist Linda Napoleoni estimated that the intelligence community drained a little over a billion dollars out of the US economy through insurance and banking fraud. She claims Oliver North was mastermind of the scheme, and that it acted as an indirect tax because the taxpayer eventually had to intervene and make good the losses.

In the case of the banks, intelligence people usually obtained large loans and then began selling the bank’s stock short. When the bank collapsed, the loans either disappeared or were eventually repaid at 30 or 40 cents on the dollar. Sometimes the banks did not collapse but simply endured huge losses through bad loans. Bayshore National Bank in Florida was stripped of 13 million. Congressman Henry Hyde, who was OSS in World War II, was deeply involved in covert operations employed these tactics in defrauding the Oak Saving Bank in Illinois. The Resolution Trust Corporation brought a suite (93 C 2477) claiming that as a member of the Board of Directors, he did much, through gross negligence, to take down the bank, and with great losses. The case went to Federal Judge Brian Barnett Duff, a pal of George H. W. Bush, who ruled that almost all proceedings were to be kept secret. That ended the case.

One could guess that Hyde helped loot the bank on behalf of the agency and might have received a share. On the other hand, he paid a private investigator to keep track of the bank scandal, so he may have been acting on his own. But that is only a guess. Hyde had close ties with the Paradise Island Casino in the Bahamas since 1969, and would have been in a position to launder C.I.A. and other funds through it. Hyde , a key member of important committees, played the leading role in preventing the House investigation from turning up anything about C.I.A. involvement in Contra drug dealing. He was also the central figure in the impeachment of Bill Clinton.

In the end, the Bush administration gave some of the healthier failed S&Ls , along with tax breaks, to political friends at fire sale prices One the major benefi C.I.A.ries were Ronald Pearlman and the Bass family. Pearlman and his partners paid $315 million for $7.1 billion in good assets and $5.1 billion to make good bad loans.

There were also government-sponsored crooked real estate deals and bogus oil and gas contracts. Fraudulent securities transactions and false insurance claims were common. Many shell corporations were established, but not all their functions were scams. If they were they would very soon have no customers to prey on at the appropriate times. There were government-sponsored real estate deals and bogus oil and gas ventures. Fraudulent securities transactions and false insurance claims were common. People were encouraged to give airplanes and boats to covert agents for use in Central America. The donors were assured they would collect far more in tax breaks than the values of the donations. Donors were also helped to file false insurance claims for the allegedly "stolen "items. In one case, ATF agents accidentally stumbled onto some of the stolen items that were warehoused in Joplin, Missouri and brought the DEA into the case. Both agencies were quickly warned that they were interfering in a national security operation.

Some of the early scams were fairly benevolent. Big contributors were asked to buy securities and told they would profit and that some of the money would be channeled to fighting the contras. In the end they lost half their money. Commissions to the salesmen came to 15% and another 35% went to some accounts controlled by Oliver North. They were told that they could write off their losses on a 2 for one basis and that the IRS would not challenge this. There is no evidence that the IRS ever did. They lost nothing on an after-tax basis.

Major General Richard Secord’s companies usually had the name ‘stanford” in them. Lawrence P. Hamil alone had 39 corporations, all with the word “Gulf” in their names. Some were used to launder money, but most were deployed to raise money through fraud. Hamil often used Charles Keating’s Lincoln Savings and Loan to provide up-front money for his schemes. The bank received worthless securities as collateral. Frequent players in Hamil’s ventures were Major General John Singlaub, Major General Richard Secord, Jeb Bush, Neil Bush, George W. Bush, Prescott Bush, and Wally Bush.

Hamil attended Georgetown but did not graduate. In the late 1970s he served the C.I.A. by peddling American Express cards in Argentina, despite a trade embargo imposed by the Carter administration. During the Falklands War he worked with Amaro Pintos Ramos, a Brazilian industrialist, smuggling a few Exocent missiles into Argentina. He came into the Contra supply effort early and had copies of the C.I.A. plan for Operation Eagle, the effort to arm and supply the Contras. It is unknown how be obtained this Bill Casey document, perhaps it came through his ties to Ramos, George H.W. Bush friend and occasional partner.

Perhaps it came from Casey himself as he was a family friend. He was to excellent at real estate swindles, notably the a Boca Chica deal and the notorious Topsail Development Limited scam in Pensacola. In the 1990s, he seemed to be working for the Department of Defense. When he travels it is on a DoD Lear jet, and his luxury hotel bills are paid by the same agency. In 1998, it is said that he was busy channeling Chinese contributions into Bush gubernatorial campaign. The Justice Department claims to have no information on him, but has used a national security block to keep him off the witness stand. A few reporters who have explored his activities have lost their jobs,, but Gloria Borger survived after briefly showing an interest in him.

According to Gene Wheaton, a military criminal investigator with ties to the agency, rogue agents or “crazies” in the covert division carried out some operations to make money for the agency and themselves and becauses they were fun. In Operation’screw Worm,” they created an air base on the border of Mexico and Guatemala so they could move weapons into Peru to fight the insurgent Shining Path but also just to keep the conflict going and sell arms. They had customers on both sides. It was essentially a business operation.

Wednesday, September 8, 2010

Covert Finances: Pinnacle and After

One of the successors of BCCI was Pinnacle Banc Group, whose flagship is the First Bank of Cicero, Illinois. Fof a long time, the key figure behind that bank was Archbishop Paul Marcinkus, who was also head of IOR, the Vatican Bank. Under him, an Italian criminal syndicate known as P-2 looted the Vatican Bank. Pinnacle has also been deeply involved in the financial schemes of Roger D’ Onofrio, a former C.I.A. paymaster in Italy. D’Onofrio was charged in Italy in 1995 of dealing in stolen drugs, nuclear triggers, other radioactive materials, US securities, drugs, and arms. It is said that he also dealt in exceptionally high quality counterfeit currency. In the past he acted as a C.I.A. paymasters for operatives and business partners. According to Sherman Skolnich, John Tarullo, who is connected to the Cicero bank and wasonce a member of London Gold Pool helped the C.I.A. and several criminal organizations, and D’Onorio –who could well still be C.I.A.—transport stolen gold. He was murdered after Skolnich discussed these operations on a Chicago TV show.

The Cicero bank is also entangled in ventures with the C.I.A.’s Household International and Household Ban, Marcinkis, and the Giannini family. SISMI, Italian intelligence, is also involved in some of the C.I.A./Pinnacle ventures. Wallace Lieberman , a likely Mossad asset, was found near the Cicero bank in 1991. It was said that, on behalf of Israel, he was trying to shakedown the Pinnacle partners. Perhaps he was trying to obatain the release of Jonathan Pollard, an Israeli spy. Pollard’s family was in Chicago at the time, and Ariel Sharon had just been there. Subsequently his son, Barry, faced treason charges.
Enron and C.I.A.

When BCCI eventually collapsed, Enron became the C.I.A.’s chief vehicle for laundering money. Some Enron operations were to morph into Clearstream International, a bank that most likely has C.I.A. ties. Another C.I.A. front was Coopers and Lybrand, where many former agents can be found. Maria Carlucci, wife of former Deputy Director Frank Carlucci also worked there.

Clifford Baxter retired as vice chairman of Enron in May 2001. He was probably eased out because he had complained to Kenneth Lay about the creation of 2,800 partnerships where Enron debt could be parked, thus creating the impression that the firm was generating more revenue. Early in the morning of January 25, 2002, he was found dead in his Mercedes, dead of an apparently self-inflicted wound to the head. The Sugar Land police immediately labeled it a suicide as did the coroner, who did not wait for the results of a police investigation.

Baxter had made $30,000,000 in unloading his Enron stock and was in the process of upgrading to something bigger than his 72 fool yacht. There was no evidence presented that his fingerprints were on the typed suicide note or the spent shell casing. The autopsy suggested he may have fallen down to the left before his death. He was shot with rat shot, though one would wonder if someone with that much wealth would do his own exterminating. Days before, he was discussing the possible need for a bodyguard.e had agreed to testify before a Senate committee and a House Committee was also interesting in calling him.

If he was only going to testify about unorthodox accounting procedures and the use of off-shore partnerships, it is difficult to understand why his life was in danger or why he might commit suicide. All of this soon became part of the public record, and there was no way of getting details on the off-shore entities. If he knew anything about how the George W. Bush campaign financed its operations during the Florida electoral dispute, he might have been in some trouble. It is likely that the Bushes spent 40 million dollars from Carlos Lehder, founder of the Medellin drug cartel and that the money was laundered through Enron to James Baker III and Governor Marc Racicot. The Montana governor is said to have used the money to buy the assistance of south Florida Democratic leaders in preventing an effective recount.. The drug lord has been in a federal prison and then mysterious disappeared.

It is well known outside the United States that Enron was negotiating with the Taliban before September 11, 2001 over what Afghanistan would be paid to permit two pipelines bearing Caspian gas and oil to cross the country. Baxter may have been able to shed light on this and he could have been privy to Enron’s role in complex transactions aimed at propping up the sagging stock market. There was a close relationship between Enron and the C.I.A., with the C.I.A. loaning the firm a number of its agents. Some speculate that C.I.A. software was used to invest about $7 billion in missing Enron funds. Former German minister of Technology Andreas von Bulow has charged that there was about $15 billion in insider trading investment profits on the events of 911. Marc Racicot, former attorney general and governor of Montana, has been identified with the drug trade across the Canadian border int a Chinook Reservation, but key witnesses have turned up dead or were intimidated into silence.

Enron played a bigger role than another firm in election George W. Bush. Second in importance was Halliburton, particularly through its subsidiary of Kellogg, Brown ,and Root. This firm has had multiple linkages with the international drug trade, and it can only be assumed that it has played this role at the behest of the intelligence community. It played a major role in the drug trade through Turkey and Kurdistan and has close ties with the Russian underworld.

Eight years before its collapse , twenty C.I.A. agents were on loan to Enron. These agents trained other employees in intelligence matters, with a view to increasing interntaional sales."It was the C.I.A. trained employees and C.I.A. insider information that made it possible for Enron to force its will on the citizens of Dabhol," claimed a retired C.I.A. agent. The people of that part of India were almost forced to accept an electricity generating plant they did not want. This may just have been a case of using the C.I.A. in industrial espionage, a parctice that began with President George H. W. Bush. . Whether the corporation was tied to the government and the C.I.A. cannot be determined with any certainty.
Ken Lay was a Pentagon official under Nixon, and board member Frank Wisner, son of a man who was present when the agency was created. The corporation was almost created by Bush Sr., in that it grew by capitalizing on his deregulation of energy. From the beginning, it funded right-wing think tanks and pursued national objectives by seeking to gain control of energy resources abroad. In return, it was rewarded with a huge contract as a result of the First Gulf War, Desert Storm. Enron has had a very close relationship with a technology services corporation named DynCorp. Founded in 1943, it has become a major public contractor, dealing with Pentagon, State Department, and F.B.I.. Herbert APug@ Winokur of Enron was its chairman for a time and former head of the C.I.A., James Wolsey served on its board. It is particularly active in Columbia, allegedly helping the C.I.A. and Pentagon root out the drug trade and drug crops.

In January, 2002, four of C.I.A. employees on loan from the agency
and a former F.B.I. agent formed Secure Solutions International, which worked on contract with Enron. David M. Cromley's, their leader, had been head of business analysis for Enron. One wonders if he ever used the government’s Echelon commuications’ monitoring program in this task or other C.I.A. tools. The Houston Chronicle claimed to have information that this was the case. Was this software used in parking assets off shore or in generating what former German Minister of Technology, Andreas von Bulow guestimated to be $15 billion in inside trader profits.

Apparently some Enron money was moved to the Cook Islands, because the Bush people wanted “A quick folding tent”that could be taken down almost without a trace. Some of this money was routed through Saudi-controlled Five Star Trust in Houston for use in the 2004 ele3ction. It was reported that $29,000,000 was used to pay techni C.I.A.ns to poses as Homeland Security and F.B.I. agents and go to various counties to adjust county-wide electronic voting mechanisms. Five Star Trust has been accused of also funnelling money to Osama bin Laden.

Catherine Austin Fitts is a former Reagan sub-cabinet member who was hired by the George H.W. Bush administration to deal with funds seized in various financial frauds, including BCCI. Her job was expanded to include tracking down missing federal money. By 1996, she was looking for $4.4 trillion dollars, much of which was stolen from HUD. In that year, she said the Ahonest people@ were removed from HUD and the Department of Justice set out to shut down her firm. She wondered how all that money could ever be laundered, and then she noted that J.P. Morgan-Case , Arthur Anderson, Lockheed, and Dyn Corp were heavily represented at Enron and that suddenly massive and unaccounted amounts of money started flowing through Enron. It was the perfect entity for money laundering with over 3000 subsidiaries. There were over 700 subsidiaries in the Caymen Islands alone. What occurred soon thereafter was the classic “pump and dump” operation on the Enron stock. It might be recalled that the operators tied to Ollie North were masters of pump and dump schemes. Operating through foreign entities, they would be hard to trace. She noted that the government’s dealing with the collapse of Enron was highly irregular.

Its imminent collapse was clear but none of the normal steps that should have been taken occurred before bankruptcy was filed. Enron and its accountant Arthur Anderson were permitted to shred documents at will. She assumes that many important documents are now under the protection of Swiss bank secrecy law. The firm was even permitted to have gold derivatives and bullion transferred at will. After the filing, no effort was made to seize cash payments for on-going government contracts. As almost any newspaper reader knows, the firm was also given a quarter of a billion dollars in tax rebates. Pitts noted that when Noriega was arrested, the US government used PROMIS software to track down and seize $2 billion in his assets. This was not done with Enron. The US government knew of the 700 subsidiaries in the Cayman Islands and of other subcontracting firms there. The government of the Cayman Islands offered to help, but the Department of Justice never filed a request for assistance.

Fitts looked to the Senate investigation of the collapse for evidence that there was no real interest in getting at the truth. A professor who headed an internal Enron audit testified that no notes were taken of his meetings but that a very carefully written summary memo was produced afterward. She called him a typical “white shoes” respectable fellow who had no idea what was going on and was there to give the internal probe some legitimacy. The Senate did not press him. It treated Herbert “Pug” Winokor with kid gloves. He headed the Enron board’s finance committee and headed DynCorp. He said he had been lied to and they left it at that. She said Dyn Corp. uses the most advanced PROMIS software, has access to everyone’s bank account and other financial dealings, and and could quickly make anyone look like a criminal. She thought “Pug” was today’s J.Edgar Hoover. She is now past 80 and has lost all faith in government.

Former Enron CEO Ken Lay died of a heart attack on July 5, 2006 in Aspen. He had been convicted but not sentences for fraud. Dying before the sentencing meant that his assets , wherever they are secreted away, will remain with his family. While Lay wass alive and before the sentencing, a restitution order could have been found had prosecutors been able to find Judge Sim Lake, who had presided. On July 12, Neil Coulbeck 53, died a suicide in woods outsided London. He had been head of an Enron affiliate in Scotland and his information was considered essential in the UK case against Enron. There were complaints that he had been “hounded” by the F.B.I.. One would think that the F.B.I. would treat a potentially friendly witness better. The F.B.I. has recently been granted extraterritoriality rights in the UK.

Since the fall of BCCI, the C.I.A. has used a number of private banks to launder money. One was Hamilton Bankin Miami, which folded in 2006. It was said to handle money from drug and arms transactions as well as the stashes of crooked Latin American politicians. There are also C.I.A. fronts in the Cook Islands, and the George W. Bush campaign used a bank there in 2004. The advantage there is that there are no rules and banks can be disassembled over night.

Monday, September 6, 2010

Covert Finances: BCCI

BCCI, the Bank of Commerce and Credit International, was founded in the late seventies It facilitated the activities of world intelligence agencies, the C.I.A., and unsavory elements. We know tht Richard Helms of the C.I.A. supported its founding, and one person close to its leaders, said, "What I have been told this is that it wasn't a Pakistani bank at all. The guys behind the bank weren't Pakistani at all. The whole thing was a front." On the other hand Bob Crowley, a long-time C.I.A. covert ops leader, said that the Pakistani intelligence service (ISI) had an important part in what he thought was essentially a massive ponzi scheme. He added that F. Lee Bailey fronted for it and tghat “God knows how many thoroughly rotten Congressmen” backed it. In the end, elder statesman Clark Clifford was paid to front for it and unwittingly take a fall.

In the beginning, 1972, the little bank was a front for British intelligence in Muslim lands, and later its role was vastly expanded. Joseph Trentino has written that BCCI emerged after members of the Safari Club, compised of various intelligence agencies, decided they needed their own bank .

BCCI was operated by reliable C.I.A. associates from Saudi Arabia and Central Asia, many of them Pakistanis, and it became the bank of choice for the agency. It had many layers and overalapping parts and seemed to be structured so its functions could not be monitored or regulated by governments. It relied heavily upon shell corporations and subsidiaries in lands where there were strong bank confidentiality laws. It bribedofficials in at least 71 countries. BCCI grew from a small Pakistani bank to the largest secret money network on earth. George H.W. Bush established an account there while still DCI and French police later found it when they raided BCCI. The bank was used by the mafia, all sorts of dictators, war lords, terrorists, skamsters, and criminals around the world. On June 4, 1992, The Houston Chronicle reported that Khalid bin Mahfouz , Osama bin Laden’s brother-n-law owned a large chunk of BCCI stock. He has numerous dealings with George W. Bush’s friend, James Bath. Thomas Kean, chairman of the 9/11 Commission was also a bin Mahfouz business partner. Prince Turki bin Faisal al-Saud, former head of Saudi intelligence, was another important investor. Jack Blum , a former Senate investigator, said, “This whole collection of people were wrapped up in the Bush crowd in Texas.”

It was involved in the arms and drugs trades, blackmailing politicians, and financing terrorism. It was closely tied the Pakistan’s intelligence agency, ISI, and played a central role in the drug trade. It was also the main conduit for financing the resistance to the Soviet occupation of Afghanistan. The Chinese Communists assisted the C.I.A., through BCCI, in helping the mujahedeen against the Soviets. BCCI also sent money to officers of international banks and banking regulatory agencies to further financial schemes; all of those, some say, prefigured the financial crisis of 2008.

In 1977 it began to infiltrate the U.S. banking system through the covert acquisition of banks. Agha Hasan Abedi, BCCI founder, arranged for some of his clients to purchase First American Bankshares, which had probably been a C.I.A. bank for decides. There were three other BCCI banks in the U.S. Jackson Stephens, then chair of Worthen Bank in Arkansas, played an important role bringing the bank to the US when he helped BCCI purchase First American. Doubtless, a good deal of drug money was laundered there. Eventually the ruling house of Abu Dhabi would own a substantial chunk of the bank.

A case can be made that Charles Keating had ties to the C.I.A., and a much stronger case can be made that the agency looted some S and Ls in the late 1980s and routed the proceeds through BCCI.
Some might remember that in 1990, Baltimore financier Robert Maxwell brought suite to obtain Bank of Maryland records. He claimed that his relationship with the bank was ended because he objected to the C.I.A.’s using the bank to issue illegal letters of credit to cover a covert operation. Two years later, the court ordered those records sealed. The case is interesting becaue it raises the question of whether the C.I.A. is essentially exempt from banking regulations.

BCCI operated through many layers of subsidiary entities and became the central bank for some countries and repaying leaders of those countries with bribes Pakistanis and Saudi seemed to be running it, but it is unknown who owned and controlled it. In some ways it was a giant Ponzi scheme, and its financial statements were less than transparent and honest. By the early eighties it owned banks in the US and around the world. Mohammed Hammond, who ran the Luxembourg branch also moved money for Hezballah. Manuel Noriega was instructed to route his money laundering through it, and it soon became his favorite bank’ s favorite bank. It operated at so many levels and through so many fronts that it was almost impossible to follow how it moved money. When Noriega was arrested, the US government was only able to trace the movement of $20 million of his money through BCCI’s labyrinths. BCCI was used to pay people on the C.I.A. payroll in Britain and it was used fund the insurgency against the Russian occupation of Afghanistan.

BCCI was used by the C.I.A., Mossad, and many intelligence agencies as well as organized crime. It was a key conduit for funding the right wing militias in Central America. The full extent of C.I.A. involvement in the farious frauds perpetrated by the BCCI will never be known. At the least, it must have had knowledge of of these schemes and who was being bribed . Such information would have been invaluable.

A Senate committee eventually described it as “the largest criminal enterprise in history.” When reports of its wrong-doing surfaced, George W. Bush had Robert Mueller of the Justice Department investigate. Witnesses and files disappeared and lower level prosecutors complained of high level pressure to “lay off” Khalid bin Mahfouz, Osama bin Laden’s brother -in-law and likely bag man escaped the net as did almost all key figures. He was later proven to be financing Al Quaeda. Today he sits on the Carlyle Group’s board along with George H.W. Bush. Two minor figures did get jail time for helping BCCI sell $1 billion worth of oscilloscopes and computer equipment to help Pakistan’s nuclear weapons. Orin Senator Orin Hatch led the effort to salvage BCCI’s reputation. He had business dealings with two men in Houston connected to BCCI. One of them, Mohammed Hammond, died mysteriously in 1990 .

BCCI bribed politicians in many countries, and among them were members of both parties in the United States. When BCCI collapsed, the Bank of England seized many of its Chicago records, and it is believed that many bribes passed through that city. A list of politicians on the take surfaced in 1991, the same year that the Bank of England took over many of its accounts. The Federal Reserve and Four Media organizations had copies of the list. But little was done with it. Until 1988, when the Chicago branch closed, bribes came to it through the Banca Nazionale del Lavore. Its Atlanta branch also loaned Saddam Huesein $5 billion. A great deal of money was laundered through the Chicago Mercantile Exchange, and commodities exchanges through the Board of Trade were used channel money to politicians. A cicero bank with links to the Vatican was also tied into some transactions. Sometimes, the politicians just received speakers fees at the exchanges, which were huge but perfectly legal. In “Operation Sour Mash,” the F.B.I. probed these operations and two members of the Chicago Board of Trade went to prison. Judge Marvin Aspen said the feds had only uncovered the “ tip of the iceberg," but little more was accomplished. It was discovered that a financial services outfit named Capcon was a BCCI front for moving money in the Chicago exchanges. Sherman Skolnick, a Chicago investigator, dug up information that George H.W. Bush was a business partner of Manuel Noriega and that they worked through the Continental Bank of Chicago. The BCCI operatives who were caught in Tampa in 1989 claimed to know about the Bush-Noriega tie and managed to get very light sentences.

Probably as part of an effort to cover its own tracks, the C.I.A. , in 1984, sent a report to many branches of government outlining BCCI’s involvement in moving drug money. Of course, it did not implicate itself. No one in power, other than John Kerry, sought to expose BCCI for 6 more years.
Days before the “surprise” arrest of five top BCCI official , some major international drug dealers withdrew their money. There was never a thorough investigation. The firms’ top lawyers became the sacrificial victims, eventually losing large amounts of stock in a bank BCCI had illegally acquired. Investigators thought top Reagan administrationofficials had warned the drug merchants. In 1991, the federal attorney in Miami was blocked by the Bush administration when he attempted to indict some BCCIofficials for tax faud. The Manhattan DA, who shut down BBI’s American branch, claimed that 16 BCCI rankingofficials died during the investigation.

When the bank’s drug money laundering operation became public knowledge, the George H.W. Bush administration prevented a thorough investigation. . The Manhattan DA, who shut down BBI’s American branch, claimed that 16 BCCI rankingofficials died during the investigation. In 1991, Attorney General William Barr refused to conduct an investigation. He and his predecessor had practically admitted that higher powers in the Bush administration had ruled out a probe. Brent Scowcroft and Lawrence Eagleburger , when working for Kissinger Associates, were BCCI consultants. They later accepted high positions in the George H.W. Bush administration. On July 5, 1991, the Bank of England formally shut down BCCI’s operations.

Eleven billion in assets simply disappeared and little was done for innocent depositors other than honor federal insurance on accounts. Asian workers in the United Kingdom and Gulf States lost a great deal and never knew what hit them. It is said that the terrorist Abu Nidal also lost money. It is hard to believe that BCCI could have operated without the protection and sponsorship of people in high places. Yet, Robert Bueller, then head of the F.B.I.’s criminal division, found that to be the case. Christopher Drogoul, manager of BNL in Atlanta, was blamed for the loss of almost half of that money. His defense was that he was told by the US government to funnel money to Saddam Hussein to finance the war against Iran. A federal judge agreed that he and his co-defendants were "pawns and bit players" in a larger drama, but the Clinton Justice Department pursued his case and he accepted a plea bargain. The Clinton administration did not look further into the BCCI scandal. In 1992, George H. W. Bush pardoned a number of people who had been convicted in connection with BCCI.

The Federal Reserve’s records manager said that a large part of the FED’s records on the BCCI disappeared in 1988 sometime after the Kerry Committee was told that Manuel Noriega’s drug money was laundered through that bank.

In the seventies, drugs came through Columbian outlets, and this trade was controlled by the proprietary known as Zenith Corporation, which was located on the grounds of the University of Miami. By the 1980s, the Panama branch of BCCI was actively seeking drug money deposits on the orders of corporation’s vice president, Alaudin Shaik It was a major handler of the contras’ drug money. BCCI, a bank that catered to the international intelligence community, drug dealers, arms merchants, and others was established at the suggestion of Jackson Stephens, head of the Arkansas Financial Group that bears his name. He contributed $100,000 to George H.W. Bush in 1980 and a like amount to the son in 1990. He played a major role in getting Swiss and Saudi investments for George W. .Bush’s Harken Oil and also helped line up for Harkin an oil deal with Bahrain. BCCI had multiple close ties to Beorge W. Bush’s Harkin Oil. According to the Wall Street Journal, “The number of BCCI-connected people who had dealings with Harken —- all since George W. Bush came on board -- raises the question of whether they mask an effort to cozy up to a presidential son."

In the 1980s, an unbelievable amount of C.I.A. money was routed out of HUD to the C.I.A.. How much of this was intentional and how much was simply stolen is difficult to determine. In 1989, Catherine Austin Fitts was assistant secretary of HUD and discovered that vast amounts were missing. Eventually it was learned that $59.6 billion was lost. Under the Clinton Administration, she was given a contract to contiune reforming HUD finances, and she did a remarkable job. Then a rival contractor accused her of stealing $3.8 million. She and her firm were subjected to 18 audits before she was cleared. Today she remains a crusader for honesty in government.

A number of investigators believe BCCI was also used to handle the profits of Saddam Hussein and George H. W. Bush in whatever racket they operated on middle eastern oil in the 1980s. Saddam also had a steak in the Carlyle Group. He was also a major stockholder in Daimler-Chrysler. He was also a major stock holder in Hachette, a foreign firm that was financing George magazine. He also owned part of the firm that produced and operated people moving systems for airports. Perhaps his most valuable assets were records on the financial activities of the Bush family, and just before the second US Iraq War, someone in his family in Switzerland released 300 Bush wire transfer records to some 25 foreign accounts.

Skolnick, using records of Banca Nazionale del Lavoro --, owned in part by the Vatican with a branch in Chicago, claims that Daddy Bush and Saddam were business partners in a number of areas, including the Middle East protection racket. Eventually, the partnership was dissolved in a Chicago case that was sealed by the court. Apparently Saddam defaulted on some loans. The two men seem to have been skimming off the oil profits that resulted from Reagan-Bush policies. Skolnick, thinks they were running an oil protection racket, which seems a little crude. The House Banking Committee, under Henry Gonzales, sought these records but to no avail.

In addition to BNL, Saddam and Bush used BCCI. Some of the sealed records were said to be the relevant Chicago branch records of both banks. Investigators claim that Bush’s share from this oil scheme and his private selling of weapons to Iraq in the 1980s went into Pennzoil, in which he has a major share. It is well-known that Ross Perot financed a massive investigation of the Bush family and some think these activities were at its center. This writer has a different theory that he cannot prove.

People of the State of Illinois ex rel Willis C. Harris, Bank Commissioner vs. the Board of Governors of the Federal Reserve System and the House Banking Committee, No. 90 C 6863, in the U.S. District Court, was the case involving the financial relationshiop between Saddam, Bush, and an Italian Bank. It was finally resolved in the 7th Circuit by a panel dominated by Chief Judge Richard Posner, a well-know right wing judge . The case was sealed and Posner issued an order barring Skolnich and his aids from federal court houses. 1990 or 1991) That led to the dissolution of the partnertship is not known. Tom Flocco notes that the F.B.I. raided the Atlanta branch of Banco Lavoro Nazionale on August 4, 1989 and that it found that the bank had loaned Saddam Hussein $4 billion. This seems to have dried up Saddam’s credit and it may have forced him to do something with partnership funds that angered Bush.

French intelligence claimed that Osama bin Laden later rebuilt the BCCI money laundering network so it could be used to launder drug money and finance Al Qaeda and the Taliban in Afghanistan. According to a “confidential ‘France only’” report of the Direction Generale de la Securitie Exterieure, the C.I.A. and MI-6 had control of Al Qaeda’s main training facility in Afghanistan as late as 1995.

The story of BCCI insolvency and scandal broke in July, 1991 when the Justice Department finally opened a half-hearted investigation of the failing institution that had lost at least $ 7 billion in deposits. The bank operated in the United States partly by illegally controlling North American Bank, whose officers claimed to know who owned their bank.

A February 23, 1992 NBC newscast described Bill Casey’s close ties to BCCI. He frequently met with BCCI head Abedi every few months at the Madison Hotel.

Sunday, September 5, 2010

Covert Finances: Transition to Afghan Drugs

In 1984 Peter Jennings of ABC aired agent Scott Barnes, who said he asked two fellow agents in Honolulu to kill Ronald Rewald, an agent and officer of the BBRDW bank. William Casey demanded that ABC muzzle Jennings, whjo refused to back off. Then the SEC gave Capital Cities, a firm tied to Casey, permission to purchase ABC. Jennings was silenced and some started calling it the “ C.I.A. Network.” Rewald was not killed. Rather he was sent to prison with an 80 year sentence.

In 1986, a team lead by much-decorated Lt. Colonel James “Bo” Gritz went to Burma to interview warlord General Khun Sa real name was Chang Chi-fu. The general was supposed to have information about missing POWs, but did not. Gritz asked him to cooperate in the US war on drugs, and the general replied that the US was his biggest drug customer. He said he could produce aq long list ofofficials he dealt with over twenty years, After being told in Washington that the general was lying, Gritz returned to interview the general. Khun Sa refused to name some current contacts but he did name Shackley and Armitage. Subsequently, the US indicted Khun Sa, so he could not come to the US and testify, and an effort was made to destroy the good name of Gritz, probably America’s most decorated officer at that time. Gritz also had to defend himself from charges of passport abuse. William Maddox, the US attorney who unsuccessfully prosecuted Gritz, said “”George Bush called me up and told me to get Bo Gritz.”

Nugan Hand was succeeded by Household International, and its general counsel was former C.I.A. director William Colby. He became somewhat outspoken in retirement and died in a strange boating accident in 1996.

The beginnings of American interest in Afghan opium seem to be in the 1970s, when the USAID –funded Helmand-Arghandab Valley authority constructed the Kajaki Dam, which made possible irrigation efforts that permitted opium production to reach new levels. It was handled by the St. Joe Company, a firm tied to the Bush family and Jeb’s Bushb’s Codina Firm. The St. Joe Company was founded in 1936 by the Alfred I. Du Pont Testamentary Trust. It used its Florida National Bank to move drug profits to Switzerland, and it also cooperated with the Lanksy/Trafficante Miami National in moving illicit money. MucSt. Joe Company, Peter Jennings, drugs, Bill Casey, CIAh of the money eventually ended up in Citibank. In 2002, Karl Rove managed to purchase a magnificient beach tract in Florida from the St. Joe Company for a mere $165,000.

Codina and the St. Joe Company had links to th e now disgraced financier Sir Allen Stanford, who was investigated for laundering C.I.A. drug money in his off-shore banks. The Soviets claimed that the C.I.A. allied in 1979 with mujahedeen drug dealers. By 1989, the Times of London reported that half the heroin getting to the United States came from Afghanistan. In July 2000, trhe Taliban shut down poppy production. Production resumed after the Taliban was overthrown. One impediment to even more opium reaching the west is the determination of Ayatolah Khatami to prevent its movement from Iran. However, he has relatively weak border forces.

Saturday, September 4, 2010

Covert Finances: Drug Trade Through Vietnam War

Paul L.E. Helliwell was sent to Miami in 1960 to build a cover for anti-Castro activitries. Helliwell had been an OSS officer, and was the chief architect the C.I.A.’s drug money laundering operations. He owned Castle Bank in the Bahamas. It was a despository for mob money, and his partner was Burton Kanter, a Chicago lawyer who specialized in legalizing money from organized crime. Prominent people from the legitimate business world also put money there including Thomas Corcoran and the Fords. “Tommy the Cork” had run FDR’s informal spying operations before the OSS was created. Corcoran, working with Chiang Kai-shek’s brother, T.V. Soong, was financing the American Volunteer Group, that carried out sabotage operations against Red China. Another Helliwell operation was the Bank of Pirenne in Key West, "a two-time laundromat for the Lansky mob and the C.I.A.. " The latter was tied to the Bank of Cutler Ridge. The Bank of Pirenne received money from Lansky’s Bank of Internal Commerce, a bank the C.I.A. sometimes used. The Lansky bank also had business relations with drug interests in France and Lebanon. Helliwell’s Sea Supply Corporation sent arms to the Nationalist Chinese in Burma and to Thailand’s police. In return, the company received China White heroin.

Wallace Groves, an ex-convict, operated another C.I.A. money laundering operation called Intercontinental Diversified (I.D.C.) . He sold his 46% share in 1978 for $33 million. In an SEC hearing, C.I.A.officials admitted using $5 million of I.D.C’s funds and claimed Groves went along out of friendship. I.D.C. was a spin-off of an Asian mining company and was represented by a Helliwell firm. Groves also fronted Resorts International, owned largely by the mob. Resorts International, formerly the Mary Carter Paint Co., operated the Paradise Island resort. The C.I.A. had to be aware that money from the Paradsise Island Bridge Company and the resort was being delivered to Nixon. This situation most likely was an important element in the tension between the president and the agency.

James Jesus Angleton, head of Counter Intelligence, also maintained ties with the Mafia through New York lawyer Mario Brod. On one occasion money was moved through these channels to pay thugs to beat up leftists in Mareselles. Sometimes, the mob was used to help feret out Communist agents in the United States.

Agents Ted Shackley and Thomas Clines, and Richard Armitage were the major operatives, responsible for shipping tons of raw opium. Years later Ross Perot learned of Armitage's activities and unsuccessfully tried to get the government to move against Armitage. Secretary of Defense Frank Carlucci warned Perot to leave it alone. The eccentric millionaire said he had stumbled into a’snake pit without bottom.” Armitage became very close to the Bush family, and would later b ecome involved with the drug trades in Albania and Russia. In the former, he worked closely with the Russian mafia. General Colin Powell was to call him “my white son.” <>
Ted Shackley

Rafael Quinteros worked under Shackley and would later be part of Oliver North's Central American operation which would be called the National Program Office (NPO); it was ultimately run by Vice President George H. Bush. Shackley director of “Operation Phoenix,” which was created by William Colby. Shackley and Climes operated Operation Mongoose from 1962 to 1965, which was targeted at assassinating Fidel Castro. Shackley was a talented and zealous operative who was being groomed by some superiors for high posts in the agency. AS Saigon station chief, he moved to place Operation Phoenix under the military, but it continued to be operated by men with C.I.A. links. Some of the South Vietnamese thugs them employed were so depraved that they devoured their enemies organs. Prior to his arrival in Saigon in 1966, the assassination program was carried out by Military Assistance Command, Vietnam -- Special Operations Group (MACV-SOG) under General John Singlaub. Shackley probably had to find some way to keep the military involved while taking control himself. His next job was cleaning up the mess in the western hemisphere that occurred when Philip Agee spilled numerous secrets.

Shackley then became deputy director of the C.I.A. under George H.W. Bush. Shackley’s drug operation and Project Phoenix was coordinated with the White House through liason officer Eric Von Arbond, who also handled the “40 Committee,” which carried out murders and assassinations. It had an interesting history. Before Dien Bien Phu in 1954, French intelligence ( SDECE) ran drugs out of Southeast Asia to Europe. When the United States assumed French responsibilities in the area, the C.I.A. took over the drug operation. It is unclear how many SDEC people were still used. Also involved was Etienne Tarditi of the Corsican mob and some of his American counterparts. Carmel Offie, a C.I.A. person operating an export-import firm, coordinated operations and worked with another agent, Irving Joseph Brown, the AFL’s top man abroad. He often recruited diplomats to bring in drugs. However, Maurice Rosal Bron, the most famous diplomat ever caught, was recruited by Tarditi. Rosal had a great weakness for young boys, and Tarditi used this Guyatemalan ambassador to the Netherlands as a mule to New York. In 1960, Tarditi, the diplomat, and several others were caught. This was the beginning of the famous French Connetion Case, which became the basis for the 1971 movie. Brown was persona non grata in France and Algeria because Prersident De Gaulle knew the C.I.A. was using drug money to finance the Secret Army Organization, which tried to kill the French president.

The heroin was taken out by the C.I.A.’s Air America choppers and taken off to be refined into heroin. Sometimes the heroin was refined in Vietnamese Pepsi Cola plants, and some insist that these plants were used in Asia for refining heroin long after that. Investigative reporter Carlos Pacelli was to talk to vets who talked “about their personal experiences in loading raw opium or heroin onto Agency-controlled aircraft during the Vietnam conflict.”. The C.I.A. share of the drug profits was largely used to finance Project Phoenix, which handled the political assassination of between 27,000 and 60,000 Vietcong communist leaders in Laos and Cambodia, as well as thousands of innocent people. However, writers friendly to the agency admit only that Laotian tribesmen allied to the US may have been moving drugs and that the C.I.A. disregarded it. John Singlaub took care of the murders, and Secord saw to moving arms and drugs. A great deal of the drugs went to American troops in South Vietnam, and some angry American soldiers shot down Air America aircraft in protest. Santos Trafficante, a mafia don, visited Vang Pao, and saw to getting the drugs to the USA and wider world.

There was little to worry about from US based drug enforcementofficials. Too many of them became quickly seduced by big money and life in the underworld. In 1970, John Ingersoll, head of Bureau of Narcotics and Dangerous Drugs recruited the C.I.A. to help him root out corruption in the BNDD. He brought in a close friend , Patrick Fuller to act as chief inspector. The joint effort was called Operation TwoFold. Little did he know that the C.I.A. had many reasons to prevent the anti-drug agency from becoming efficient. Several major allies were moving drugs into the United States at that time, and the C.I.A. was also involved in peddling drugs from the Golden Triangle. The operation resulted in no convictions. One of the top C.I.A. people in Operation TwoFold was Evan Parker, who was the first C.I.A. agent to run the Phoenix Program foa assassinating Viewtnamese dissidents, which had been financed by drug money. By 1977, 125 “former” C.I.A. people were working for the DEA ( it now had a new name.) They were busy emasculating the anti-drug agency; however, they did use DEA cover to search out some drug king pins around the world and execute them. As late as 2008, the DEA in South Asia and Afghanistan is thoroughly infiltrated by the C.I.A.. The C.I.A. also stole hundreds of tons of equipment and supplies from the military and moved it to secret storage in Thailand.

Drug money was deposited in the Nugan Hand Bank as well as some of the proceeds of covert arms sales to China. It was founded in Australia in 1973 by ex-Green Beret Michael Hand and Australian lawyer Frank Nugen, a produce salesman. Four officers of the C.I.A. proprietary company Air America were also involved in establishing this bank. It was established around the time when drug money bank, Castle Bank and Trust Company of Nassau, went into eclipse when it was exposed as a receptacle for C.I.A. drug money. The F.B.I. has learned that it was laundering money for mob figures. It was founded former OSS officer Helliwell, who had been part of an operation that included Howard Hunt and had paid informants in opium. His bank laundered drug money that came out of the trade in southeast Asia and it worked closely with the Nationalist Chinese. A lawyer, Helliwell moved drugs into Miami through his Sea Supply, Inc. When the C.I.A. started moving drugs from IndoChina in 1965, their operations meshed with his in moving drugs to the US. His bank also mov ed money to the accounts of Washington politicians to protect its operations.

The Nugyen Hand Bank soon had branches wherever the C.I.A. had large stations. Some called it the “Green Beret Bank” because so many Green Berets were employed by it. Its CEO was retired Rear Admiral Earl Yates, who operated out of Virginia Beach Virginia. Other rankingofficials were retired military people or C.I.A. officers. An active duty army officer Earl Cocke ran its Washington branch. Cocke was to retire as a Brigadier General. He was also tied closely with Project Hammer, an interagency operation moving legitimate and illegitimate funds. He was once the top US representative to the World Bank. Former C.I.A. director William Colby was its lawyer. It laundered drug money and funneled C.I.A. money. Alexander Butterfield, who was responsible for Nixon’s taping system, was a former intelligence officer in Asia who had much knowledge of the bank’s operations. Edwin Wilson became Associated with the bank when it facilitated moving arms into Angola in 1974. By the 1980s, Wilson had a large horse farm in Virginia hunting country and a lavish DC townhouse. In the interim, he had gone into business with Egyptian Defense Minister Mohammed Abu Ghazala, who was also dealing with the US government and the agency.

In 1975, it funded the election defeat of Gough Whitlam’s government in Australia. The bank unsuccessfully tried to frame an anti- organized crime attorney general Frank Walker in New South Wales by opening a Swiss bank account in his name. The bank smuggled marijuana and the Victoria police reported that it moved $110,000,000 worth of heroin in 1978. It also engaged in global arms smuggling.

Some of the bank’s people were also involved in the C.I.A. investment bank, Bishop, Baldwin, Rewald Dillingham and Wong The political payments for the arms deals routed to the United States, often by Merrill Lynch. The Chinese had made a practice of donating heavily to the Republican party, but beginning in 1992 they moved beyond given mere tokens to the Democrats. In that year they channeled a six figure contribution as insurance.

Michael Hand was to play a major role in exploiting oil and gas resources. Beginning in 1967, there was an effort to acquire major nga and petroleum assets in Australia by a consortium of the C.I.A., oilman Nelson Bunker Hunt, Aristotle Onassis, and the Rockefellers. Efforts focused on the Great SouthBasin discovery and plans to monopolize it. Mitsubishi and Mitsui of Japan also became partners. As part of this huge operation, the Rockefellers and Onassis helped Adnan Khashoggi, a very rich man and C.I.A. asset, gain control of the United California Bank and Security National Bank, also of California. They were used in pay-ffs to Japanese politicians and others. The coalition also gained control of several banks in Australian and New Zealand. These banks joined the Nugyen Hand Bank in laundering drug money from both the C.I.A. and Onassis operations in the Golden Triangle.

On January 27, 1980, Nugan was found dead in his Mercedes, 100 miles west of Sydney. It was said to be a suicide, and Hand said his partner had stolen vast sums . Two days later, Hand met with directors, and allegedly said they must do as they were told or "finish up with concrete shoes" and they would be "liable to find their wives being delivered to them in pieces". He then fled Australian authorities, but was able to meet with Bill Casey in Panama several times. The bank was $50 million in debt Thousands of investors in the United States and elselwere lost money. The bank went out of business, and money disappeared from its vaults all ov er the world. Its records were destroyed. Australian authorities found a long list of their own politicians along with the bribes they had received. The bank had ties with over 25 separate drug trading entities. It was found that the bank defrauded US citizens working in Saudi Arabia. These people were encouraged to buy government bonds through the bank, but the money disappeared. Its branch in Chiang Mai, TailandBin the heart of drug countryB was on the same floor of a building where the Drug Enforcement Agency maintained an office.

Australian banks took up some of the slack left by the collapse of the Nugyan Hand Bank, and Richard Armitage, took care of U S financial transactions with them. Bishop, Baldwin, Rewald, Dillingham and Wong (BBRDW) in Hawaii was used for a time as a C.I.A. drug bank. It soon had branch offices in Austgralia and elsewhere in Asia. There was also information on the overseas bank accounts of U Sofficials. George H.W. Bush had accounts under two aliases; Richard Armitage was Mr. Branch; Bill Case was Mr. Denile. President and Mrs. Marcos also had money there.

Friday, September 3, 2010

Covert Finances: Early Drug Operations

When government agencies do something illegal or something that would bring them shame or contempt they find covert ways of paying for the activities. Sometimes this financing involved money that came from the sale of drugs or weapons, and sometimes the funds came from the loot of war or elaborate financial schemes. On other occasions, banks or businesses have been looted to provide money for black operations. By following the money, we also learn that American intelligence people found it necessary to develop close ties with people in organized crime, who were often partners with the government in illegal transactions.

Unscrupulousness and lawless conduct in foreign affairs sometimes led to lawless conduct in American domestic affairs. After World War II, the United States used some of the loot Japan had amassed to finance the Liberal Democratic Party. These funds were called the “M Fund,”and the Eisenhower Administration turned control of the fund over to the Japanese right in return for pumping a substantial amount into Richard Nixon’s presidential campaign. Of course, the transfer had to be facilitated by the C.I.A., an agency that was increasingly moving toward the right.

The C.I.A. was created in 1949, and much of its money comes to it through the Department of Defense. The act creating the agency, provided for a black budget that the agency could spend as it pleased, provided there were no presidential order to the contrary.

any other Government agency is authorized to transfer to or receive from the Agency such sums without regard to any provisions of law limiting or prohibiting transfers between appropriations [emphasis added]. Sums transferred to the Agency in accordance with this paragraph may be expended for the purposes and under the authority of sections 403a to 403s of this title without regard to limitations of appropriations from which transferred.

Hence, vast amounts of money could be hidden in the budgets of various departments and transferred to the C.I.A., but there never seemed to be enough funding. It is difficult to determine when the C.I.A. found that the drug trade was a good way to finance operations. Perhaps it goes back to morphine trading by former Nazis who became C.I.A. contract operatives after World War II. There is also the theory that drug trading began with agents working in post-war Albania.

There is also evidence that from the beginning the C.I.A. needed funds other than those appropriated by Congress to carry out some operations. Using hidden funds removed the problem of public accountability. After World War II, what became the C.I.A. had a substantial store of Nazi and Japanese loot and treasure in the form of gold, platinum, and gems. It was kept in various places. Some was in the Black Eagle Trust in New York. Some was in the Philippines, and Ferdinand Marcos eventually helped administer it and was removed from power when he sought too large a share for himself. Imelda Marcos claimed that much of her fortune came from the Japanese gold, but she may have said that to cover up the fact that much of it came from graft. William Quasha, an American lawyer often in the Philippines, was Marcos’s money manager and funneled Marcos money into legitimate investments. Alan, his son, along with Harvard University, came to the rescue of George W. Bush in Harken Oil venture. In 1994 Alan Quasha became head of the American Stock Exchange. Today he is a member of Harvard board for its foreign policy center. Some of the money was used to influence elections in Europe and in more recent years some was used to reimburse international banks for bad loans to third world countries. In recent years, some believe these funds are mot completely controlled by the government but have been partly diverted from the use of right wing groups allied with the intelligence agencies. They were also used to bail out major banks and to buy into major financial institutions. It is claimed that they were also used as leverage to loot MGM and there was an unclear connection to the collapse of Banco Ambrosiano in Milan.

Drug money

The drug trade was a major source of unappropriated funds. For many years, it was second only to the profits from the illicit arms trade. From its creation, the agency has raised money by moving drugs. Eventually, private firms became important partners in the drug trade. Michael Ruppert has built a case that American International Group, a huge investment firm, has long been a partner in the drug trade. In 1995, Bill Clinton briefly nominating its CEO to be Director of the Central Intelligence Agency. The firm has been used in covert operations as early as World War II.

The Kuomintang (KMT) Nationalist Chinese had been dealing in drugs since the 1920s, and an exiled KMT force in the Shan State of Burma exchanged drugs for OSS arms in the 1940s. OSS Colonel Paul Helliwell began moving drugs to the U.S. where they were sold in Black ghettos during World War II. He created an OSS proprietary company, Sea Supply, in Miami to move the arms and drugs. Poppies from Burma and elsewhere were turned into motrphine base in jungle labs. Eventually it was turned into into China White and placed in the hands of US mafia distributors, Meyer Lansky in Tampa and the Santo Trafficantes, father and son. They also moved the drugs into the Latino Barrios. Helliwell served as one of the agency’s main contacts to Myer Lansky. He owned several banks which handled Lansky funds. With the likely help of Helliwell, the C.I.A. and Lansky used the Paradise Island resort for money laundering, and the agency must have known that the mobster was skimming casino profits. Resorts International were also part of the C.I.A.-Mob connection. It is not known whether the agency knew that Paradise Island profits ere sometimes being carried to Rebozo for Nixon. Often, Seymour (Sy) Alter, a Lansky man and Nixon/Rebozo friend since 1962, made the deliveries. Some came from the Paradise Island Bridge Company, represented by Halliwell. Nixon could have been a stockholder. We know he had an account in Halliwell’s Castle Bank. C.I.A. funds from Resorts International would often be used for black operations. The laundering operations in these places were simple enough. Someone like Khesoggi, known as a frequent big looser, would come in and blow a huge amount of money. Then other bills close to that amount could be moved out.

The French set up a drug network in Southeast Asia after World War. They employed the Corsican mafia to refine the morphine into heroin. When the French left, the C.I.A. took over their drug network. Two months after the French decamped, Colonel Edward Lansdale, a C.I.A., officer was leading the Saigon Military Mission and overseeing the C.I.A. drug trade. He would assist the Laotian warlord Vang Pao to overcome his rivals, and thus won a military By the late 1950s, distributors included the some Long Beach gangs

Meanwhile, the US police were moving against drug dealers from French Corsica. President Dwight Eisenhower cautiooned the C.I.A. to reign in these C.I.A. people in Southeast Asia, probably meaning to restrain their drug trafficking, but nothing happened. In addition, Nationalist Chinese entrepreneurs were moving drugs into the US with the full knowledge and connivance of the Taiwan and US governments. In 1960, Russ Koen pointed this out in his The China Lobby and added that prominent Americans were profiting from the trade. Harry J. Anslinger, head of the Federal Bureau of Narcotics, denounced him and the book, and Macmillan soon let it sink into obscurity.

After 1951 C.I.A. planes moved the drugs for them. Even after the KMT was forced out of Burma, the C.I.A. retained ties with drug traffickers in the area and played a role in damaging the careers of Richard Horn and some other DEA agents who worked against the trade in the 1990s. It appears that DEA agents often tried to derail the C.I.A. drug trade, but that others seemed to be working against drug-dealing competitors. It is also known that the Pacific Command of the U.S. forces briefly operated the drug trade of the Imperial Japanese Army briefly at the end of World War II. There is evidence that Egel Krogh turned up an illegal C.I.A. drug trade in 1971, which apparently had been unknown to the Nixon White House. It appears that the C.I.A. was working with French intelligence and Corsican gangsters in a Southeast Asian drug trade. When Nixon learned of this, he went after the C.I.A. operation.