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COVERT ACTION: SPECIAL: NAZIS, THE VATICAN, AND CIA

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CIA-RDP90-00845R000100170004-5

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December 22, 2016

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June 3, 2010

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Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 INFORMATION BU] Number 25 $3.00 Special: Nazis, the Vatican, and CIA Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Editorial This issue of CAIB focuses on the fascist connection, in par- ticular the U.S. role in helping hundreds, perhaps thousands, of prominent Nazis avoid retribution at the end of World War II. The CIA (originally the OSS) and the U.S. military, along with the Vatican, were instrumental in exfiltrating war crimi- nals not just to Latin America, but to the United States as well. As the Reagan administration attempts to rewrite history, it is worthwhile to examine carefully the wartime and postwar machinations of the extreme Right. The President goes to Bit- burg claiming it is time to forgive and forget, when in reality he is merely cutting a crude political deal with the reactionary West German government for its approval of Star Wars by giv- ing his absolution to the SS. Harboring War Criminals As we demonstrate in the pages of this issue, war criminals like Josef Mengele, Walter Rauff, and Klaus Barbie did not simply vanish at the end of the war or gracefully retire. Most of them spent several years in the direct employ of the U.S. intel- ligence agencies and, when necessary, were set up in business in Latin America or the U.S. The Kameradenwerk-the Nazi old boy network-remained active over the years, vigorous enough to have planned and carried out the 1980 coup in Bolivia, for example, and to have held high places in Pinochet's government in Chile. And they are major figures in the international arms and drug trades as well-traffic which the U.S. tries to blame on the socialist countries. Hundreds of Nazis have been set up in scientific institutions in this country. Ironically, it now appears that Star Wars is merely an extension of the Nazis' wartime rocket research. Much of the U.S. space program was designed by them. When the Justice Department's Office of Special Investigations learn- ed that the scientist responsible for the Apollo-1 I moon trip, Arthur L.H. Rudolph, was a war criminal who exploited slave laborers to their deaths in his Nazi rocket factory, he was al- lowed to depart the U.S. voluntarily with no prosecution and no public announcement until he was safely hack in West Ger- many. Rudolph was only one of thousands of fascist scientists, doc- tors, technicians, and, above all, intelligence operatives, as- Table of Contents Editorial 2 Nazi Doctors in U.S. 26 Allen Dulles and the SS By Peter Dale Scott 4 Knights of Malta Examined By Francoise Hervet 27 Klaus Barbie's Bolivian Coup By Kai Hermann 15 The Greek Civil War By Eleni Fourtouni 39 A Sophisticated Torture By Robert Cohen 21 The Real Eleni By Nikos Raptis 41 The Real Treason By William Preston, Jr. 23 Supplying the Contras By Fred Clarkson 56 Interview With Nuremberg Lawyer 24 About the Cover: Left photo: Greek women hanged at Volos, 1943, by Nazi occupiers and their Greek fascist collaborators. Credit: Spyros Meletzis. These women partisans are only a few of tens of thousands butchered during the German occupation (1941- 1944) and the civil war (1944-1949) which followed the liberation of Greece. The Greek collaborators not only went unpunished, they commenced a five-year reign of terror-working first with the British and then the Americans-to exterminate the Greek Left. These were the people Eleni Gatzoyiannis supported and served as an informer, for which she was tried, convicted, and executed. Right photo: President Reagan and Chancellor Kohl, May 5, 1985, accompanied by General Matthew B. Ridgway (right) and West German General Johannes Steinhoff (left), at Bitburg military cemetary where SS members are buried. Credit: Associated Press. CovertAction Information Bulletin, Number 25, Winter 1986; published by Covert Action Publications, Inc., a District of Columbia Nonprofit Corporation; Post Office Box 50272, Washington, DC 20004, (202) 737-5317; and c/o Sheridan Square Publications, Inc., 145 West 4th Street, New York, NY 10012, (212) 254- 1061. Typography by Your Type, New York, NY; printing by Faculty Press, Brooklyn, NY. Staff: Ellen Ray, William Schaap, Louis Wolf, and B. Lynne Barbee. Indexed in the Alternative Press Index. ISSN 0275-309X. Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 similated after World War II. Only slowly, and with painstak- ing research, does the information surface. All of the most ghoulish scientific experimentation by the Axis medical establishment was eagerly gathered up by the U.S. What carne of it, and of its practitioners, is a matter of speculation, though we do know that the CIA's mind control programs like MKULTRA, torture training through their Of- fice of Public Safety, and massive research in and use of chem- ical and biological warfare (begun in Operation NKNAOMI) were the backbone of CIA and Pentagon covert activities over the last 40 years. Torture, crude and sophisticated, was ex- ported to client states in Latin America, Africa, Asia, and else- where, and CBW was directly employed against Vietnam, Cuba, and it appears, now, Nicaragua. Recent events indicate that the doors of the Georgetown car barn (where OPS trained torturers from foreign police forces until 1974, when the pro- gram was banned by Congress) are being opened again. In the 1985 foreign aid bill the current Congress lifted the ban on such training at a time when, for example, death squad mur- ders in El Salvador have doubled this year. Torture, the policy of so many American allies, is getting better press under Reagan. Newsweek magazine of June 7, 1982 kicked off the campaign, carrying a column entitled The Case for Torture," by CCNY philosophy professor Michael Levin, who argued that torture is "not merely permis- sible, but morally mandatory" to save lives threatened by ter- rorists. And on November 13, 1985, the New York Times re- ported that "liberal" Senator Patrick J. Leahy (Dem.-Vt.) con- fessed to an audience that he did not care for lie detectors. "I personally like thumbscrews. They work far, far better." The Knights of Malta For nine hundred years the Knights of Malta have built up a military and intelligence organization designed to protect the established order and the privileges of the ruling classes throughout the world, yet most people arc unaware of their existence. Little is known of their role in the Third Reich or, along with the Vatican and the CIA, in the protection of Nazis after the War, or today in the wars in Central America. The ar- ticle in this issue begins what must be a long and complicated analysis of this organization and others like it. Eleni and the Greek Civil War There is no better example 01' the power of disinformation than the hoopla which surrounded Nicholas Gage's hook, / :Irni (a cover story in the New York Times Maga=inr last spring) and the recent movie based on it. First the Nazis, then the British, and then the Americans-each with their fascist Greek col- laborators-were responsible from the 1940s through the 1970s for the brutal deaths of tens of thousands of Greeks, de- cimating the ranks of the progressive forces. Yet Gage would have us believe that it was the communists'Aho were evil and the fascists who were good. We hope the analyses presented here help rectify the 40-year-old lie Gagc has resurrected. The World Anti-Communist Leage While General John K. Singlaub makes the rounds of televi- sion talk shows touting the Nicaraguan rontra.% and hoping WACL's mercenary adventures in Central America, the ori- gins of his group are pointedly ignored. Many of the WACL's leaders have deep ties not merely to Rev. Moon's nryrmidons but also to Nazis and Nazi collaborators, who hobnob with high administration figures. The Overt Covert Wars Friends jokingly advise us to change our name. Covert ac- tion has become so overt as to make the term an anachronism. The President, having manipulated Congress into repealing the Clark Amendment, has now gone over their heads by Execu- tive Order to fund a covert war against the government of An- gola. As with Nicaragua, debate over this "secret" war will he finessed by shifting the focus of discussion from its legality or morality to its level of financing. Computer Researchers: This magazine is typeset by computer, and Al material is prepared using the WordStarC? word processing pro- gram. For computer researchers who may find it useful, we will provide floppy disks with the text of all articles in this issue, in Wordstar, in either the CT/M? or the MS-DOS 40 format, for $20.00. We hope that in the fu- ture CA/B will be available as a data base. Nazi flag waves in the Andes after 1980 Bolivian coup. Number 25 (Winter 1986) Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 How Allen Dulles and the SS Preserved Each Other By Peter Dale Scott * Dr. Josef Mengele, the "Angel of Death," the experimenter and executioner of the German concentration camp at Au- schwitz, is perhaps the most notorious of all the unconvicted Nazi war criminals. The exhumation in early 1985 in Brazil of a body which international forensic experts subsequently judged to be that of Mengele has momentarily quieted the de- mands that he be found and brought to trial. The supporting evidence and testimony was persuasive enough to silence many initial skeptics. Nevertheless other wanted Nazi criminals have been erroneously but persuasively reported dead. Adolf Eichmann, for example, had been declared dead in Austria in 1947, "on the testimony of one Karl Lukas, who swore that he had been present when Eichmann died in Prague on April 28, This photograph was used by Josef Mengele in 1956 when he applied for an identity card in Argentina in his own name. It is the most recent authenticated photograph of the "Angel of Death" of Auschwitz. * Peter Dale Scott, a former Canadian diplomat with a Ph.D. in political sci- ence, and Professor of English at the University of California at Berkeley, is the author of The War Conspiracy: The Secret Road to the Second Indochina War (Indianapolis, IN: Bobbs-Merrill, 1972), The Assassinations, Dallas and Beyond: A Guide to Cover-Ups and Investigations (New York: Vintage, 1976), and Crime and Cover-Up (Berkeley: Westworks, 1977). This article is from a larger work in progress. 4 CovertAction 1945."' And when in the same year a doctor wrote that she wished to testify against Mengele, the response of Telford Taylor, U.S. Chief of Counsel for War Crimes at Nuremberg, was "to advise our records show Dr. Mengerle [sic] is dead as of October 1946."' (At the time of General Taylor's letter, U.S. Army Counterintelligence knew both of Mengele's survi- val and even his location, in the small Bavarian village of Au- tenried.') Four years before the emergence of the latest Mengele death report, a biography of Martin Bormann noted how the issuance of false death reports, substantiated in some cases by the plant- ing of skeletons, was the standard modus operandi of the post- war Kameradenwerk in South America to which Mengele, and allegedly Bormann, belonged.' Indeed the very abundance of such skeletons was enough, not only to weaken their credibil- ity, but to confirm that a powerful and ruthless organization was protecting the wanted criminals. In the case of Bormann himself, The [Israeli intelligence organization] Mossad was to point out that they have been witnesses over the years to the exhu- mation of six skeletons, two in Berlin and four in South America, purported to be that of Martin Bormann.` It is worth recalling that Mengele was reported dead in 1968, after the search for him had been fueled by revelations in the Eichmann trial. Then as now the major source for the report was a respected Brazilian policeman (Erich Erdstein in 1968) who "specialized in narcotics smugglers."" Erdstein sub- sequently published a vivid eyewitness account of Mengele's brief capture, release, subsequent recapture, and death by gun- fire on a barge at his own hands. When a respected Brazilian policeman with a record of im- portant narcotics arrests describes Mengele's death in vivid de- tail, it is hard to disbelieve him. But after a second respected Brazilian policeman with a similar record has supplied a differ- ent, wholly incompatible account of Mengele's death, then the credibility of such sources has to be reassessed. Even if the second report proves to be correct, the earlier report remains as evidence that a well-organized conspiracy existed to protect Mengele, like Bormann, with disinformation. 1. Ladislas Farago, Aftermath: Martin Bornumn and the Fourth Reich (New York: Avon, 1975), p. 345. 2. U.S. National Archives, Record Group 165, 250.401, Sect. XIX; letter of 19 January 1948 from Brig. Gen. Telford Taylor, OCCWC, OMGUS. 3. U.S. National Archives, Record Group 319, CIC File No. V-2399, XE 012547 D20D216; Washington Post, March 15, 1985, p. A10. 4. Paul Manning, Martin Bormann: Nazi in Exile (Secaucus, NJ: Lyle Stuart, 1981), p. 183. 5. Ibid. 6. Erich Erdstein with Barbara Bean, Inside the Fourth Reich (London: Robert Hale, 1978), pp. 199-201, 217-218. Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 The story of Mengele's death is in this respect a small synec- doche of the story of Mengele's life. To begin to understand it, one must be prepared to disbelieve authorities that would nor- mally be credible, and to explore alternative hypotheses that would normally be dismissed as sheer paranoid fantasy and de- lusion. The Mengele Kameraden and U.S. Intelligence By July 1945 Josef Mengele had been captured and iden- tified at an allied prisoner-of-war camp. Forty years later an eyewitness told a congressional committee how guards knew Mengele's name, and also the general nature of his crimes as doctor, experimenter, and executioner at Auschwitz.' Also in 1985 the Simon Wiesenthal Center in Los Angeles released documents obtained from the U.S. Army under the Freedom of Information Act, according to which Mengele "may have been arrested by U.S. authorities in Austria in 1947 and sub- sequently released."Yet like so many of his fellow members of the SS, the bureaucrats of death in the Nazi behemoth, Mengele was somehow allowed to disappear, to reemerge ten years later in Latin America. Twenty years ago only a few would have believed that the victorious allies in the so-called "good war" could have delib- erately allowed a sadistic mass murderer like Josef Mengele to go free. From the revelations since the Eichmann trial, how- ever, it has become only too obvious that the OSS, the wartime precursor of today's CIA, arranged for numbers of wanted criminals to "escape" from camps, and when necessary sup- plied them with new identities to protect them from justice. Murderers, far from being exempted from such protection, seem to have been among those most likely to obtain it. This is particularly true of those Schur:staf/e'! (SS: elite guard) veterans whose careers have been most closely linked to The "Butcher of Lyon" in the plaza of La Paz. 7. Washington Post, Fchruary 15, 1985, p. A4. 8. The Nation, March 2. 1985, p. 231: Number 25 (Winter 1986) Walter Rauff, inventor of the portable gas chamber. After the war, Rauff worked for the Gehlen Org and later in Chile for Pinochet as torture expert. Mengele's in Latin America: Klaus Barbie, the butcher of Lyon, in Bolivia; Walter Rauff, supervisor of the SS mobile gas chambers, in Chile; and Friederich Schwend, yet another wanted murderer, in Peru. Like Mengele, all three of these men developed links with neo-fascist elements in the military or interior ministries of their new countries, or both. All col- laborated in repressive operations against the Lcft, particularly at the time of the CIA-assisted overthrow of the Allende gov- ernment in Chile. Barbie and Schwend, at least, have acted in this capacity through arms deals with the German firm Merex AG, a proprietary firm of the German l3ntlclc.~tuu hrirhtr/ien,ct (BND: federal intelligence service), itself a descendant of the Gehlen intelligence network which in 1945 passed from the leadership of the Nazi SS to that of American intelligence, and eventually the CIA. We shall see that after World War 11, while the CIA and the Gehlen Organization (usually referred to as the "Gehlen Org") were being slowly organized on the U.S. payroll, both Barbie and Schwend worked for U.S. Army Counterintelligence (CIC); and at this time Schwend was working on setting up the secret SS escape routes to Latin America by which both men would eventually reestablish themselves. It has been charged that Rauff played an even more prominent role in setting up the CovertAction 5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 Approved For Release 2010/06/03: CIA-RDP90-00845R000100170004-5 The ubiquitous Reinhard Gehlen served Hitler, Dulles, and Adenauer in succession. escape route, while also on the U.S. payroll, and that he did so with an immunity granted to him by Allen Dulles of the OSS, after the SS-OSS secret (and sometimes unauthorized) negotia- tions in north Italy in which, unquestionably, both Dulles and Rauff participated. The primary purpose of these secret talks was to secure a separate Nazi and fascist surrender in north Italy, and at least partly to prevent a de facto seizure of power by Italian com- munist partisans behind the Nazi lines. But even the intense fixation which the OSS and the SS shared about reducing the inevitable communist role in postwar Europe does not appear to diplomatic historians to explain the zealous intensity with which Dulles, at times in direct contravention of written or- ders, pursued negotiations for a surrender which in fact pre- ceded that of V-E Day by just six days. We shall study the same excessive zeal with which future CIA personnel protected the convicted war criminal Barbie and concealed him from the French authorities who knew very well that U.S. intelligence was hiding him from them. A recent U.S. Justice Department report on the U.S. handling of the Barbie case is clearly an essay in damage limitation, designed to blame low-level people in U.S. Army Counterintelligence while suppressing the rather obvious connections to the Gehlen Org and its then employers, the CIA. The role of Schwend (and almost certainly Rauft) in exfiltrating whole cadres of wanted SS criminals, while on the U.S. payroll, only confirms recent speculations that the SS networks were being preserved for postwar anticommunist activities, as the result of an ar- rangement negotiated with Dulles and his OSS superiors. 6 CovertAction Such an OSS-SS deal does not appear to have been approved at the time at any higher level. Indeed as late as December 1945 the U.S. War Department refused U.S. intelligence offi- cers permission to collaborate with even the Gehlen Organiza- tion, whose prewar origins lay not in the Nazi SS but the even- tually decapitated Abwehr

The level of intelligence it takes to run this country could fit in that the size of the f****** retarded nap okay well I'm up jackass

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The CIA's complicity in the Mexican Drug Cartels (including military training at Fort Bragg)

By Derek Knauss -May 9, 20250

And how a Green Beret co-founded a major bank caught in drug money laundering

The following is an except from Paul L. William's book "Operation Gladio: The Unholy Alliance between the Vatican, the CIA, and the Mafia":

When the US military occupation of Afghanistan became precarious, the CIA worked with the Mexican drug cartels to develop poppy fields throughout the mountains of Mexico's west coast. By 2013, heroin and cocaine from Mexico – with a street value of $3 billion – flooded Chicago. The drugs arrived by land, rail, and air, including 747 jetliners. When Jesus Vicente Zambada Niebla, a member of the Sinaloa cartel, was collared by Chicago police officials, he claimed to be a CIA operative under government protection. His trial was halted by federal prosecutors on the basis of the "Classified Information Procedures Act." The prosecutors claimed that Niebla's testimony would constitute a threat to national security.

By 2018, Mexico's southwestern Guerrero state became the top source of heroin for the US drug epidemic, which resulted in more than sixty-four thousand deaths in 2016. The Drug Enforcement Agency says that 93 percent of heroin in America now comes from Mexico, more than double the amount from five years before. Guerrero emerged as a heroin hub because its mountains are inaccessible and catch the warm, humid air from the Pacific.

The Sinaloa cartel controls the flow. Its only rival is the Jalisco New Generation cartel, which arose from infighting after the arrest of Joaquin "El Chapo" Guzman in January 2016. The strength of the Sinaloas stems from the support in the form of arms and immunity that the cartel has received from the CIA. Commenting on this support, Robert Farago and Ralph Dixon maintain the following in a 2011 article for the Washington Times: "The CIA's motive is clear. The US government is afraid that the Los Zetas cartel will mount a successful coup against the government of [Mexican President] Felipe Calderon.

But the motive isn't clear since the CIA purportedly has controlled and abetted Los Zeta by proving military training for members of this criminal syndicate at Fort Bragg and other military installations throughout the United States.

What is clear is the possibility that the Gladio strategy of tension is at work south of the border so that new fields of poppies may be cultivated to perpetuate the CIA's covert operations – operations that will safeguard not the American people but rather the holdings of an elite group of bankers and businessmen.

"The only thing that is constant is change," so said Heraclitus 2,500 years ago. Gladio provides proof of this adage. Gladio began as a covert operation to thwart the spread of communism and evolved into an effort to advance the economic hegemony of an Anglo-American money cartel. It no longer sought to amke the world safe for democracy but rather to subject humankind to the designs of a synarchy. Its activities were no longer confined to the borders of Western Europe but extended throughout Latin America, the Middle East, Africa, Australia, and Central Asia.

From the time of its inception, Gladio was fueled by heroin. This reliance produced a plague that has spread throughout the civilized world. The illicit gains fof the CIA from trafficking were originally washed in the Holy See.

But the Vatican Bank became capable of handling the flood of revenue that poured into the Bastion of Nicholas V. New financial institutions were established to serve as laundries, including the Castle Bank and Trust in Miami, the Nugan Hand Bank [co-founded by Michael Hand a Green Beret] in Sydney, and the Bank of Commerce and Credit in Karachi.

But even these banks proved insufficient to handle the billions of dollars in ill-gotten gains, and so the dirty money began to flow through major American banks, including Citibank, American Express of Beverly Hills, Manufacturers Banks, the Great American Bank, Chemical Bank, and Chase Manhattan.

The CIA's reliance on La Cosa Nostra also changed and the agency, by creating Gladio II, became compelled to forge new alliances with the Latin American cartels, the babas and Grey Wolves of Turkey, street gangs within America's inner cities, and the Albanian Mafia who emerged almost overnight as "the leading crime outfit in the United States."

And so Gladio goes on to advance the interests of an Anglo-American money cartel. It will persist on the winds of war as long as the affairs of men are governed by covetousness and greed. It matters not that a handful of people might draw back the curtain to reveal figures with bloody swords.

On January 27, 1980, two American policemen, driving along the Great Western Highway near the port of Sydney, came upon a 1977 Mercedes Benz parked along the side of the road. Inside the car, slumped across the front seat, was the body of a burly, middle-aged man. Searching his pockets, the policemen found the business card of William Colby, former director of the CIA. On the back of the card was Colby's itinerary for his trip to Hong Kong and Singapore. The dead man's hand was wrapped around the barrel of a new .30-caliber rifle. Next to the body was a Bible with a meat-pie wrapper as a book mark. On the wrapper were scrawled the names of Colby and California Congressman Bob Wilson, then the ranking Republican on the House Armed Services Committee.

The dead man was identified as Frank Nugan, co-owner of the Nugan Hand Bank and one of the most prominent lawyers in Australia. His death was ruled as a suicide despite the fact that Nugan's fingerprints were not on the rifle, and only a contortionist could have shot himself in the head from the position in which he was found in the vehicle.

When Nugan's partner, Michael Hand, a former Green Beret who had served in Vietnam, learned of the death, he rushed back to Sydney from a business trip in London and began shredding enough of the bank's documents to fill a small cottage. The next day, Hand held a meetings of Nugan Hand Bank directors in which he warned them that they must follow his instructions in destroying all records of transactions, otherwise they would "finish up with concrete shoes" or find their wives being delivered to them "in pieces." By June 1980, Nugan Hand Ltd was in liquidation. It owed about $50 million to creditors. Hand fled to the United States, never to be seen or heard from again.

The Nugan Hand Bank had been established in 1973 by Nugan and Hand. Shortly after setting up headquarters in Sydney, the bank blossomed into twenty-two branches. One branch was set up in Chiang Mai, the heart of Thailand's opium industry, in the same suite as the United States Drug Enforcement Administration (DEA). The DEA receptionist answered the bank's phone and took messages when the representatives were out. Neil Evans, the former head of the Chiang Mai branch, told investigators that he had seen millions pass through his office, claiming that the bank operated solely "for the disbursement of funds, anywhere in the world, on behalf of the CIA, and also for the taking of money on behalf of the CIA."

The money taken from the bank by the CIA was used to purchase weapons from international arms dealer Edwin Wilson for guerilla forces in Indonesia, Thailand, Malaysia, Brazil, and the white Rhodesian government of Ian Smith. Wilson was a former CIA operative who was later convicted of selling arms and explosives to the Libyan government of Muammar Gaddafi. Funds were also shelled out to undermine the liberal government of Prime Minister Gough Whitlam, who had pulled Australian troops out of Vietnam and condemned the bombing of Hanoi. These actions were orchestrated by Theodore Shackley, the CIA's deputy director of operations. After Whitlam was removed from office by John Kerr, Australia's governor-general, in 1975, the black ops money flowed to Italy and the IOR, for support of the Christian Democrats.

The bank also imported heroin into Australia from the Golden Triangle. This dirty work was done by Australian police officers in service to the CIA, according to the Commonwealth-New South Wales Joint Task Force on Drug Trafficking. In 1976, one such officer, Murray Riley, organized five shipments of heroin into Australia, mostly in false-bottom suitcases. For each shipment the branches of the Nugan Hand were used to transfer the purchase money from Sydney to Hong Kong. Over one hundred pounds of heroin was involved in each importation, and much of this was eventually shipped from Hong Kong to the United States. Riley was also involved in two heroin importations in July and September 1977.

Board of Directors & Administrative Staff of the Nugan Hand Bank

Dr. Guy Parker – an expert from the RAND Corporation

Major General Richard Secord – director of the Defense Security Assistance Agency, who worked closely with Ted Shackley in smuggling heroin money out of Vietnam…

Walter McDonald – retired CIA deputy director and head of the Annapolis branch

Dale Holmgreen – former chairman of the CIA's Civil Air Transport and manager of the Taiwan branch

Theodore Shackley – former CIA deputy director for clandestine operations

Richard L. Armitage – special consultant to the Pentagon in Thailand who oversaw the transfer of heroin profits from Indonesia to Shackley's account in Tehran, Iran

Patry Loomis – former CIA advisor to the Provincial Reconnaissance Unit in Vietnam

Robert "Red" Jansen – former CIA station chief in Bangkok, who represented Nugan Hand in Thailand

[The following were excerpts from Paul L. Williams book "Operation Gladio: The Unholy Alliance between the Vatican, the CIA, and the Mafia"]

From cynthiachung.substack

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RAMPARTS MAGAZINE MISREPRESENTS ROLE OF CENTRAL INTELLIGENCE AGENCY IN FIGHTING AGAINST IMPORTATION OF DANGEROUS DRUGS

Document Type:

CREST

Collection:

General CIA Records

Document Number (FOIA) /ESDN (CREST):

CIA-RDP75B00380R000300080002-3

Release Decision:

RIPPUB

Original Classification:

Document Page Count:

150

Document Creation Date:

December 16, 2016

Document Release Date:

May 11, 2005

Sequence Number:

Case Number:

Publication Date:

June 2, 1971

Content Type:

OPEN

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Body:

Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3 TAB Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3 Jun; 1971 The objective of ? foreign conce, Act into accoew. mate' sales to the United ;,te .??., The 25 Percent Rule The Antidumping Act provides that in normal situations fair value &lien be deter- mined by comparing tile eX factory home market price of the merchandise under in- - vestigation with the ex factory price at which the merchandise is sold in the United States. ? If tthe price fis the United States is less than the home market price, then there are "sales 1,1, 1,F,fl then fair value" within the rncaning he eta to to. 'le Act also steles that in situations where quantity of merchandise sold in the 1,,alle market is so small in relation to the. ? quantity sold for exportation td countries ? other than the United States as, to form an 'inadequate basis for comparison, then third ? country price should be used as the basis for .? comparison. The Antidumping Regulations provide that ' generally for purposes of determining what constitutes an "inadequate basis of com- ? parison" for fair value mimeses, home mar- . ?' ket sales will be considered to be inadequate if less than 25 percent of the.non-U.S, sales of the merchandise are sold in the home mar- ket. The selection of home market or third. country price for fair value comparison can easily Ise crucial to the results of antidump? ing investigations, for frequently home mar- ket price tends to be higher than third coun- try price. This is particularly true whore merchandise is sold in a protected home mar- ket and, when sold in third countries, is ex- posed to the vagaries of world competition. ? It has been Treasury's experience that cases arise where sales in the home market are adequate as a basis for fair value corn-, }Dodson, even though less than 26 percent of the non-U.S. sales are sold in the home mar- ket. From a technical standpoint, the exist- ing regulations provide for this ,situation, since the 25 percent rule is introduced by the adverb "Generally." ExaMination of the precedents, however, revealed that the Treas- ury has not, in recent years at least, made nis' exception in applying the 25 percent rule. 'I de left the Treasury with two alterna- it 'could have ignored the previous in- ? e. elistions of the Antidumping Regula- lolls which had, in effect, applied the regults-' dons as if the word "Generally" were not there, or it coud propose a change in the Antidumping Regulations to eliminate the 26 percent rule. We chose the latter course. The proposal was published in the Federal Register of April 27, and is currently open for comment by interested persons. Any com- ments received will be carefully considered before we take final action on this proposal. A LOOK INTO THE FUTURE In my judgment, we have only come to the end of the beginning of the rejuvenation process. But, I believe we have made a solid start. ? Let me take a final brief moment to touch upon what I see happening In the future. We have taken steps to initiate a fresh examina- tion of the Treasury's antidumping proce- dures and regulations to see what more can be done. The regulations were substantially revised in mid-1068 after a broad review, with the dual objectives of conforming the Treasury's procedures to the requirements of the International Anti-Dumping Code, and also of having the regulations imple- ment in clear and precise language the ob- jectives of the Antidumping Act. With al- ' most three additional years of experience under the regulations, as then revised, it is now appropriate to stop and take a now look to see whether additional changes may be ap- propriate. A Notice of Proposed Rule Making Ii' this erect was PUbliSlIed, in the roderal Approved For Release 2005/05/20: CIA-RDP75600380R000300080002-3 COIN.GRESSIONAL REco-:&D ?:.Exteusiolls ,of Rem-arks ? is to Induce mI; Id engage in 1.10, ? Sixty days are being allowed for the sub- mission of comments. I would assume that many persons present here today?if you are not already aware of the Treasury's invita- tion to submit coraments?may wish to do so. ? Let ine emphasize that the Treasury De- partment continues, as always, to adhere to its policy of equitable adminietration of the? Antidumping Act. With the increased per- sonnel assigned to this field and modernized procedures and policies, we shall speed up antidumping investigations, thereby making administration of the law more effective?all ? this without sacrificing equity. Let me also emphasize that the Treasury Department and the Administration are strongly opposed to having the Antidumping Act transformed into an instrument of pro-' tectionism. On the other hand, we are equally strongly opposed to allowing foreign arms to injure U.S. industry by unfair price discrimination. It is with the latter objec- tive in mind that the Treasury Department introduced the changes in the administra- tion of the Antidumping law, which I have discussed with you today. To the extent that we succeed in our objective, the Treasury's rejuvenation of the Antidumping Act will become all increasingly important influence in favor of a freer international trade policy. In conclusion, I would like DO repeat a statement made by Secretary Connally on May 17 before the Subcommittee on Inter- national Trade of the Senate Committee on Finance: ? "The efforts to foster increased comped-, tiveness -in our economy. must be actively pursued in the context of fair and liberal trading arrangements." RAMPARTS MAGAZINE MISREPRE- SENTS ROLE OF CENTRAL INTEL- - LIGENCE AGENCY IN FIGHTING? ' AGAINST IMPORTATION OF. DAN.? GEROUS DRUGS C." ? ? NON. ?CE:ARLES S. CUBSE2. OF CALIFORNIA . IN THE HOUSE OF REPRESENTATIVES Wednesday, June 2, 1071 Mr. GUBSER. Mr. Speaker, recently Ramparts magazine published an article which, like so many other articles which appear in new left publications, attempt- ed to discredit established agencies of the Government, including the Central- In- telligence Agency, Unfortunately, the Stanford _Daily, the newspaper pub- lished by students at Stanford Univer- sity, saw fit to lend credibility to this article by reprinting it. A tearsheet from the Stanford Daily was sent to me by a constituent and I submitted it to the Bureau of Narcotics and Dangerous Drugs with a request for comment. Under date of May 27 I re- ceived a reply from Mr. John E. Ingersoll, director of the Bureau of Narcotics and. Dangerous Drugs. His letter should be brought to the attention of all responsible Members of Congress and the press since it certainly contradicts the implications contained in the Ramparts magazine ? article. Mr. Ingersoll's response follows: Hon, CHARLES 5, GUUSER ELS, /1011.SC Of Representatives Washington, D.O. ' DEAR CONGRESSMAN CUBSER: This is in response to your letter of May 21, 107h Which enclosed a tearsheet from the "Standard E5305 sity) of the article. entitled;-"T.ie New Opium War," as reprinted from "Ramparts Mag- ,azine." Charges made in the article appeal' to he a part of a continuing effort to discredit agencies of the U.S. Government, such as the U.S. Military, the FBI, the CIA, and the De- partment of State, all of which are, in point of fact, working .actively with the Bureau of .Narcotics and Dangerous Drugs (BNDD) in our worldwide effort to curtaii international drug traffic, Actually, CIA has for sometime been this 'Bureau's strongest partner us identifying foreign sources and routes of illegal trade in narcotics. Their help has included both direct support in intelligence concede's, as well as in intelligence analysis and production. Liai- son between our two agencies is close and constant in matters of mutual interest. Much of the progress we are now making in Wen- tifyine? overseas narcotics traffic can, in fact, ? be attributed to CIA cooperation. In Burma. Laos, and Thailand, opium is produced by tribal peoples, some of Whom load a marginal existence beyond the polit- ical reach of their nationas governments. Since the 1950's, this Southeast Asian area has become a massive producer of illicit opium and is the source of 500 to 700 metric tons annually, which is about half of the world's illegal supply. Up to now, however, ? less than ten percent of the heroin entering the United States comes from Far Eastern production. ? The dimensions of the drm; problem and the absence of any strong poiitical base for control purposes has been a dilemma for United Nations opium control bodies op- 'crating in Southeast Asia for many years. ? Drug traffic, use, and addiction appears to ?.have become accepted as a fact of life in this area and, on the whole, public attitudes ..are not conducive to change. The U.S. Government has been concerned that Southeast Asia could become the major source of illicit narcotics for U.S. addicts after the Turkish production is brought under control. Tile Bureau of Narcotics and ?? ? Dangerous Drugs, with the help of CIA,. , DOD, and the Department of State, has been workifig to- define and characterize the prob- lem so that suitable programs to suppress the illicit traffic and eliminate illegal opium production, such as the proposed United Nations pilot project in Thailand, can be implemented, ? It is probable that opium production in Southeast Asia will be brought under effec- tive control only with further political de- ?velopment in these countries. Nevertheless, in consideration of U.S. Military personnel in the area, as well as the possibility that opium from this area may become a source for domestic consumption, concerned U.S. Agencies, including CIA, Bureau of Customs, DoD, and State, are cooperating with BNDD to work out programs to meet the immedi- ate problem as well as provide longer term solutions. . ? Since, the subject matter of your letter concerns CIA, I have taken the liberty of. furnishing .a copy along with my reply to. Director Richard Helms. Sincerely, ? JOHN E. INGERSOLL,. Director. As an enclosure to his letter, Mr. In- gersoll inchideci a paper entitled "Recent Trends in the Illicit Narcotios Market In Southeast Asia." This should also be of interest .to every person who is con- cerned about this problem and I there- fore include the text herewith: RECENT TRENDS IN THE ILLICIT NARCOTICS MARISET IN SOUTHEAST ASIA 1. The reported increasing incidence of heroin addiction among U.S. servicemen in Vietnam and recent intellizeAee Indiestin; " APvii 13. *proved For .Releatie fticititiVff:tit'fitiHkitf" 03 00300080002-3 4.1.14 .4)/ki,I1 Approvecl,For !Release 20,05/05/20 : CIA-RDP75600380R000300080002-3 and the United States may also be increas- ing suggest that Southeast Asia is grow- ing in importance as a producer of heroin. While this phenoinenon in part reflects im- provement in Information available in re- cent .months to the U.S. Government,. there Noe' are also good indications that production of illicit narcotics in Southeast. Asia has in- deed risen in 1971. BACXGROUND 2, The Burma, Laos, Thailand border area, known Also an the "Golden Triangle," is et/MAW:Teti one of the world's largest oPinne producing yegione. Tine region normally ac- counts for about 700 tons of opium annual- ly or about one-half of the world's total, il- licit output. A substantial proportion is con-. slimed within the region. Burma, by far the largest producer of- opium in this region, accounts for about 400 tons annually.. ? a nunivra . 3. Production in Burma is concentrated in the Eastern and Northern parts Of Shan State and in the Southwestern part of Kas chin State. Poppy fields cover the rugged slopes in Eastern Shan State around Kong Tung and in Northern Shan State from Lashio east and north to the China border. The latter territory, comprised of the former, We and Kokang feudal states, is now a cen- ter of insurgency directed against the Bur- mese government, with much of the area un- der insurgent control, 4. The growing season varies with the al- titude, but the planting season generally falls during the months of August and Sep- tember, with the harvest some seven months later during February and- March. At har- vest time the women of the hill tribes slit the poppies and collect the raw. opium by. hand. The opium plants themselves are ground into a compound for smoking. In Northeast Burma, the raw opium is packed by the growers and traded to Itinerant Chi- nese merchants who transport it to major collection, points, particularly around Lashio and Kong Tung. Agents of the major en- trepreneurs circulate through the hill coun- try shortly after harvest time arranging for payment and pickup. Payment is often ,in the form of weapons and ammunition, el- thongh gold and silver rupees are also used, 5. The opium harvested in Shan, Win and Kokand areas is picked up by caravans that are put together by the major insurgent leaders in these areas. The caravans, which can include up to GOO horses and, donkeys and 300 to 400 men, take the opium on the southeasterly journey to the- processing plants that lie along the Mekong River in the Tachilek (Burma) -Mae Sat (Thailand). Ben liouei Sal (Laos) area. Caravans carry- ing In excess of 16 metric tons have been reported. THAILAND ' 6; Opium-growing areas in northern Thai- land are located in the upland tracts oc- cupied by various tribal groups. The pro- vinces of Ching Mai, Chiang Rai, and Nan, which Ilene the largest concentration of Angie, produce most Thai opium, Illicit opium peeteection in Thailand is estimated at 200 7005. LAOS 7, Another, lest; productive, opium growing area is along the 2,500 to 4,500 foot high mountainsides of Northwest Laos. The opium cultivated by the Meo in this area is- of a relatively lower grade and thus less Slat.. able for refinement into morphine base or heroin. In these areas where the tribesmete, have been encouraged to grow corn, the pop- pies are planted among the corn, When the corn is cut, the poppies continue to grow until they too can be harvested. 6, Major producing areas include Phong Saly Province in the North, Mutt Phan (Sanmena) Province in the Northeast, and the Plaine de Jams area of Xiang Fainting Province in the Es-tit-central put oX thiP country. However, largo areae of production In Phong Spey, Hotta Pisan, and Kiang Khoang have fallen under the control oY the Paehet Lao and North Vietnamese. D. The trade in- Northwest Laos is less well structured and organized for significant com- mercial exploitation. There are no advance purchasing agents or pick-up caravans. The ' harvested opium and the poppy plants which ? are ground op for smoking are transported to nearby village markets by the growers themselves. In highland market places the raw opium and Its by-product are teieci open- ly as currency. Ethnic Chineee merchants are ethe traditional purchasers of the opium products throughout Laos. Tho producte they collect are transported to population con- ?.ters and also to processing plants ialong- the Mekong River by travelers, particularly gov- ernment soldiers, who have the most mobil- ity and access to air travel in the area, and ? refugees. Opium. produced in the Commu- nist-controlled areas also find its way into the regular marketing channels'. ? DISTRIBUTION AND REI,INERIES 10, The KMT irregular "armies" and the ? Burmese Self Defense Forces (ICK1r) are the most important trafficking syndicates in ?Nerthern Southeast Asia: The KMT irregu-. lars?formerly the remnants of the Chinese Nationalist forces which retreated across the Chinese border in I049?now composed largely of recruits front the local population, have a combined strength of between 4,000 and 6,000 well-armed men. The largest force, with an estimated strength of 1,400 to 1,900, is the Fifth Army. The second largest with a troop strength of, between 1,200 and 1,700 is the Third Army. The headquarters of both ? armies are located in a remote part of North- ' ern Thailand between Fang and Mae Sae It Is estimated that these two KMT irregular forces control more than 80 percent of the opium traffic from the Shan State. II. The ICKnir have been major competitors of the KMT irregulars in the opium trade. The'leDZY are comprised of former Shan State insurgents and bandits who have allied themselves with the Burmese government against both the nreeT and Chinese Commu- nist-baeked insurgents. In return the 'gov- ernment of Burma allowed them to pursue .their ?Menu trafficking activities. 12. The. Shan States Army, an insurgent. group, is also heavily involved in the opium business, It maintains several camps in Northern Thailand where opium is marketed for weapons and military supplies. 13. About 140 tons of raw opium is nor- ? mally transported annually out of Northeast Burma to foreign markets. Most of this opium is stored or processed in the Mekong River tri-border area before transiting Thai- land and Laos. Tachilek, Burma is probably' the most important transshipment point in the border area. In 1970, out of a total of 123 tons reportedly shipped out of Northeast Burma, 45 tons was received in the Tachilek area. In the first two months of 1971, 58 out of a total of 67 tons had Tachilek as its desti- nation. Other important transshipment points appear to be located in the vicinity of Ban Reuel Sai, Laos, and Mae' Salong, Thailand, ' 14. There appear to be at least 21 opium refineries of various sizes anti capacities lo- cated in the tri-border area, of which about 7 are believed to be able to process to the heroin stage. The' most important are located in the areas around Tachilek, Burma, Ban Hemel Sai and Nam Keung, Laos, and iSilao Salong, Thailand, The best known, if not ' largest of these refineries is the one at Zan Houel Tap, Laos, near Ban Houel Sat which ' is believed capable of processing some 100 kilos of raw opium per day. The 14 refineries In the Tachilek area apparently process the largest volume of raw opium- in the region. ,In 1070, about 30 tons was converted by the Tachilek refineries into refined?opiums mop. ? phine base, and heroin, . . , 15. The typical refinery is on a small trib- ntary of the Mekong River in art isolated ' arca with A military defense periineter guard- ing all ground approaches. Most of these re- fineries operate under the protection of the various military organizations in the region, or are owned or managed by the leaders of these 'military groups. The KielY units pro- tect and operate most of the refineries in Burma; Leaders or these groups also hold an ownership Interest in many of these fa- cilities. In Thailand, the refineries appear to be operated by units of the liesT irregulars, whereat; in Laos, most of the re aneriee oper- ate under the protection of ,ilements of elle Royal Laotian Armed Form While the management and ownereltip of the Lao- tian refineries appear to be primarily in the hands of a consortium of Chinese, some re- -ports suggest that a senior VAR officer 'my hold an ownership interest in a few Of these facilities. ? 16, Most of the narcotics buyers in the tri- border area are ethnic Chinese. While many of these buyers pool their purchases, no large syndicate appears to be invelved. The opium, mor

For the ramparts they watched we're so valiantly as in cowards streaming the rape of many but not to their face no goddamn way cuz I'm every f****** card and they're the jacket diamonds by the way all of them

Chapter 33 - ya ll. art s[N}M hmmm