Tag Archives: Oliver North

Hyde’s Blind Spot

Hyde’s Blind Eye: Contras & Cocaine

By Dennis Bernstein & Leslie Kean, ConsortiumNews.com, December 14, 1999

Henry Hyde, who starred as chief House manager in President Clinton’s impeachment, played a very different role a decade earlier.

In 1987, instead of the grim prosecutor set on punishing Clinton for his sex-and-lies offenses, Hyde was the glib defense attorney searching for reasons to spare President Reagan from possible impeachment over the Iran-contra scandal and related drug crimes implicating the Nicaraguan contra army.

As a member of the congressional Iran-contra committee, Hyde vigorously defended Reagan’s Iran-contra activities and steered the panel away from any serious investigation of the contra-cocaine connection.

The suppression of that contra-cocaine probe, in particular, proved crucial in shielding Reagan and his vice president, George Bush, from blame for a policy that fueled America’s cocaine pandemic and wreaked havoc on cities across the nation.

While it is not clear exactly what Hyde knew about the contra-cocaine corruption in 1987, government investigators already had collected strong evidence of widespread criminality.

The contra-cocaine issue had surfaced publicly in 1985 and had become the subject of a Senate inquiry in 1986. Even earlier, the CIA and the Drug Enforcement Administration were aware of the contra-cocaine problem.

Those early suspicions have now been proved out. Last year, CIA inspector general Frederick Hitz issued a lengthy report admitting that drug traffickers permeated the contra movement from its inception in the early 1980s and that contra-cocaine smuggling continued throughout the decade. [For details on Hitz’s report, see Robert Parry’s Lost History.]

According to the CIA inspector general’s report, the evidence showed that from the start, the CIA knew the contras were involved in “criminal activities,” including terrorist bombings, hijackings and narcotics trafficking.

By 1981, contra operatives had delivered their first shipment of cocaine to the United States, the report revealed. The inspector general also confirmed that drug traffickers from the Medellin cartel secretly collaborated with contra operatives to pump money into the contra war.

We now know, too, that in 1982, Reagan’s first attorney general, William French Smith, gave the CIA legal clearance to work with drug traffickers without a requirement to report on their criminal activities.

This so-called “memorandum of understanding” was effectively a carte blanche for the CIA to ignore drug operatives working in the contra movement as well as other CIA-backed projects.

Though now confirmed by the CIA’s inspector general and other investigators, the contra-cocaine charges were a matter of heated denials in the mid-1980s — when the drug smuggling actually was taking place.

“The government made a secret decision to sacrifice a part of the American population for the contra effort,” testified Washington attorney Jack Blum before the Senate Intelligence Committee in 1996. Blum had been special counsel to Sen. John Kerry’s Senate Foreign Relations subcommittee on terrorism and narcotics.

Reagan administration officials also were “quietly undercutting law enforcement and human-rights agencies that might have caused them difficulty,” Blum stated. “Policy makers absolutely closed their eyes to the criminal behavior of the contras.”

From his twin perch on the House Intelligence Committee and the congressional Iran-contra panel, Henry Hyde was especially well positioned to stop potential threats to the contras from law-enforcement officials and congressional investigators who were compiling the evidence.

Hyde’s spot at the nexus of information made him one of President Reagan’s most important defenders.

One of the Illinois Republican’s principal contributions to the contra-cocaine cover-up was his championing of a bogus 1987 investigative report largely clearing the contras of drug-trafficking suspicion.

The 900-word memo, drafted by Iran-contra committee staff member Robert A. Bermingham, claimed that a thorough investigation into the drug-trafficking charges had found no evidence that the contra leadership was implicated in narco-trafficking. Bermingham submitted the memo to Iran-contra committee chairman, Rep. Lee Hamilton, on July 23, 1987.

During the course of our investigation, the role of U.S. government officials who supported the contras and the private resupply effort, as well as the role of private individuals in resupply, were exhaustively examined,” Bermingham wrote.

“Hundreds of persons, including U.S. government employees, contra leaders, representatives of foreign governments, U.S. and foreign law enforcement officials, military personnel, private pilots and crews involved in actual operations were questioned and their files and records examined. …

“There was no information developed indicating any U.S. government agency or organization condoned drug trafficking by the contras or anyone else.”

More broadly, Bermingham disparaged the contra-cocaine allegations as self-serving claims coming from disreputable individuals.

“During the course of our investigation, we examined files of State, DOD, NSC, CIA, DEA, Justice, Customs and FBI, especially those reportedly involving newspaper allegations of contra drug trafficking,” he said. “We have discovered that almost all of these allegations originate from persons indicted or convicted of drug smuggling.”

Bermingham also reported that “contra leaders have been interviewed and their bank records examined. They denied any connection with or knowledge of drug trafficking. Examination of contra financial records, private enterprise business records, and income tax returns of several individuals failed to find any indication of drug trafficking.”

Bermingham then concluded, “additional investigation of these allegations is unwarranted in view of the negative results to date.”

While Bermingham’s description of his investigation sounded impressive, the memo offered virtually no documentation from — or even identification of — the “hundreds” of witnesses supposedly questioned.

There were no excerpts from depositions, no quotes from the files, no references to specific records examined, no citation of which foreign governments had cooperated or how, no detailing of the witness accounts alleging contra-drug trafficking and how those stories were debunked.

Though the Democrats soon realized that Bermingham’s sweeping claims were not supported by the evidence, Hyde signed off on it and used the memo to disparage anti-contra evidence coming from other investigators.

Hyde cited the memo as proof that the Democrats had “left no stone unturned” in efforts to hurt the contras, but still had come up empty.

With Hyde’s backing, the Bermingham memo galvanized a Washington conventional wisdom that the contra-cocaine charges had been thoroughly investigated and discredited.

What is now even more troubling about the memo — and Hyde’s endorsement — is that recent internal investigations by the CIA and the Justice Department have revealed that the agencies and the groups cited by Bermingham actually possessed significant proof of contra-connected drug trafficking in their files.

The agencies also knew that criminal investigations had been sidetracked for political reasons. For example, the CIA and Justice Department acknowledged that investigative leads into a 1983 drug-smuggling case in San Francisco were dropped after CIA officials expressed concerns that contra leaders in Costa Rica could be implicated.

Consider also what was going on at the NSC and the State Department in 1985-86: NSC aide Oliver North had teamed up with four companies owned and operated by drug traffickers — and North helped arrange State Department contracts to pay all four for shipping non-lethal supplies to the contras.

According to government documents, the companies were:

•  SETCO Air, owned and operated by the notorious Honduran drug trafficker Ramon Matta Ballesteros.

• DIACSA, the Miami-based headquarters for major traffickers, Floyd Carlton and Alfredo Caballero.

• Vortex, an air service partly owned by drug trafficker Michael Palmer, descibed in court records as “working for the largest marijuana cartel in the history of the country.”

• Frigorificos de Puntarenas, a Costa Rican seafood exporter established by the Medellin cartel and operated by Cuban-American traffickers.

Months before the Bermingham memo — on March 25, 1987 — the CIA also had interviewed Cuban-American Moises “Dagoberto” Nunez about his role in Frigorificos, according to the CIA inspector general’s report.

Nunez “revealed that since 1985 he had engaged in a clandestine relationship with the National Security Council,” the CIA report stated, adding: “Nunez … indicated that it was difficult to answer questions relating to his involvement in narcotics trafficking because of the specific tasks he performed at the direction of the NSC.”

The Reagan administration also knew that Felipe Vidal, another Cuban-American working for the CIA and Frigorificos, had a criminal record as a drug trafficker, according to the inspector general’s report.

Defenders of Hyde and the Bermingham memo could argue that the CIA withheld much of this evidence from Congress, that Hyde and Bermingham were more dupes than conscious participants in a cover-up.

But there still was a significant body of incriminating evidence before the Iran-contra committees in 1987. Senior CIA officials, Alan Fiers and Joe Fernandez, had told the Iran-contra investigators that drugs were a significant problem on the so-called Southern Front in Costa Rica.

Also, by the time of Bermingham’s memo, Robert Owen, a North intermediary and an early congressional witness, had turned over contra files that referred to drug trafficking.

When one of Palmer’s planes crash-landed in 1986, Owen had written to North, “no doubt you know that the DC4 … was used at one time to run drugs and part of the crew had criminal records. Nice group the boys chose.”

Contrary to Bermingham’s “exhaustively” researched memo, too, some contra leaders were acknowledging financial and material support from drug traffickers.

One leader, Octaviano Cesar, admitted receiving help from notorious drug trafficker George Morales. Cesar justified the arrangements as necessary for “the security of my country.”

Bermingham’s tarring of “almost all” the witnesses as convicted or charged criminals did not turn out to true, either. Indeed, many of the witnesses who described contra-drug activity worked for the DEA or the FBI.

Throughout 1986, the Kerry investigation was forwarding contra-drug evidence to the Justice Department, including the testimony of one FBI informant named Wanda Palacio.

Palacio gave an eyewitness account of Colombian drug traffickers loading cocaine onto planes belonging to the CIA-connected airline, Southern Air Transport, in 1983 and 1985.

She identified one of the SAT pilots as contra fly-boy Wallace “Buzz” Sawyer and placed him at the airport in Barranquilla, Colombia, in early October 1985.

Sawyer died when his contra plane was shot down in Nicaragua on Oct. 5, 1986, but his flight logs were recovered and revealed that he had flown SAT planes into Barranquilla on several days in early October 1985.

Palacio was one of the many corroborated witnesses who was not a convicted criminal, but whose information was nonetheless rejected by Reagan’s Justice Department and, presumably, by Bermingham’s study.

Indeed, from a review of the evidence available just in 1987, it seems like Bermingham must have been interviewing a different set of government officials and contra leaders than those who had caught the attention of Kerry and other investigators.

As Kerry’s final report summarized: “It is clear that individuals who provided support for the contras were involved in drug trafficking. It is also clear that the supply network of the contras was used by drug trafficking organizations, and elements of the contras themselves knowingly received financial and material assistance from drug traffickers.

“In each case, one or another agency of the U.S. government had information regarding the involvement either while it was occurring or immediately thereafter.”

Though Bermingham’s memo now appears to have been a sham report based on a selective reading of the record, it dealt a powerful blow to those who favored a broader Iran-contra investigation in 1987.

In particular, Hyde seized on the document as proof that critics were falsely maligning the contras. Hyde also scolded the Democrats for not highlighting the exculpatory memo in their final Iran-contra report when it was released in November 1987.

“The fact is that the committees’ staff left no stone unturned in its efforts to obtain information that might be politically damaging to the Resistance,” the contras, declared Hyde and other committee Republicans in a footnote to the final report.

“The committees’ investigators reviewed major portions, if not all, of the contras’ financial records; met with witnesses who alleged the Resistance was involved in terrorism or drug-running; investigated the financial conduct of the [State Department’s non-lethal contra aid program, and] received no credible evidence of misconduct by the Resistance.

“It came as little surprise, of course, that the committees’ majority does not explicitly acknowledge this. … For this reason, suggestions that the committees have not investigated such matters, and other committees of Congress should, ought to be seen for what they are: political harassment by congressional opponents of the Resistance.”

In the years that followed, some of those most troubled by Hyde’s protection of the drug-tainted contra operation have been agents of the Drug Enforcement Administration.

Michael Levine, a former undercover DEA agent, has reviewed the evidence of the Reagan administration’s complicity in the contra-cocaine operations and asserted that he has put corrupt police officers in prison for much less.

“Imagine this, here you have Oliver North, a high-level official in the National Security Council running a covert action in collaboration with a drug cartel,” Levine said.

“That’s what I call treason [and] we’ll never know how many kids died because these so-called patriots were so hot to support the contras that they risked several generations of our young people to do it.”

Levine still fumes when he reviews the incriminating entries in North’s notebooks that were turned over to the congressional committees. On July 12, 1985, for instance, North wrote about one contra arms warehouse in Honduras: “Fourteen million to finance came from drugs.”

“What the hell does that mean, and where does Congressman Hyde think the drugs went that paid for the contras’ weapons? Into kids’ bodies,” Levine said.

Levine viewed Hyde as a protector of the dirty secrets, even if he did not participate directly in the contra-cocaine operations. “As a key member of the joint committees, he certainly played a major role in keeping the American people blindfolded about this story,” Levine said. “There was plenty of hard evidence. … The totality of the whole picture is very compelling. This is very damning evidence. …

“In my book, Big White Lie, I [wrote] that the CIA stopped us from indicting the Bolivian government at the same time contra assets were going down there to pick up drugs. When you put it all together, you have much more evidence to convict Ollie North, [former senior CIA official] Dewey Clarridge and all the way up the line, than they had in any John Gotti [Mafia] case.”

Celerino Castillo III was a top DEA agent in El Salvador who encountered obstructions in the mid-1980s when his undercover work turned up links between the contra-supply operation and cocaine trafficking.

“They were running narcotics and weapons out of Ilopango to support the contras,” Castillo said in an interview. “We’re talking about very large quantities of cocaine and millions of dollars. … There’s no doubt about it; we saw the cocaine and the boxes full of money.”

Castillo said the operation was run out of “Hangars 4 and 5 controlled by North and the CIA with [former CIA officer] Felix Rodriguez. The cocaine was transshipped from Costa Rica through El Salvador and into the United States.”

The DEA agent detailed how known traffickers with multiple DEA files used the two hangars and how they had obtained U.S. visas with the help of the U.S. government.

Castillo said his reports were very thorough and included “not only the names of traffickers, but their destinations, flight paths, tail numbers and the date and time of each flight.” According to Castillo, the drug planes flown by contra pilots came from Costa Rica and sometimes the drugs came on military aircraft from Panama.

The top drug pilot flying for the contra network then was Francisco Guirola Beeche, Castillo said. Guirola’s name was all over DEA databases, according to Castillo, and the aircraft was on a watch list for drug trafficking.

Guirola, an associate of Salvadoran death squad leader Roberto D’Aubuisson, ran afoul of U.S. law on Feb. 6, 1985, when his plane landed in Texas with nearly $6 million in suspected drug money on board.

Authorities seized the money — which Guirola said was going to finance political operations of D’Aubuisson’s right-wing ARENA party. But Reagan administration prosecutors soon released the plane and offered to free Guirola on probation.

The plea bargain was so lenient that it mystified U.S. District Judge Hayden Head Jr., who complained that “the punishment doesn’t fit the crime.” But prosecutors persuaded the judge to approve the deal. [AP, June 13, 1985]

By letting Guirola go free, the plea bargain prevented a thorough examination of the source of Guirola’s money.

The drug-trafficking evidence at Hangars 4 and 5 might have raised suspicions, too, about Cuban-American Felix Rodriguez who oversaw the contra-supply operations for Oliver North. Rodriguez had been placed in El Salvador by Vice President Bush’s office.

During the Iran-contra hearings, the former CIA paramilitary expert received laudatory treatment from Hyde and other committee Republicans. When Rodriguez testified, Hyde showered the former CIA officer with praise for battling communism, but Hyde avoided questions about the shadowy operations at Hangars 4 and 5.

Hyde also shifted the blame to Congress for the contras’ need for money. “I know there is a zeal among some to confine this inquiry to who did what, and ignore why,” Hyde declared.

“And I just want to make the point that I think why some of these things were done contributes to a fuller understanding of who and what [was done], and that the nonfeasance of Congress may well turn out to be every bit as important as the misfeasance or malfeasance of certain individuals.”

A mountain of evidence now exists to back up the fact that the contras were connected to major cartel trafficking operations.

Yet, because of the aggressive defense played by Hyde and other Republicans — not to mention the timidity of senior Democrats — North and other key officials escaped serious investigation on drug charges.

Indeed, North nearly won a U.S. Senate seat in 1994 and has emerged since as a national television personality on NBC’s cable news networks.

For Hyde, there have been honors, too. On March 4, 1991, then-CIA director William Webster awarded Hyde a CIA Seal Medallion for his “tremendous service” and his “sustained outstanding support” for the CIA.

Without doubt, Hyde performed a “tremendous service” for the spy agency and its public reputation. At a pivotal moment in the 1980s, Hyde helped keep the lid on some of the CIA’s dirtiest secrets.

Hyde’s performance was in marked contrast to his moral zeal in the 1990s when confronting President Clinton’s dissembling about sexual peccadillos.

Moral Universe: Where More Than Space and Time Are Warped, published by Common Courage Press. The book can be ordered from www.commoncouragepress.com or by calling 1-800-497-3207

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“Big Al” Carone

Married to the Mob and the CIA

Was “Big Al” Carone a prominent Mafioso, CIA operative, NYPD detective, bagman for George Bush and Oliver North, drug dealer, assassin and a “man of honor?”

by Michael C. Ruppert, High Times, September 11, 2002

“The plaintiffs would have this court believe that Mr. Carone has played the role of Forrest Gump, popping up as a key player in virtually every government conspiracy theory promulgated over the last 50 years. This court simply cannot view any of the plaintiffs’ claims as plausible, especially in light of the complete lack of even a scintilla of evidence except for one patently forged document and self-serving declarations. Accordingly, the court dismisses the case pursuant to Rule 12(b)(1).” — Ricardo M. Urbina, United States District Judge, February 27, 2001

I first walked into this case in late 1983 when I got a call from former CIA case officer David MacMichael. As a matter of conscience, Dave had for many years been speaking out about illegal and inhumane operations being conducted by the CIA.

“Mike, there’s a woman in New Mexico named Dee Ferdinand. She says that her father, a guy named Albert Carone, was a high-level agency operative. He was also NYPD. She says that he was also in the Mafia. He’s been dead since ’90 and every record about him has apparently been sanitized. The family’s been denied benefits and had bank accounts stolen even though the daughter has records. She says her father knew Ollie North and George Bush personally. I think it’s something you might want to look into.”

It bit me like a pit bull. I had just started writing about CIA operations again after a disastrous and painful experience as the Los Angeles County press spokesman for the Ross Perot presidential campaign of 1992. That had proven to be yet another case of unmet expectations in my quest to find an honorable man. I had also just spent months putting together a conference in Indiana for the families of what was to ultimately become 109 US servicemen who had been “suicided” or died under suspicious circumstances. In almost every case where I could get information, I had discovered that there was a connection between the deaths and covert operations. Quite often there were links, reported by the dead serviceman to his family, of drug smuggling or criminal activity on or around military bases where they served.

My then fiancée, Mary, and I had brought many of these families together in a small town in Indiana in the fall of 1993. The ultimate pain for all of them was the discovery that there was no honor in their own government. The deaths of all of their sons, husbands and brothers had been dismissed as suicides or accidents. The cover-ups had been sloppy, arrogant and brutal in their apparent contempt for evidence. All of the families had vowed to do whatever it took to break the cases. None of them understood that they all would ultimately fail.

Now I was presented with a case where it had happened to someone on the inside–a bad guy. Would it be any different?

Mary and I packed our bags and flew to Albuquerque. My “cop instincts” had always served me well, and there was something about the demeanor of Desiree (Dee) Ferdinand, with her disarming Brooklyn accent reminiscent of Michelle Pfeiffer in Married to the Mob, that allowed me to instantly trust her. Her husband, Tommy Ferdinand, had struck me the same way. No b.s. and a sense of humor that I wish he still had today. I had told Dee up front where I was coming from. I didn’t like bad guys. She had been just as up-front that she knew that her father was a crook, a drug dealer, a CIA operative, a bagman, a killer and an all-around not-very-nice person. But for her it was a matter of honor.

That, I understood.

The Ferdinands rented a large ranch house in Corrales, just north of the city. On two acres Dee boarded and cared for six horses. She had a son, Vinnie, who was in his early twenties and going to college. Vinnie would soon become a Bernalillo County sheriff’s deputy. She had a younger daughter, Nikki, who was still living at home. Also living at the house was Tommy’s mother, Irene, and a not-too-friendly Rotweiler named Mikie which Mary instantly named “Cujo.”

The hospitality was genuine New York Italian and the food was just as authentic. Over two and a half days we talked. I asked questions and looked at documents and papers retained by Dee Carone Ferdinand after the death of her father, Albert Vincent Carone, in January 1990.


In a videotaped deposition made in September 1998 as she and a former Green Beret named Bill Tyree brought suit against the CIA, Dee Ferdinand was asked to describe what kind of a man her father was. “He was known as man of great respect, a man of honor. That is not to say that he was honest. He wasn’t. He did many bad things. But he lived by a code of honor. If he said something was so, you could take it to the bank.”

Over the years I have talked to almost every family member who knew Big Al, including Dee’s sister Carla and her husband John. Dee, Tommy, Carla, John, Irene and Vinnie had all seen Big Al in his Army uniform. Tommy and John told me how they had driven him at times to secure areas at LaGuardia or JFK airports, in full uniform, often with a briefcase handcuffed to his wrist. On other occasions he had been chauffeured in military vehicles. On one occasion Tommy had dropped him off at JFK inside a secure area, only to see the figure of Richard Nixon waiting for Carone in the open doorway of a nearby helicopter.

Over the course of two days I “debriefed” the family. Carone knew a great many people. He had served as an NYPD detective and bagman for the Genovese and Colombo families. He frequently took military leaves of absence to travel all over the world. The names of people he would later talk about, knowing of his imminent death, included Bill Casey, George Bush, Oliver North, Elliot Abrams, Richard Armitage (now deputy secretary of state to Colin Powell), Richard Secord, John Singlaub, Rafael “Chi Chi” Quintero, drug smuggler Barry Seal, Arkansas billionaire Jackson Stephens, Special Forces Colonel James “Bo” Gritz, General Richard Stillwell, Edwin Wilson, Robert Vesco and many more.

The paper exhibits were compelling and convincing. But I retained a healthy skepticism until I put Dee through a final test. I prepared list of names, some fake, some authentic. I asked Dee if her father had mentioned any of the names over the years. Without a single misstep she picked out almost every member of the board of directors of the Nugan Hand Bank, a legendary CIA drug bank that operated in Australia during the late 1970s and early ’80s. She didn’t fall for any of the falsified names. The real names included Edwin Black, General Leroy Manor and legendary CIA drug banker Paul Helliwell. [For an excellent history of the Nugan Hand affair, I recommend The Crime of Patriots by the late Wall Street Journal reporter Jonathan Kwitny.]

I had been thoroughly convinced that Al Carone was everything his daughter said he was. I told her that in my opinion, there was only one man who could help her. He had served as the CIA’s chief of station in Laos during the Vietnam War. He had risen to oversee the agency’s Western Hemisphere operations and the 1973 overthrow of Chilean President Salvador Allende. He had been the most powerful operations executive at the CIA before Jimmy Carter took office in January 1977. He had stayed with CIA until about 1980, and had retired under a cloud caused by the escapades of Edwin Wilson, one of his protégés who had been convicted of selling plastic explosives to Libya’s Muammar Qaddafi.

Throughout his career, especially from the days in Southeast Asia when he ran the largest CIA operation in history, his name had been linked to heroin. His name also turned up during the Iran-Contra investigations of the 1980s, which saw an explosion in cocaine use from which America has not yet recovered. From the moment that I had learned that CIA was dealing drugs and had begun the investigations that would nearly cost me my life, I had been obsessed with this man. He was the man who had been in charge of CIA’s covert operations when they had tried to recruit me in 1976.

“Dee, “I said. “As far as I know there is only one man who can help you. His name is Ted Shackley.


Al Carone, or “Big Al” as he was known, had been a de facto orphan in Brooklyn in the late ‘20s and early ‘30s. A street kid, left to roam while his mother “entertained” gentlemen at night, he had slept under stoops and in stairwells. He had been adopted by the legendary mobster Vito Genovese, who operated out of a nearby bar. Genovese fed the young street kid, sometimes let him sleep in the bar, and gave him quarters and dimes for running errands. It was here that Al Carone learned about loyalty and honor. There was no end to his love for “Don” Vito.

By the time World War II came around, little Al had become “Big Al,” a lifelong bodybuilder and a “made” member of the family. He entered the Army and was quickly assigned to the Counter Intelligence Corps. Dee said that all of the paperwork she possessed covered the fact that her father really had spent the entire war working for the Office of Strategic Services (OSS), the forerunner of the CIA. This made immediate sense to me, because I had seen US government reports that Vito Genovese and his boss, Charlie “Lucky” Luciano, had been used by the OSS and the Office of Naval Intelligence throughout World War II, first to protect New York docks from sabotage, then to assist in the invasion of Italy and later to prevent Communists and Socialists from winning elections in postwar Italy. The latter activities, funded by Corsican heroin, were the genesis of the famed French Connection, which smuggled tons of heroin into New York City until the 1970s.

After the war in 1946, “Big Al” had joined the New York City police. Dee had photos of her father as a patrolman and later as a detective. Throughout his NYPD career, Carone had made the payoffs to make sure that the CIA’s dope hit the streets safely. She had cancelled pay stubs, copies of pension records, a copy of his graduation roster from the police academy. Big Al had retired as a detective first grade in 1966. Yet, after her father’s death, when she went to ask for death benefits, the NYPD had told her that Al Carone has never been a policeman.

I remember holding one of his passports in my hands and seeing the visa stamps for London, the Bahamas and New York City. I remember the travel records of one of his partners named James Strauss, showing massive expenditures for dozens of flights to all of the world’s financial capitals, sometimes every other day, that a former FBI agent once told me, “could only have come from a GTR government travel account, because an airline would never allow a private business to run up that kind of a tab.”

Most of all I remember holding his personal phone book, separated at the spine from years of use and finding entries for maybe a dozen known Mafia figures including “Boss of Bosses” Paul Castellano, Joe Perscillia, Matty “the Horse” Ianniello and many others. Also in the phone book, on a separate sheet of paper but in the same handwriting, was the Locust Valley, Long Island address and phone number for CIA Director William Casey.

Casey, said the entire Carone family, had been at the Ferdinand home for Vinnie’s christening in the early ‘70s. When Dee was growing up, Casey and his wife had been frequent guests for dinner and social events. So had, on different occasions, Santo Trafficante, mob boss of South Florida, known as Uncle Sonny; Sam Giancana, known as Uncle Momo; and the short-lived boss of bosses Aniello Delacroce had been known as “Uncle Neal.” Both Delacroce and Castellano died in New York mob hits.

There were photographs of Carone in Army uniforms: one as a major, one as a full colonel. There were telegrams and letters referring to him by his military rank. And yet, after his death–which, as I read from the death certificate, was caused by “chemical toxicity of unknown etiology”–the US Army had insisted that he had never served in the military after 1946 and had never attained a rank higher than staff sergeant. He had been buried in a New Mexico military cemetery with that rank on his tombstone. This, said Dee, was not honorable.

But what had been done to Al Carone and his family had been more ruthless, systematic and well executed than anything I have seen before or since. Immediately after his death, both his personal and joint bank accounts held with Dee had disappeared. Even though Dee held passbooks and cancelled checks, the banks had insisted that the accounts never existed. Life-insurance policies which Dee and Tommy had given to a local attorney named Robert Fuentes–later discovered to have intelligence connections–disappeared. Carone’s NYPD pension vanished. The state of New Mexico said that Al Carone had never had a driver’s license. He lived there for 10 years. Coin collections and the contents of several storage facilities evaporated. Even the registration on his personal vehicle, which had always been registered in his name, was altered in state computers. When Dee went to check about having it transferred to her daughter, she found that the New Mexico DMV records showed that Dee had originally purchased the car in the early ‘80s.

Carone’s death had been long, painful and expensive. He knew he was going to die after his own collision with a question of honor, yet he had said repeatedly to the entire family that when he died they all would be taken care of. For the Mafia there was no more important code of honor than taking care of the family. It was apparently different for the CIA, and Big Al Carone had planted his feet in too many worlds before his own death. And it seems, to this day, that the world of the CIA was the one that eliminated his life, and in them, and the interests they worked for, there was no honor at all.

Nobody ever doubted where Al Carone was coming from. “Civilians” were not to be hurt. People who got killed were players, and they knew that was part of the game. Although Carone taught torture and interrogation techniques and guerrilla warfare, he served mostly as a “paymaster,” especially for assassinations and executions in the dark world of clandestine warfare. One assassination that Dee and Tommy would later discuss in their videotaped depositions was John F. Kennedy. Carone had revealed, before his death, that he had been in Dallas on November 22, 1963, that he had been positioned on a rooftop at the Love Field airport but could not get a clean shot. He was grateful for that. He had also delivered a cash payoff to Jack Ruby before the assassination.

Throughout the ‘70s and ‘80s, when there were drug missions to be financed, Al Carone delivered both the money and the orders. When someone needed to be killed, it was the same thing. Before his death, he talked openly of working with Oliver North, Richard Secord, Richard Armitage, Barry Seal and Elliot Abrams. He told his family that North, Secord, Abrams and Armitage were “assholes.


Throughout the years Carone had also shown signs of compassion and his own code of honor. He often lamented the fate of the POWs and MIAs in Vietnam and, in the years before his death, spoke openly about how “the boys” had been sold out. He spoke on several occasions of a Green Beret named “Sandy” whom he had worked with. He said Sandy had been sold out, betrayed and framed for a murder he didn’t commit because he had learned too much. Carone became obsessed with helping Sandy, and had spoken of delivering diaries to CIA headquarters that had been kept by his murdered wife that could have “brought down the government.” Both Dee and Tommy had seen the diaries in Carone’s briefcase before he had taken them to Langley, Virginia.

Carone was a good soldier. He did his job for years and kept his grumblings close to his vest. But things were falling apart. They had gotten out of hand. There were too many drugs, too much killing; too much corruption in Al Carone’s scheme of things. It no longer served any greater purpose. There was no compass except greed.

In the summer of 1985 Al Carone and his buddy Jim Strauss—whose company had the voluminous airline bills—went on a mission to Mexico. That mission, as were many of the other activities of Al Carone, fell under the umbrella code name of Amadeus. Dee and Tommy had heard the name many times before, when answering phones or taking messages for Big Al. It was name that always made him jump. It was a name that they said connected directly to George Herbert Walker Bush.

Carone was gone for weeks. And when he returned from Mexico he was never the same. His heart was broken. He said that he and Strauss and the men who were with them had wiped out entire village which Dee and Tommy can only remember as Chiapatulla or Tapachulla. “We killed everything there,” said Big Al, “men, women children, everything.” It was wrong. He also spoke of how a narc and a pilot had been tortured and buried alive. He was referring to DEA Agent Kiki Camarena. It was shortly after that he started to get violently ill. Within 18 months or so, he had kidney failure. The doctors, and there were many, could not pinpoint the cause. He would tell Dee and Tommy, “I’m not long for this world. The suits are coming to get me.”

He talked more openly in his last years. He voiced his concerns and became obsessed with the POWs, with Sandy and the “assholes” who had taken over the government. Before he died in 1990, he made his daughter promise not to bury him in his Army uniform. He was ashamed. “Burn it,” he said.


Shortly after I left New Mexico, Dee Ferdinand went to a luncheon of former intelligence officers. There she met former Howard Hughes aide and lifelong CIA operative Robert Maheu. Maheu gave her Shackley’s phone number.

Dee’s first conversation with Shackley was not thrilling. Keeping his standard noncommittal posture, he denied knowing Al Carone. This was a position he changed in subsequent conversations with Dee over the years. He asked her what she wanted. The first thing she wanted was her father’s headstone changed to reflect his rank of colonel.

It was changed within 10 days, and Dee took photographs of the new marker. She also “appropriated” a copy of the change order. The Army still—to this day—denies the rank.

After returning to Los Angeles, I wrote up a report of what I had learned. I sent it to a good friend, a retired Army Criminal Investigation Division warrant officer named Bill McCoy who lived in Alexandria, Virginia. McCoy was impressed and got Dee’s phone number from me. That was the beginning of a tightly woven friendship that involved phone calls, sometimes five times a week, until McCoy’s death in October 1997. “Mac,” as we all called him, was a loveable giant, prone to wearing berets, who had his investigative fingers in almost every covert operation I had ever heard of.

There were many mysteries about McCoy that remain unsolved to this day. Not the least of which was why he spent two years keeping Dee from learning the identity of Bill Tyree, the former Green Beret who had been framed for his own wife’s murder. Tyree, on the other hand, had only been told Dee’s married name rather than her maiden name. In the meantime I, familiar with both cases, never knew what Mac was doing.

Mac was a father-like figure, a great cook and raconteur. I visited his home in Virginia many times in 1994 and 1995. While coordinating information on a number of investigations, he managed to keep Bill and Dee from connecting. In the meantime, as the Carone family were threatened, intimidated and plagued by all manner of terrifying events, Dee’s resolve only deepened. She told me, with a conviction I still remember, “This is about honor. This is becoming a vendetta. All I want is what rightfully belonged to my father, nothing more.”

Her brother-in-law was shot at. Her son Vinnie narrowly escaped death in what appeared to be a staged traffic accident. Her fences were cut a half-dozen times and her horses scattered over the New Mexico countryside. Tommy, who held a civilian job at Kirtland Air Force Base, was shuffled to lower-paying assignments and eventually laid off. In 1997 Vinnie, then a sheriff’s deputy working extradition cases, was sent on dangerous and solitary assignments. He was photographed in secure areas of government facilities.

Dee would talk to McCoy four or five times a week. I would talk to McCoy or Dee at least twice a week. Still, none of us knew that Sandy and Tyree were one and the same, even though McCoy was doing investigations on Tyree’s case and he held all the pieces.


Things were complicated further in April 1995, when the Murrah Building was destroyed by a bomb blast in Oklahoma City. I was living near DC at the time, and Dee had called me within hours of the blast. She had called Shackley almost immediately. Then she called me. I gave her my word that I would not repeat what Shackley had said. According to Dee, Shackley said the act would be placed squarely at the feet of domestic terrorists. This, even as news reports were reporting only that Islamic terrorists were suspects.

Shortly thereafter, a journalist named David Hoffman, whom I had put in touch with Dee, got the same story from her on the strict condition that the conversation was off the record and confidential. Less than a year later he published a book in which he reported all of Dee’s conversation with Shackley, and even embellished to the point of placing himself in Shackley’s living room and describing him smoking a pipe, sitting in an overstuffed chair and “chortling” in satisfaction.

Dee, as a matter of honor, called Shackley as soon as she heard about the book. Because of that action or responsibility her relationship with him continued and, in fact, deepened.


Bill McCoy died suddenly in October 1997. He was found sitting in his favorite easy chair, the victim of an apparent heart attack. Questions still linger among those of us who knew him.

It was around the time of Mac’s death that Dee and Tyree connected. Dee learned that Billy was “Sandy” and Billy learned that Dee was the daughter of Big Al. Facilitated by Massachusetts attorney Ray Kohlman, who came to represent both of them, first Billy and then Dee filed suits against the government. Over the years, Billy placed collect calls from the Walpole state prison in Massachusetts that sometimes added between $500-800 a month to the Ferdinands’ phone bills. This wore heavily on Tommy and his temper frequently got the better of him, especially as his hours were being cut back.

Dee was obsessed, and now she had a court case and searing documents that helped both her and Tyree. Affidavits long buried came to the surface, including one purportedly written by Bill Casey. Though filled with grammatical errors and misspellings, I was inclined to believe the document’s authenticity. My reasons were simple and based upon my years of experience, I knew that intelligence agencies often wrote completely accurate documents and deliberately salted them with errors to later discredit them. The 1986 document had more credibility because, while completely vindicating Dee’s assertions, it carefully laid all the blame in the CIA at the feet of people who were then or would soon be dead. It never once mentioned George Bush, and the document followed the long-cultivated CIA fallback position that drug dealing was all done to fight communism, and never once mentioned the billions of dollars that had flowed into American financial markets.

From 1998 until her case was finally dismissed, there were endless, draining, expensive, time-consuming legal moves, the kind I have witnessed in dozens of cases over the years. As time progressed, first Tyree’s suit and then Dee’s were dismissed. All of this happened and Dee and Bill Tyree spent more time talking to each other than any other living souls. They have never seen each other in person. For Tyree, locked up on a life sentence, this was not an issue. For Dee’s family, especially Tommy, who was paying the phone bills, it was; especially as the family teetered from month to month, on the edge of eviction.

I have both and seen and lived this hellish existence in the search for justice and the redemption of honor. It eats everything.

Dee and Tommy were divorced last year, as the suit was finally thrown out by a court system that seemingly wouldn’t know the rule of law, or honor, if it smacked it in the face. Dee now lives in a modest Albuquerque apartment and Tommy spends a lot of time riding his motorcycle. Tommy’s mother will no longer speak to Dee. Vinnie, still a sheriff, has at times estranged himself from his mother in recent years. All of Dee’s horses are gone and she holds down a job to pay the rent.

“It’s over,” she says with the same conviction I heard in 1993. “I will have nothing more to do with my father’s case. They won. I have nothing more to give.”


Dee has had a number of conversations with Ted Shackley over the years and refuses to discuss details of any of them except to say that he was always helpful, always sympathetic and that he gave her advice that helped as she prepared and fought her case. “Of all the people I have spoken to who had something to do with this case, he’s the only one who never lied to me.”

When I asked how she could trust Shackley, she refused to discuss the matter any further. The conversations were private. It was a matter of honor.

One time, in tears, she recounted how Shackley had told her how proud he was of her as Big Al’s daughter, and that she had fought as hard as possible to honor her father. He had told her that she had behaved as he would have wanted his own daughter to behave, and maybe that is what this story is all about.

Having lost all of her material possessions and her marriage, and having suffered for years in a losing and futile battle—the way all of these battles always end—Dee Carone Ferdinand has no doubt in her heart that she gave all she had to give. She sleeps soundly at night and there is something in her still that remains defiantly unbroken, as Al Carone’s visions of total, unprincipled corruption come to full flower in the American government.

It was, after all, a matter of honor.

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Barry Seal

Inside The Octopus

Could Barry Seal be the man behind the JFK assassination, Air America, Watergate, Iran-Contra and just about every other major scandal in recent history?

Preston Peet, High Times, June 5, 2002

Who is really responsible for the JFK assassination, Air America, Watergate, Iran-Contra and just about every other major scandal in recent history? Could the Barry Seal story provide the answer? Does Seal’s sad saga provide a window on the Octopus that really rules America? 

Adler Berriman “Barry” Seal was born in Baton Rouge, Louisiana on July 16, 1939 to a typical American family. Barry, his two brothers, Benjy and Wendell, his mom, a homemaker, and his dad, a candy wholesaler, lived in a house on Lovers Lane. During his teens, Barry would bicycle to Ryan’s Field to watch airplanes in action. Seal’s first flight instructor, Eddie Duffard, told Dan Hopsicker that Barry was a skinny kid with a paper route, but he was always trying to prove something.

“That boy was first cousin to a bird,” recalled Duffard.

On July 16, 1955, his 16th birthday, Seal got his pilot’s license. Two weeks later, he boarded a U.S. Air Force plane for a two-week summer camp with the Civil Air Patrol at Barksdale Air Force Base in Shreveport, Louisiana. There he came under the command of David Ferrie, and met fellow cadet Lee Harvey Oswald, two principal figures in the assassination of President John F. Kennedy.

John Odom was a childhood friend. “One Friday, I got a call from Barry asking if I’d like to fly to Lacombe. We left about 5:30 AM,” says Odom. At the Lacombe airport, David Ferrie pointed out 50 boxes on the runway. Flying back to Baton Rouge, Seal told Odom the boxes were weapons, and Ferrie was paying him $400 a week — $2,500 a week in today’s dollars — to deliver them. “How’d you like to make that kind of money?” asked Seal, who was still a high-school senior.

Two years later, he was making $2,000 per flight, carrying weapons into Cuba for Fidel Castro’s revolution. Joe Nettles, his second flight instructor, believes Seal was the best pilot in the US at the time. One thing we know for sure: After falling into David Ferrie’s orbit, Seal suddenly became very secretive.


Ferrie had been an undercover operative for the Office of Strategic Services, the precursor to the CIA, during World War II. He was also a failed priest, a self-trained cancer researcher, an avid hypnotist and an enthusiastic supporter of right-wing agendas. As commander of a Civil Air Patrol unit, he probably screened cadets for future roles in intelligence operations.

Eddie Shearer, one of Ferrie’s cadets, recalls this revealing incident: “This kid was twirling a ‘guidon,’ a metal pole with a fleur de lis, and it got away from him and cut his hand. Dave walks over to him and puts his hand out in front of the kid’s face, like he’s giving him a stiff-arm, and says, ‘You will feel sensation, but no pain.'” It became clear to Shearer that Ferrie had been hypnotizing some of the cadets for a long time.

In 1960, Seal asked his roommate, Jerry Chidgey, to help him empty out the Louisiana National Guard armory, using keys Seal had mysteriously obtained. They loaded weapons into an unmarked police van and drove to Hammond, Louisiana, “where the guns were loaded onto a DC-3 and flown to Guatemala.”

As we know today, Guatemala was a staging area for the CIA-sponsored Bay of Pigs invasion of Cuba in April 1961. Seal sent his mother a postcard from the Mayas Excelsior Hotel in Guatemala City, just three weeks before he flew a P-51 in the ill-fated invasion.

He then returned to the US and joined the US Army Special Forces Reserves. He was assigned to the 21st Special Forces Group and went to jump school in Ft. Benning, Georgia. On May 1, 1963, Seal was assigned to Company D, Special Ops Detachment of the 20th Special Forces Group-Spec Forces Group Airborne.

It is during this time, just before President Kennedy was killed, that an illuminating photograph was taken. A smiling 24-year-old Seal is seated at a nightclub table in Mexico City with Frank Sturgis, Felix Rodriguez and William Seymour, all members of the CIA’s assassination squad, Operation 40.

Louis Gaudin, an air-traffic controller at Redbird Airport, located south of Dallas, told the FBI he recalled observing three men in business suits board a Comanche-type aircraft hours after the assassination. Seal owned such a plane, and many believe he flew the plane that spirited the assassins to Canada.

In 1965, Seal went to work flying for the CIA-friendly, Howard Hughes-owned company, Trans World Airlines, becoming, at age 26, the youngest pilot certified to fly Boeing 707s. While “working” for TWA, Seal volunteered for hazardous duty to fly into battle zones in Vietnam with explosives and war material.

Theodore “The Blond Ghost” Shackley, had been in charge of the covert anti-Castro operations in Miami, but after the Bay of Pigs, he was moved to Southeast Asia, along with Felix Rodriguez, Ed Wilson, Oliver North, John Singlaub and Richard Secord.

Secord coordinated clandestine flights of supplies, personnel — and, some say, heroin and opium — to various points in Asia and Europe. Barry Seal was a pilot for some of those flights. Secord also helped plan bombing runs against Laotian opium warlord Vang Pao’s rivals, in exchange for Pao’s help in keeping the communist North Vietnamese out of Laos. Various pilots for Air America have alleged that they were flying opium deliveries that Shackley had personally authorized.


Seal survived Vietnam and returned to the US. On July 1, 1972, while on “sick leave” from his job with TWA, he was arrested by US Customs agents and charged, along with Murray Kessler, a nephew of mob boss Carlo Gambino, in an attempt to smuggle 14,000 pounds of C-4 to anti-Castro forces in Mexico. His arrest was preceded and followed by some very unusual and interesting actions on the part of the Nixon administration and the CIA, not to mention the prosecutors.

According to Henrik Kruger in The Great Heroin Coup, on May 27, 1971, President Richard Nixon authorized the spending of $100 million on a “covert kidnapping and assassination program.” Just a few days later, Nixon created the Special Investigations Unit, the notorious “plumbers,” telling Charles Colson to hire CIA agent Howard Hunt to work with G. Gordon Liddy. He created the Drug Enforcement Administration on July 1, 1973. Author Dan Hopsicker believes Nixon was attempting to wrest control of global narcotics operations away from the CIA.

Two weeks before Seal’s bust, Frank Sturgis was arrested breaking into the Democratic Party’s national headquarters in the Watergate Hotel, along with Nixon’s head of campaign security and three other men with ties to the Bay of Pigs invasion. Liddy and Hunt, who ran the operation from a hotel room across the street, were also arrested. In a desperate attempt to insure their silence, Nixon scrambled to find $200,000 in “hush money.”

Pete Brewton, in his book, The Mafia, CIA, and George Bush, quotes a letter written by Seal during this period, stating that the Customs agent who busted him, Cesario Diosdado, “has proven to have been an ex-CIA agent who worked in the Bay of Pigs invasion and has been working both sides of the fence in the Miami area.” According to Brewton, the deal had been for 10,000 automatic weapons and C-4 explosives, in exchange for 25 kilos of heroin. Was this heroin going to be converted into the much-needed hush money? After delaying the proceedings for two years, the government presented tainted evidence, effectively sabotaging the case, which resulted in a mistrial for Seal. Six weeks later, Nixon resigned.


Seal lost his “cover job” with TWA, but continued working for the CIA, flying round trips to Latin America using the code name Ellis McKenzie. During one of these runs, a friend told Seal he was glad the C-4 never made it to Mexico. After all, think of the death and destruction it would have caused. Seal, now in his thirties, began weeping uncontrollably. His friend had to take over the controls. It was the first sign Seal was having trouble reconciling what the CIA was paying him to do.

Offering up a rationale for CIA involvement in drug dealing, covert operative Gerry Patrick Hemming told Hopsicker, “First of all, we figure, who’s using this dope? Leftists! You can’t allow that kind of capability to remain freelance. There’s too much money.” So the US government keeps its hands on the drug wheel, to keep control of the money.

Seal was arrested again in Honduras on Dec. 10, 1979, with a plane filled with Colombian cocaine. According to Seal’s wife, Debbie, the bust went down because he’d paid off the wrong people. It took nine months to “figure out who to bribe.”

According to Mara Leveritt in The Boys on the Tracks, Louisiana State Police Sergeant Jack Crittendon talked to Seal in 1982, telling him he was about to be indicted on a Quaalude charge, so why didn’t he work for them as an informant and avoid criminal prosecution? Seal said he would “have to talk to his people.” As Crittendon related to Leveritt, “At that point, Seal had more resources than the Louisiana State Police. We knew he wasn’t going to the leaders of the cartel in Colombia and ask them if they minded if he went ahead and informed on them. And we knew he wasn’t going to talk it over with the people who worked for him. So who were these people he was going to have to talk to?” Could it be his handlers at the CIA?

In April 1982, within weeks of this conversation, Seal moved his smuggling operation from Baton Rouge to Mena, Arkansas, a small mountain community with a population of 5,800. He opened Rich Mountain Aviation at the Mena airport. The life he was living was showing up in his appearance. He weighed close to 300 pounds, and his new nickname was “Thunder Thighs.” He was also dabbling in cocaine use.

Seal would fly weapons to Nicaraguan Contra bases in Costa Rica and Honduras for Oliver North and return with loads of cocaine, making airdrops into the surrounding areas around Mena. He was also training pilots and smugglers, even making his own training films, one of which shows a gleeful Seal picking up “the first daylight drug drop in US history.”

The operation Seal brought to Mena was not a small one. As Leveritt reports, Seal himself testified his enterprise consisted of “a Lear Jet, as well as helicopters, surplus military cargo planes, and several single- and twin-engine planes. He also had at his disposal two ships with sophisticated navigational and communications equipment — one of which boasted a helipad — and numerous cars and vans. Seal claimed he employed more than 60 people, coordinating their activities through state-of-the-art electronics. His communications equipment featured ultra high-frequency radios with scramblers, pocket-sized encoders for telephones and high-frequency satellite communications devices like those used on Air Force B-52s. For navigation, his pilots had night-vision goggles and other devices, which Seal once described as being of the same range and quality as those used on nuclear submarines.” He was also laundering money through the tiny banks of Mena, having accomplices who worked at the banks pass out money to tellers in slightly less than $10,000 amounts, to dodge IRS attention.

In March 1983, Seal was indicted by a Florida grand jury for smuggling 200,000 bogus Quaaludes, the same charge the Louisiana police warned him about a year earlier. Was this a real bust? Or perhaps an attempt to “sheep-dip” Seal into the role of a mob-connected drug trafficker? Or maybe just an attempt to maintain leverage on someone threatening to pull out of covert operations? The phony Quaaludes were so worthless Seal had dumped thousands into a river. Why would a bigtime cocaine smuggler take a risk for phony pills that couldn’t even be sold?

In October 1983, the FBI opened an investigation into Rich Mountain Aviation. The Colombian cocaine pipeline fueling the Contras’ war against Nicaragua’s leftist government was hemorrhaging money, as every link along the chain skimmed whatever they could steal. Much of the intense surveillance on Seal was probably designed to keep his pilfering down rather than stop his operation.

Seal was convicted on the Quaalude charge in February 1984, and faced up to 10 years in prison. Desperately looking for a deal to stay out of prison, he flew to Washington for a meeting with George Bush’s Vice-Presidential Drug Task Force, where he was recruited into a new operation. With CIA-mounted cameras hidden in the nose and cargo bay of Seal’s C-123K plane, Seal flew to Los Brasiles civilian airfield in Nicaragua on June 25, 1984.

The hidden cameras took a series of grainy photos in which Seal, top Medellin cartel leader Pablo Escobar, a mystery man known as Frederico Vaughn, and Seal’s co-pilot, Emile Camp, along with Nicaraguan soldiers, were caught loading 1,200 kilos of cocaine. Seal flew the plane back to Homestead Air Force Base in Florida, where the DEA took the cocaine and the CIA took the film. This operation was intended to “sheep-dip” the Sandinista government as cocaine smugglers.

Due to Seal’s cooperation in setting up this sting, a federal judge reduced his sentence to six months probation, praising Seal for his work against the Sandinistas and pointing out that when an informant puts his life on the line to help the forces of law and order, they deserve just compensation.

As early as June 27, 1984, reports were leaking out that the Reagan administration had “proof” of Sandinista drug running. That September, Sen. Paula Hawkins (R-FL) accused the Sandinistas of “being a brutal regime funded by the drug trade.” Though the photos weren’t released to the press, the story made front pages around the US.

Seal continued flying weapons and supplies for the Contra support efforts, and flying tons of drugs back into the US on the return. His operation suffered a real blow when Emile Camp flew into the side of a mountain just short of Mena. Flying helicopters, Seal and his brother Ben found the wreckage after a two-day search. Leveritt reports that Seal’s secretary at Rich Mountain Aviation, Deandra Seale, later testified that Seal and Camp had been planning on taking a trip to Baton Rouge, then on to Miami in Seal’s Lear Jet, but after finding the Lear stolen upon their arrival in Baton Rouge, Seal had Camp fly another of his planes back to Mena, while Seal took a commercial flight. Camp never made it. Many people in the area assumed foul play was involved and that Seal was the real target.

In December 1984, Seal was arrested in Louisiana flying in a load of marijuana. After paying $250,000 bond, Seal went back to work as an informant for the DEA, working to get a light sentence for both the pot and other charges involving masterminding the smuggling of massive amounts of drugs into Louisiana. Seal helped in an assortment of cases, helping the US government obtain 17 criminal convictions, including those of Norman Saunders, prime minister of the Turks and Caicos Islands, in March 1985, and three upper-level members of the Medellin cartel. Seal told investigators that between March 1984, and August 1985, he made a quarter-million dollars smuggling up to 15,000 kilos of cocaine while working for the DEA, and another $575,000 when the DEA let him keep the money from one shipment.

All this assistance didn’t help Seal in the Louisiana federal court, where he was sentenced Dec. 20, 1985 to six months supervised probation at a Salvation Army halfway house. Judge Frank Polozola barred him from carrying a gun or hiring armed guards. “They made me a clay pigeon,” said Seal.

On a cool twilight evening in Baton Rouge, February 19, 1986, Seal pulled into a Salvation Army parking lot in his white Cadillac. He sat for a moment, then saw several Colombian gunmen approaching his car. He covered his ears as bursts from MAC-10 machine guns shattered the evening calm.


Richard Sharpstein, defense attorney for one of Seal’s assassins, Miguel Velez, says: “All three Colombians who went on trial always said they were being directed, after they got into this country, on what to do and where to go by an ‘anonymous gringo,’ a US military officer, who they very quickly figured out was Oliver North,”

But none of this ever came out in court. All three killers volunteered the same information to their attorneys. All three were convicted of murder and are now serving life in Angola state prison. “Barry had gotten screwed on his deal down there in Baton Rouge,” says Sharpstein today.

“Seal’s lawyer, Lewis Unglesby, testified that when they told Barry he had to report to the halfway house, Barry told them it was a death warrant. Seal went back to Unglesby’s office, where they called George Bush directly, who was then both Vice President and coordinator of the Drug Task Force. Barry threatened to blow the whistle on the Contra guns-for-drugs deals. Barry had openly said to many people that he had hired and trained a lot of the pilots on that operation, and he had the goods on Bush and others. IRS agents showed up at his house, and claimed there was a $30 million lien on him because he’d made $60 million in the drug business. Barry told them to go to hell. He called Bush again and told him to get the IRS off his ass. He wouldn’t let the IRS agents in the house, so they came back with a warrant. He was burning things in the toilet. This testimony came from IRS agents in the sentencing phase when we were trying to prove the government was involved. Shortly before he was killed, they were threatening to take away his house.” The IRS was able to seize most of Seal’s aircraft, while his million-dollar offshore bank accounts were also mysteriously emptied out.

“An interesting thing came up from the local cops,” Sharpstein continues. “When it went out on the honk as to who it was that was killed at the halfway house, the FBI showed up and cleaned out Seal’s car. There was almost nothing left. We finally made them give us a couple of boxes. They claimed they gave us what they had, like a phony passport from Honduras, but nothing heavy.”

When HT pointed out that didn’t sound legal, seizing evidence from a murder scene under investigation, Sharpstein replied ruefully, “Right. But there were a lot of funny things that went on. The Colombians got a life sentence instead of the death penalty, because we showed government complicity.” The most important item retrieved from Seal’s car was George Bush’s private phone number.

Hopsicker is the first researcher to note there were other murders that same day, including top people in the Medellin cartel. Pablo Carrera, the number-two man, was gunned down in Colombia, as was Pablo Ochilla, the brother-in-law of Jorge Ochoa. The murders took place simultaneously in Colombia, Miami and Baton Rouge.

“Barry Seal wasn’t assassinated by the Medellin cartel,” says Hopsicker, who alleges that up to 30 cartel soldiers were also murdered that same evening. “Seal’s murder may have been the opening salvo in the cleanup of Operation Black Eagle, a network of 5,000 people who made possible the export of arms in the direction of Central America, and the import of drugs back.”


“I was working with an IRS criminal investigator and we were doing a straight-ahead law-enforcement investigation of a cocaine-smuggling operation,” former Arkansas State Police Lieutenant Russell Welch tells HT, describing his and IRS agent Bill Duncan’s investigation into Mena Airport. “As time went on it became more convoluted, issues came up, things from the Justice Department weren’t being handled the same as other investigations were being handled. This was creating problems for us, and ultimately led to a breakdown in the entire criminal-justice system as far as we were concerned, in that things were being handled differently from the prosecutorial and Justice Department ends.” Asked if he felt Seal was being protected, Welch answers, “Without a doubt.”

In Welch’s view of the U.S. government’s efforts to investigate, or not investigate, Seal’s operation at Mena, “Seal was running a very obvious cocaine-smuggling operation. We ran a successful investigation. Even the U.S. Attorney at the time for Mena, J. Michael Fitzhugh, three or four times said we’re going to prosecute these guys. He called meetings of all the agencies involved, and although the DEA and the FBI hung around and acted like they had an investigation going, it was clear to us they didn’t. We had subpoenaed Seal 30 days before he was killed. We had been trying for a year to get him to come to Arkansas to answer questions for us, then three days before Christmas we got a call to interview him in Louisiana, so we did. Then he was killed a month later.”

Bill Duncan, Welch’s partner in the investigation, was told by one secretary at Rich Mountain Aviation, who also happened to be the daughter of a high-ranking Colombian official, that Seal had paid a $450,000 bribe directly to Attorney General Edwin Meese, which might explain why federal investigations into Seal never materialized.

When Duncan was about to testify to the House Judiciary Subcommittee on Crime in December 1987, which was trying to figure out why there had never been an indictment at Mena, two IRS attorneys assigned to “assist” him in preparing for his appearance told him not to say anything about either the bribe allegation or his belief that the investigation had been stymied due to interference from the U.S. Department of Justice. He later revealed that they were asking him to “perjure himself.” Duncan resigned in 1989 after 17 years with the IRS, disgusted with the way his investigation into Seal had been scuttled. Welch also resigned after surviving being infected with anthrax.

Within two weeks of Seal’s assassination, Louisiana Attorney General William J. Guste Jr. wrote an angry letter to Meese demanding to know why Seal had not been protected, when he obviously knew such a huge amount about international illegal drug trafficking, having, by Guste’s figures, brought between $3 and $5 billion worth of drugs into the US. There was no response to his query.

Leveritt quotes Joe Hardegree, the prosecuting attorney for Polk County, Arkansas, in a written statement explaining why there was no action taken in the Mena investigations: “I have good reason to believe that all federal law-enforcement agencies from the Justice Department down through the FBI to the DEA all received encouragement to downplay and de-emphasize any investigation or prosecution that might expose Seal’s activities and the national-security involvement in them. It was in this framework that the federal grand juries and law-enforcement authorities in Arkansas apparently stopped in their serious deliberations or investigations concerning Barry Seal’s activities and all of the surrounding circumstances. The really unfortunate aspect of this whole matter is the apparent fact that the federal investigation of drug trafficking in connection with the Mena airport came to be intricately involved with the internal politics and more particularly with the private wars conducted by the Reagan White House and so sensitive that no information concerning Seal’s activities could be released to the public. The ultimate result is that not only Seal but all his confederates and all those who worked with or assisted him in illicit drug trafficking were protected by the government.”

According to Leveritt, in 1988, two years after Seal was murdered, the Reagan White House “ordered the CIA, the Defense Intelligence Agency, and the National Security Agency to refuse to turn over information sought by the General Accounting Office for its investigation into Mena.”


Despite government roadblocks, investigations into Mena continue, led by “deep throat” informers from the world of black operations. The most fascinating of these spooks to come forward was Major Gene Duncan, also known as Doris Gene “Chip” Tatum.

Many years ago, Tatum posted a story on the Internet titled: “Who the Hell Is Ellis McKenzie?” It detailed a special assignment he conducted in Honduras after Seal’s death, involving a cocaine smuggler using Seal’s old alias. Tatum was arrested for treason and placed in jail. While incarcerated, he continued to orchestrate the posting of sensitive material about Seal on the Internet. Suddenly, he was unexpectedly released and immediately disappeared. He is assumed dead. Before he disappeared, Tatum posted a list of “Boss Hogs” reportedly given to him by Seal:


William Casey, Director Central Intelligence

Clair Elroy George, Head of CIA’s Central American Task Force

Vice President George Bush

Dr. Henry Kissinger, Chairman, Kissinger Associates, former US Secretary of State; former National Security Adviser

General Alexander Haig, former Secretary of State

Donald Gregg, former National Security Adviser to VP Bush, Ambassador to Korea and alleged joint “Controller” of Panama’s Manuel Noriega, along with William Casey

Duane “Dewey” Claridge, CIA

Joseph Fernandez, CIA Costa Rica Station Chief

Lt. Col. Oliver North, National Security Council aide

John Singlaub, CIA covert operator

William Colby, Director Central Intelligence, 1973-76

Richard V. Secord

William Weld, head of Criminal Division, US Department of Justice

Felix Rodr”guez

General Peroot, Defense Intelligence Agency

Only one person would emerge to refute Tatum’s claims: William “Bear” Bottoms, a former Navy pilot, the brother of Seal’s first wife, and one of the pilots in Seal’s smuggling operations. After filling his Internet site with endless babble leading nowhere, Bottoms earned the reputation as the number-one disinformation specialist involving Mena.

Meanwhile, Seal’s favorite plane has turned up as part of a fleet of planes used by George W. Bush as the Governor of Texas. As Hopsicker reported in former LAPD narcotics officer Mike Ruppert’s newsletter, From the Wilderness, on Oct. 31, 1999, the 1982 Beechcraft King Air 200 (FAA registration number N6308F, serial number BB-1014), went through a convoluted path from Seal to Bush that brings one immediately back to the halcyon days of Iran-Contra.

“I followed the plane through the people who owned it between Seal and Bush, and guess what? They are some of the same people connected to some of the major financial fraud that went under the rubric of the Iran-Contra and savings and loan scandals, and they all had ties to the Bush family,” says Hopsicker.

“I heard tons of people tell me what a generous, warm spirit Seal was,” concludes Hopsicker. But by the end of his life, Seal showed signs of cocaine abuse, no longer charming and friendly, but just another desperate cocaine addict. One of Seal’s boyhood friends, John Prevost, told Seal’s wife shortly before the end, “You tell Barry, if he’s dealing drugs, he needs to die in a flaming car wreck.” Prevost told Hopsicker that Seal had really changed. He kept a gun under the seat of his car and was loud, boastful, arrogant. “It wasn’t the Barry I knew.”

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the gruesome reality of governments

State-Organized Crime

by William R. Chambliss
American Society of Criminology, 1988 Presidential Address
From Criminology, 27:183-208 (1989)

There is a form of crime that has heretofore escaped criminological inquiry, yet its persistence and omnipresence raise theoretical and methodological issues crucial to the development of criminology as a science. I am referring to what I call “state-organized crime.


Twenty-five years ago I began researching the relationship among organized crime, politics, and law enforcement in Seattle, Washington (Chambliss, 1968, 1971, 1975a, 1975b, 1977, 1980, 1988a). At the outset I concentrated on understanding the political, economic, and social relations of those immediately involved in organizing and financing vice in the local area. It became clear to me, however, that to understand the larger picture I had to extend my research to the United States and, eventually, to international connections between organized criminal activities and political and economic forces. This quest led me to research in Sweden (Block and Chambliss, 1981), Nigeria (Chambliss, 1975b), Thailand (Chambliss, 1977), and of course, the Americas.

My methods were adapted to meet the demands of the various situations I encountered. Interviews with people at all levels of criminal, political, and law enforcement agencies provided the primary data base, but they were supplemented always with data from official records, government reports, congressional hearings, newspaper accounts (when they could be checked for accuracy), archives, and special reports.

While continuing to research organized crime, I began a historical study of piracy and smuggling. In the process of analyzing and beginning to write on these subjects, I came to realize that I was, in essence, studying the same thing in different time periods: Some of the piracy of the sixteenth and seventeenth centuries was sociologically the same as some of the organized criminal relations of today – both are examples of state-organized crime.

At the root of the inquiry is the question of the relationship among criminality, social structure, and political economy (Petras, 1977; Schwendinger and Schwendinger, 1975; Tilly, 1985). In what follows, I (1) describe the characteristics of state-organized crime that bind acts that are unconnected by time and space but are connected sociologically, (2) suggest a theoretical framework for understanding those relationships, and (3) give specific examples of state-organized crime.


The most important type of criminality organized by the state consists of acts defined by law as criminal and committed by state officials in the pursuit of their jobs as representatives of the state. Examples include a state’s complicity in piracy, smuggling, assassinations, criminal conspiracies, acting as an accessory before or after the fact, and violating laws that limit their activities. In the latter category would be included the use of illegal methods of spying on citizens, diverting funds in ways prohibited by law (e.g., illegal campaign contributions, selling arms to countries prohibited by law, and supporting terrorist activities).

State-organized crime does not include criminal acts that benefit only individual officeholders, such as the acceptance of bribes or the illegal use of violence by the police against individuals, unless such acts violate existing criminal law and are official policy. For example the current policies of torture and random violence by the police in South Africa are incorporated under the category of state-organized crime because, apparently, those practices are both state policy and in violation of existing South African law. On the other hand, the excessive use of violence by the police in urban ghettoes is not state-organized crime for it lacks the necessary institutionalized policy of the state.


In the history of criminality, the state-supported piracy that occurred between the sixteenth and nineteenth centuries is an outstanding example of state-organized crime (Andrews, 1959, 1971).When Christopher Columbus came to the Americas in search of wealth and spices in 1492, he sailed under the flag of Spain although he himself was from Genoa. Vasco de Gama followed Columbus 6 years later, sailing under the Portuguese flag. Between Spain and Portugal, a vast new world was conquered and quickly colonized. The wealth of silver and gold was beyond their wildest dreams. A large, poorly armed native American population made the creation of a slave labor force for mining and transporting the precious metals an easy task for the better armed Spanish and Portuguese settlers willing to sacrifice human life for wealth. Buttressed by their unflagging belief that they were not only enriching their motherland and themselves but also converting the heathens to Christianity, Spanish and Portuguese colonists seized the opportunity to denude the newly found lands of their wealth and their people (Lane-Poole, 1890). Portugal, as a result of Vasco de Gama’s voyages, also established trade routes with India that gave it a franchise on spices and tea. Portuguese kings thus became the “royal grocers of Europe” (Howes, 1615; Collins, 1955).

In Europe during the sixteenth and seventeenth centuries, nation-states were embroiled in intense competition for control of territory and resources. Then, as now, military power was the basis for expansion and the means by which nation-states protected their borders. Military might, in turn, depended on labor and mineral resources, especially gold and silver. The wealthier nations could afford to invest in more powerful military weapons, especially larger and faster ships, and to hire mercenaries for the army and navy. Explorations cost money as well. When Spain and Portugal laid claim to the Americas, they also refused other nations the right to trade with their colonies (Mainwaring, 1616). Almost immediately, conflict developed between Spain and Portugal, but the pope intervened and drew a line dividing the New World into Spanish and Portuguese sectors, thereby ameliorating the conflict. But the British, French, and Dutch were not included in the pope’s peace. They were forced to settle for less desirable lands or areas not yet claimed by the Spanish and Portuguese.

Although they lacked the vision to finance explorers such as Christopher Columbus and Vasco de Gama, France, England, and Holland nonetheless possessed powerful navies. They were also the home of some of the world’s more adventurous pirates, who heretofore had limited their escapades to the European and African coasts. With the advent of Spain and Portugal’s discovery of vast new sources of wealth, other European nations were faced with a dilemma: They could sit idly by and watch the center of power tip inexorably toward the Iberian Peninsula, or they could seek ways to interfere with the growing wealth of their neighbors to the south. One alternative, of course, was to go to war. Another, less risky for the moment but promising some of the same results, was to enter into an alliance with pirates. France, England, and Holland chose the less risky course.

To transport the gold and silver from the Spanish Main (the Caribbean coast of South America) to Bilbao and from Brazil to Lisbon required masterful navigational feats. A ship laden with gold and silver could not travel fast and was easy prey for marauders (Exquemling, 1670). To complicate matters, ships were forced by prevailing winds and currents to travel in a predictable direction. These conditions provided an open invitation for pirates to exploit the weaknesses of the transporting ships to their advantage. Poverty and a lack of alternatives drove many young men to sea in search of a better life. Some came to the New World as convicts or indentured slaves. The lure of the pirate’s life was an alternative that for all its hardships was more appealing than the conditions of serfdom and indentured servitude.

The French government was the first to seize the opportunity offered by engaging in piracy (Ritchie, 1986). It saw in piracy a source of wealth and a way of neutralizing the some of the power of Spain and Portugal. Although piracy was an act second to none in seriousness in French law (summary execution was the punishment), the French government nonetheless instructed the governors of its islands to allow pirate ships safe portage in exchange for a share of the stolen merchandise. Thus, the state became complicitous in the most horrific sprees of criminality in history.

The pirate culture condoned violence on a scale seldom seen. There was no mercy for the victims of the pirates’ attacks. Borgnefesse, a French pirate who wrote his memoirs after retiring to a gentleman’s life in rural France, was an articulate chronicler of these traits. He wrote, for example, of how he once saved a young girl “not yet into puberty” from being raped by two “beastly filibusters” who were chasing her out of a house in a village that he and his men had attacked (LeGolif, 1680). Borgnefesse wrote of being embarrassed that on that occasion he felt “pity” for the young girl and violated one of the ironclad laws of the pirate’s world: that women were prizes for whoever found them in the course of a raid. The would-be rapists resisted his effort to save the girl and “told me I was interfering in a matter which was none of my business, that pillage was permitted in the forcing of the women as well as the coffers.

“It was commonplace among pirates to “take no prisoners” unless, of course, they could be useful to the victors. Borgnefesse described how he cut off the heads of everyone on board a Spanish “prize” because the enemy angered him by injuring his arm during the battle. Another time he and his men took all the people on a captured ship, tied them up in the mainsail, threw them in the water, and then drank rum while listening to the screams of the slowly drowning men. For all his criminal exploits, however, Borgnefesse was well protected by French ships and French colonies.England and Holland were quick to join the French. Sir Richard Hawkins and his apprentice, Sir Francis Drake, were issued “letters of marque” from the admiralty directing governors of British colonies and captains of British warships to give safe passage and every possible assistance to Hawkins and Drake as they were acting “under orders of the Crown” (British Museum, 1977). Their “orders” were to engage in piracy against Spanish and Portuguese ships. Thus, the state specifically instructed selected individuals to engage in criminal acts. The law, it must be emphasized, did not change. Piracy remained a crime punishable by death, but some pirates were given license to murder, rape, plunder, destroy, and steal.

The state’s complicity in piracy was more successful, one suspects, than even the most avaricious monarchs expected. On one voyage (between 1572 and 1573), Drake returned to England with enough gold and silver to support the government and all its expenses for a period of 7 years (Corbett, 1898a, 1898b). Most of this wealth came from Drake’s attack on the town of Nombre de Dios, which was a storage depot for Spanish gold and silver. In this venture Drake joined forces with some French pirates and ambushed a treasure train.

Drake was knighted for his efforts, but the Spanish were not silent. They formally challenged Britain’s policies, but the queen of England denied that Drake was operating with her blessing (after, of course, taking the gold and silver that he brought home) and Drake was tried as a criminal. He was publicly exiled, but privately he was sent to Ireland, where he reemerged several years later (in 1575) serving under the first Earl of Essex in Ireland.

Borgnefesse and Sir Francis Drake are only two of hundreds of pirates who plied their trade between 1400 and 1800 (Senior, 1976), Their crimes were supported by, and their proceeds shared with, whatever nation-state offered them protection and supplies. In theory, each nation-state only protected its own pirates, but in practice, they all protected and pirates willing to share their gains.

To rationalize the fundamental contradiction between the law and the interests of the state, European nations created a legal fiction. Issued either directly from the monarch or the Admiralty, the letters of marque gave pirates a sort of license, but with specific limitations on the kinds of acts that were permissible. One restriction was that the pirates were not to (a) attack ships of the country issuing the letter, (b) plunder villages or towns, or (c) open the captured cargo until they returned to port.

The reality of piracy was quite at odds with all of these limitations. Much of the success of piracy depended on attacking towns and villages, during which raping, plundering, and razing the town were accepted practices. Pirates sometimes kept one or more officers from captured ships along with their letters of marque and identifying flags in order to show them in case of attack by a ship from another country. This also enabled a pirate ship from France, say, to raise an English flag and attack a French ship. For the pirates loyalty to the nation came second to the search for gold.

At one time or another virtually every European nation, and the United States as well, between 1500 and 1800 was complicitous in piracy. In the United States, Charleston, South Carolina, several New England towns, and New York were safe harbors for pirates. In return for sharing in the prize, these towns provided safety from capture by foreign authorities and a safe place for pirates to celebrate their victories.

John Paul Jones became an American hero through his success as a pirate and was even given a commission in the navy (de la Croix, 1962; MacIntyre, 1975). Jean and Pierre Lafitte were the toast of New Orleans society while they enriched themselves by organizing and aiding pirates and smugglers at the mouth of the Mississippi River. Their status was considerably enhanced when the federal government enlisted their aid in the war against England and made Jean an officer of the U.S. Navy in return for helping to defeat the British Navy that was gathering its forces for an attack on New Orleans (Verrill, 1924). In time of war, nations enlisted pirates to serve in their navy. In time of peace, they shared in the profits.

During the period from 1600 to 1900, capitalism was becoming firmly established as the dominant economic system of the world. The essential determinant of a nation’s ability to industrialize and to protect its borders was the accumulation of capital. Not only was another nation’s wealth a threat to the autonomy of neighboring states, one nation’s gain was invariably another’s loss. Piracy helped to equalize the balance and reduce the tendency toward the monopolization of capital accumulation. The need for capital accumulation does not end with the emergence of capitalism; it continues so long as the economy and a nation’s military and economic strength depend on it. When piracy ceased to be a viable method for accumulating capital, other forms of illegality were employed. In today’s world, there is evidence that some small city-states in the Far East (especially in Indonesia) still pursue a policy of supporting pirates and sharing in their profits. But piracy no longer plays a major role in state-organized crime; today, the role is filled by smuggling.


Smuggling occurs when a government has successfully cornered the market on some commodity or when it seeks to keep a commodity of another nation from crossing its borders. In the annals of crime, everything from sheep to people, wool to wine, gold to drugs, and even ideas, has been prohibited for either export or import. Paradoxically, whatever is prohibited, it is at the expense of one group of people for the benefit of another. Thus, the laws that prohibit the import or export of a commodity inevitably face a built-in resistance. Some part of the population will always want to either possess or to distribute the prohibited goods. At times, the state finds itself in the position of having its own interests served by violating precisely the same laws passed to prohibit the export or import of the goods it has defined as illegal.

Narcotics and the Vietnam War

Sometime around the eighth century, Turkish traders discovered a market for opium in Southeast Asia (Chambliss 1977; McCoy, 1973). Portuguese traders several centuries later found a thriving business in opium trafficking conducted by small ships sailing between trading ports in the area. One of the prizes of Portuguese piracy was the opium that was taken from local traders and exchanged for tea, spices, and pottery. Several centuries later, when the French colonized Indochina, the traffic in opium was a thriving business. The French joined the drug traffickers and licensed opium dens throughout Indochina. With the profits from these licenses, the French supported 50% of the cost of their colonial government.When the Communists began threatening French rule in Indochina, the French government used the opium profits to finance the war. It also used cooperation with the hill tribes who controlled opium production as a means of ensuring the allegiance of the hill tribes in the war against the Communists (McCoy, 1973).

The French were defeated in Vietnam and withdrew, only to be replaced by the United States. The United States inherited the dependence on opium profits and the cooperation of the hill tribes, who in turn depended on being allowed to continue growing and shipping opium. The CIA went a step further than the French and provided the opium-growing feudal lords in the mountains of Vietnam, Laos, Cambodia, and Thailand with transportation for their opium via Air America, the CIA airline in Vietnam.Air America regularly transported bundles of opium from airstrips in Laos, Cambodia, and Burma to Saigon and Hong Kong (Chambliss, 1977: 56). An American stationed at Long Cheng, the secret CIA military base in northern Laos during the war, observed:

“. . . so long as the Meo leadership could keep their wards in the boondocks fighting and dying in the name of, for those unfortunates anyway, some nebulous cause . . .the Meo leadership [was paid off] in the form of a carte-blanche to exploit U.S.-supplied airplanes and communication gear to the end of greatly strengthening the opium operations . . . . (Chambliss, 1977: 56)

This report was confirmed by Laotian Army General Ouane Rattikone, who told me in an interview in 1974 that he was the principal overseer of the shipment of opium out of the Golden Triangle via Air America. U.S. law did not permit the CIA or any of its agents to engage in the smuggling of opium. After France withdrew from Vietnam and left the protection of democracy to the United States, the French intelligence service that preceded the CIA in managing the opium smuggling in Asia continued to support part of its clandestine operations through drug trafficking (Kruger, 1980).

Although those operations are shrouded in secrecy, the evidence is very strong that the French intelligence agencies helped to organize the movement of opium through the Middle East (especially Morocco) after their revenue from opium from Southeast Asia was cut off.In 1969 Michael Hand, a former Green Beret and one of the CIA agents stationed at Long Cheng when Air America was shipping opium, moved to Australia, ostensibly as a private citizen. On arriving in Australia, Hand entered into a business partnership with an Australian national, Frank Nugan. In 1976 they established the Nugan Hand Bank in Sydney (Commonwealth of New South Wales, 1982a, 1982b). The Nugan Hand Bank began as a storefront operation with minimal capital investment, but almost immediately it boasted deposits of over $25 million. The rapid growth of the bank resulted from large deposits of secret funds made by narcotics and arms smugglers and large deposits from the CIA (Nihill, 1982).In addition to the records from the bank that suggest the CIA was using the bank as a conduit for its funds, the bank’s connection to the CIA and other U.S. intelligence agencies is evidenced by the people who formed the directors and principal officers of the bank, including the following:

Admiral Earl F. Yates, president of the Nugan Hand Bank was, during the Vietnam War, chief of staff for strategic planning of U.S. forces in Asia and the Pacific.

General Edwin F. Black, president of Nugan Hand’s Hawaii branch, was commander of U.S. troops in Thailand during the Vietnam War and, after the war, assistant army chief of staff for the Pacific.

General Erle Cocke, Jr., head of the Nugan Hand Washington, D.C. office.

George Farris worked in the Nugan Hand Hong Kong and Washington, D.C. offices. Farris was a military intelligence specialist who worked in a special forces training base in the Pacific.

Bernie Houghton, Nugan Hand’s representative in Saudi Arabia. Houghton was also a U.S. naval intelligence undercover agent.

Thomas Clines, director of training in the CIA’s clandestine service, was a London operative for Nugan Hand who helped in the takeover of a London-based bank and was stationed at Long Cheng with Michael Hand and Theodore S. Shackley during the Vietnam War.

Dale Holmgreen, former flight service manager in Vietnam for Civil Air Transport, which became Air America. He was on the board of directors of Nugan Hand and ran the bank’s Taiwan office.

Walter McDonald, an economist and former deputy director of CIA for economic research, was a specialist in petroleum. He became a consultant to Nugan Hand and served as head of its Anapolis, Maryland branch.

General Leroy Manor, who ran the Nugan Hand Philippine office, was a Vietnam veteran who helped coordinate the aborted attempt to rescue the Iranian hostages, chief of staff for the U.S. Pacific command, and the U.S. government’s liaison officer to Philippine President Ferdinand Marcos.

On the board of directors of the parent company formed by Michael Hand that preceded the Nugan Hand Bank were Grant Walters, Robert Peterson, David M. Houton, and Spencer Smith, all of whom listed their address as c/o Air America, Army Post Office, San Francisco, California.

Also working through the Nugan Hand Bank was Edwin F. Wilson, a CIA agent involved in smuggling arms to the Middle East and later sentenced to prison by a U.S. court for smuggling illegal arms to Libya. Edwin Wilson’s associate in Mideast arms shipments was Theodore Shackley, head of the Miami, Florida, CIA station. In 1973, when William Colby was made director of Central Intelligence, Shackley replaced him as head of covert operations for the Far East; on his retirement from the CIA William Colby became Nugan Hand’s lawyer.

In the late 1970s the bank experienced financial difficulties, which led to the death of Frank Nugan. He was found dead of a shotgun blast in his Mercedes Benz on a remote road outside Sydney. The official explanation was suicide, but some investigators speculated that he might have been murdered. In any event, Nugan’s death created a major banking scandal and culminated in a government investigation. The investigation revealed that millions of dollars were unaccounted for in the bank’s records and that the bank was serving as a money-laundering operation for narcotics smugglers and as a conduit through which the CIA was financing gun smuggling and other illegal operations throughout the world. These operations included illegally smuggling arms to South Africa and the Middle East. There was also evidence that the CIA used the Nugan Hand Bank to pay for political campaigns that slandered politicians, including Australia’s Prime Minister Gough Whitlam (Kwitny, 1987).

Michael Hand tried desperately to cover up the operations of the bank. Hundreds of documents were destroyed before investigators could get into the bank. Despite Hand’s efforts, the scandal mushroomed and eventually Hand was forced to flee Australia. He managed this, while under indictment for a rash of felonies, with the aid of a CIA official who flew to Australia with a false passport and accompanied him out of the country. Hand’s father, who lives in New York, denies knowing anything about his son’s whereabouts.

Thus, the evidence uncovered by the government investigation in Australia linked high-level CIA officials to a bank in Sydney that was responsible for financing and laundering money for a significant part of the narcotics trafficking originating in Southeast Asia (Commonwealth of New South Wales, 1982b; 1983). It also linked the CIA to arms smuggling and illegal involvement in the democratic processes of a friendly nation. Other investigations reveal that the events in Australia were but part of a worldwide involvement in narcotics and arms smuggling by the CIA and French intelligence (Hougan, 1978; Kruger, 1980; Owen, 1983).

Arms Smuggling

One of the most important forms of state-organized crime today is arms smuggling. To a significant extent, U.S. involvement in narcotics smuggling after the Vietnam War can be understood as a means of funding the purchase of military weapons for nations and insurgent groups that could not be funded legally through Congressional allocations or for which U.S. law prohibited support (NARMIC, 1984).

In violation of U.S. law, members of the National Security Council (NSC), the Department of Defense, and the CIA carried out a plan to sell millions of dollars worth of arms to Iran and use profits from those sales to support the contras in Nicaragua (Senate Hearings, 1986). The Boland amendment, effective in 1985, prohibited any U.S. official from directly or indirectly assisting the Contras. To circumvent the law, a group of intelligence and military officials established a “secret team” of U.S. operatives, including Lt. Colonel Oliver North, Theodore Shackley, Thomas Clines, and Maj. General Richard Secord, among others (testimony before U.S. Senate, 1986). Shackley and Clines, as noted, were CIA agents in Long Cheng; along with Michael Hand they ran the secret war in Laos, which was financed in part from profits from opium smuggling. Shackley and Clines had also been involved in the 1961 invasion of Cuba and were instrumental in hiring organized-crime figures in an attempt to assassinate Fidel Castro.

Senator Daniel Inouye of Hawaii claims that this “secret government within our government” waging war in Third World countries was part of the Reagan doctrine (the Guardian, July 29, 1987). Whether President Reagan or then Vice President Bush was aware of the operations is yet to be established. What cannot be doubted in the face of overwhelming evidence in testimony before the Senate and from court documents is that this group of officials of the state oversaw and coordinated the distribution and sale of weapons to Iran and to the Contras in Nicaragua. These acts were in direct violation of the Illegal Arms Export Control Act, which made the sale of arms to Iran unlawful, and the Boland amendment, which made it a criminal act to supply the Contras with arms or funds.The weapons that were sold to Iran were obtained by the CIA through the Pentagon. Secretary if Defense Caspar Weinberger ordered the transfer of weapons from Army stocks to the CIA without the knowledge of Congress four times in 1986. The arms were then transferred to middlemen, such as Iranian arms dealer Yaacov Nimrodi, exiled Iranian arms dealer Manucher Gorbanifar, and Saudi Arabian businessman Adnan Khashoggi. Weapons were also flown directly to the Contras, and funds from the sale of weapons were diverted to support Contra warfare. There is also considerable evidence that his “secret team,” along with other military and CIA officials, cooperated with narcotics smuggling in Latin America in order to fund the Contras in Nicaragua.

In 1986, the Reagan administration admitted that Adolfo Chamorro’s Contra group, which was supported by the CIA, was helping a Colombian drug trafficker transport drugs into the United States. Chamorro was arrested in 1986 for his involvement (Potter and Bullington, 1987: 54). Testimony in several trials of major drug traffickers in the past 5 years has revealed innumerable instances in which drugs were flown from Central America into the United States with the cooperation of military and CIA personnel. These reports have also been confirmed by military personnel and private citizens who testified that they saw drugs being loaded on planes in Central America and unloaded at military bases in the United States. Pilots who flew planes with arms to the Contras report returning with planes carrying drugs.

At the same time that the United States was illegally supplying the Nicaraguan Contras with arms purchased, at least in part, with profits from the sale of illegal drugs, the administration launched a campaign against the Sandinistas for their alleged involvement in drug trafficking. Twice during his weekly radio shows in 1986, President Reagan accused the Sandinistas of smuggling drugs. Barry Seal, an informant and pilot for the Drug Enforcement Administration (DEA), was ordered by members of the CIA and DEA to photograph the Sandinistas loading a plane. During a televised speech on March 1986, Reagan showed the picture that Seal took and said that it showed Sandinista officials loading a plane with drugs for shipment to the United States. After the photo was displayed, Congress approved $100 million in aid for the Contras. Seal later admitted to reporters that the photograph he took was a plane being loaded with crates that did not contain drugs. He also told reporters that he was aware of the drug smuggling activities of the Contra network and a Colombian cocaine syndicate. For his candor, Seal was murdered in February 1987.

Shortly after his murder, the DEA issued a “low key clarification” regarding the validity of the photograph., admitting there was no evidence that the plane was being loaded with drugs.

Other testimony linking the CIA and U.S. military officials to complicity in drug trafficking included the testimony of John Stockwell, a former high-ranking CIA official, who claims that drug smuggling and the CIA were essential components in the private campaign for the Contras. Corroboration for these assertions comes also from George Morales, one of the largest drug traffickers in South America, who testified that he was approached by the CIA in 1984 to fly weapons to Nicaragua. Morales claims that the CIA opened up an airstrip in Costa Rica and gave the pilots information on how to avoid radar traps. According to Morales, he flew 20 shipments of weapons into Costa Rica in 1984 and 1985. In return, the CIA helped him to smuggle thousands of kilos of cocaine into the United States. Morales alone channeled $250,000 quarterly to Contra leader Adolfo Chamorro from his trafficking activity. A pilot for Morales, Gary Betzner, substantiated Morales’ claims and admitted flying 4,000 pounds of arms into Costa Rica and 500 kilos of cocaine to Lakeland, Florida, on his return trips. From 1985 to 1987, the CIA arranged 50 to 100 flights using U.S. airports that did not undergo inspection.The destination of the flights by Morales and Betzner was a hidden airstrip on the ranch of John Hull. Hull, an admitted CIA agent, was a primary player in Oliver North’s plan to aid the Contras. Hull’s activities were closely monitored by Robert Owen, a key player in the Contra supply network. Owen established the Institute for Democracy, Education, and Assistance, which raised money to buy arms for the Contras and which, in October 1985, was asked by Congress to distribute $50,000 in “humanitarian aid” to the Contras. Owen worked for Oliver North in coordinating illegal aid to the Contras and setting up the airstrip on the ranch of John Hull.

According to an article in the Nation, Oliver North’s network of operatives and mercenaries had been linked to the largest drug cartel in South America since 1983. The DEA estimates that Colombian Jorge Ochoa Vasquez, the “kingpin” of the Medellin drug empire, is responsible for supplying 70% to 80% of the cocaine that enters the United States every year. Ochoa was taken into custody by Spanish police in October 1984 when a verbal order was sent by the U.S. Embassy in Madrid for his arrest. The embassy specified that Officer Cos-Gayon, who had undergone training with the DEA, should make the arrest. Other members of the Madrid Judicial Police were connected to the DEA and North’s smuggling network. Ochoa’s lawyers informed him that the United States would alter his extradition if he agreed to implicate the Sandinista government in drug trafficking. Ochoa refused and spent 20 months in jail before returning to Colombia. The Spanish courts ruled that the United States was trying to use Ochoa to discredit Nicaragua and released him (the Nation, September 5, 1987).

There are other links between the U.S. government and the Medellin cartel. Jose Blandon, General Noriega’s former chief advisor, claims that DEA operations have protected the drug empire in the past and that the DEA paid Noriega $4.7 million for his silence. Blandon also testified in the Senate committee hearings that Panama’s bases were used as training camps for the Contras in exchange for “economic” support from the United States. Finally, Blandon contends that the CIA gave Panamanian leaders intelligence documents about U.S. senators and aides; the CIA denies these charges (the Christian Science Monitor, February 11, 1988: 3).

Other evidence of the interrelationship among drug trafficking, the CIA, the NSC, and aid to the Contras includes the following:

In January 1983, two Contra leaders in Costa Rica persuaded the Justice Department to return over $36,000 in drug profits to drug dealers Julio Zavala and Carlos Cabezas for aid to the Contras (Potter and Bullington, 1987: 22).

Michael Palmer, a drug dealer in Miami, testified that the State Department’s Nicaraguan humanitarian office contracted with his company, Vortex Sales and Leasing, to take humanitarian aid to the Contras. Palmer claims that he smuggled $40 million in marijuana to the United States between 1977 and 1985 (the Guardian, March 20, 1988: 3).

During House and Senate hearings in 1986, it was revealed that a major DEA investigation of the Medellin drug cartel of Colombia, which was expected to culminate in the arrest of several leaders of the cartel, was compromised when someone in the White House leaked the story of the investigation to the Washington Times (a conservative newspaper in Washington, D.C.), which published the story on July 17, 1984. According to DEA Administrator John Lawn, the leak destroyed what was “probably one of the most significant operations in DEA history” (Sharkley, 1988: 24).

When Honduran General Jose Buseo, who was described by the Justice Department as an “international terrorist,” was indicted for conspiring to murder the president of Honduras in a plot financed by profits from cocaine smuggling, Oliver North and officials from the Department of Defense and the CIA pressured the Justice Department to be lenient with General Buseo. In a memo disclosed by the Iran-Contra committee, North stated that if Buseo was not protected “he will break his long-standing silence about the Nic[araguan] resistance and other sensitive operations” (Sharkley 1988: 27).

On first blush, it seems odd that government agencies and officials would engage in such wholesale disregard of the law. As a first step in building an explanation for these and other forms of state-organized crime, let us try to understand why officials of the CIA, the NSC, and the Department of Defense would be willing to commit criminal acts in the pursuit of other goals.


Why would government officials from the NSC, the Defense Department, the State Department, and the CIA become involved in smuggling arms and narcotics, money laundering, assassinations, and other criminal activities? The answer lies in the structural contradictions that inhere in nation-states (Chambliss, 1980).

As Weber, Marx, and Gramsci pointed out, no state can survive without establishing legitimacy. The law is a fundamental cornerstone in creating legitimacy and an illusion (at least) of social order. It claims universal principles that demand some behaviors and prohibit others. The protection of property and personal security are obligations assumed by states everywhere both as a means of legitimizing the state’s franchise on violence and as a means of protecting commercial interests (Chambliss and Seidman, 1982).

The threat posed by smuggling to both personal security and property interests makes laws prohibiting smuggling essential. Under some circumstances, however, such laws contradict other interests of the state. This contradiction prepares the ground for state-organized crime as a solution to the conflicts and dilemmas posed by the simultaneous existence of contradictory “legitimate” goals.

The military-intelligence establishment in the United States is resolutely committed to fighting the spread of “communism” throughout the world. This mission is not new but has prevailed since the 1800s. Congress and the presidency are not consistent in their support for the money and policies thought by the front-line warriors to be necessary to accomplish their lofty goals. As a result, programs under way are sometimes undermined by a lack of funding and even by laws that prohibit their continuation (such as the passage of laws prohibiting support for the Contras). Officials of government agencies adversely affected by political changes are thus placed squarely in a dilemma: If they comply with the legal limitations on their activities they sacrifice their mission. The dilemma is heightened by the fact that they can anticipate future policy changes that will reinstate their sources and their freedom. When that time comes, however, programs adversely affected will be difficult if not impossible to re-create.

A number of events that occurred between 1960 and 1980 left the military and the CIA with badly tarnished images. Those events and political changes underscored their vulnerability. The CIA lost considerable political clout with elected officials when its planned invasion of Cuba (the infamous Bay of Pigs invasion) was a complete disaster. Perhaps as never before in its history, the United States showed itself vulnerable to the resistance of a small nation. The CIA was blamed for this fiasco even though it was President Kennedy’s decision to go ahead with the plans that he inherited from the previous administration. To add to the agency’s problems, the complicity between it and ITT to invade Chile and overthrow the Allende government was yet another scar (see below), as was the involvement of the CIA in narcotics smuggling in Vietnam.

These and other political realities led to a serious breach between Presidents Kennedy, Johnson, Nixon, and Carter and the CIA. During President Nixon’s tenure in the White House, one of CIA’s top men, James Angleton, referred to Nixon’s national security advisor, Henry Kissinger (who became secretary of state), as “objectively, a Soviet Agent” (Hougan, 1984: 75). Another top agent of the CIA, James McCord (later implicated in the Watergate burglary), wrote a secret letter to his superior, General Paul Gaynor, in January 1973 in which he said:

When the hundreds of dedicated fine men and women of the CIA no longer write intelligence summaries and reports with integrity, without fear of political recrimination – when their fine Director [Richard Helms] is being summarily discharged in order to make way for a politician who will write or rewrite intelligence the way the politicians want them written, instead of the way that truth and best judgement dictates, our nation is in the deepest of trouble and freedom itself was never so imperiled. Nazi Germany rose and fell under exactly the same philosophy of governmental operation. (Hougan, 1984: 26-27)

McCord (1974: 60) spoke for many of the top military and intelligence officers in the United States when he wrote in his autobiography: “I believed that the whole future of the nation was at stake.” These views show the depth of feeling toward the dangers of political “interference” with that which is generally accepted in the military-intelligence establishment as their mission (Goulden, 1984).

When Jimmy Carter was elected president, he appointed Admiral Stansfield Turner as director of Central Intelligence. At the outset, Turner made it clear that he and the president did not share the agency’s view that they were conducting their mission properly (Goulden, 1984; Turner, 1985). Turner insisted on centralizing power in the director’s office and on overseeing clandestine and covert operations. He met with a great deal of resistance. Against considerable opposition from within the agency, he reduced the size of the covert operation section from 1,200 to 400 agents. Agency people still refer to this as the “Halloween massacre.”Old hands at the CIA do not think their work is dispensible. They believe zealously, protectively, and one is tempted to say, with religious fervor, that the work they are doing is essential for the salvation of humankind. With threats from both Republican and Democratic administrations, the agency sought alternative sources of revenue to carry out its mission. The alternative was already in place with the connections to the international narcotics traffic, arms smuggling, the existence of secret corporations incorporated in foreign countries (such as Panama), and the established links to banks for the laundering of money for covert operations.


Assassination plots and political murders are usually associated in people’s minds with military dictatorships and European monarchies. The practice of assassination, however, is not limited to unique historical events but has become a tool of international politics that involves modern nation-states of many different types.In the 1960s a French intelligence agency hired Christian David to assassinate the Moroccan leader Ben Barka (Hougan, 1978: 204-207). Christian David was one of those international “spooks” with connections to the DEA, the CIA, and international arms smugglers, such as Robert Vesco.

In 1953, the CIA organized and supervised a coup d’etat in Iran that overthrew the democratically elected government of Mohammed Mossadegh, who had become unpopular with the United States when he nationalized foreign-owned oil companies. The CIA’s coup replaced Mossadegh with Reza Shah Pahlevi, who denationalized the oil companies and with CIA guidance established one of the most vicious secret intelligence organizations in the world: SAVAK. In the years to follow, the shah and CIA-trained agents of SAVAK murdered thousands of Iranian citizens. They arrested almost 1,500 people monthly, most of whom were subjected to inhuman torture and punishments without trial. Not only were SAVAK agents trained by the CIA, but there is evidence that they were instructed in techniques of torture (Hersh, 1979: 13).

In 1970 the CIA repeated the practice of overthrowing democratically elected governments that were not completely favorable to U.S. investments. When Salvador Allende was elected president of Chile, the CIA organized a coup that overthrew Allende, during which he was murdered, along with the head of the military, General Rene Schneider. Following Allende’s overthrow, the CIA trained agents for the Chilean secret service (DINA). DINA set up a team of assassins who could “travel anywhere in the world . . . to carry out sanctions including assassinations” (Dinges and Landau, 1980: 239). One of the assassinations carried out by DINA was the murder of Orlando Letellier, Allende’s ambassador to the United States and hi former minister of defense. Letellier was killed when a car bomb blew up his car on Embassy Row in Washington, D.C. (Dinges and Landau, 1982).Other bloody coups known to have been planned, organized, and executed by U.S. agents include coups in Guatemala, Nicaragua, the Dominican Republic, and Vietnam. American involvement in those coups was never legally authorized. The murders, assassinations, and terrorist acts that accompany coups are criminal acts by law, both in the United States and in the country in which they take place.

More recent examples of murder and assassination for which government officials are responsible include the death of 80 people in Beirut, Lebanon, when a car bomb exploded on May 8, 1985. The bomb was set by a Lebanese counterterrorist unit working with the CIA. Senator Daniel Moynihan has said that when he was vice president of the Senate Intelligence Committee, President Reagan ordered the CIA to form a small antiterrorist effort in the Mideast. Two sources said that the CIA was working with the group that planted the bomb to kill Shiite leader Hussein Fadallah (the New York Times, May 13, 1985).

A host of terrorist plans and activities connected with the attempt to overthrow the Nicaraguan government, including several murders and assassinations, were exposed in an affidavit filed by free-lance reporters Tony Avirgan and Martha Honey. They began investigating Contra activities after Avirgan was injured in an attempt on the life of Contra leader Eden Pastora. In 1986, Honey and Avirgan filed a complaint with the U.S. District Court in Miami charging John Hull, Robert Owen, Theodore Shackley, Thomas Clines, Chi Chi Quintero, Maj. General Richard Secord, and others working for the CIA in Central America with criminal conspiracy and the smuggling of cocaine to aid the Nicaraguan rebels.

A criminal conspiracy in which the CIA admits participating is the publication of a manual, Psychological Operation in Guerilla Warfare, which was distributed to the people in Nicaragua. The manual describes how the people should proceed to commit murder, sabotage, vandalism, and violent acts in order to undermine the government. Encouraging or instigating such crimes is not only a violation of U.S. law, it was also prohibited by Reagan’s executive order of 1981, which forbade any U.S. participation in foreign assassinations.

The CIA is not alone in hatching criminal conspiracies. The DEA organized a “Special Operations Group,” which was responsible for working out plans to assassinate political and business leaders in foreign countries who were involved in drug trafficking. The head of this group was a former CIA agent, Lou Conein (also known as “Black Luigi”). George Crile wrote in the Washington Post (June 13, 1976): “When you get down to it, Conein was organizing an assassination program. He was frustrated by the big-time operators who were just too insulated to get to. . . . Meetings were held to decide whom to target and what method of assassination to employ.”

Crile’s findings were also supported by the investigative journalist Jim Hougan (1978: 32).

It is a crime to conspire to commit murder. The official record, including testimony by three participants in three conspiracies before the U.S. Congress and in court, make it abundantly clear that the crime of conspiring to commit murder is not infrequent in the intelligence agencies of the United States and other countries.

It is also a crime to cover up criminal acts, but there are innumerable examples of instances in which the CIA and the FBI conspired to interfere with the criminal prosecution of drug dealers, murderers, and assassins. In the death of Letellier, mentioned earlier, the FBI and the CIA refused to cooperate with the prosecution of the DINA agents who murdered Letellier (Dinges and Landau, 1980: 208-209). Those agencies were also involved in the cover-up of the criminal activities of a Cuban exile, Ricardo (Monkey) Morales. While an employee of the FBI and the CIA, Morales planted a bomb on an Air Cubana flight from Venezuela, which killed 73 people. The Miami police confirmed Morales’ claim that he was acting under orders from the CIA (Lernoux, 1984: 188). In fact, Morales, who was arrested for overseeing the shipment of 10 tons of marijuana, admitted to being a CIA contract agent who conducted murders, bombings, and assassinations. He was himself killed in a bar after he made public his work with the CIA and the FBI.Colonel Muammar Qaddafi, like Fidel Castro, has been the target of a number of assassination attempts and conspiracies by the U.S. government. One plot, the Washington Post reported, included an effort to “lure [Qaddafi] into some foreign adventure or terrorist exploit that would give a growing number of Qaddafi opponents in the Libyan military a chance to seize power, or such a foreign adventure might give one of Qaddafi’s neighbors, such as Algeria or Egypt, a justification for responding to Qadaffi militarily” (the Washington Post, April 14, 1986). The CIA recommended “stimulating” Qaddafi’s fall “by encouraging disaffected elements in the Libyan army who could be spurred to assassination attempts” (the Guardian, November 20, 1985: 6).

Opposition to government policies can be a very risky business, as the ecology group Greenpeace discovered when it opposed French nuclear testing in the Pacific. In the fall of 1985 the French government planned a series of atomic tests in the South Pacific. Greenpeace sent its flagship to New Zealand with instructions to sail into the area where the atomic testing was scheduled to occur. Before the ship could arrive at the scene, however, the French secret service located the ship and blew it up. The blast from the bomb killed one of the crew.


Every agency of government in restricted by law in certain fundamental ways. Yet structural pressures exist that can push agencies to go beyond their legal limits. The CIA, for example, is not permitted to engage in domestic intelligence. Despite this, the CIA has opened and photographed the mail of over 1 million private citizens (Rockefeller Report, 1975: 101-115), illegally entered people’s homes, and conducted domestic surveillance through electronic devices (Parenti, 1983: 170-171).

Agencies of the government also cannot legally conduct experiments on human subjects that violate the civil rights or endanger the lives of the subjects. But the CIA conducted experiments on unknowing subjects by hiring prostitutes to administer drugs to their clients. CIA-trained medical doctors and psychologists observed the effects of the drugs through a two-way mirror in expensive apartments furnished to the prostitutes by the CIA. At least one of the victims of these experiments died and suffered considerable trauma (Anderson and Whitten, 1976; Crewsdon and Thomas, 1977; Jacobs, 1977a, 1977b).

The most flagrant violation of civil rights by federal agencies is the FBI’s counterintelligence program, known as COINTELPRO. This program was designed to disrupt, harass, and discredit groups that the FBI decided were in some way “un-American.” Such groups included the American Civil Liberties Union, antiwar movements, civil rights organizations, and a host of other legally constituted political groups whose views opposed some of the policies of the United States (Church Committee, 1976). With the exposure of COINTELPRO, the group was disbanded. There is evidence, however, that illegal surveillance of U.S. citizens did not stop with the abolition of COINTELPRO but continues today (Klein, 1988).


Elsewhere I have suggested a general theory to account for variations in types and frequency of crime (Chambliss, 1988a). The starting point for that theory is the assumption that in every era political, economic, and social relations contain certain inherent contradictions, which produce conflicts and dilemmas that people struggle to resolve. The study of state-organized crime brings into sharp relief the necessity of understanding the role of contradictions in the formation and implementation of the law.

Contradictions inherent in the formation of states create conditions under which there will be a tendency for state officials to violate the criminal law. State officials inherit from the past laws that were not of their making and that were the result of earlier efforts to resolve conflicts wrought by structural contradictions (Chambliss, 1980; Chambliss and Seidman, 1982). The inherited laws nonetheless represent the foundation on which the legitimacy of the state’s authority depends. These laws also provide a basis for attempts by the state to control the acts of others and to justify the use of violence to that end.For England in the sixteenth century, passing laws to legitimize piracy for English pirates while condemning as criminal the piracy of others against England would have been an untenable solution, just as it would undermine the legitimacy of America’s ideological and political position to pass legislation allowing for terrorist acts on the part of U.S. officials while condemning and punishing the terrorism of others.

Law is a two-edged sword; it creates one set of conflicts while it attempts to resolve another. The passage of a particular law or set of laws may resolve conflicts and enhance state control, but it also limits the legal activities of the state. State officials are thus often caught between conflicting demands as they find themselves constrained by laws that interfere with other goals demanded of them by their roles or their perception of what is in the interests of the state. There is a contradiction, then, between the legal prescriptions and the agreed goals of state agencies. Not everyone caught in this dilemma will opt for violating the law, but some will. Those who do are the perpetrators, but not the cause, of the persistence of state-organized crime.

When Spain and Portugal began exploiting the labor and natural resources of the Americas and Asia, other European nations were quick to realize the implications for their own power and sovereignty. France, England, and Holland were powerful nations, but not powerful enough at the time to challenge Spain and Portugal directly. The dilemma for those nations was how to share in the wealth and curtail the power of Spain and Portugal without going to war. A resolution to the dilemma was forged through cooperation with pirates. Cooperating with pirates, however, required violating their own laws as well as the laws of other countries. In this way, the states organized criminality for their own needs without undermining their claim to legitimacy or their ability to condemn and punish piracy committed against them.

It should be noted that some monarchs in the sixteenth and seventeenth centuries (James I of England, for example) refused to cooperate with pirates no matter how profitable it would have been for the Crown. So, too, not all CIA or NSC personnel organize criminal activities in pursuit of state goals.

The impetus for the criminality of European states that engaged in piracy was the need to accumulate capital in the early stages of capitalist formation. State-organized criminality did not disappear, however, with the emergence of capitalism as the dominant economic system of the world. Rather, contemporary state-organized crime also has its roots in the ongoing need for capital accumulation of modern nation-states, whether the states be socialist, capitalist, or mixed economies.Sociologically, then, the most important characteristics of state-organized crime in the modern world are at one with characteristics of state-organized crime in the early stages of capitalist development. Today, states organize smuggling, assassinations, covert operations, and conspiracies to criminally assault citizens, political activists, and political leaders perceived to be a threat. These acts are a criminal in the laws of the nations perpetrating them as were the acts of piracy in which European nations were complicitous.

At the most general level, the contradictions that are the force behind state-organized crime today are the same as those that were the impetus for piracy in sixteenth-century Europe. The accumulation of capital determines a nation’s power, wealth, and survival today, as it did 300 years ago. The state must provide a climate and a set of international relations that facilitate this accumulation if it is to succeed. State officials will be judged in accordance with their ability to create these conditions.

But contradictory ideologies and demands are the very essence of state formations. The laws of every nation-state inhibit officials from maximizing conditions conducive to capital accumulation at the same time that they facilitate the process. Laws prohibiting assassination and arms smuggling enable a government to control such acts when they are inimical to their interests. When such acts serve the interests of the state, however, then there are pressures that lead some officials to behave criminally. Speaking of the relationship among the NSC, the CIA, and drug trafficking, Senator John Kerry, Chairman of the Senate Foreign Relations Subcommittee on Terrorism, Narcotics, and International Operations, pinpointed the dilemma when he said “stopping drug trafficking to the United States has been a secondary U.S. foreign policy objective. It has been sacrificed repeatedly for other political goals” (Senate Hearings, 1986). He might have added that engaging in drug trafficking and arms smuggling has been a price government agencies have been willing to pay “for other political goals.”

These contradictions create conflicts between nation-states as well as internally among the branches of government. Today, we see nations such as Turkey, Bolivia, Colombia, Peru, Panama, and the Bahamas encouraging the export of illegal drugs while condemning them publicly. At the same time, other government agencies cooperate in the export and import of illegal arms and drugs to finance subversive and terrorist activities. Governments plot and carry out assassinations and illegal acts against their own citizens in order to “preserve democracy” while supporting the most undemocratic institutions imaginable. In the process, the contradictions that create the conflicts and dilemmas remain untouched and the process goes on indefinitely.

A U.S. State Department report (1985) illustrates, perhaps, the logical outcome of the institutionalization of state-organized crime in the modern world. In this report the State Department offered to stop criminal acts against the Nicaraguan government in return for concessions from Nicaragua. Three hundred years earlier England, France, and Spain signed a treaty by which each agreed to suppress its piracy against the others in return for certain guarantees of economic and political sovereignty.


My concern here is to point out the importance of studying state-organized crime. Although I have suggested some theoretical notions that appear to me to be promising, the more important goal is to raise the issue for further study. The theoretical and empirical problems raised by advocating the study of state-organized crime are, however, formidable.Data on contemporary examples of state-organized crime are difficult to obtain. The data I have been able to gather depend on sources that must be used cautiously. Government hearings, court trials, interviews, newspaper accounts, and historical documents are replete with problems of validity and reliability. In my view they are no more so than conventional research methods in the social sciences, but that does not alter the fact that there is room for error in interpreting the findings. It will require considerable imagination and diligence for others to pursue research on this topic and add to the empirical base from which theoretical propositions can be tested and elaborated.We need to explore different political, economic, and social systems in varying historical periods to discover why some forms of social organization are more likely to produce state-organized crimes than others. We need to explore the possibility that some types of state agencies are more prone to engaging in criminality than others. It seems likely, for example, that state agencies whose activities can be hidden from scrutiny are more likely to engage in criminal acts than those whose record is public. This principle may also apply to whole nation-states: the more open the society, the less likely it is that state-organized crime will become institutionalized.

There are also important parallels between state-organized criminality and the criminality of police and law-enforcement agencies generally. Local police departments that find it more useful to cooperate with criminal syndicates than to combat them are responding to their own particular contradictions, conflicts, and dilemmas (Chambliss, 1988).

An exploration of the theoretical implications of these similarities could yield some important findings.The issue of state-organized crime raises again the question of how crime should be defined to be scientifically useful. For the purposes of this analysis, I have accepted the conventional criminological definition of crime as acts that are in violation of the criminal law. This definition has obvious limitations (see Schwendinger and Schwendinger, 1975), and the study of state-organized crime may facilitate the development of a more useful definition by underlying the interrelationship between crime and the legal process. At the very least, the study of state-organized crime serves as a reminder that crime is a political phenomenon and must be analyzed accordingly.


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