References to Chapter 9:
1. See Anslinger and Tompkins, The Traffic in Narcotics, op. cit. and Harry J. Anslinger, The Opium of the People's Government', in US Congress, House Committee on Un-American Activities, Soviet Total War:
'Historic Mission' of Violence and Deceit, Volume II (Washington, D.C.: US Government Printing Office, September 30,1956).
2. Stefan T. Possony, Maoist China and Heroin (Taipei, Taiwan: China Publishing Company, no date)
3. Candlin, Psycho-Chemical Warfare: The Chinese Communist Drug Offensive Against the West, op. cit., page 26.
4. As described in detail by William J. Gill, the new Secretary of State, Dean Rusk, was at least very sympathetic to the interests of the Chinese Communists. Also in 1961, there was an influx into the Depart- ments of State and Justice of individuals who were formerly denied security clearances or whose back- grounds normally would have prevented them from receiving a clearance. The Ordeal of Otto Otepka (New Rochelle, N.Y.: Arlington House, 1969).
5. A substantial portion of the CIA's analysis was leaked to and printed by the New York Times. Curi- ously, the printed article does not include any of the data on China, nor is the geography of the original
'Golden Triangle' shown on the included map. See Felix Belair, Jr., 'C.I.A. Identifies 21 Asian Opium
Refineries', New York Times, June 6,1971, page A2.
6. Edward Jay Epstein, Agency of Fear, (New York: G. P. Putnam's Sons, 1977), page 85.
7. Ibid., pages 149-150.
8. Cabinet Committee on International Narcotics Control, World Opium Survey -1972, publisher not identified, released on August 17,1972 by the Department of State.
9. Ibid., page 26.
10. Ibid., pages A45-A46.
11. Quoted in Hon. Lester L. Wolff, The Narcotics Situation in Southeast Asia, Report of a Special Study
Mission (Washington, D.C.: US Government Printing Office, 1972), page 12.
12. In reviewing the state of intelligence data, a former counter-intelligence specialist with the
Defence Intelligence Agency [DIA] stated that the narcotics intelligence people did not seem to possess
any systematic intelligence about narcotics traffic. Epstein, Agency of Fear, op. cit., page 253. Candlin
assessed The World Opium Situation statements by the BNDD on the rapid decline of mainland Chinese opium production in the 1950s and 1960s as being without 'even the flimsiest basis of support'. Psycho- Chemical Warfare: The Chinese Communist Drug Offensive Against the West, op. cit., page 106.
13. US Congress, Senate, International Terrorism, Insurgency, and drug-trafficking Present Trends in Terrorist Activity, Joint Hearings Before the Committee on Foreign Relations and the Committee on the Judiciary, May 13,14 and 15,1985 (Washington, D.C.: US Government Office, 1985), page 31.
14. World Drug Impact, Part 1, op. cit, page 14.
15. See, for example, US Department of State, Bureau of International Narcotics Matters, Interna-
tional Narcotics Control Strategy Report (Washington, D.C.: US Government Printing Office, March 1987).
16. About the only Communist country to be unequivocally identified as trafficking in narcotics 'as a
matter of policy' is Laos. See Michael Isikoff, 'US Accuses Laos of drug-trafficking', Washington Post,
August 30,1988, page A4.
17. In the interests of detente', US government officials have suppressed data and have knowingly failed to collect and use evidence considered contrary to policy. For example, prior to the Biological and Toxin Weapons arms control treaty signed in 1972, the United States was aware of massive Soviet activity in applying genetic engineering to chemical and biological warfare. As Herbert E. Meyer, the former Vice Chairman, National Intelligence Council, explained, this data was 'removed at the specific request of Henry Kissinger'. The Defence of Western Europe, London Conference Proceedings (New York: International
Security Council, 1988), pages 72-73. This action was most unfortunate. Had the data been pursued
CHAPTER 9: Hear No Evil, See No Evil, Speak No Evil 109
at this time, Soviet narcotics trafficking might have been uncovered insofar as it was a component of the Soviet Bloc's chemical warfare strategy. As Ray Cline, then Director of the State Department's Intelligence and Research Bureau, reported, 'crucial intelligence was often suppressed to insure that only Nixon and Kissinger had the full body of information...'. John Ranelagh, The Agency: The Rise and Decline of the CIA (New York: Simon and Schuster, 1986), page 518.
Another example of the suppression of data ostensibly in the interests of detente, was the handling of the Soviet KGB defector, Anatoliy Golitsyn. Golitsyn had been an especially valuable defector, in the opinion of the French and British authorities, and of the CIA's chief of counter-intelligence, James Angleton. Golitsyn had provided important information on Soviet penetrations of several intelligence organisations, most notably the French, British and American, and had provided unique details on Soviet intelligence, the reorganisation of which he had helped to plan, and on Soviet deception. At Angleton's request, Golitsyn was studying the possibility that the Sino-Soviet split was a deliberately orchestrated deception. Edward Jay Epstein, reporting on his extensive discussions with Angleton, stated that in 1969 the Director of the CIA, Richard Helms, told Angleton that it was now the policy of the Nixon White House to accept the Sino-Soviet split as genuine - that is, drop the investigation. Edward Jay Epstein, Deception, (New York: Simon & Schuster, 1989), page 98.
18. Jack Anderson, 'Kennedy May Help in California', Washington Post, May 26,1972, page D19.
19. Edward Jay Epstein, Agency of Fear (New York: G. P. Putnam's Sons, 1977).
21. US Congress, Senate, Drugs and Terrorism, 1984, Hearing Before the Subcommittee on Alcoholism and Drug Abuse of the Committee on Labour and Human Resources, August 2,1984 (Washington, D.C.: US Government Printing Office, 1984).
22. Assuming they did not have advance notice.
23. It would be only prudent to assume that many of the 'Bulgarian' officials were actually Soviet and East
European intelligence service officials acting under Bulgarian cover.
24. Drugs and Terrorism, 1984, op. cit., page 55.
25. Ibid., page 60.
26. Ibid., pages 59,66.
27. US Department of State, Bureau of International Narcotics Matters, International Narcotics Control
Strategy Report (Washington, D.C.: US Department of State, 1989), pages 19,159.
28. The key report was Shakarchi Trading Company, File No. UN-89-0002, January 3,1989.
29. See Peter Samuel, 'Senior Bulgarian Aides Linked to a Booming Trade in Heroin', New York City Tribune, March 30,1989, page A1,'Druglords Seen Moving Into Havens in Communist Bloc', New York City Tribune, March 31,1989, page A1; 'In 1986, Bulgarian Connection Surfaced in Big Seizure in LA of Drug Money', New York City Tribune, April 4,1989, page A1; and 'State Dept. Said to Slight Drug Enforcement to Preserve Detente', New York City Tribune, April 7,1989, page A1; Knut Royce, 'Heroin Labs in Bulgaria', Newsday, April 1,1989, page 7;'Dirty Money: Drugs to Gold', Newsday, April 2,1989; and Bill Gertz, 'Bulgarian Front Linked to Drugs', Washington Times, April 3,1989, page A1.
30. Bill Gertz, 'State Confirms Bulgarian Company's Drug Ties', Washington Times, April 7,1989, A6.
31. Peter Fuhrman, The Bulgarian Connection', Forbes, April 17,1989, pages 40-44.
32. Robert S. Greenberger, 'Customs Chief's Feud on Drug Conference Typifies Appointee-Bureaucrat
Conflict', Wall Street Journal, May 19,1986, page 66.
33. US Department of State, Bureau of International Narcotics Matters, International Narcotics Control
Strategy Report (Washington, D.C.: US Government Printing Office, March 1988), pages 14,35.
34. Chemical analysis can be used to help determine the manufacturing origins of drug samples, especially if certain trace elements that are characteristic of the particular production process are present. This information also could be used by knowledgeable authorities to thwart proper identification by deliberately introducing indicator chemicals during the manufacturing process that would cause incorrect conclusions to be drawn following such chemical analysis.
35. Michael Isikoff, 'Soviets Suggest Trading Facts on drug-traffic', Washington Post, July 20,1988. Also,
the Boston Globe reported on September 13,1988 that Great Britain and the Soviet Union agreed to 'unite in the fight against drug smuggling by sharing intelligence,training and operations'.
36. National Drug Control Strategy, op. cit., p.67.
37. Michael Isikoff, 'DEA Proposes to Train KGB to Combat Drugs'. Washington Post, December 15,
1989, page A23.
38. Larry Rohter, 'America's Blind Eye', New York Times Magazine, May 29,1988, pages 26,29.
39. 1972 is the year given in Jim McGee and David Hoffman, 'Rivals Hint Bush Understates Knowledge of Noriega Ties', Washington Post, May 8,1988, page A16, citing access to Justice Department files. According to Michael Isikoff, a DEA official stated that the DEA's knowledge of Noriega's ties to illicit drug-trafficking dated from 1970. 'DEA Fights to Keep Office in Panama', Washington Post, October 4,1988, page A27. As John E. Ingersoll, then Director of the Bureau of Narcotics and Dangerous Drugs, confirmed in 1972, there was sufficient evidence that one of the options considered as a solution to Panama's drug problem was Noriega's assassination. Seymour M. Hersch, 'US Aides in '72 Weighed Killing Officer Who Now Leads Panama', New York Times, June 13,1986, page 1.
40. Rohter, 'America's Blind Eye', op. cit., page 26. According to a Washington Times report, Noriega was recruited in 1966 by the CIA case officer Nester Sanchez. Bill Gertz, 'Noriega Was a Spy for Nearly Everyone', Washington Times, January 8,1990, page A1.
41. Michael Hedges, To Gen. Noriega with Love: Letters from America's Top Drug Enforcers', Washington Times, January 17,1990, page A1.
42. With respect to developments surrounding the finalisation of the Panama Canal Treaties under
President Carter, see Warren Brooks, 'How Canal Drug Ties Were Hidden: Carter Wanted His Treaty', Washington Times, July 28,1988, page F1. See also G. Russell Evans, The Panama Canal Treaties Swindle: Consent to Disaster (Carrboro, North Carolina: Signal Books, 1986).
43. This incident and others where Panama's involvement in drug-trafficking is denied are identified by Rohter in 'America's Blind Eye', op. cit.
44. Jim McGee and Bob Woodward, 'Noriega Arms Indictment Stalled in '80', Washington Post
March 20,1988, page A22.
45. 'Detente' was first identified in a secret Soviet dispatch from Moscow Novosti KGB headquarters
in 1968 by KGB-International Department operative Yuri Bezmenov. In 1969, the new detente project was
explained to a gathering of Novosti-KGB staff including Bezmenov by Nikolai Agayantz, the son of the KGB
disinformation specialist General-Major Ivan Agayantz. The meeting took place in Ambassador Pegov's
office at the USSR Embassy in India. Detente was not mere propaganda, Agayantz lectured. Rather, it was
part of a new strategy, based on the theory and practice of the ideological offensive as formulated in various texts, such as The Art of War by Sun Tzu. See Joseph D. Douglass, Jr., Why The Soviets Violate Arms Control Treaties (Washington, D.C.: Pergamon-Brassey's, 1988), pages 9-10.
46. Street costs of drug-trafficking in America were estimated at $140 to S200 billion in 1990. The costs in lost labour, prisons and health treatment are estimated at $60 to $100 billion. This totals $200 to
$300 billion. To this total must be added the cost of street crimes as well as blue and white collar crimes,
which are not known to have been totalled. See US General Accounting Office, Controlling Drug Abuse. A Status Report (Washington, D.C.: US Government Printing Office, 1988).
47. Howard Kurtz, 'Bank of America Officer Indicted in Drug Probe', Washington Post, March 19,
1986, page A3.
48. As explained by Ramon Milian Rodriguez, a CPA who handled money-laundering and invest-
ments for the Medellin Cartel: 'In every instance, the banks knew who they were dealing with... They were
dealing with Milian Rodriguez who represented money from South America, and their corresponding banks in Panama knew where the money came from because we required certain things from them.... We were breaking the laws in a very big manner and you always have to have plausible deniabil-ity. And the New York banks are no fools'. US Congress, Senate, Drugs, Law Enforcement and Foreign Policy: Panama, Hearings Before the Subcommittee on Terrorism, Narcotics and International Relations of the Committee on Foreign Relations, February 11,1988, (Washington, D.C.: unpublished stenographic transcript, 1988)
50. Ibid., page 65. See also Howard Kurtz, 'Bank of America Officer Indicted in Drug Probe', Wash-
ington Post, March 19,1986, page A3.
51. 'Cocaine', ABC News 'Close-up', August 20,1983, Mediascan Transcript ABC-COCAINE 082083,
52. James Ring Adams, 'Losing the Drug War: Drugs, Banks, and Florida Politics', American Spectator, September 1988, page 20.
53. Ibid., page 24.
54. Michael Hedges, 'Lack of Prosecutors Forces US to Blink at Florida Drug Crimes', Washington
Times, November 18,1988, page A1.
55. Drugs, Law Enforcement and Foreign Policy: Panama, February 11,1988, op. cit., page 94.
56. Boston Globe Spotlight Team, 'Critics Say Cash Probes Violate Rights of Privacy'. Part 7 in Money- laundering, published by the Boston Globe, no date or page numbers given.
57. US Congress, Senate, National and International Security Threat of Narcotics Trafficking, Hearing Before the Caucus on International Narcotics Control, June 8,1987 (Washington, D.C.: US Government Printing Office, 1987), page 36.
58. Hearing to Receive Testimony on Drugs, Law Enforcement and Foreign Policy: Panama, February
11,1988, op. cit, page 79.
59. Another Colombian cartel from Cali received publicity as a result of drug wars in New York for
control of the cocaine and crack markets. Michael Isikoff, 'DEA Official Guarded After Death Threat',
Washington Post, August 28,1988, page A9.
60. US Congress, Senate, Hearing to Receive Testimony on Drugs, Law Enforcement and Foreign
Policy: Panama, February 10,1988, stenographic transcript, pages 65-66.
61. Michael Isikoff, 'US Links Bank to Drug Cartel', Washington Post, October 12,1988, page A1; and
'Indicted Banker Testified to Noriega Links', Washington Post, October 13,1988, page A3.
62. Ramon Rodriguez was caught taking $5.4 million in cash out of the country to Panama. This was
mainly expense money - bribes and so forth. Rodriguez testified that he made $2-4 million a month
CHAPER 9: Hear No Evil, See No Evil, Speak No Evil 111
and that he paid Noriega about $10 million a month. Most of the real money he shipped to Panama in commercial shipping containers. The $14-32 million involved in the Bank of Credit and Commerce Inter-
national [BCCI] indictment was a trivial amount when compared with the overall size of money-launder-in operations. See US Congress, Senate, Hearing to Receive Testimony on Drugs, Law Enforcement and Foreign Policy: Panama, February 11,1988, stenographic transcript, page 59.
63. Nick Tosches, Power on Earth (New York: Arbor House, 1986), pages 81-107.
64. US Senate, Hearing to Receive Testimony on Drugs, Law Enforcement, and Foreign Policy: Panama, February 11,1988, op. cit. page 95.
65. Power on Earth, op. cit., page 89.
66. Charles McCoy, 'Records from 41 Banks Are Subpoenaed in Widening money-laundering Inquiry', Wall Street Journal, October 31,1988, page B12. Other banks allegedly used by the money-laundering ring and identified in the article were: Atico Savings Bank; Banco Central S.A.; Banco de Bogota; Banco Granadero de Colombia; Bank Real Miami S.A.; Barnett Banks; Capital Bank; Consolidated Bank N.A.; Dadeland Bank; Deutsch Sudamerikanische Bank; Eagle National Bank, Eastern National Bank; First Federal Savings of Palm Beach; First Nationwide Bank; Florida International Bank; Florida National Bank of Miami; Israel Discount Bank; Marine Midland International Bank; Miami National Bank; NCNB National Bank of Florida; Northern Trust Bank of Florida; Peoples First National Bank; Professional Savings Bank; Southeast Banking Corporation; United National Bank; Westchester Bank; Banco Atlantico; Banco Leumi Trust Co. of New York; Philadelphia International Bank; Lorain County Bank; California First Bank; Philadelphia National Bank; and Sun Bank N.A..
67. The White House, Office of the Press Secretary, Remarks by the President to International Drug
Enforcement Conference, April 27,1989, page 2.
68. See Peter Samuel, 'Senior Bulgarian Aides Linked to a Booming Trade in Heroin', New York City Tribune, March 30,1989, page A1; 'Druglords Seen Moving Into Havens in Communist Bloc', New York City Tribune, March 31,1939, page A1; 'In 1986, Bulgarian Connection Surfaced in Big Seizure in LA of Drug Money', New York City Tribune, April 4,1989, page Al; Knut Royce, 'Heroin Labs in Bulgaria', Newsday, April
1,1989, page 7; and 'Dirty Money: Drugs to Gold', Newsday, April 2,1989; and DEA Investigation Report
Shakarchi Trading Company, File No. UN-89-0002, January 3,1989, pages 3-5. The Republic Bank of New York, its deposits of $760 million with the San Francisco Reserve Bank in 1984-almost all of it from correspondent banks in Hong Kong - and the bank Treasurer's desire not to advertise or talk about this business,were discussed in 'West Coast Cash Surge Linked to Drug Dollars', Money-laundering, op. cit.
69. For a general description of the program, see 'US Loans to E. Germany Sent on to Terrorists', Free
Press International Report, July 14,1989.
70. American Interests Special 'Follow the Money' (Federal News Service, 1989), page 13-1.
71. Ibid., pages 14-2,15-1.
72. James Bamford, The Puzzle Palace (New York: Penguin Books, 1982), page 325.
73. Edward Jay Epstein, Agency of Fear (New York: G. P. Putnam's Sons, 1977), pages 85,158.
74. Bamford, The Puzzle Palace, op. cit., page 327.
75. For a good description of this abortive beginning of the use of intelligence in fighting the war on drugs, see Bamford, The Puzzle Palace, op. cit, pages 314,325-337,369-370, and 381.
76. Bamford, The Puzzle Palace, op. cit, page 336.
77. Guy Gugliotta and Jeff Leen, Kings of Cocaine (New York: Simon & Schuster, 1989), page 126.
78. Associated Press, 'Customs Chief Vents Anger As He Resigns', Atlanta Journal, August 1,1989. His remarks are supported in Drug money-laundering, Banks and Foreign Policy, A Report on anti-money- laundering law enforcement and policy based on oversight hearings before the Senate Foreign Relations Committee on September 27 and October 4 and hearings before the Senate Banking Committee on November
1 submitted to the Foreign Relations Committee by the Subcommittee on Narcotics and Terrorism, undated but circa February 1990.
79. US Congress, Senate, International Terrorism, Insurgency, and drug-trafficking Present Trends in
Terrorist Activity, Joint Hearings Before the Committee on Foreign Relations and the Committee on the
Judiciary, May 13,14 and 15,1985 (Washington, D.C.: US Government Printing Office, 1985), page 114.
80. Ibid., page 141.
81. Senate, International Terrorism, Insurgency, and drug-trafficking, op. cit, page 168.
82. Department of State, Report to Congress, op. cit, page 2.
83. See William E. Simon, 'Should We Bail Out Gorbachev?' Reader's Digest, September 1988.
84. US Department of State, Report to Congress, Section 2013, PL. 99-570, Reports and Restrictions
Concerning Certain Countries, May 1,1988, page 2.
85. International Narcotics Control Strategy Report, March 1988, op. cit, page 35.
86. Elaine Shannon, Desperados (New York: Viking, 1988), pages 393,432-433.
88. Michael Levine, Deep Cover (New York: Delacorte Press, 1990), page 229.
89. Michael Isikoff, 'Mexico Says NBC Reports Distorted', Washington Post, January 11,1990, E1.
90. Michael Hedges, 'Helms: Von Raab Shushed on Mexican Drugs', Washington Times, April 6, 1989, page A6.
112 RED COCAINE
91. Michael Isikoff, 'Blunt Assessment of Bolivia Ignored', Washington Post, March 1,1990, A4.
92. US Department of State, Bureau of International Narcotics Matters, International Narcotics Control
Strategy Report (Washington, D.C.: US Department of State, March 1990). See also Michael Isikoff, 'World
Output of Narcotics Soars, Congress Told', Washington Post, March 2,1990, page A24.
93. 'World Output of Narcotics Soars, Congress Told', op. cit.
94. Jack Anderson and Dale Van Atta, 'CIA Breaks Ranks on Cuba, Nicaragua', Washington Post, June
3,1987, page E19.
95. Michael Hedges, 'Drug Money Ends Up in 'Drawer of Fidel", Washington Times, March 10, 1989,
96. See US Department of State, Report to Congress, op. cit; and US Department of State, Bureau of International Narcotics Matters, International Narcotics Control Strategy Report: Mid-Year Update (Washington, D.C.: US Government Printing Office, September 1988).
97. Brian Crozier, 'Drogue: la Filiere Sovietique', L'Express, December 25, 1986, page104.
For a partial English translation, see 'The Soviet Drug War Against the West', The Free Nation, February
1987, pages 1-2.
98. Ibid., page 104. Also see Brian Crozier, The Gorbachev Phenomenon (London and Lexington, Georgia: The Claridge Press, 1990), pages 147-170.
99. Rachel Ehrenfeld and Peter Samuel, 'Drugs, the DEA and Damascus', Australia/Israel Review, August 25 - September 7,1987; and Jack Anderson, 'Syrians Aiding Heroin Traffic in Beka'a Valley', Washington Post, February 1,1984, page F10.
100. Michael Hedges, 'Federal Scourge of Drug Kingpins', Insight, June 6,1988, page 24. 101. US
Department of State, International Narcotics Control Strategy Report: Mid-Year Update, op. cit, page