cocaine, conspiracy theories and the cia in central america by Craig Delaval Delaval is a freelance writer and filmmaker and was a production assistant for "Drug Wars." This article was edited by Lowell Bergman, series reporter for "Drug Wars." Since its creation in 1947 under President Harry Truman, the CIA has been credited with a number of far-fetched operations. While some were proven - the infamous LSD mind-control experiments of the 1950s - others, like the assassination of John F. Kennedy and the crash of the Savings and Loans industry, have little or no merit. In 1996 the agency was accused of being a crack dealer. A series of expose articles in the San Jose Mercury-News by reporter Gary Webb told tales of a drug triangle during the 1980s that linked CIA officials in Central America, a San Francisco drug ring and a Los Angeles drug dealer. According to the stories, the CIA and its operatives used crack cocaine--sold via the Los Angeles African-American community--to raise millions to support the agency's clandestine operations in Central America. The CIA's suspect past made the sensational articles an easy sell. Talk radio switchboards lit up, as did African-American leaders like U.S. Rep. Maxine Waters, D-Los Angeles, who pointed to Webb's articles as proof of a mastermind plot to destroy inner-city black America. One of the people who was accused in the San Jose Mercury-News of being in the midst of the CIA cocaine conspiracy is one of the most respected, now retired, veteran D.E.A. agents, Robert "Bobby" Nieves. "You have to understand Central America at that time was a haven for the conspiracy theorists. Christic Institute, people like Gary Webb, others down there, looking to dig up some story for political advantage," Nieves said. "No sexier story than to create the notion in people's minds that these people are drug traffickers." But in the weeks following publication, Webb's peers doubted the merit of the articles. Fellow journalists at the Washington Post, New York Times and Webb's own editor accused him of blowing a few truths up into a massive conspiracy. Amongst Webb's fundamental problems was his implication that the CIA lit the crack cocaine fuse. It was conspiracy theory: a neat presentation of reality that simply didn't jibe with real life. Webb later agreed in an interview that there is no hard evidence that the CIA as an institution or any of its agent-employees carried out or profited from drug trafficking. Still, the fantastic story of the CIA injecting crack into ghettos had taken hold. In response to the public outcry following Webb's allegations--which were ultimately published in book form under the title Dark Alliance--the CIA conducted an internal investigation of its role in Central America related to the drug trade. Frederick Hitz, as the CIA Inspector General-- an independent watchdog approved by Congress--conducted the investigation. In October 1998, the CIA released a declassifie.

1. cocaine, conspiracy theories and the cia in central america by
Craig Delaval
Delaval is a freelance writer and filmmaker and was a
production assistant for "Drug Wars." This article was edited by
Lowell Bergman, series reporter for "Drug Wars."
Since its creation in 1947 under President Harry Truman, the
CIA has been credited with a number of far-fetched operations.
While some were proven - the infamous LSD mind-control
experiments of the 1950s - others, like the assassination of John
F. Kennedy and the crash of the Savings and Loans industry,
have little or no merit.
In 1996 the agency was accused of being a crack dealer.
A series of expose articles in the San Jose Mercury-News by
reporter Gary Webb told tales of a drug triangle during the
1980s that linked CIA officials in Central America, a San
Francisco drug ring and a Los Angeles drug dealer. According
to the stories, the CIA and its operatives used crack cocaine--
sold via the Los Angeles African-American community--to raise
millions to support the agency's clandestine operations in
Central America.

2. The CIA's suspect past made the sensational articles an easy
sell. Talk radio switchboards lit up, as did African-American
leaders like U.S. Rep. Maxine Waters, D-Los Angeles, who
pointed to Webb's articles as proof of a mastermind plot to
destroy inner-city black America.
One of the people who was accused in the San Jose Mercury-
News of being in the midst of the CIA cocaine conspiracy is one
of the most respected, now retired, veteran D.E.A. agents,
Robert "Bobby" Nieves.
"You have to understand Central America at that time was a
haven for the conspiracy theorists. Christic Institute, people like
Gary Webb, others down there, looking to dig up some story for
political advantage," Nieves said. "No sexier story than to
create the notion in people's minds that these people are drug
traffickers."
But in the weeks following publication, Webb's peers doubted
the merit of the articles. Fellow journalists at the Washington
Post, New York Times and Webb's own editor accused him of
blowing a few truths up into a massive conspiracy.
Amongst Webb's fundamental problems was his implication that
the CIA lit the crack cocaine fuse. It was conspiracy theory: a
neat presentation of reality that simply didn't jibe with real life.
Webb later agreed in an interview that there is no hard evidence
that the CIA as an institution or any of its agent-employees
carried out or profited from drug trafficking.
Still, the fantastic story of the CIA injecting crack into ghettos

3. had taken hold. In response to the public outcry following
Webb's allegations--which were ultimately published in book
form under the title Dark Alliance--the CIA conducted an
internal investigation of its role in Central America related to
the drug trade. Frederick Hitz, as the CIA Inspector General--
an independent watchdog approved by Congress--conducted the
investigation. In October 1998, the CIA released a declassified
version of Hitz's two-volume report.
The IG's report cleared the CIA of complicity with the inner-
city crack cocaine trade. It refuted charges that CIA officials
knew that their Nicaraguan allies were dealing drugs. But, the
report said that the CIA, in a number of cases, didn't bother to
look into allegations about narcotics And the Hitz report
describes how there was little or no direction for CIA operatives
when confronted by the rampant traffic in drugs in Central
American during the 1980s.
What follows is a closer look at the Hitz report, drawing on
interviews with Frederick Hitz and others interviewed for
FRONTLINE's "Drug Wars" series.
The War on Communism
When the Marxist Sandinistas overthrew the government of
longtime dictator Anastasio Somoza in 1979, U.S. approval
soured when it became clear that the new regime saw itself as a
satellite of Cuba, if not the Soviet Union. When Ronald Reagan
became president soon after, he quietly began sending aid to
those fighting the Marxist government. They were known as the
Nicaraguan Resistance, or more simply, the Contras.

4. contras
Contra soldiers
As with Burma, Laos and Afghanistan before it -- where the
U.S. had helped fight wars -- Nicaragua had a narcotics trade--a
fact which was brought to the CIA's attention while the Contra
effort was barely off the ground. In 1981 members of the
Nicaraguan Revolutionary Democratic Alliance (ADREN) were
working alongside CIA officers to overthrow the new Sandinista
government.. As noted in the Hitz report, a cable to CIA
headquarters stated that ADREN leadership had decided to
"engage in drug smuggling to the United States in order to
finance its anti-Sandinista operations." The cable stated that an
"initial trial run" had taken place in July 1981, when drugs were
transported via plane to Miami.
In what would prove common during the Contra war, the CIA
never followed up on the allegations, or bothered to verify
whether the "initial run" had taken place, according to the Hitz
report. ADREN disbanded in 1982. But some members joined
the Nicaraguan Democratic Force (FDN), which worked with
the CIA.
In another instance, the CIA received allegations that five
members of the Democratic Revolutionary Alliance (ADREN) --
those fighting along the border of Nicaragua and Costa Rica -
were involved in drug trafficking. The five were allegedly
working with known drug trafficker Jorge Morales.

5. Although the CIA broke off contact with the ARDE in 1984, it
continued to have contact with four of the five members who
associated with Sr. Morales until 1987.
"In the context of this struggle between the Contras and the
Sandinistas, there were accusations flying left and right, some
of which were probably meritorious, and a good many of which
were part of the battle they were involved in," Hitz said. The
question for the CIA officer in the field was, how do you deal
with those accusations?
"And what they did was, for the most part, attempt to track them
down," Hitz said. "But on several cases, no action appears to
have been taken. And that's the part that we find in our report."
Around the same time--the early 1980s--a letter between
Attorney General Smith and CIA Director Casey was made
official, creating what some considered a convenient loophole
for the CIA
The Letter
In the winter of 1982, as the United States was plotting how to
overthrow the Sandinista government that came to power in
Nicaragua, a letter - a "Memorandum of Understanding" [MOU]
was being drafted in Washington, D.C. The presumptive author
was the U.S. Attorney General, the late William French Smith.
The recipient was the Central Intelligence Agency Director
William Casey.

6. The subject was a list of offenses that CIA field officers in the
field were required to report if they witnessed or became aware
of a crime -- particularly if it involved an informant or someone
the CIA officer wanted to recruit as an "agent". The letter of
understanding listed all kinds of crimes from murder to passport
fraud. But it omitted narcotics violations.
The oversight was too glaring, apparently, to leave without
comment. Weeks later a follow up letter based on some internal
discussion in the Justice Department was sent to the CIA
"I have been advised that a question arose regarding the need to
add all narcotics violations to the list of "non-employee"
crimes," Smith wrote to Casey in his February 11, 1982 letter.
But instead of adding drugs to the list, Smith cited existing
federal policy on narcotics enforcement, and wrote:
"In light of these provisions and in view of the fine cooperation
the Drug Enforcement Administration has received from CIA,
no formal requirement regarding the reporting of narcotics
violations has been included in these procedures." In effect, the
agreement meant that CIA officers were not required to report
narcotics violations back to headquarters. As the CIA's
Inspector General Fred Hitz told us, it was at best a "mixed
message."
Was the omission of a requirement to report narcotics violations
a conscious decision designed to provide cover for CIA agents
caught in the midst of the thriving drug business in Central
America? Fred Hitz refuses to speculate. Hitz insists he finds it

7. hard to believe that any CIA agent in the field would be
involved, especially since " it was well known during this
period that if the CIA was linked to any drug shipment, the
political damage [to the Contra cause] would be irreparable."
"It was fairly clear, and all of the officers whom we questioned
on it, and some whom we didn't but whom the House
questioned, realized that if drugs were intermixed with this
program, it would fail, it would kill it," Hitz said. "They knew
perfectly well because of past accusations in previous theaters
that that would be the kiss of death."
Yet there was a lack of narcotics-related direction from CIA
headquarters during the Contra war, as indicated when the issue
of reporting suspected narcotics violations arose again in 1987.
Acting CIA director Robert Gates sent a 1987 memorandum to
CIA Deputy Director for Operations Clair George stating that it
was imperative that CIA officers cease relations with Contras
who were "even suspected of involvement in narcotics
trafficking," according to the Hitz report.
Gates' memorandum instructed George to vet names of air
crews, air services companies and subcontractors with the DEA,
U.S. Customs and the FBI to ensure that none of the contractors
used by the CIA were involved in narcotics. For some reason,
this memorandum "was not issued in any form that would advise
Agency employees generally of this policy," Hitz stated in his
report. It never got to the field agents who were supposed to use
it as a guide.
Hitz interprets both the omission of narcotics from the MOU
and the fact that Gates' memo did not ever make it to the agents

8. who needed it as the failings of a vast bureaucracy. These
events, however, as well as others documented in the report,
have provided fodder to those interpreting the agency's behavior
less sympathetically.
Jonathan Winer was a staffer on a Senate Committee
Investigation led by Senator Kerry of Massachusetts, and is a
former deputy assistant Secretary of State for International
Narcotics Matters. "If you're focused on winning an ideological
war, you're probably not focused at the same time on the law
enforcement consequences of what you're doing," Winer said.
"And certainly, our government in the 1980s was not focused on
that problem. It actively resisted being focused on that
problem."
Others believe that the U.S. espionage agency was simply
covering its tracks.
The Ilopango Air Base
The story of Ilopango air base in San Salvador has become a
favorite anecdote among those backing the claim that the CIA
protected Contras neck-deep in the drug trade. The Hitz report
states that by 1985, the DEA was watching Carlos Albert
Amador. He was a former pilot for the Southern Front Contras,
a group that operated along the northern border of Costa Rica
and in the southern regions of Nicaragua. Carlos Alberto
Amador had previously flown secret Contra missions out of the
airfield. But, in 1985 , he came under suspicion for transporting
drugs from Costa Rica to Miami. The CIA cable noted that
Amador "had access to Hanger 4 at Ilopango air base."

9. The cable quoted a DEA source who "stated that Amador was
probably picking up cocaine in San Salvador to fly to Grand
Caymen [sic] and then to south Florida," adding that the DEA
was going to ask San Salvadorian police to investigate Amador
and anyone associated with Hanger 4.
But Hanger 4 -- as the author of the cable would later tell CIA
investigators -- was also thought to be associated with Oliver
North, who was under commission from the White House to
secretly carry out aid to the Contras.
When CIA headquarters responded to the cable, it told its local
station that it "would appreciate Station advising DEA not to
make any inquiries to anyone re Hanger [sic] no. 4 at Ilopango
since only legitimate....supported operations were conducted
from this facility."
Former DEA field agent Nieves denied the suggestion that CIA
objectives overrode DEA drug enforcement during the Contra
War.
"I was given carte blanche to do my job," Nieves said. "Never
once did anybody ever say anything to me about anything I was
doing that was nothing but supportive. There was no
interference. There was no overriding priority, there was no
competition, there was no anything except for support of the
DEA's mission. And that's a fact."
But others say the CIA's loose grip on its contacts certainly
didn't help the DEA's cause.

10. "I believe that elements working for the CIA were involved in
bringing drugs into the country," said Hector Berrellez, DEA
field agent.
"I know specifically that some of the CIA contract workers,
meaning some of the pilots, in fact were bringing drugs into the
U.S. and landing some of these drugs in government air bases.
And I know so because I was told by some of these pilots that in
fact they had done that."
While most D.E.A. veterans we interviewed dismiss allegations
of any conscious CIA activity or involvement in drug
trafficking, a number are suspicious, and a handful like
Berrellez claim they had hard evidence of "CIA contract
employees" being involved. With the exception of the
Venezuela National Guard case we were unable to find any
evidence that any CIA agent was ever considered a potential
target of a grand jury investigating drug trafficking.
Drug policy: MIA
"If it's your job to check out food at the supermarket counter ...
you're not worrying about the person who's supposed to be
stocking the shelves. It's not your job," said Jonathan Winer,
explaining the CIA's minimal attention to drug trafficking in
Central America.
It is clear from interviews with former D.E.A. agents, CIA
officials and former Colonel Oliver North that the CIA did not

11. ignore narcotics in Central America. Injecting the United States
into a Nicaraguan civil war was hardly an easy sell to Capitol
Hill, with nightmares of Vietnam still fresh from the 1970s.
Any hint of collusion with the drug trade would be like handing
a loaded gun to opponents aiming to kill the effort.
But the degree to which that point was communicated to CIA
agents in the field, according to the Hitz investigation, does not
inspire confidence.
"There was no directorate of operations instruction about how to
deal with drug allegations during the whole period of the Contra
effort," Hitz said. "They were in process. They were working on
some kind of guidance. But they never published it in black
letter and sent it to the field." In Nicaragua, the Smith-Casey
letter basically excused CIA officers from reporting drug
trafficking among their contacts. Even when it became clear
that narcotics could cast a pall on the effort, the CIA appeared
unwilling to react.
As early as 1980, a handbook had been developed with a section
instructing CIA officers how to deal with contacts suspected of
trafficking drugs. But those regulations were ruled inapplicable
to the Contra affair, because they were meant for CIA personnel
who were specifically collecting narcotics intelligence -- not the
case in Central America. Inexplicably, the handbook wasn't
formally published until 15 years later.
In addition, in the mid-1980s, any effort to keep the CIA out of
the world of drug trafficking was made more difficult by the
decision of its boss, Director Casey, to activate what became
known as the "off-the books" operation of Oliver North.

12. alt tag
North at Iran-Contra Hearings
Along with a leading role in the Iran/Contra scandal - in which
North helped sell arms to Iran to fund the Contra War - North is
also said to have employed air and sea transport companies
moonlighting as drugs carriers.
When the Kerry Commission released its report in 1988, the
company Frigorificos De Puntarenas was listed as receiving
$261,000 in funds from the Nicaraguan Humanitarian
Assistance Office, an organization established in 1985 to spend
$27 million in congressional humanitarian aid to the Nicaraguan
resistance.
Frigorificos' owner, Luis Rodriguez, also operated Ocean
Hunter/Mr. Shrimp out of Miami, Florida.
In 1986 the DEA seized 400 pounds of cocaine hidden in yucca
addressed to Ocean Hunter. Rodriguez later testified that both
companies were used to launder drug money between Costa Rica
and Miami.
North has categorically denied that anybody in his operation
was trafficking drugs. But in 1987, a co-owner of the shrimp

13. companies pointed the finger at the National Security Council.
Moises Nunez told the CIA that he had had a clandestine
relationship with the National Security Council since 1985.
"If we have a foreign policy that says we're going to oppose the
spread of Communism, that's not inconsistent with the (drug)
policy,' North said in an interview with FRONTLINE. "We're
not going to tolerate the flow of drugs into this country.
Unfortunately you've got members of Congress up there who
want to beat the drum and blame the problem of narcotics in
America on the Nicaraguan resistance. And that's just not the
case."
"He is either misinformed or lying," Winer says. "Oliver North's
diaries are filled with references to drug trafficking and people
associated with his enterprise drug trafficking--filled with it.
Oliver North can say, 'I never hired or worked with any drug
traffickers.' His organization did."
While the Kerry report listed several companies used by the
Nicaraguan Humanitarian Assistance Office that had drug ties,
it failed to pass definitive judgement on how much government
agencies knew about those ties.
"At best, these incidents represent negligence on the part of
U.S. government officials responsible for providing support to
the Contras," the Hitz report stated. 'At worst, it was a matter of
turning a blind eye to the activities of companies who use
legitimate activities as a cover for their narcotics trafficking."
Situation Unresolved

14. That statement sums up the debate remaining over the CIA's
involvement in the Contra War. The Hitz report gives an
abundance of anecdotal evidence showing that drugs were low
on the list of intelligence priorities in the Contra war. It shows
that allegation after allegation were either partially investigated
or not investigated at all.
To this day, Fred Hitz denies that the CIA had any intentional
ties to drug trafficking. But he also admits that the Agency in
many cases took a rain check on specifically addressing
narcotics activity within its allies' ranks.
Some say that's expected when fighting ideological wars in
countries where drugs have historically fueled not only conflict,
but entire economies as well.
"You're always going to be having drug traffickers, gun runners,
people who are alien smugglers ... as some of the kinds of
people that you're going to be relying on to carry out a covert
war," Winer observes. "And that's true of any government
anywhere--whether you're talking Afghanistan, Colombia,
Southeast Asia, Burma. Your operatives tend to be people who
are involved in other illicit activities. These things tend to go
together."
If you put aside conspiracy theories of crack peddling, that still
leaves the question of why the Agency has repeatedly found
itself associated with drug traffickers.

15. To add to the list of theories and speculations, Fred Hitz has his
own.
"I would call them bureaucratically challenged," Hitz said.
"(The CIA) didn't get it done. Having studied the agency over a
period of eight years and the bureaucracy that is involved, it
grieves me but doesn't surprise me that nobody grasped the
nettle and got the right information to the field."
"No conspiracy," he said. "That's ineptitude. Yes, there are lots
of things going on. There is congressional testimony. There are
crises in other parts of the world. There are things that are
keeping the individuals who write these regulations busy; but
that's no excuse. You've got to get to it."
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