U.S. AID TO FIGHT DRUGS IN PERU

Washington Vows To Send $22 Million

LIMA, Peru--Peru will receive $22 million from Washington to buy equipment
for its anti-narcotics police, the U.S. ambassador to Peru announced on Friday.

Ambassador John R. Hamilton and Peruvian Foreign Minister Diego Garcia
Sayan signed the agreement to fund coca plant eradication and coca-growing
prevention programs, which are run by the anti-narcotics police.

These new funds come two months after Washington sent $25 million to Peru
to promote alternative crops in the jungle area.

In announcing the latest anti-narcotics aid package, Hamilton read a short
statement denying "that American money is used for corruption or the abuse
of power."

The announcement came a day after allegations surfaced that the Central
Intelligence Agency paid Peru's jailed former spy chief, Vladimiro
Montesinos, $1 million a year over the past decade to set up an anti-drug
unit, even as he had business dealings with Colombian rebels.

A panel of six judges is investigating a battery of charges against
Montesinos, including allegations that he engineered the sale of 10,000
assault rifles to the Revolutionary Armed Forces of Colombia (FARC). The
guerrillas have been at war with Colombian forces for 37 years, and fund
much of their activity through drug sales, officials in Washington and
Bogota say.

But Montesinos is now saying it was the CIA agents who told him of the ring
that tried to smuggle arms to the FARC from Jordan through Peru, one of the
judges said on Friday.

"I think Montesinos tries to push the idea that had he been involved in the
arms trafficking, the CIA would not have given him any vital information,"
Judge Jimena Cayo Arias-Schreiber said.

Montesinos now wants those agents to testify in his defense.

Cayo confirmed that Montesinos has disclosed the names of the CIA agents
who allegedly visited him last year at the Peruvian Intelligence Service
headquarters and provided him with evidence about the arms sale.

Montesino's lawyer, Gloria Aguero, gave the information to the six-judge
panel investigating dozens of charges against the spymaster during his
decades as the top adviser to disgraced former President Alberto Fujimori,
Cayo said.

Cayo would not confirm whether Montesinos mentioned two CIA agents, as some
news reports say. She said that she only knew the name of one agent but
that she was unable to disclose it.

But whether the agents will testify remains questionable. The investigating
judges have not tried to get sworn statements from the CIA officials, Cayo
said.

"Only the defendant himself or a prosecutor can demand the agents to appear
in court and doing it would involve the use of diplomatic procedures
between Peru and the U.S.," she said.

According to Montesinos' version of events, he met with CIA agents back in
August 2000 and received documents that uncovered a ring that delivered the
weapons to the FARC. At an Aug. 21 news conference, Fujimori credited
Montesinos with breaking up the ring, presenting his spy chief in a rare
public appearance.

Cayo said she had no information about a $1 million annual payment from the
CIA to Montesinos during the last decade.

Newly elected President Alejandro Toledo has vowed to create an anti-drug
czar's office to fight narcotics trafficking. During the 10-year Fujimori
administration, Montesinos was unofficially considered the Peruvian
equivalent of an anti-drug czar.

On Thursday, a second Peruvian judge declared Fujimori an "absent criminal"
and issued a warrant for his arrest. Fujimori holds dual Peruvian and
Japanese citizenship. He fled to Japan after videos showing Montesinos
bribing opposition members of Congress became public.

The scandal first forced Montesinos to flee. Fujimori left several weeks
later. After reaching Japan, his ancestral home, Fujimori resigned and
sought asylum. The two countries have no extradition treaty and Japan does
not usually extradite its nationals.

On Friday, the Japanese government reiterated that it would not surrender
the former president to authorities in Lima. Peru's Foreign Minister Garcia
responded by saying he would send another letter to Japan, expressing his
concern at Tokyo's position.