CIA TURNED A DELIBERATE BLIND EYE TO CONTRAS' DRUG SMUGGLING

The Central Intelligence Agency deliberately ignored evidence of drug
smuggling by its Contra allies in the Eighties, the agency has admitted.
The revelations are contained in an internal report by former CIA
Inspector-General Frederick Hitz which investigated widespread allegations
that the CIA co-operated with cocaine traffickers.

The Cold War was in full flood in the mid-Eighties, and the then president
Ronald Reagan was on a crusade. He was intent on ousting the Sandinista
regime in Nicaragua with the assistance of his CIA boss, William Casey, and
Lieutenant-Colonel Oliver North of the National Security Council. Mr Reagan
called the anti-Communist, anti-government Contra rebels backed by the
United States "the moral equivalent of the Founding Fathers".

But there is mounting evidence that these people were deeply involved in
smuggling drugs into the US, creating a domestic scourge that would
continue long after the Cold War ended.

The report details dozens of allegations of drug trafficking against
individuals who worked with the Contras. In six cases, "CIA knowledge of
accusations or information indicating that organisations or individuals had
been involved in drug trafficking did not deter their use or employment by
[the] CIA."

The CIA used Alan Hyde, a Honduran businessman, to transport guns by sea
from mid-1987 to late 1988. Mr Hyde had already been reported to be "making
much money dealing in white gold, ie cocaine" and the US Coast Guard called
him the "godfather" of criminal activity in the region. But, "There was a
lot of pressure from [a senior CIA official] and DCI Casey to get the job
done," a CIA officer recalled. In March 1993, a cable discouraged
counter-narcotics efforts against Mr Hyde, because "his connection to [CIA]
is well documented and could prove difficult in the prosecution stage".
There is no evidence that the CIA told the Federal Bureau of Investigation,
Drug Enforcement Administration or US Customs, that it was using Mr Hyde.

Many allegations concern the pilots who flew military supplies to the
Contras. They were allegedly taking "guns down, drugs up" - filling their
aircraft with cocaine on the return trip to the US. Carlos Amador, for
instance, was flying supplies from Ilopango air base in El Salvador. A CIA
cable in April 1986 reported that "a [Drugs Enforcement Administration]
source stated that Amador was probably picking up cocaine in San Salvador
to fly to Grand Caymen [sic] and then to South Florida". He warned that
"[DEA] will request that San Salvador police investigate Amador and anyone
associated with Hangar 4", part of the military facility used for supplying
the Contras. The CIA response was direct: "Would appreciate Station
advising [DEA] not to make any inquiries to anyone re Hangar no. 4 at
Ilopango since only legitimate, supported operations were conducted from
this facility."

The operation at Hangar 4 was run by Lt-Col North, and his "Private
Benefactors", who funded a secret war after the US Congress cut off funding
for the Contras. There is evidence that Lt-Col North, too, knew of
allegations that people working with his operation were involved in drug
smuggling. In a diary note he recorded: "Honduran DC-6 which is being used
for runs out of New Orleans is probably being used for drug runs into US."

The Contras' purchasing agent in New Orleans was Mario Calero, the brother
of a senior Contra leader. The CIA was told in February 1986 of allegations
that Mario Calero was engaged in drug trafficking. But "no information has
been found to indicate that CIA took any action in response", the report
notes.

Former DEA agent Celerino Castillo says in his book Powderburn that he
became aware of drug smuggling through Ilopango. In August 1986, he met
Jack McCavett, "the mild-mannered CIA station chief in El
Salvador", who said "we have nothing to do with that operation." Three days
later, he called Mr Castillo over to his office, and pulled $45,000 from
his desk drawer. "'I've got money left over from my budget," he said. 'Take
this for your anti-narcotics group. Go buy them some cars'."

The Hitz report is adamant that the CIA itself did not indulge in cocaine
smuggling to support the Contras' operations. "No information has been
found to indicate that CIA as an organisation or its employees conspired
with, or assisted, Contra-related organisations or individuals in drug
trafficking to raise funds for the Contras or for any other purpose," it
says.

But it does provide ample evidence that the CIA turned a blind eye when
drug trafficking may have been taking place, and recruited and employed
contractors who were alleged to have been in the business.

People have tried to work on this subject, and have met only scepticism and
hostility. An investigation by Democratic senator John Kerry came to
damning conclusions, but was attacked by the government