CIA DIDN'T ALWAYS REPORT CONTRACTORS' ALLEGED DRUG-DEALING

The Central Intelligence Agency failed to alert Congress or law
enforcement about allegations of drug dealing by some of its hired
hands during the 1980s secret war against the Marxist government of
Nicaragua, the agency disclosed in a report released Thursday.

The report, by the CIA's Office of the Inspector General, adds weight
to long-held suspicions that the agency sometimes looked the other way
when it learned of drug-dealing by some of the people it used on a
contract basis in the Contra war.

Some of the material has come out before in a U.S. Senate
investigation and in various press accounts during and since the
1980s, including recent leaks about this report.

During the 1980s, the CIA received allegations of drug-trafficking on
the part of several dozen Contra-related individuals and one Contra
organization, the inspector general's report states. Sometimes the
agency investigated the allegations of drug-running, broke off ties
with the individuals and alerted other law enforcement agencies. In
other cases, it did not, the report shows.

However, investigators found no information that the CIA or its
employees ``conspired with or assisted Contra-related organizations or
individuals in drug trafficking to raise funds for the Contras or for
any other purpose.''

The report did not try to verify the allegations, which range from
unverified accusations in Sandinista publications to cables to CIA
headquarters from worried CIA officers working with the Contras in
Central America.

Details of the report

The inspector general reported that:

``The CIA acted inconsistently'' in handling allegations of drug
trafficking. ``In six cases, CIA knowledge of allegations or
information indicating that organizations or individuals had been
involved in drug trafficking did not deter their use or employment by
the CIA.''

The agency also failed to notify Congress about eight of 10
Contra-related individuals about whom the CIA had received
drug-trafficking allegations or information, the inspector general
reported.

The CIA notified U.S. law enforcement of allegations of
drug-trafficking by 25 Contra-related people, but did not pass on
information about 11 other Contra-related people and ``assets.''

Agency was suspicious

The report describes the agency's suspicions about a variety of
operatives and contractors who assisted it in some way during the
Contra war. Among them was Eden Pastora, commander of a tiny
anti-Sandinista army operating out of Costa Rica.

The agency broke off relations with Pastora and reported him to U.S.
law enforcement after receiving numerous allegations of
drug-trafficking by members of his group, but continued dealing with
some of the people around him, the report says.

A Central American CIA chief of station recalled that there was a
group of ``ne'er-do-well'' people with criminal histories around
Pastora. ``Some were scoundrels,'' the CIA official said, but ``we
were going to play with these guys. That was made clear by (CIA Chief
William) Casey and (then-L.A. Division Chief Duane)
Clarridge.''

The inspector general's investigation followed publication of a series
in the San Jose Mercury News. The series, ``Dark Alliance,'' described
a California drug ring run by two Nicaraguan Contra sympathizers and
strongly suggested that the drug dealers were protected from
prosecution by the CIA or other government agencies.

A previous report by the CIA inspector general found that the drug
ring had no connection with the CIA. The Department of Justice Office
of the Inspector General, which also conducted an investigation, found
no substantiation for the key claims in the series. Jerry Ceppos,
executive editor of the Mercury News, later wrote a column saying the
series did not meet the paper's standards in some respects.

IF YOU'RE INTERESTED The inspector general's report is available
online at www.cia.gov/cia/publications/cocaine2

Checked-by: Patrick Henry