PROBE: NO PROOF CIA CONSPIRED WITH TRAFFICKERS

An investigation into the CIA's possible dealings with Central American
drug smugglers during the 1980s has found no evidence that the CIA
conspired with drug traffickers who were helping Nicaraguan Contra rebels,
sources say. But a classified report of the probe, conducted by the
agency's Inspector General's Office, also concluded that some CIA personnel
were aware of allegations of drug trafficking by some Contra supporters and
failed to adequately check them out. ``In some of these cases the
allegations were handled appropriately'' while in others they were not,
said an official familiar with the report. According to the New York Times,
the report found that the CIA's decision to keep paid agents suspected of
drug trafficking, or to continue dealing with them in some less-formal
relationship, was made by top officials at the agency's headquarters in
Langley, Va., in the midst of the war waged by the CIA-backed Contras
against Nicaragua's leftist Sandinista government. But the report also says
that ``the central shortcomings in the handling of such allegations have
been addressed and corrected in the years since the Contra program ended,''
the official said. The investigation was the second part of a general
inquiry by the Inspector General's Office, ordered in response to a series
published in the Mercury News nearly two years ago about connections
between drug trafficking by CIA-sponsored Contra rebels and the crack
cocaine explosion in the United States.

TWO DEALERS

The series described the activities of two Nicaraguan drug dealers, both
Contra sympathizers, who were said to have sold cocaine in the United
States and used the millions of dollars in proceeds to buy weapons for the
Contras. The series credited one of them, Danilo Blandon, with selling
enough cocaine to a South-Central Los Angeles crack dealer to spark a U.S.
crack epidemic. The series also implied that the drug dealers received
government protection, possibly from the CIA.

Last year, the Mercury News reported shortcomings in the series, and the
series' author has since left the newspaper.

The report contains so much classified information about the agency's
sources and methods, according to a CIA spokesman, that the agency is
uncertain whether it can publish an unclassified version. There has been
speculation that it contains damaging information about the CIA's
willingness to ignore the illegal activities of some Nicaraguan Contras.

The possibility that the report won't be made public drew a swift and angry
response from Rep. Juanita Millender-McDonald, who represents the Watts
area of Los Angeles. She said she is disgusted with the turn of events.

``My constituents are waiting,'' the congresswoman said. ``I am
disappointed that the inspector general has come up with something that
can't be released.''

The completed report has been given to the Senate and House committees on
intelligence. Millender-McDonald said she expects the House intelligence
committee to hold hearings on the matter.

The classified report, running to about 500 pages with various appendixes,
found ``no information to indicate that the CIA or its employees conspired
with or assisted Contra-related organizations or individuals in drug
trafficking,'' said a federal official familiar with the report.

`No' CIA involvement

The inspector general's mission was to find out whether the CIA or its
people were involved in supporting drug trafficking. ``The answer to that
is clearly no,'' the official said.

Peter Kornbluh, a senior analyst at the National Security Archive, a
non-profit organization specializing in obtaining the declassification of
foreign policy documents, also challenged the CIA's explanation of why the
report could not be released.

``The truth is,'' Kornbluh said, ``even if there is a modicum of validity
to the sources and methods argument, and in this case I don't think there
is, national security is far better served by the release of the
information than the withholding of it.''

A report released earlier this year by the CIA's inspector general found no
link between the drug dealers and the CIA and said the CIA did not
intervene to protect them. It also found no information to indicate that
the drug trafficking was motivated by a commitment to support the Contra
cause.

The second phase of the investigation looked at any knowledge the CIA had
of other alleged drug trafficking by the Contras or people associated with
the program.

An investigation by the Department of Justice's inspector general also has
produced a report that has not been made public.

Checked-by: (Joel W. Johnson)