PINOCHET ACCUSED OF DRUG DEALS

Ex-Spy Chief Says Dictator Also Embezzled

SANTIAGO, Chile Gen. Augusto Pinochet's former intelligence chief,
now one of his bitterest enemies, has implicated the disgraced
dictator and one of his sons in a cocaine manufacturing and smuggling
scheme and contends that it was one of the sources of Pinochet's
illicit $28 million fortune.

Gen. Manuel Contreras, who ran the Directorate of National
Intelligence, the Chilean secret police, during the 1970s, made the
charges in a document submitted last week to an investigating
magistrate here. He also accused Pinochet of embezzling money from
secret government accounts that the dictator controlled during his 17
years in power, which ended in 1990.

According to Contreras' account, the cocaine was processed with
Pinochet's authorization at a Chilean Army chemical plant in
Talagante, south of here, during the 1980s. Pinochet's son Marco
Antonio and one of his business partners then arranged for the drugs
to be transported to Europe and the United States, with payoffs going
into secret bank accounts the Pinochet family held abroad, Contreras'
account said.

The accusations were first reported Sunday in the Chilean newspaper
La Nacion. Contreras has been in jail since January 2005 in
connection with human rights abuses and was not available for
comment. But his lawyer, Fidel Reyes, and judicial officials
confirmed Monday that the account published Sunday accurately
reflected the written statement Contreras supplied to the magistrate.

During the 1970s, when the worst of the military dictatorship's human
rights abuses occurred, Contreras was one of Pinochet's closest and
most trusted associates. But the two men have fallen out in recent
years, with Contreras contending that he is being made the scapegoat
for human rights violations for which Pinochet should take responsibility.

In 1993, a Chilean court sentenced Contreras to seven years in prison
for his role in the 1976 assassination in Washington of Orlando
Letelier, a former foreign minister of Chile. He has also been
convicted of kidnapping a Socialist Party leader in 1974, and
convicted in Argentina of the 1974 bombing assassination of a former
Chilean army chief opposed to Pinochet.

Contreras said, according to the account, that the drug manufacturing
effort was overseen by a secret police chemist named Eugenio Berrios,
accused by human rights groups of developing poisons to kill
Pinochet's political opponents. Berrios disappeared in 1991, as he
faced questioning about the making of the bomb that killed Letelier,
and was found dead on a beach in Uruguay four years later.

Spokesmen for Pinochet, who is now 90, ailing and reviled even by
many who once supported him, and Marco Antonio Pinochet, on Monday
angrily denied Contreras' accusations, which the Chilean army said it
would investigate.