From the Radio Free Michigan archives ftp://141.209.3.26/pub/patriot If you have any other files you'd like to contribute, e-mail them to bj496@Cleveland.Freenet.Edu. ------------------------------------------------ Board: NEWS BB Topic: WHITEWATER Subject: LOND. TELEGRAPH 10/9 Here's the second story from Ambrose Evans-Pritchard in the 10/9 London Sunday Telegraph....... "SMUGGLERS LINKED TO CONTRA ARMS DEALS" It is engraved on the consciousness of the world by now that Arkansas is a corrupt one-party state. What is less well known is that it is also a major point for trans-shipment of drugs coming from Latin America and the Carribean. In the mid-1980s it was perilously close to becoming a "narco-republic" - a sort of mini-Colombia within the borders of the United States. Organized crime has long had a foothold in Arkansas, especially in the gambling town of Hot Springs where Bill Clinton spent most of his childhood. and the geography is good for smuggling. Located in the hinterland, the state is safely removed from the microscopic surveillance of the U.S. Coast Guard. Business exploded in the early 1980s, according to sources in state and federal law enforcement. Drugs were flown into airstrips all over Arkansas, and from there transported overland to cities such as St. Louis and Chicago. Basil Abbott, a convicted drug pilot, says that he flew a Cessna 210 full of cocaine in to Marianna, in eastern Arkansas, in the spring of 1982. The aircraft was welcomed by an Arkansas State Trooper in a marked police car. "Arkansas was a very good place to load and unload," he said. But the nerve center of the smuggling operation was at Mena, a small town in the Ouachita mountains of western Arkansas. Aircraft with modified cargo doors would drop their loads over pre-arranged sites, then fly empty into the Mena airport. The legendary smuggler Barry Seal had his base of operations there, storing aircraft at a refitting shop called Rich Mountain Aviation. Seal was probably the biggest importer of cocaine in American history. Between 1980 and his assassination in 1986, his team of pilots smuggled in 36 metric tons of cocaine, 104 tons of marijuana and three tons of heroin, according to a close associate of Seal. The sums of money involved were staggering. At his death, Seal left a number of operational bank accounts. One of them, at the Cayman Islands branch of the Fuji Bank, currently has an interest-bearing balance of $1,645,433,000. There were various attempts to investigate the Mena smuggling ring. All of them were obstructed. The first was a joint investigation by the Arkansas State Police and the U.S. Treasury's Internal Revenue Service. It lasted from 1985 to 1986. The IRS investigator, Bill Duncan, says that there was a cover-up in which crucial evidence was withheld from the federal grand jury. He resigned in disgust from the Treasury. Russell Welch, the investigator for the State Police, suffered a sever illness during the probe. He was hospitalized and diagnosed with anthrax poisoning. The Sunday Telegraph has a copy of his hand-written private notes for the full three years of the investigation, along with supporting documents from FBI and Drug Enforcement Administration (DEA) sources. cont. It is clear that Welch has stumbled on a complex operation in which narcotics trafficking and government covert operations had somehow got mixed up. On June 4, 1985, his diary says that an agent from the DEA "informed me in strictest confidence that it was believed, within his department, that Barry Seal is flying weapons to Central and South America. In return he is allowed to smuggle what he wanted back into the United States". In August 1987 he received a secret teletype from the FBI offices in Chicago advising him that "a CIA or DEA operation is taking place at the Mena airport". The Sunday Telegraph has a copy of the telex. By late 1987 he was deeply disturbed. "I feel like I live in Russia, waiting for the secret police to pounce down. A government has gotten out of control. Men find themselves in positions of power and suddenly crimes become legal. National Security?!" In 1988 the Democratic whip in the U.S. Congress, Bill Alexander, started an investigation through the General Accounting Office. It went nowhere. Alexander then tried again with a joint investigation by the U.S. Congress and the Arkansas Attorney General's Office, but ran into endless obstruction. Compromised: Clinton, Bush, and the CIA, a best-selling book published this year, has helped to open up the mystery of what happened at Mena. the author Terry Reed has recounted his role in the drama, and since then other sources have come forward. It appears that the CIA chose Barry Seal and his smuggling operation to be the sub-contractor for its covert scheme to supply arms to the Nicaraguan Contra rebels between 1984 and 1986. The CIA could not use government aircraft or pilots because of a congressional prohibition on aid to the Contras. It was in a desperate hurry to get things started, and Seal was there with an infrastructure already in place - in Arkansas. A big blunder? Undoubtedly. But it is probably going too far to accuse the CIA of complicity in narcotics trafficking. Seal had ostensibly turned over a new leaf by then. Facing indictment for smuggling, he had convinced Vice-President Bush's drug task force that he could crack open the Medellin cartel as an undercover agent for the DEA, which he did in fact accomplish in a spectacular sting operation. Big snag. He never stopped hauling cocaine for himself. In fact he used the high-tech equipment given to him by the CIA and the DEA to perfect his smuggling skills. "The CIA didn't realize that Seal had synergised their covert operation with the Dixie Mafia. They didn't figure it out until they were in the quicksand, and by then it was too late," said Seal's associate. "In the end, you had a situation where the Dixie Mafia was blackmailing the CIA." The result was a free-for-all in Arkansas. The regional drug cartel thought that it had acquired a sort of federal immunity for drug trafficking, and behaved accordingly. By 1986 there was an epidemic of cocaine, contaminating the political establishment from top to bottom. The nightlife of the Clinton coterie was worthy of cont. Caligula. Dan Lasater, a self-made restaurant tycoon and money-man for Governor Clinton, gave parties at which cocaine would be served like hors d'oeuvres and sex was rampant. Some of this is documented graphically in police records. Bill Clinton was in frequent attendance. Lasater was eventually convicted on federal charges of distributing cocaine to friends. In 1986 he was sentenced to 36 months in jail. In addition, there is a document from the Regional Organized Crime Center in Nashville, dated May 15, 1986, which shows a request for information on Lasater "in reference to narcotics trafficking via aircraft with possible organized crime ties". This was never followed up. The DEA kept a file on Lasater. A memo from March 1984 names Patsy Thomasson, Lasater & Co. executive vice president as a designated passenger on private flights with Lasater to Latin America. Thomasson is now Director of Administration at the White House and a crucial figure in the inner circle of Bill and Hillary Clinton (it was she who removed Whitewater files from the White House office of the late Vincent Foster on the night of his death). On February 8, 1984, she flew to Belize with Lasater to negotiate the purchase of a farm. Lasater is now under investigation by the Whitewater prosecutor. The FBI is trying to determine whether Lasater's brokerage firm used client accounts to launder drug profits. In particular, they are looking at transactions worth $107 million that were put through the account of an unsuspecting court clerk in Kentucky. Also under the microscope is the participation of Lasater & Co. in several hundred million dollars-worth of bond issues by the Arkansas Development Finance Authority (ADFA), an agency created by Bill Clinton in 1985. There have been many allegations that ADFA served as a "laundromat" for dirty money. In December 1988 it wired $50 million to the Fuji Bank in the Cayman Islands. Investigators will be looking for proof that the money - all of it - returned to Arkansas for its intended purpose of building family houses. The more we learn about the circle of people who surrounded Bill Clinton in Arkansas, and the way they conducted business, the more alarming this picture becomes. ------------------------------------------------ (This file was found elsewhere on the Internet and uploaded to the Radio Free Michigan archives by the archive maintainer. All files are ZIP archives for fast download. E-mail bj496@Cleveland.Freenet.Edu)