Print Version: The CIA and Drugs

"In my 30-year history in the Drug Enforcement Administration and related agencies, the major targets of my investigations almost invariably turned out to be working for the CIA."Dennis Dayle, former chief of an elite DEA enforcement unit. {1}

On August 18, 1996, the San Jose Mercury initiated an extended series of articles about the CIA connection to the crack epidemic in Los Angeles. Though the CIA and influential media like The Washington Post , The New York Times, and The Los Angeles Times went out of their way to belittle the significance of the articles, the basic ingredients of the story were not really new -- the CIA's Contra army, fighting the leftist government of Nicaragua, turning to smuggling cocaine into the U.S., under CIA protection, to raise money for their military and personal use.

February 11, 1982: CIA Is Given Green Light to Take Part in Illegal Drug Trade in Afghanistan CIA Director William Casey gets a legal exemption sparing the CIA for a requirement that they report on drug smuggling by CIA officers, agents, or assets. Attorney General William French Smith grants the exemption in a secret memorandum. On March 2, Casey thanks Smith for the exemption, saying it will help protect intelligence sources and methods. [Unholy Wars: Afghanistan, America and International Terrorism by John K. Cooley, 2002, pp. 110-111] There are allegations that in 1981 President Reagan approved a covert program to weaken Soviet soldiers fighting in Afghanistan by addicting them to illegal drugs (see February 1981 and After). A book cowritten by two Time magazine reporters will even allege that “a few American intelligence operatives were deeply emeshed in the drug trade” during the war. [The Road to 9/11: Wealth, Empire, and the Future of America, by Peter Dale Scott, 2007, pp. 124-125] President Clinton will rescind the exemption in 1995. [Cooley, 2002, pp. 111]

History Commons, Dec.18, 2008

What was unique about the articles was (A) they appeared in a "respectable" daily newspaper and not an "alternative" publication, which could have and would have been completely ignored by the powers that be; and (B) they followed the cocaine into Los Angeles' inner city, into the hands of the Crips and the Bloods, at the time that street-level drug users were figuring out how to make cocaine affordable: by changing the costly white powder into powerful little nuggets of crack that could be smoked cheaply.

The Contra dealers, principally Oscar Danilo Blandon and his boss Juan Norwin Meneses, both from the Nicaraguan privileged class, operated out of the San Francisco Bay Area and sold tons of cocaine -- a drug that was virtually unobtainable in black neighborhoods before -- to Los Angeles street gangs. They then funneled millions in drug profits to the Contra cause, while helping to fuel a disastrous crack explosion in L.A. and other cities, and enabling the gangs to buy automatic weapons, sometimes from Blandon himself.

The principal objection raised by the establishment critics to this scenario was that, even if correct, it didn't prove that the CIA was complicit, or even had any knowledge of it. However, to arrive at this conclusion, they had to ignore things like the following from the SJM series:

a) Cocaine flights from Central America landed with impunity in various spots in the United States, including a U.S. Air Force base in Texas. In 1985, a Drug Enforcement Administration (DEA) agent assigned to El Salvador reported to headquarters the details on cocaine flights from El Salvador to the U.S. The DEA did nothing but force him out of the agency {2}.

b) When Blandon was finally arrested in October 1986, after congress resumed funding for the Contras, and he admitted to crimes that have sent others away for life, the Justice Department turned him loose on unsupervised probation after only 28 months behind bars and has paid him more than $166,000 since.

c) According to a legal motion filed in a 1990 police corruption trial: In the 1986 raid on Blandon's money-launderer, the police carted away numerous documents purportedly linking the U.S. government to cocaine trafficking and money-laundering on behalf of the Contras. CIA personnel appeared at the sheriff's department within 48 hours of the raid and removed the seized files from the evidence room. This motion drew media coverage in 1990 but, at the request of the Justice Department, a federal judge issued a gag order barring any discussion of the matter.

d) Blandon subsequently became a full-time informant for the DEA. When he testified in 1996 as a prosecution witness, the federal prosecutors obtained a court order preventing defense lawyers from delving into Blandon's ties to the CIA.

e) Though Meneses is listed in the DEA's computers as a major international drug smuggler and was implicated in 45 separate federal investigations since 1974, he lived openly and conspicuously in California until 1989 and never spent a day in a U.S. prison. The DEA, U.S. Customs, the Los Angeles County Sheriff's Department, and the California Bureau of Narcotic Enforcement have complained that a number of the probes of Meneses were stymied by the CIA or unnamed "national security" interests.

f) The U.S. Attorney in San Francisco gave back to an arrested Nicaraguan drug dealer the $36,000 found in his possession. The money was returned after two Contra leaders sent letters to the court swearing that the drug dealer had been given the cash to buy supplies "for the reinstatement of democracy in Nicaragua". The letters were hurriedly sealed after prosecutors invoked the Classified Information Procedures Act, a law designed to keep national security secrets from leaking out during trials. When a U.S. Senate subcommittee later inquired of the Justice Department the reason for this unusual turn of events, they ran into a wall of secrecy. "The Justice Department flipped out to prevent us from getting access to people, records -- finding anything out about it," recalled Jack Blum, former chief counsel to the Senate subcommittee that investigated allegations of Contra cocaine trafficking. "It was one of the most frustrating exercises that I can ever recall."

CIA arms, money, and disinformation enabled Corsican criminal syndicates in Marseille to wrestle control of labor unions from the Communist Party. The Corsicans gained political influence and control over the docks -- ideal conditions for cementing a long-term partnership with mafia drug distributors, which turned Marseille into the postwar heroin capital of the Western world. Marseille's first heroin laboratories were opened in 1951, only months after the Corsicans took over the waterfront. {3}

The Nationalist Chinese army, organized by the CIA to wage war against Communist China, became the opium barons of The Golden Triangle (parts of Burma, Thailand and Laos), the world's largest source of opium and heroin. Air America, the CIA's principal airline proprietary, flew the drugs all over Southeast Asia. {4}

During U.S. military involvement in Laos and other parts of Indochina, Air America flew opium and heroin throughout the area. Many GI's in Vietnam became addicts. A laboratory built at CIA headquarters in northern Laos was used to refine heroin. After a decade of American military intervention, Southeast Asia had become the source of 70 percent of the world's illicit opium and the major supplier of raw materials for America's booming heroin market. {5}

The Nugan Hand Bank of Sydney was a CIA bank in all but name. Among its officers were a network of US generals, admirals and CIA men, including former CIA Director William Colby, who was also one of its lawyers. With branches in Saudi Arabia, Europe, Southeast Asia, South America and the U.S., Nugan Hand Bank financed drug trafficking, money laundering and international arms dealings. In 1980, amidst several mysterious deaths, the bank collapsed, $50 million in debt. {6}

For more than a decade, Panamanian strongman Manuel Noriega was a highly paid CIA asset and collaborator, despite knowledge by U.S. drug authorities as early as 1971 that the general was heavily involved in drug trafficking and money laundering. Noriega facilitated "guns-for-drugs" flights for the Contras, providing protection and pilots, as well as safe havens for drug cartel officials, and discreet banking facilities. U.S. officials, including then-CIA Director William Webster and several DEA officers, sent Noriega letters of praise for efforts to thwart drug trafficking (albeit only against competitors of his Medellin Cartel patrons). When a confluence of circumstances led to Noriega's political luck running out, the Bush administration was reluctantly obliged to turn against him, invading Panama in December 1989, kidnapping the general, and falsely ascribing the invasion to the war on drugs. Ironically, drug trafficking through Panama was not abated after the US invasion. {7}

Obsessed with overthrowing the leftist Sandinista government in Nicaragua, Reagan administration officials tolerated drug trafficking as long as the traffickers gave support to the Contras. In 1989, the Senate Subcommittee on Terrorism, Narcotics, and International Operations (the Kerry committee) concluded a three-year investigation by stating: "There was substantial evidence of drug smuggling through the war zones on the part of individual Contras, Contra suppliers, Contra pilots, mercenaries who worked with the Contras, and Contra supporters throughout the region. ... U.S. officials involved in Central America failed to address the drug issue for fear of jeopardizing the war efforts against Nicaragua. ... In each case, one or another agency of the U.S. government had information regarding the involvement either while it was occurring, or immediately thereafter. ... Senior U.S. policy makers were not immune to the idea that drug money was a perfect solution to the Contras' funding problems." {8}

In Costa Rica, which served as the "Southern Front" for the Contras (Honduras being the Northern Front), there were several different CIA-Contra networks involved in drug trafficking, including that of CIA operative John Hull, whose farms along Costa Rica's border with Nicaragua were the main staging area for the Contras. Hull and other CIA-connected Contra supporters and pilots teamed up with George Morales, a major Miami-based Colombian drug trafficker who later admitted to giving $3 million in cash and several planes to Contra leaders. {9} In 1989, after the Costa Rica government indicted Hull for drug trafficking, a DEA-hired plane clandestinely and illegally flew him to Miami, via Haiti. The US repeatedly thwarted Costa Rican efforts to extradite Hull back to Costa Rica to stand trial. {10}

Another Costa Rican-based drug ring involved a group of Cuban Americans whom the CIA had hired as military trainers for the Contras. Many had long been involved with the CIA and drug trafficking. They used Contra planes and a Costa Rican-based shrimp company, which laundered money for the CIA, to move cocaine to the U.S. {11}

Costa Rica was not the only route. Other way stations along the cocaine highway -- and closely associated with the CIA -- were the Guatemalan military intelligence service,which harbored many drug traffickers, and Ilopango Air Force Base in El Salvador, a key component of the U.S. military intervention against the country's guerrillas. {12}The Contras provided both protection and infrastructure (planes, pilots, airstrips, warehouses, front companies and banks) to these CIA-linked drug networks. At least four transport companies under investigation for drug trafficking received US government contracts to carry non-lethal supplies to the Contras. {13} Southern Air Transport, "formerly" CIA-owned, and later under Pentagon contract, was involved in the drug running as well. {14} Cocaine-laden planes flew to Florida, Texas, Louisiana and other locations, including several military bases. Designated as "Contra Craft," these shipments were not to be inspected. When some authority wasn't clued in and made an arrest, powerful strings were pulled on behalf of dropping the case, acquittal, reduced sentence, or deportation. {15}

CIA-supported Moujahedeen rebels engaged heavily in drug trafficking while fighting against the Soviet-supported government and its plans to reform the very backward Afghan society. The Agency's principal client was Gulbuddin Hekmatyar, one of the leading druglords and leading heroin refiner. CIA-supplied trucks and mules, which had carried arms into Afghanistan, were used to transport opium to laboratories along the Afghan-Pakistan border. The output provided up to one half of the heroin used annually in the United States and three-quarters of that used in Western Europe. US officials admitted in 1990 that they had failed to investigate or take action against the drug operation because of a desire not to offend their Pakistani and Afghan allies. {16} In 1993, an official of the DEA called Afghanistan the new Colombia of the drug world. {17}

While working to keep key Haitian military and political leaders in power, the CIA turned a blind eye to their clients' drug trafficking. In 1986, the Agency added some more names to its payroll by creating a new Haitian organization, the National Intelligence Service (SIN). SIN was purportedly created to fight the cocaine trade, though SIN officers themselves engaged in the trafficking, a trade aided and abetted by some of the Haitian military and political leaders. {18}

1. Peter Dale Scott & Jonathan Marshall, Cocaine Politics: Drugs, Armies, and the CIA in Central America, Berkeley: U. of CA Press, 1991, pp. x-xi.
2. Celerino Castillo, Powder Burns: Cocaine, Contras and the Drug War, Mosaic Press, 1994, passim.
3. Alfred W. McCoy, The Politics of Heroin in Southeast Asia, New York: Harper & Row, 1972, chapter 2.
4. Christopher Robbins, Air America, New York: Avon Books, 1985, chapter 9; McCoy, passim
5. McCoy, chapter 7; Robbins, p. 128 and chapter 9
6. Jonathan Kwitny, The Crimes of Patriots: A True Tale of Dope, Dirty Money and the CIA, New York: W.W. Norton & Co., 1987, passim; William Blum, Killing Hope: U.S. Military and CIA Interventions Since World War II, Maine: Common Courage Press, 1995, p. 420, note 33.
7. a) Scott & Marshall, passim
b) John Dinges, Our Man in Panama, New York: Random House, 1991, passimc) Murray Waas, "Cocaine and the White House Connection", Los Angeles Weekly, Sept. 30-Oct. 6 and Oct. 7-13, 1988, passimd) National Security Archive Documentation Packet: "The Contras, Cocaine, and Covert Operations" (Washington, D.C.), passim
8. "Kerry Report": Drugs, Law Enforcement and Foreign Policy, a Report of the Senate Committee on Foreign Relations, Subcommittee on Terrorism, Narcotics and International Operations, 1989, pp. 2, 36, 41
9. Martha Honey, Hostile Acts: U.S. Policy in Costa Rica in the 1980s, Gainesville: University Press of Florida, 1994.
10. Martha Honey and David Myers, "U.S. Probing Drug Agent's Activities in Costa Rica," San Francisco Chronicle, August 14, 1991.
11. Honey, Hostile Acts.
12. Frank Smyth, "In Guatemala, The DEA Fights the CIA", New Republic, June 5, 1995; Martha Honey, "Cocaine's Certified Public Accountant," two-part series, The Source, August and September, 1994; Blum, p. 239.
13. Kerry report, passim.
14. Scott & Marshall, pp. 17-18
15. Scott & Marshall, passim; Waas, passim; NSA, passim.
16. Blum, p. 351; Tim Weiner, Blank Check: The Pentagon's Black Budget, New York: Warner Books, 1990, pp. 151-2
17. Los Angeles Times, Aug. 22, 1993
18. New York Times, Nov. 14, 1993; The Nation, Oct. 3, 1994, p. 346

Capitol Hill Blue, December 10, 2008

The CIA and Drugs

CIA-supplied trucks and mules, which had carried arms into Afghanistan, were used to transport opium to laboratories along the Afghan-Pakistan border. The output provided up to one half of the heroin used annually in the United States and three-quarters of that used in Western Europe.