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The Secret Team by L. FLETCHER PROUTY

JOHN BACHER: The Secret Team

An Introduction To The Assassination Business By L. FLETCHER PROUTY

On the Trail of the CIA

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John Bacher
 The Secret Team

Part I: The Secret's Out
Last summer's Iran-Contra TV show, starring Ollie North, will be immortalized in the Congressional Record, but nothing was resolved by the split decision. The issue was turned into:
Did Reagan know about the arms-for-hostage swap with Iran or that the profits were spent to arm the Contras in Nicaragua? The actual story is far more horrifying. Neither the Tower Commission nor the Congressional inquiry have revealed how much American foreign policy has been run by a clique of neofascists in what John F. Kennedy called an "invisible government."

Since the passage of the National Security Act of 1949, American foreign policy has been divided in open and covert fields. In the covert field, mercenary wars are carried out, unfriendly governments are secretly toppled, and narcotics are traded for guns to supply fascistic-minded allies. During the past twenty-five years, these covert operations (as revealed by a law suit by the U.S. Christic Institute, an interfaith, public interest law firm and public policy centre), have been directed by a remarkably unknown 'Secret Team."

Cuba, Laos, Cambodia, Thailand, Chile, Iran, Australia, Nicaragua...

The first gathering of the U.S. Secret Team was for the Bay of Pigs invasion and a super-secret sub-operation, "Operation Mongoose" to assassinate Cuban revolutionary leaders. After attempts to overthrow Castro were abandoned in 1965, such veterans of the Cuban adventure as Theodore Shackley and Thomas Clines, along with future Contra fundraiser, Major General John Singlaub, moved to direct the U.S. secret war in Laos. Shackley and Clines backed Van Pao, a major opium trader. Drug money was used to train the Hmong tribesmen in political assassination: Some 100,000 non-combatant "communist sympathizers" were assassinated in Laos, Cambodia, and Thailand,. Shackley and Clines also directed the Phoenix program in Vietnam in 1974 and '75 that murdered 60,000 non-Viet Cong civilian administrators. From 1971 to 1973, they also directed the CIA's "Track II" strategy, aimed at overthrowing Allende's democratic government in Chile. Here the Secret Team recruited the terrorist Arnac Galil from the Cuban military, who would later try to assassinate Eden Pastora, the leader of a Costa Rican-based contra group who refused to cooperate with the CIA-directed Contras.

After Vietnam, Shackley's Secret Team moved to Teheran, to help the Shah's secret police assassinate opponents of the regime. After the Vietnam war; opium funds from Southeast Asia were illegally deposited in the Australian Nugan Hand Bank, Shackley and Secret Team members were implicated in destabilizing the Australian Labor Party government at this time. In 1978, no longer in government service under the Carter administration, Shackley and Clines armed Nicaraguan dictator Anastasio Somoza after the U.S. government banned such aid, and later advised Somoza's ex-National Guardsmen until this job was taken over by the CIA following President Ronald Reagan's election. After Congress cut off Contra aid in 1984, Reagan turned to the Secret Team to illegally fund the Contras.

Post-Bay of Pigs Terrorism and Drug Traffic

The heart of the Iran-Contra affair lies at the attempt to continue, under the National Security Council, covert wars that were rendered difficult to carry out after Congress began monitoring such actions in the wake of Watergate. Formerly, the Central Intelligence Agency, beginning in 1949, had a blank cheque to carry out any imaginable order of an American president. The biggest fiasco of those cowboy days, the Bay of Pigs invasion of 1961, left a terrible legacy, the Secret Team, responsible for the Iran-Contra cloak and dagger stunts.

Unlike its model, the covert CIA invasion of Guatemala of 1954, which led to brutal human rights violations, the invasion of Cuba failed, leaving the American government with a problem -- how to dispose of a secret army, trained in terror, assassination, and sabotage. Veteran CIA officer, Ray Cline, himself a key player of the Secret Team, has observed that after training the Cubans and putting them in business, it was "not that easy to turn them off." By the early 1970s, American law enforcement officials estimated that at least eight per cent of the Bay of Pigs army had been arrested for drug crimes. Others signed up for CIA missions; some participated in the Watergate burglary, led by ex-CIA Bay of Pigs political officer E. Howard Hunt.

Despite Nixon's use of Cubans in Watergate, his administration actually pioneered in shaking off the drug-financed covert terrorist actions characteristic of the "invisible government." Under Nixon, CIA director James Schlesinger fired some 1,000 CIA covert warfare specialists. Another 600 were let go by Stansfield Turner in the Carter Administration. Nixon's break with the extremists' dreams of using military force to overthrow Castro came in 1974, when Secretary of State Henry Kissinger tried to establish normal diplomatic relations with Cuba. Orlando Bosch, the leader of the Cuban terrorist organization, CORU, was even jailed in Costa Rica for plotting to assassinate Kissinger during a 1976 visit. Throughout President Carter's efforts to normalize relations, CORU conducted a campaign of terrorism. This terror was a dress rehearsal for the Contra War, as it featured massive financial frauds and manipulations, for which the killing often seemed to be a convenient pretext. Respected journalist Penny Lemoux points this out in her book In Banks We Trust. Many of the kidnappings conducted by CORU of supposed Castro sympathizers were simply shakedowns. The terrorists conducted twenty-five bombings in Miami alone. After a Cuban airliner was bombed in 1976, killing 73 people, including the entire Cuban fencing team, CORU succeeded in perpetuating conflict between the U.S. and Cuba. Castro broke off talks for normalizing relations because of the wave of anti-Americanism that followed.

Hasenfus Spills the Beans

After the election of Ronald Reagan, the energies of the Cuban exiles were directed toward the Contra War against Nicaragua. One CIA Cuban veteran, turned Contra trainer, Felix Rodriguez, helped blow up a Spanish freighter trading with Cuba in 1964, and later interrogated Che Guevara shortly before his murder in 1967. Another, Luis Posada, was removed from his post as chief of Venezuelan intelligence after his links to the 1976 bombing of the Cuban airliner were uncovered. Rodriguez and Posada were in charge of loading Eugene Hasenfus's supply plane from the Ilopango air base in El Salvador. When the Sandinistas shot down the plane and captured the pilot, Hasenfus told the international press that he worked for the CIA and that his boss should help him get out of jail. He was freed by President Ortega.

The Contra War is characterized by the same combination of terrorism, lucrative drug deals, and unobtainable objectives, as CORU's war against the Cuban government Two Nicaraguan smugglers convicted in the largest cocaine seizure in the history of the U.S. West Coast, in 1985, admitted they had passed drug profits to the Contras. A leading San Francisco fundraiser for the Contras was identified in 1984 by the U.S. Drug Enforcement Administration as "the apparent head of a criminal organization responsible for smuggling kilogram quantities of cocaine into the United States." Former U.S. Ambassador to El Salvador, Thomas White, has charged the Reagan Administration with attempting to kill an FBI inquiry into the Contras' drug ties. One convicted smuggler admitted to flying 1,500 kilograms of cocaine from the farm of a CIA operative in Costa Rica to the United States. CBS Evening News reported that at a 1980 drug trial in Costa Rica, the government presented wire-tapped evidence showing "the drug dealers' ties to the top level of Contra leaders in Costa Rica,"

The controversial arms sales to Iran, portrayed as an irrational departure from policy, actually fit into a period of prolonged cooperation with that repressive regime.. During 1982-83, the CIA helped pass along to Khomeini details on Tudeh Communist party activities, based on the revelations of a KGB defector. Armed with this information, Khomeini's forces arrested or killed 4,000 Tudeh supporters and expelled eighteen KGB agents. Former U.S. Under-Secretary of State, David Newon, even noted with satisfaction that "The leftists there seem to he getting their heads cut off." Israel, the proxy for the U.S. arms shipments to Iran, continued to sell arms to the Khomeini dictatorship even after the seizure of the U.S. Embassy. Their sales included spare parts for US.-made FA Phantom jets. Profits from the covert Iranian sale, Washington Post journalist Jack Anderson has reported, also went to Israel's foreign intelligence agency, Mossad, for undercover operations abroad.

The Iran-Contra affair points to the sophistication needed by the peace movement to counter the distortions of terrorism and narcotics smuggling that are used as a pretext to support wars around the world. This is difficult for, as we learn from books such as The Iran Contra Connection: Secret Arms and Covert Operations in the Reagan Era, moderate government officials have supported absurd policies because of manipulation by reactionary extremists more interested in making a killing in the drug trade than in political objectives.

One hopeful sign is the law suit now being organized by the Christic Institute. This Washington-based organization was begun seven years ago by lawyer Daniel Sheehan and an interfaith group anxious to apply the law to burning issues. It won favorable judgments in the Three Mile Island investigation and the Karen Silkwood case, to name two. Sheehan has persuaded the organization Trial Lawyers for Public Justice to donate the services of forty-five lawyers to speed up the depositions of all those involved with the Secret Team. The case will take almost a year to prepare, but the results may help restore democracy and justice to the U.S. government.

The Iran-Contra Connection-Secret Teams and Covert Operations in the Reagan Era, by Jonathan Marshall, Peter Dale Scott, and Jane Hunter. South End Press, Boston, 1987. See also, Veil: The Secret Wars of the CIA, 1981-1987, by Bob Woodward, General, 1987.

Part II: The Way of Pigs
This article is the second in a series on the influence of the "secret team" on American foreign policy. The antics of this organization have recently come to public view as a result of the Iran-Contra affair. It explains the events leading to the failed Bay of Pigs invasion, which set the stage for drug trade-financed terrorist adventures in Southeast Asia, Australia, Chile, and Nicaragua.
The origins of the Secret Team that organized the Iran-Contra affair lie in the invisible government structure created by the U.S. National Security Council in 1947. This legislation injected into the body of American constitutional politics a secret, paranoid, repressive apparatus similar to those of fascist states and Stalin's despotism. Like the wartime Manhattan Project, the secret agencies operating under the National Security Act had no accountability to Congress or to the American public. They were only answerable to the President. An enormous mandate for mischief was given the new Central Intelligence Agency by a highly ambiguous phrase, buried in sub-section 102 of the Act. This gave the CIA authority to "perform such other powers and duties related to intelligence affecting the national security as the National Security Council may from time to time direct." At the first meeting of the National Security Council in December 1947, the original CIA covert operation was authorized. It was to be a massive program of interference with the Italian elections of April, 1948. Along with statements to Italian voters from Hollywood movie stars and funding of the Christian Democratic Party, this covert electoral campaign had a more sinister hue: collaboration with the Mafia. Mafia gunmen actually assassinated Communist Party leaders in Sicily, firing into the midst of the party's rallies. The CIA's other European cold war antics had similar high- and low-brow directions. While funding was given to the prestigious British intellectual journal, Encounter, Mafia henchmen were also used to break a strike of the Communist-controlled Marseilles dockworkers' unions.

For every Communist-led front group, the CIA marshalled its own "free world" equivalent. To rival the Communist-dominated International Union of Students and World Federation of Youth, the CIA created its own World Assembly of Youth. The International Confederation of Free Trade Unions was launched by the CIA to counter the Communist-dominated World Trade Union Federation. Rival groups were also formed among journalists, lawyers and intellectuals.

Dulles Purges Communist Parties Of Moderates

CIA intrigue tended to divide opinion in the world into pro-American or pro-Soviet camps. Despite the universalist claims of the ideologies of both blocs, both tended to view each other as dominant in their respective spheres of influence. The CIA's Allen Dulles even used his Eastern bloc contacts to purge Eastern European communist parties of their moderate, nationalistic minded leadership. Under "Operation Splinter Factor" Dulles' double agent in the Polish secret police, Josef Swiatlo, named prominent liberal Communists as CIA agents, based on their cooperation with U.S. intelligence during World War Two in the struggle against Nazi Germany.

By 1951 some 169,000 Czech Communists were arrested-- ten percent of the entire membership. Thousands more were arrested in Poland, East Germany and Bulgaria, with hundreds being executed. Dulles, intending to discredit communism in the West, actually preferred oppressive regimes in Eastern Europe to ones that tolerated pluralism. Similarly, rather than trying to inflame the West to revolt, Soviets moved to strengthen the status quo. At the height of the bitterly contested Italian elections, the USSR encouraged a desertion of the Communists by demanding that Italy speed up its reparation payments and by taking Yugoslavia's side in a dispute over Trieste.

In the early years, the American covert operations had little impact. They were directed against Communist groups in the West that were already restrained by the Soviet leaders whose commands they followed.

The Eisenhower administration, however, chose to use the CIA on tougher targets than the Communist dissidents of the Western bloc. The CIA was now turned, with devastating force, on the non-Communist democratic governments of Iran and Guatemala, giving these countries a poisoned legacy of continuous domination by terrorist-minded elites.

Iran: Religious Fanatics And Paid Rioters

The Iranian government of Mohammed Mossadegh had enraged Britain by nationalizing that country's oil monopoly in Iran. While the Americans under Truman initially supported the staunchly anti-Communist Mossadegh, this soon changed after the British Foreign Secretary, Anthony Eden, offered the Americans a share in Iran's oil. To destabilize Iran, the Americans cooperated in a boycott led by oil multinationals. They cut off all foreign aid and froze the foreign assets of its banks. This forced Mossadegh to reduce the military budget, curb feudal dues and luxury imports and reduce the Shah's income, all of which encouraged upper class Iranians to collaborate with the CIA. The CIA's principal collaborator, and future Prime Minister, General Zahedi, had been interned by the British in World War Two for pro-Nazi activities. The initial bumbling efforts of the Shah on American advice to dismiss Mossadegh for Zahedi led to the Shah's exile and widespread rioting by Communists. Fearing a leftist coup, Mossadegh was vulnerable to a CIA action involving the use of paid rioters to overthrow his government. U.S. money paid bus and taxi drivers to convey the rioters. They were headed by CIA agent Kermit Roosevelt, grandson of Teddy. After the rioters overturned Mossadegh, the Shah and Zahedi returned.

In its clandestine coup, the CIA made allegiance with reactionary mullahs whose heirs it would bargain with during the Iran/Contra arms deals. The coup laid the basis for the same clerical terror which is now being waged by the Khomeini regime. An index of banned books was drawn up. Former cabinet ministers were beaten, tortured, and killed. Unarmed students were murdered in the Teheran University. The day on which Iran's parliament voted to ratify the American-engineered split in its oil, 29 army officers loyal to Mossadegh were executed. Religious fanatics went on a campaign of terror against the Ba'hai faith, whose temple in Iran was turned into a headquarters for the military government.


After using anti-Communism to seize Iranian oil, the Eisenhower administration used the same cloak to maintain the United Fruit Company's hold on banana production in Guatemala. The democratically elected Conservative government of President Jacobo Arbenz was bent on land reform, and it was United Fruit's land that was being returned to peasants. Both Standard Oil of New Jersey and United Fruit faced anti-trust actions. These were dropped under cold war pretexts of national security.

The CIA's invasion of Guatemala involved one of the most reactionary, fascist-minded members of the country's ruling elite. Colonel Castillo Armas, who earlier had tried to overthrow the government, agreed to return the expropriated United Fruit lands, destroy the railway workers' union, and establish a strong-arm dictatorship. The CIA created an army of 150 mercenaries in Nicaragua, under the friendly eye of the Somoza dictatorship. Although the U.S. used anti-Communism to justify its efforts, ex-CIA agent Phillip Agee would later reveal that the very head of the Guatemala Communist Party, Carlos Manuel Pellecer, was himself a CIA agent. Dulles fabricated an elaborate hoax that the Guatemala government was importing arms from Czechoslovakia. The CIA's secret air force then actually bombed a British ship they believed was carrying arms to Guatemala, which was only carrying cotton and coffee.

The small CIA mercenary army was able to overthrow the Guatemalan government, essentially because its generals panicked in the face of the mercenaries' air superiority. The U.S. was pleased with Castillo Armas's return of lands to the United Fruit Company, his awarding the country's oil resources to foreign interests, and his removing taxes on foreign corporations. But Allen Dulles and his brother, Secretary of State John Foster Dulles, were outraged that Armas allowed dissidents to leave the country. They wanted them all to be executed.

The Bay Of Pigs: "Operation Success!"

The folly of the Bay of Pigs invasion can only be understood as a result of the over-confidence of the CIA on the heels of its past victories of covert war. In a classic case of hubris, the CIA's operation would be labelled, "Operation Success."

Like its Guatemalan and Iranian victories, the CIA attempted to topple Castro through an alliance with the most fascist minded of thenation's elite, and was aided, as in its European adventures, by an alliance with organized crime. American gangsters Meyer Lanksy and Santo Trafficante had been central in establishing Batista's dictatorship in 1952. They were quickly expelled after Castro's 1959 victory and their lucrative casinos shut down.

Many soldiers in the Bay of Pigs invasion force were recruited from Santo Trafficante's security staffers, who had been long involved in cocaine and heroin smuggling. One recruiter was Richard Cain, a former Chicago cop who became a close assistant of mobster Sam Giancana. Two leading Cuban conspirators, Felipe de Diego and Rolando Martinez, would be later involved in the Watergate burglary. Another, Orlando Bosch, would become synonymous with terrorism. After the disastrous invasion, CIA activities against Cuba were given greater manpower and expenditures. These were organized by CIA agent Theodore Shackley, who commanded a force of 300 Americans and 4-6000 Cubans carrying out hit and run actions against Cuban targets. One of its last operations was the smuggling of narcotics to the U.S., which led to the dismantling of the force.

Superficially a failure, the CIA covert war against Cuba was a success insofar as it forced Cubans to rely on an alliance with the Soviet Union which, by restricting the scope of civil liberties, diminished the appeal of the Cuban Revolution throughout Latin America. Castro's movement had been initially alienated from the Communist Party which was under orders not to rock the boat in the American sphere of influence. Rather than see the revolution go to the graveyard with the government of President Arbenz of Guatemala, Castro embraced the Soviet Union and his former Communist adversaries. Che Guevara himself had actively supported Arbenz and was determined to avoid his fate; he thanked that experience for teaching "the weakness that government was unable to overcome."

The United States was unable to impose a band of terrorists upon Cubans, as it had in Iran and Guatemala. But as long as covert warfare remained part of U.S. foreign policy, extremists could use anti-Communism as a license to terrorize and control in country after country.

Two documentaries about the Secret Team were aired on CBC Radio's Sunday Morning by Stephen Wadhams and Martha Honey. Tapes are available from CBC Sunday Morning, Box 500, Station A, Toronto, M5W 1E6 at $20.00 per tape.

Part III: Chaos in Laos
The Secret Team Enters South-East Asia
More bombs were dropped on Laos between 1965 and '73 than the US had dropped on Japan and Germany during World War II. More than 350,000 people were killed. The war in Laos was a secret only from the American people and Congress. It anticipated the sordid ties between drug trafficking and repressive regimes that have been seen later in the Noriega affair.

AFTER THE CLOSING DOWN OF the United States's secret war in Cuba, CIA agents Theodore Shackley and Tom Clines were sent eastward to set up a far more massive secret war in Laos. Like its previous "Operation Success," "Mongoose" and "JM/Wave" assignments, the team was presented with another "mission impossible" -- to prop up a reactionary U.S. client state with little indigenous popular support. That the mission succeeded as well as it did, from 1965 to 1973, was only possible because of massive narcotics smuggling and saturation bombing which tended to overshadow any national foreign policy objective.

Prior to the arrival of the Secret Team in Laos, the U.S. had a sordid history of the destruction of neutralist Laotian governments with broad political support, since the country received its independence from France in 1954. The CIA engineered coups in 1958, 1959, 1960, and possibly on other occasions, as William Blum has documented in his The CIA: A Forgotten History. Such manipulation had the effect of driving the Pathet Lao (Communist Party) out of the political arena and into military conflict in alliance with North Vietnam. U.S. President John F. Kennedy did have the intelligence to see the absurdity of this situation and obtained a coalition government with the Pathet Lao backed by international agreement. This neutral regime was, however, overthrown in 1964 by a right wing coup, giving effective control to reactionary generals with close ties to the CIA.To stabilize this regime with so little popular support, the CIA sent Theodore Shackley and Tom Clines to Laos in 1964.

Unlike the war in Vietnam, the secret war in Laos remained in the hands of the CIA and avoided direct deployment of U.S. troops. This lack of American casualties tended to hide its massive scale. After the war's end, the New York Times observed that "some 350,000 men, women and children have been killed, it is estimated, and a tenth of the population of three million uprooted." Between 1965 and 1973, more than two million tons of bombs were dropped on Laos -- far more than the U.S. had dropped on both Japan and Germany during World War II. This bombing was applied to all regions controlled by the Pathet Lao. A former American community worker in Laos, Fred Branfam, described how "village after village was levelled, countless people burned alive by high explosives, or by napalm and white phosphorous, or riddled by anti-personnel bomb pellets." In order to wreck the economy in the Pathet Lao area, the U.S. dropped millions in forged currency. At the end of the war in Laos, the Plain of Jars resembled a lunar landscape marked by bomb craters,"stark testimony to the years of war that denuded the area of people and buildings." Irrigation works collapsed and so many water buffalo had been killed in the war that farmers had to harness themselves to the plows to till fields. Unexploded ordnance are still killing and hampering food production. Such weaponry includes fragmentation weapons with explosives and steel bits released from large canisters.

THE ROYAL LAO ARMY HAD PROVEN unreliable to prop up John Foster Dulles's puppet American regimes in the '50s, which were often overthrown by nationalistic officers. Therefore Shackley and Clines developed their own secret army, based on the discontented Meo tribal minority and financed by the narcotics trade. Meo villages that refused to send troops to fight in this secret army were bombed by the U.S. Air Force, as Noam Chomsky and Edward Herman point out in After the Cataclysm. To suit U.S. strategic needs, villages were relocated. Besides 15,000 Meo tribesmen, the secret army included 15,000 mercenaries from Thailand, and U.S.-trained soldiers from South Vietnam, Taiwan, South Korea and the Philippines. The New York Times quipped that the "Secret Army" was secret only from "the American people and Congress." American advisers killed in Laos were reported to have died in Vietnam.

ONE objective of Shackley and Clines was to monopolize the opium trade in Laos for their Meo ally, Van Pao. In 1965 Van Pao's opium trafficking competitors were assassinated.

After the end of the Indochina war, the CIA admitted that "certain elements" of its war organization had been involved in opium smuggling. As Henrick Kruger points out in The Great Heroin Coup (Black Rose, 1980), the CIA was forced to admit this because of reports of returning U.S. veterans. One report, by highly-decorated Green Beret Paul Withers, explained that one of his main tasks had been "to buy up the entire crop of opium" of the Meo tribe. About once a week an Air America (a CIA owned company) plane, he reported, "would arrive with supplies and kilo bags of opium, which were loaded on the plane. Each bag was marked with the symbol of the tribe." Air American flights were exempted from normal customs inspections. In 1971 some 60 kilos of heroin (worth $13.5 million) were seized from the briefcase of the chief Laotian delegate of the World Anti-Communist League.

Shackley and Clines also developed a program to use their secret army for "unconventional warfare" activities, including political assassinations. This is detailed in the lawsuit of the Christic Institute. In 1966 a multi-service operation, the Military Assistance Command, Vietnam -- Special Operations Group (MACV-SOG) was formed. From 1966-1968 this group supported the assassination activities of the secret army and was commanded by future World Anti-Communist League president and Contra fundraiser, General John K. Singlaub. Serving under Singlaub in Laos in 1968 was the then Second Lieutenant Oliver North.

From 1968 to 1971 Theodore Shackley and Tom Clines supervised the Special Operations Group in Laos. The secret army assassinated over 100,000 noncombatant villagers: mayors, bookkeepers, clerks and other political figures in Laos, Cambodia and Thailand. These killings established a foundation of terror for the Laotian government, undermined Prince Norodom Sihanouk's efforts to steer a neutral course for Cambodia, and discouraged the growth of democracy in Thailand. The style of terror resembled the random killings of Colonel Kurtz's Montagnards in the film Apocalypse Now. Unfortunately movie watchers are deceived into thinking such madness would bring official punishment instead of promotions.

The antics of the Secret Team in Laos would be a prelude to even more destructive activities in Vietnam, where their program of narcotics smuggling and assassination would develop even greater scope. This war was too massive to let the brunt of the fighting to fall to tribal minorities and foreign mercenaries, causing America to officially enter Southeast Asia.

The U.S. client state's government became so deeply involved in illegal activities, such as the heroin trade and thievery, that it more resembled an organized crime syndicate than a coalition of conservative political parties. The terrorist operations of the Secret Team in Vietnam, such as the infamous Phoenix Program, destroyed both the "third force" and the communist-led National Liberation Front, tending to make the domination of the area by North Vietnam the inevitable outcome of the conflict.

Part IV: Visiting Vietnam
Vietnam epitomized the mindless destruction and unobtainable ends of the Secret Team. As in Laos, the combination of massive bombing, tribal allies gulled by promises of greater autonomy, and an imposed elite of collaborators enriched by the narcotics trade, only destroyed alternatives to communist rule in the long run.

The CIA's shadowy activities in Vietnam were necessary to prepare American public opinion to accept the commitment of ground troops to a foreign war. Its actions in this regard were diabolically clever, William Blum in his book, The CIA, A Forgotten History, draws attention to the confessions of Phillip Liechty, a former CIA officer. Liechty revealed he had seen the plans to take large amounts of Communist bloc arms, load them on a Vietnamese boat, fake a battle, and then call in naive reporters to see the "captured" weapons as proof of foreign assistance to the Viet Cong. After this staged incident concerning the sinking of a "suspicious vessel" in "shallow water" off South Vietnam on Feb. 16, 1965, the United States State Department released a paper alleging aggression from the North. Liechty noted also an elaborate scheme to forge Viet Cong postal stamps to indicate North Vietnamese aid; Life Magazine put the CIA forgery on a full cover blow up.

THE CIA'S DRUG DEALING efforts in Vietnam began with a paradox, which underlay the growing American colonization of the southern republic. The Americans' man in South Vietnam, Ngo Dinh Diem, had come to power in 1955 by driving out the French-backed opium lords of Saigon, involving violent confrontations with these gangsters. Soon, however, as Alfred McCoy spells out in his book, The Politics of Heroin in South-east Asia, the nationalistic sounding Diem had simply become an American puppet in place of the former French-backed emperor Bao Dai. Unable to build a popular basis of support, Diem turned to the familiar means - a secret police financed by the opium trade. From 1958 to 1960, Diem's security adviser, Ngo Dinh Nhu, revived the opium trade and stationed agents in Laos and in the Corsican Mafia-controlled commercial airline, Air Laos. From 1961 to `62, South Vietnamese Transport Groups smuggled opium from Laos to South Vietnam.

McCoy outlines how, after Diem's ouster in 1963, the instability of South Vietnamese governments largely stemmed from the inability of a single strong man to control the opium trade. Competing power factions used different government institutions. Premier Khan used the national police force. President Thieu used the navy customs and port authority. Vice-President Ky was involved in smuggling operations using the air force. Ky directed one particularly audacious "Operation Haylift," an American plan intended to fly agents into North Vietnam. It ended up as a cover for gold and opium smuggling. These competing factions would frequently arrest each other. George Robert, chief of the U.S. customs advisory team, complained in 1967 that it was impossible to distinguish between "honest actions and dishonest ones."

One of the high profile opium lords, General Loan, directed Ky's smuggling and at one point intimidated South Vietnam's legislative assembly by invading it with armed guards. Thieu's man, the infamous General Dang Van Quang (now living in Montreal) was exposed in a July, 1971 NBC News broadcast as the "biggest pusher" in Vietnam.

WHILE MANY AMERICAN MILITARY officers deplored the effects of the drug trade and tried to combat it, such qualms were not shared by the Secret Team. With the Vietnam war reaching its peak of escalation in 1968, Theodore Shackley was transferred from CIA Chief of Station, to the same position in Saigon. Shortly after his arrival he arranged a meeting with his former Cuban associate Mafia Chieftain Santo Trafficante and his Laotian ally Van Pao. According to the Christic Institute, a partnership between the two led to Trafficante's becoming the most important distributor of heroin in America. Henrik Kruger in The Great Heroin Coup, notes that Trafficante went on a business trip in 1968 to the Far East, beginning in Hong Kong, where he had located his emissary Frank Furci. Furci controlled the market on soldier's nightclubs, mess halls and a chain of Hong Kong heroin clubs.

McCoy notes that, after Trafficante's visit, a Filipino ring delivered Hong Kong heroin to the U.S. Mafia. This involved 1,000 kg of pure heroin equivalent to ten to twenty percent of all U.S. consumption. These events coincided with an American-initiated shutdown of opium-growing in Turkey, and the destruction of the "French connection" of Corsican Mafia smuggling more fled to French than American foreign policy interests (See Kruger's book for details of this).

The suit of the Christic Institute elaborates on how the Trifficante-boosted South Vietnamese drug trade provided the same basis for secret police repression under the Phoenix program as it had under Diem. While critics of the suit, noting that Theodore Shackley was no longer station chief in Saigon, imply that it made a slip, the suit is quite clear that both Shackley and Clines directed it from Washington. Promoted for their secret activities in Cuba, Laos, and Vietnam, the dynamic duo now served as Chief and Deputy Chief of the East Asia division of the CIA. Directing all CIA covert operations in Southeast Asia, Shackley and Clines also controlled the Phoenix program, which saw the assassination of some 60,000 village majors, treasurers, school teachers, and other non-Viet Cong administrators. In 1971 CIA officer William Colby, Director of Phoenix, was asked by a Congressmen, "Are you certain that we know a member of the VCI from a loyal member of the South Vietnam citizenry?". Colby replied, "No, Mr. Congressman, I am not," as William Blum points out in his book. Blum also cites the Congressional testimony of U.S. military intelligence officer in Vietnam, K. Barton Osborn. Phoenix suspects were interrogated in helicopters and then pushed out, Osborn noted. Electric shock until death was a frequent tactic. All persons detained during tactical raids were routinely classified as Viet Cong. Osborn said that none held for questioning were able to live through it.

Noam Chomsky in The Political Economy of Human Rights notes that the Phoenix system fell more harshly on non-Communist dissidents than Viet Cong, who were better able to defend themselves. By providing cash for murder, it encouraged vendettas against any foe of the powerful in the country. All this slaughter simply worked to ensure the eventual domination of South Vietnam by the Communist North, the complete mirror image of American rhetoric justifying its intervention.

Part V: Cha Cha Cha! Overthrowing Latin Democracies
LEAVING A TRAIL OF BLOOD IN CUBA, LAOS, AND Vietnam, Theodore Shackley and Thomas Clines were given a new assignment: the overthrow of the elected government of Salvador Allende in Chile (See Heinrich Kruger, The Great Heroin Coup). Although their mission was to prove more successful than their previous assignment, the consequences would be equally tragic.

In 1972, Theodore Shackley and Tom Clines were elevated to CIA's Western Hemisphere operations. Shackley became Chief and Clines his Deputy.

Some of the "dirty tricks" used by the CIA against Chilean democracy are well known. Others involved overt pressure, such as the cutting off of all U.S. and Inter-American Development bank loans, the end of all assistance from the World Bank, and the refusal of American suppliers to sell needed parts for dependent Chilean copper, steel, electricity, and petroleum industries. CIA disinformation tried to make military officers believe Allende was going to allow the USSR and North Korea to establish submarine and training bases.

Besides scheming to destabilize democracy by fomenting economic crises, the CIA under Shackley and Clines aided Chile's fascist organization, Patria y Libertad, and trained its members as guerrillas in Bolivia and Los Fresnos, Texas. They marched into political rallies wearing riot gear, engaged in violence, and in its publications openly urged a military coup.

Foes of the Pinochet dictatorship realize that it came to power by the massacre of 30,000 civilians. What they may not realize is that Patria y Libertad was aided as part of a general imposition of fascist dictatorships in Latin America, supported by terrorist organizations funded by the drug trade. Even Mexico, one Latin America's most stable, if not most perfect democracies was threatened by one Secret Team extremist.

WHILE PREPARING FOR THE CHILEAN COUP, Shackley had all telephone conversations to and from Latin America tapped, under pretext of narcotics control operations. One of Shackley's colleagues was an old contact, Alberto Sicilia-Falcon, a Cuban exile trained by the CIA as part of the Bay of Pigs invasion. While Shackley destabilized Chile, he established a gigantic heroin and marijuana ring in Mexico, which involved 1,000 persons, including film stars and international businessmen. After the overthrow of Allende, Sicila-Falcon sold guns and narcotics to spread violence in Mexico. In 1975 Sicila-Falcon was arrested and confessed to being a CIA agent, engaged in business to provide profits with which to buy ammunition for the destabilization of "undesirable" governments. FBI documents later released under the Freedom of Information Act revealed that the U.S. Embassy and U.S. Border Control had worked together "to help destabilize" the Mexican government of the populistic President, Luis Echeverria. He was in a conflict with the U.S. government over the World Bank and International Monetary Fund's plans for Mexico's newly-discovered oil reserves. A memo from FBI director J. Edgar Hoover, declassified by the Freedom of Information Act, actually praised "the detonation of strategic and effective bombs in Mexico City" and "the wave of night machine-gunnings to divide subversive leaders."

The successful overthrow of Allende and the botched attempt to remove Echeverria were a small part of the Secret Team's terrorism in Latin America. They worked with extremists who envisaged a new world order of a Fascist Iron Circle linking Argentina, Chile, Peru, Paraguay, Bolivia, Brazil, and Uraguay, toward which Allende's overthrow represented but one step.

After the coup overthrew Allende, some terrorists moved to Argentina, while others went to Europe. One key figure of this intrigue was Peronist Cabinet Minister Lopez Rega. He signed an agreement between the U.S. and Argentina to wage a common war against drug trafficking, while being himself the country's leading cocaine trader. Rega was a key figure in a death squad, the Argentine Anti-Communist Alliance (AAA). He disguised such terrorist activities as narcotics control, claiming the "Guerrillas are the main users of drugs in Argentina." He contributed to the disorder which led the fragile democracy of Argentina to be overthrown by a military dictator.

AIDED BY THE CHILEAN SECRET POLICE, THE Cuban exile drug-financed terror network also hunted down foes of the Chilean dictatorship, such as former Chilean army Chief of Staff Carlos Pratts and former Allende foreign minister Orlando Letelier. Terror was coordinated between Argentina, Bolivia, Brazil, Paraguay, and Chile under the infamous Operation Condor. Pratts, Leighton, and democratic Uruguayan and Argentinian politicians were assassinated, as well as Bolivian General Joaquin Zenteno Anaya and Uruguay's Colonel Ramon Trabal in Paris. A branch of the AAA opened in Spain to use terror in an effort to prevent the growth of Spanish democracy.

Under the public guise of combatting drug trade and upholding democracy, American foreign policy turned into a drug-financed international terror network in Latin America.

 Part VI: Who Did in the Prime Minister?
Down Under with The Secret Team and a Bank
This year we have reviewed the acts of a small, powerful group of right wing Americans with ties to the CIA that were allowed by one U.S. administration after another to destabilize governments around the world that they considered unfriendly to the United States. In this group, "the secret team," two men have repeatedly been named as key participants

Thomas Olines and Theodore Shackley, who rose to become second-in-command, directing the CIA's worldwide covert operations from its Virginia headquarters. This time around, we'll review the pivotal part they played in the "constitutional coup d'etat" that overthrew the government of Australia's Labor Prime Minister, Gough Whitlam. The story involves an Australian-based international bank that failed -the Nugan Hand Bank. Only after its collapse were key facts exposed about its complicated financial and drug-peddling activities.(For more on the mystery surrounding this outfit read Jonathan Kwitny's, The Crimes of Patriots N.Y.: Norton, 1987.)

Nugan Hand Bank: A Theft Machine

The Nugan Hand Bank was founded in the early 1970s by Frank Nugan, an Australian who had studied law for a while in Toronto, and Michael Hand, an American who had formerly fought with the Green Berets in Vietnam and then had worked with the CIA airline, Air America.

In 1973, the Nugan Hand Bank quickly expanded from a $1 million capitalization to $1 billion. It never did any banking, Jonathan Kwitny says, but it offered four main services - a way to flout laws and move money overseas; tax avoidance schemes; extraordinarily high interest; and international trade connections. Its staff included almost no real bankers, but top military and intelligence officers, such as former CIA director William Colby, who was one of the bank's attorneys. Soon it had offices in 22 countries, mostly Asian. As James Nathan pointed Out in a Foreign Policy article, "Dateline Australia: America's Foreign Watergate," one of these branches was in Chiang Mai, in northern Thailand, part of the Golden Triangle area where Thai-land, Burma and Laos join. Chiang Mai is Opium City of the World. Kwitny discovered that the Nugan Hand office in Chiang Mai had been lodged in what appears to be the same office suite as the United States Drug Enforcement Administration office. The DEA receptionist answered Nugan Hand's telephone when the bank's representatives were out.

The director of the bank's Chiang Mai office admitted on Australian television that they had handled $2.6 million in six months. This money came from drug deals in the triangle. The bank, he stated, was a laundry for Meo tribesman and other opium growers. In addition to drugs, the Nugan Hand Bank was involved in various arms deals in Indonesia, Thailand, Malaysia, Brazil and the whole Rhodesian government of Ian Smith.

The Bank was also involved in outright fraud. Its Saudi Arabian branch fleeced over $10 million from Americans working there, says Penny Lernoux in In Banks We Trust.

Getting Whitlam

The Nugan Hand Bank was well placed to destabilize the government of Labor Party Prime Minister Gough Whitlam. His government had conducted such outrages (to American minds) as pulling troops out of Vietnam; ending conscription; supporting the Indian Ocean Zone of Peace proposals; attacking the U.S. bombing of North Vietnam; and interfering with Australian intelligence efforts to aid Indonesia's invasion of East Timor and the overthrow of Salvador Allende in Chile.

The Bank helped finance a clever variety of bugging and forgery operations. Nugan Hand transferred $24 million to the Australian Liberal Party through one of its many associated companies. It tried to blackmail a cabinet minister investigating organized crime by opening up a Swiss bank account in his name and threatening to leak the information. Twice during 1975 the Whitlam government was damaged through sensational scandals broken open by mysterious leaks to the press, forcing resignations of Cabinet ministers. As Kwitny notes, one of the scandals, involving negotiations for an Arab loan, was based on documents later exposed as forgeries. This "loan affair" was seized upon by the opposition Liberal Party as the excuse to have the elected Senate hold up passage of the government's budget in order to provoke an election through financial crises. Prime Minister Whitlam charged in a public statement that the CIA was interfering with the domestic politics of his country.

Like Canadians, Australians have a Governor General. Normally, this is a non-political role. However, the Australian Governor General, John Kerr (who had long ties to such CIA front organizations as the Asia Foundation) saw a chance at this time to dismiss the Prime Minister, and did so. Three days before this "constitutional coup," an ultimatum had been delivered to the Washington representative of the Australian Security Intelligence Organization by Secret Team leader Theodore Shackley. The authenticity of this message, sent on November 8, 1975, was later confirmed by the Australian parliament. It warned Australian intelligence that if the problems posed by Whitlam's government could not be resolved they did not see how "our mutually beneficial relationships are going to continue."

Some Mysteries Remain Unanswered

In 1980, five years after the ouster of Whitlam's government, the Nugan Hank Bank collapsed, $50 million in debt. Frank Nugan was found shot dead in his car, and Michael Hand disappeared without a trace. Investigations by an Australian Royal Commission, as Lernoux documents, later revealed that the bank had regularly transferred funds from Sydney to Southeast Asia for payment of heroin shipments to Australia, which were sent in containers to the U.S. West Coast. Thousands of smaller investors in the United States and Australia lost their life savings as a result of the bank's collapse, although the Generals and intelligence agents associated with the bank escaped unharmed.

Many mysteries remain unanswered. For example, although Frank Nugan's body was exhumed for investigation, it is still uncertain whether he committed suicide or was murdered. It has not been proven that any U.S. intelligence agency communicated with former Australian Governor General John Kerr just before his dismissal of Gough Whitlam. While the fact has been well established that Michael Hand and Theodore Shackley had contacts before Shackley retired from the CIA, the nature of those contacts is a secret. Finally, whether Hand has been in contact with the CIA since going missing, that too is a secret.

In fact, the CIA has denied everything. It issued this statement, for what it is worth: "The CIA has not engaged in operations against the Australian Government, had no ties with the Nugan Hand Bank, and does not involve itself in drug trafficking." And Nixon wasn't a crook.

Part VII: The Secret Team in the Iran-Contra Affair
THE IRAN-CONTRA affair gave the American public its first insights into the way the Secret Team fashioned its own foreign policy. What is truly surprising is not the content of the arms-for-hostages deal, but the fact that it was exposed. Coming shortly after President Reagan condemned Iran and Nicaragua, along with Libya, for supposedly being the backbone of international terrorism, the deal neatly inverted U.S. propaganda. Through its weapons purchases, the monster Khomeini regime was secretly funding arms for the Nicaraguan Contras, who were waging war, backed by the U.S. in contravention of its own neutrality laws. In typical Secret Team fashion, the deal was unknown to the nominal foreign policy chiefs, the U.S. Secretaries of Defence and State, but went on behind closed doors in the office of a young Lieutenant-Colonel, whose secretary later shredded documents by confusing the FBI with the KGB.

What is unknown to the American general public, even after "Contragate," is that the arms-for-hostages deal was typical of the manoeuvres of an extremist clique whose policies were more concerned with plunder and mayhem than any genuine U.S. foreign policy interest. The team of covert agents/businessmen Theodore Shackley and Tom Clines, organized schemes ranging from aid to the Cuban drug- and gun-running exiles to providing Nicaraguan dictator Somoza with weapons in his last days, which he used to bomb civilians. Arms sales to Iran via Israel did not begin with the notorious arms-for-hostages deal. And even the avowed enemy Libya received covert U.S. aid.

THE ACTIONS OF EDWIN WILSON ARE TYPICAL of the mirror images that reflect the reality of world politics. A former CIA agent, Wilson is currently in prison for his Libyan dealings. He trained Libyan would-be terrorists while American policy denounced the Libyan terrorist network. His recruits staffed and trained the air force of Libya leader Col. Ghaddafi, and he supplied planes, men and weapons for Ghaddafi's military forays into Chad and Sudan. Such weapons sales were likely financed by the CIA-connected Nugan Hand Bank. While Wilson's escapades often have been seen as that of a traitor, they constantly had the approval of top covert warfare planner Theodore Shackley, as Jonathan Kwitny points out in The Crimes of Patriots.

During the moderate era of U.S. President Jimmy Carter, Wilson was jailed and Theodore Shackley, as well as some 800 other CIA covert operations agents, were fired. Before his imprisonment, Wilson, along with Clines, organized assistance to the Contras via Israel, who were Somoza's arms suppliers. Carter's attempts to isolate Iran were frustrated in a similar manner by the same strange alliance of extremist former covert agents and Israel. Even during the holding of the hostages, abruptly ending after the installation of Ronald Reagan as President, Israel supplied arms to the Khomeini regime. These included spare parts for U.S.-made tanks and F-4 Phantom jets, as Jonathan Marshall, Peter Dale Scott and Jane Hunter show in The Iran Contra Connection.

AGENTS FIRED BY Carter were employed in the Reagan election campaign, turning their covert tactics on the incumbent President, Reagan's campaign chairman, veteran intelligence agent William Casey, openly boasted of running an "intelligence operation" against Democrats. Later, investigations by a congressional committee showed Reagan forces had infiltrated their opponents with spies, and had even managed to acquire the "debate book" of President Carter, a briefing book used for his television debate with Reagan.

After Reagan's election, the fired agents went back to work. Contras received U.S. backing and aid was given to the Khomeini government. One of the first friendly overtures of the Reagan Administration was to pass on lists of all the members of the Iranian Tudeh (Communist) party.

KHOMEINI'S FORCES RESPONDED by killing 4,000 Tudeh leaders and supporters. Former U.S. Under-Secretary of State, David Newton, rejoiced that "the leftists there seem to be getting their heads cut off." When the arms for hostage scheme was launched, it was facilitated by Israelis long involved in their government's strategy of an alliance with Iran. Arms sales profits did not go only to the Contras. Some went to the Israeli secret service, Mossad, some to the UNITA guerrilla organization at war with Angola, while some even ended up in the pockets of financiers of the Shiite Iranians in Beirut, who had kidnapped the Americans the deal was intended to free!

The exploits of the Secret Team demonstrated how a few highly placed extremists could develop and implement their own foreign policy, working sometimes within government and sometimes in spite of it. In doing so, they used the very tactics for which they condemned their alleged adversaries.

John Bacher is a historian working in Toronto.


For The Lack Of Evidence:

It's Hard To Sue The Secret Team


A recent court decision in Florida has dismissed the Christic Institute's suit against twenty-four former U.S. intelligence agents and military officers for lack of evidence. The case is to be appealed.

John Bacher

It is a civil suit under the U.S. Racketeering Influenced Corrupt Organization Act. To be successful, it is not enough to establish that criminal events took place, but also that a conspiracy be demonstrated.

Even before dismissing the case, Judge King had reduced its scope to events that had supposedly taken place after 1983, whereas the Christic Institute had intended to bring in the entire twenty-five-year history of the "secret team." The dismissal of the case has little bearing on PEACE Magazine's series, which has dealt with the longer-term saga, and has drawn on published sources beyond the evidence collected for the court case.

In his decision, Judge King specifically noted an area or shortage of evidence. He said that the Institute "presented no direct evidence nor eyewitness testimony" that Per Anker Hansen (who was accused of committing a bombing at La Penca, Costa Rica) was present at the site where it took place. This accusation is hotly disputed by the Christic Institute, which has circulated a video that it says shows Hansen at La Penca and sneaking out before the explosion.

Judge King's decision is ironic, in that the Christic Institute was then suing in another federal court in Washington D.C. for evidence that could have provided some of the details that King says are lacking for the case to go to trial.

Critics have complained that Christic Institute Attorney Daniel Sheehan had weakened his case by extending it beyond the La Penca bombing to twenty-five years of covert CIA activities, headed by the dynamic duo of Theodore Shackley and Thomas Clines. The bombing itself, believes investigative reporter Martha Honey, whose husband was seriously injured in it, was organized to serve the closely related purposes of killing the independent liberal contra leader Eden Pastora and providing a pretext for the U.S. invasion of Nicaragua.

The lengthy process needed to appeal Judge King's decision will ensure that the Christic Institute case will not come before a jury until after the November U.S. Presidential election.

Revelations in a Senate Foreign Relations Subcommittee, chaired by Senator John Kerry, have established the connections between drug smugglers and the contras. Both George Morales and Garry Betzner have confessed to flying weapons to the contras from CIA-connected rancher John Hull's ranch in Costa Rica, and picking up cocaine.

Some journalists disputed the veracity of the testimony of drug smugglers. Indeed, a complex debate was printed in The Nation (August 29, and September 19, 1987) between Jonathan Kwitny, Daniel P. Sheehan, and TV producer Leslie Cockburn. Kwitny not only cast doubt on the pilots' stories, but tried to disprove them by showing that a plane Morales had mentioned had not been available at the time of the supposed flights, and that John Hull's air strip was too short for a fully-loaded plane of that description to have taken off there.

Subsequently, however, Senator Kerry has seemingly corroborated Morales's and Betzner's stories. He has played video-taped depositions of three former-contra leaders, whose statements confirm that drug money assisted their forces. Karol Prado, the southern contra front's second-in-command further explained that the rebels provided fuel to pilots carrying drugs when they landed at contra airstrips.

Although the drug-contra connection has been firmly established, the ties to the CIA remain more elusive. In an April 30, 1988 issue of The Nation, journalist David Corn illustrated the difficulties Kerry has experienced, hitting up against "the CIA wall" in his investigation. It was expected that Ambassador Robert Duemling of the State Department would tell the subcommittee that the CIA had propped up the Vortex Aircraft company, which smuggled arms and drugs for the contras. Duemling's testimony, however, was postponed.

Ramon Milian-Rodriguez, a convicted money-launderer for the Colombian Medellin cocaine cartel, claimed he had passed on its private drug profits to the contras. In a private session with the subcommittee, Milian-Rodriguez testified that he had funneled $10 million to the rebels through Felix Rodriguez, a former CIA agent with close ties to George Bush. These claims have not been publicly explored. However, Senator Kerry promises to do so in the future.

Another potential CIA network is that of former Israeli General Michael Harari, a top adviser to Panamanian General Noriega. According to a former Noriega aide, Josť Blandon, Harari operated airstrips throughout Central America to arm the contras and smuggle drugs. ABC News recently interviewed an American pilot who said he was part of this outfit and that he had brought drugs back to the United States. Kerry is currently investigating CIA connections to this operation behind closed doors. He is engaged in a delicate balancing act: The subcommittee's investigation could be closed down if he discloses classified operations.


Source of all articles: The Peace Magazine

The Secret Team, Part I: The Secret's Out

The Secret Team, Part II: The Way of Pigs

The Secret Team, Part III: Chaos in Laos

The Secret Team, Part IV: Visiting Vietnam

The Secret Team, Part V: Cha Cha Cha! Overthrowing Latin Democracies

The Secret Team, Part VI: Who Did in the Prime Minister?

The Secret Team, Part VII: The Secret Team in the Iran-Contra Affair

For Lack of Evidence: It's Hard to Sue the Secret Team

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