Bibliography: Peter Dale Scott and Jonathan Marshall Cocaine Politics: Drugs, Armies, and CIA in Central America University of California Press: Berkley, LA, and London 1991

Biography: Dale Scott is a former Canadian diplomat and english professor at UC Berkley. His research focuses on US covert operations and includes analyses of the Kennedy assassination and the global drug trade. He is also the author of poetry.

Research question/hypothesis: Cocaine politics is an analysis of the supply apparatus organized by the CIA to support and fuel the Contras, the remnants of the Somoza dictatorship, in their war waged on the leftist Sandinista Government. Dale Scott claims that the Contras, with the protection of the US Government, fused their supply apparatus with the drug trade dramatically increasing the amount of cocaine imported into the US. He uses this information to question the validity of the ‘narcoterrorist’ enemy blamed for the drug crises in the US.

Data: Cocaine Politics is an extension of the investigation begun by the Senate Subcommittee on Terrorism, Narcotics, and International Operations led by Senator John Kerry which interviewed the involved mercenaries, drug traffickers, and governement agents. Dale Scott extended this investigation to include customs and DEA reports and foreign and domestic news sources.

Findings:

Werner Lotz, a Costa Rican mercenary pilot, transported supplies for the Contras, the Sandinistas, and the Salvadoran guerillas. (p.10)

SETCO Air, the Honduran cargo firm owned by Juan Ramon Matta Ballesteros, received $186,000 from the State Dept. contract for transporting humanitarian goods to the Contras. (p.10)

In 1986 Frigorificos de Puntares received $262,000 from the State Dept. for Contra supply efforts. Luis Rodriguez, the CEO, was indicted on drug charges. (p.11)

DIASCA, a miami based airplane dealership and parts supply co., owned by Alfred Caballero, under active investigation by the DEA for cocaine trafficking, received a $41,000 contract for the Contra supply effort. Oliver North arranged contra financial deposits to be laundered through a DIASCA account. Floyd Carlton, one of Manuel Noriega’s pilots, used DIASCA planes to transport coke. (p.11)

Vortex received a contract of $317,000 for service to the contra supply aparatus. The company’s owner, Michael Palmer, was identified by DEA as a smuggler. (p.11)

Eden Pastora, a former Sandinista in command of an anti-Sandinista guerilla group in N. Costa Rica, transported coke for Colombian trafficker George Morales through the contra supply aparatus organized by the CIA. In 1984 the CIA dropped its alliance with Pastora in favor of other Contra leaders who also transported coke for Morales. (p.12)

John Hull, an american ex-patriate in Costa Rica, notorious for arms and drug trafficking, received $10,000 monthly from accounts established by Oliver North for aiding the contra war effort. (p.13)

Oliver North arranged for $1.5 million in eastern-bloc weapons to be transported to the Contras through the Syrian arms dealer Manzer al-Kassar whose clientile included Abu Abbas, the head of the PLO, and Abu Nidal, the terrorist responsible for the 1985 airport massacres in Rome and Vienna. (p.16)

Jose Medardo Alvero Cruz, a Miami-based Cuban, controlled a major of faction of George Morales' Columbian cartel. The Alvarez Cruz network included Frank Castro, Ricardo Morales, Carlos Hernandez Rumbaut, and Guillermo Tabraue; all long-time CIA assets involved in the bay of pigs invasion and recruited for the contra supply apparatus for Pastora’s troops. These traffickers and Santos Trafficante, leader of Cuba’s Sicilian syndicate, were also paid informants of DEACON 1, a secret intelligence unit of the BNDD organized by Lucien Conien, with the mission of collecting information on drug trafficking in Miami.  (p.25-31)

Many members involved in CORU, an organization formed by the CIA in 1976 under the direction of George Bush to terrorize Cuba and sympathetic regimes, were recruited by the CIA to serve in the contra war effort. Luis Posada, a CORU member arrested in 1976 for bombing a cuban passenger jet, was hired by the CIA in 1985 to manage military supply flights and shipments for the contras at the Ilponago air force base in El Salvador. Frank Castro, the founder of CORU, financed contra training camps in the everglades FL and donated $200,000 monthly to Pastora. CORU was financed by the World Finance Corporation (WFC), a Florida based conglomerate that was used as a drug trafficking front by the Trafficante syndicate. (p.25-31)

The Cuban Nationalist Movement (CNM), a neo-fascist anti-castro organization operating out of Miami and Union City NJ, was partly financed by the drug trade controlled by DINA, the chilean secret service. Its northern branch, Omega 7, was in contact with Alvaro Carvajal Minota, leader of the drug ring formed in San Fransisco to fund the contras. (p.33)

Antonio Cruz Vaquez, a cuban exile with intelligence connections to the Somoza regime, although it is uncertain whether he worked for the CIA or Fidel Castro, controlled a drug distribution network out of Mexico protected by the CIA. The heroin Vazquez exported was supplied by the Zambadas, a family of cuban exiles in Mexico. (p. 33)

The Tijuana based syndicate of Albert Sicilia Falcon, which transported drugs and arms throughout the US and Central America for the contras, formed after the fall of Auguste Ricord’s Marsielle syndicate known as the french connection for the massive amount of heroin it supplied the US. Sicilia’s syndicate operated with the protection of the CIA and the DFS, the Mexican intelligence agency, under the control of Miguel Nazar Haro. Jose Antonio Zorrilla Perez, Nazar’s successor at the DFS, continued to work closely with the CIA. (p. 33-40)

The US supplied $115 mill in aid, 76 planes, and trained mexican pilots for the mexican drug eradication program initiated in 1975 Operation Condor which involved aerial spraying of crops. Evergreen Intl Aviation, a CIA front company, was contracted to carry out the operation. E-Systems, a company that acquired Air Asia, a CIA airline implicated in opium smuggling, was contracted to conduct airplane maintanence in Mexico for the program. (p.37-8)

The DEA bust of a DFS protected 10,000-ton marijuana complex in Chihuahua, a state in northern Mexico, resulted in the collapse of Sicilia-Falcon’s syndicate and the murder of DEA agent Enrique Camarena. DFS officers united Sicilia Falcon’s former competitors into organized cartels and helped them relocate to Guadalajara. The DFS received 25% of the Cartel’s profits in exchange for targeting competition in their drug eradication programs. (p. 40)

The DFS and CIA collaborated to provide protection for la pipa, a smuggling operation that transported marijuana to the US through the use of natural gas trucks. (p. 40)

Miguel Felix Gallardo and Juan Ramon Matta Ballesteros, Sicilia’s connection to Andean coke, joined forces after Sicilia’s arrest. The Gallardo-Matta Ballesteros syndicate was responsible for 1/3 of the coke consumed in the US in the early 1980s. Gallardo contributed money and arms to the Contras and recruited other traffickers into the contra supply apparatus in exchange for CIA protection. Rafael Caro Quintero, one of the traffickers, allowed the CIA to run a Contra training camp at his ranch in Veracruz, Mex. (p. 41)

Propaganda Due (P2), an Italian Masonic lodge that recruited politicians, intelligence officers, business tycoons, and military leaders with the goal of creating an authoritarian state, created networks in Argentina and Uruguay. Operation Condor, founded in the 1970s by Argentina and Chile, was an alliance of Latin American military governments dedicated to wiping out communism through joint intelligence operations and assassinations. Carlos Guillermo Suarez Mason, a P2 member, provided early leadership until he became the director of Argentina’s state oil monopoly, YPF. He also worked with Israeli specialists in Guatemala to train military officers and create a computerized intelligence center. Juan Lopez Rega, a P-2 member, provided the early leadership for the argentinian anti-communist alliance (AAA), a deathsquad that collaborated with Omega 7 and contributed personnel to contra training teams. CORU members were employed as hitmen. (p. 42-4)

The 1980 military coup in Bolivia was orchestrated with the assistance of Argentinean and US intelligence agents and Klaus Barbie. 6 months before the coup Bolivian traffickers agreed to support the military leaders in exchange for protection of their trade giving it the name the cocaine coup. Arce Gomez, Bolivia’s Interior Minister after the coup that organized the neo-fascist groups, the ‘fiancés of death’, created by Klaus Barbie released convicted smugglers and recruited them to paramilitary squads. His cousin, Roberto Suarez, was a prominent coke trafficker. (p.44-6)

The Andean Brigade, an Argentinean counterinsurgency operation against the montoneros guerillas in the Andeas, brought the Argentinean military into contact with Andean traffickers. The Brigade was partly financed by those involved with the cocaine coup. (p.44)

Stifano Delle Chiaie, an Italian fugitive, Operation Condor assassin, and AAA collaborator who aspired to form an intl. neo-fascist center in Buenoaires, worked as a liason between the Bolivian military, the Sicilian mafia, the Gray Wolves, a right-wing Turkish drug trafficking organization, and Miami syndicates. (p.45-6)

Argentina coordinated the Contra supply effort in the early ‘80s through the Latin American Anti-Communist Confederation (CAL) led by Mario Sandoval Alarcon, the godfather of Guatemala’s death squads, and his protégé in El Salvador, Roberto d’Aubuisson. Argentinean officials trained death-squads and set up support networks to for the contras throughout Honduras, Costa Rica, El Salvador, and Guatemala. (p.46-7)

The CIA unified the various contra guerilla groups in the north into the Nicaraguan Democratic Front (FDN) under the command of Enrique Bermudez. Argentinean trained advisors ran training camps in Honduras, Costa Rica, and Florida. (p.48-9)

The Honduran economy in the 1980s was based on the banana trade controlled by Standard Fruit and United Fruit in New Orleans. The New Orleans mafia fused the drug trade with the banana trade through use of the same route. Joe Macheca, New Orleans mafia boss, and his successor Charles Matranga had close ties to United Fruit. . The Vaciaro brothers, Sicilian immigrants to New Orleans with connections to international syndicates, founded Standard Fruit. Honduras exported 87 kg of European morphine to the US through use of the banana trade route. (p.51-2)

Central America’s railroad empire was built by New Orleans mafiosos employed by United Fruit. (p.52)

Guy Maloney, a soldier of fortune and police chief of New Orleans, led an invasion of Honduras in 1911 that was financed by Samuel Zemurray, a US banana entrepenuer who became in 1930 United Fruit’s largest shareholder in charge of United Fruit’s operations in Central America. In 1930 Guy Maloney again led a mercenary revolt in Honduras that installed Tiburcio Carias Andino in power. Carias took control of the drug trade and authorized use of the Honduran airline TACA for drug shipments. A 1975 coup replaced Oswaldo Lopez Arellano with Humberto Regalado Lara as president. Arellano retired to direct the airline Tan-Sasha which transported coke controlled by Regalado to the US. In 1978 Policarpo Paz Garcia was brought to power in Honduras in a coup financed by Juan Ramon Matta Ballesteros. This coup was responsible for connecting Honduras to Mexican syndicates and the CIA Contra supply apparatus thereby making it a drug trafficking center in Latin America. US economic assistance to Honduras tripled between 1978-80. (p.53-4)

SETCO, Matta’s airline, was the chief transporter of supplies to the FDN and was paid for its services through a bank account established by Oliver North. The airline was also used for Matta’s smuggling operations, which were carried out through his contacts with Policarpo Paz, Col. Leonides Torres Arias, head of Honduras’ military intelligence unit G-2, and Duane Clarridge, CIA station chief in Latin America. (p.55-6)

Manuel Noriega, under orders of the CIA, donated funds to both the Social Christian Unity Party and their rivals the National Liberation Party in an effort to buy political influence in Costa Rica. (p.54)

Mario Calero, brother of FDN leader Adolfo Calero, was joint owner with Frank Moss in Hondu Carib, the CIA front airline that managed the shipping operations of the Colombian cartels. Hondu Carib transported supplies from RM Equipment, an arms dealership whose owners were implicated in drug trafficking, to the FDN until Richard Secord established a monopoly on FDN supplies through Oliver North. Hondu Carib DC-4 planes were seen making drug drops on Adler Barry Seal’s Louisiana ranch. (p.57-9)

On October 20 1984 Gerard Latchinian and Bueso Rosa, contra supporters, were caught smuggling coke in S. Florida meant to finance a coup to reinstall Gustavo Alvarez Martinez, a death squad commander who worked as a consultant to the Pentagon while in exile, to power in Honduras. Gerard Latchinian, the richest man in Honduras, was an arms dealer whose associates included Felix Rodriguez, the murderer of Che Guevara in control of Contra operations in El Salvador, and Pesakh Ben-Or, an Israeli arms dealer based in Guatemala. (p.60-1)

In 1987 Honduras exported 1/5-½ of all coke in the US market. (p.63)

Manuel Noriega was recruited by the US Defense Intelligence Agency as an asset in 1959 to protect US interests as a military and political figure in Panama. Noriega remained on the CIA payroll for much of the 1970s and 1980s, except during the Carter administration, earning between $110,000-$200,000 yr. In 1980-1 Manuel Noriega joined forces with Leonides Torres of Honduras to form a supply apparatus for the Marxist rebels of El Salvador that was fused with the drug trade. CIA paychecks to Noriega were deposited in a BCCI account. (p.65-7)

Panama served as a haven state for CIA corporate and financial fronts. The Amalgamated Commercial Enterprise was such a front that supplied the contras with arms purchased from Manzer al-Kassar, the Syrian arms and drugs broker, and used the services of the bank Banco Iberamericano, a well-known drug-laundering front for the Cali and Medellin cartels. (p.67)

The cocaine trafficking network of Steven Kalish included Michael Palmer, the owner of Vortex, and Cesar Rodriguez, owner of the airline Servicios Turisticos involved in the contra supply effort. (p.68)

In 1978 Noriega recruited Floyd Carlton and Cesar Rodriguez to transport weapons to the Sandinistas. Michael Harari, the #3 man in the Israeli Mossad, was asked by Noriega to purchase European arms for the Sandinista supply operation (p.69-73)

Early leadership of the Medellin cartel consisted of Pablo Escobar, Gustavo Gavina, and Fabio and Jorge Ochoa. In 1982 Medellin traffickers recruited Floyd Carlton to transport drugs to the US through Panama. In 1984 Costa Rica replaced Panama as the transshipment point for drugs on the way to the US. (p.69)

In 1988 the US led an invasion of Panama to remove Noriega from presidency in favor of Guillermo Endara, the former director of Banco Interoceanico. Carlos Eleta, Endara’s former business partner responsible for laundering CIA funds into Endara’s presidential campaign, was arrested in 1989 for conspiring to import ½ ton of coke monthly into the US. (p.72-3)

Richard Brenneke was a Portland OR arms dealer who was recruited by Pesakh Ben-Or in 1983 to supply the Contras with East-Bloc weapons stored in Checkslovakia. The planes used to transfer the weapons were also used to transport Medellin coke to the US. (p.74-5)

Israeli specialists trained many of the drug cartel assassins and paramilitary squads responsible for most acts of Colombian terrorism. Mossad agents were responsible for the formation of UESAT, a Panamanian bodyguard unit where Michael Harari worked as a trainer. The Israeli security firm ISDS, owed by Emil Saada, trained bodyguards in Honduras and members of Contra death-squads. (p.75-7)

In the 1980s trafficking in Colombia was divided between 5 loosely organized syndicates in Cali and Medellin. These cartels were dominated by a Peruvian source that supplied most traffickers in Columbia, Mexico, US and Europe. The early leadership of the Cali cartel consisted of Gilberto Rodriguez Orejuela, Jose Santacruz Londono, and Eduardo Tascon Moran, who exported coke to the US and Thailand. The protection and patronage by the CIA of the traffickers involved in the contra supply network brought cohesiveness to the competitive factions in Colombia. In 1983 a customs report recorded drug drops made by Isaac Kattan Kassin on Adler Barry Seal’s farm for the Juan Ramon Matta Ballesteros and Santiago Ocampo Zuluaga network. The syndicate transported cocaine from Columbia to the US via Mexico with political protection in every country where it operated. Alfonso Rivera, leader of the 1974 coalition that made many S. American countries capable of producing coca paste, and the Paredes, the wealthiest family in Peru, supplied the majority of cartels in Columbia. The Rivera-Ocampo-Matta connection was based off of Augusto Ricord’s French Connection, the major heroin pipeline created from CIA intervention in Marsielle. This syndicate ran the largest coke smuggling operation in possibly the world and continued to distribute Marsielle heroin to the US. (p.79-84)

US agents associated with the Auguste Ricord network moved Klaus Barbie from NAZI Germany to Bolivia. (p.85)

The World Anti-Communist League (WACL) and the American Anti-Communist Confederation (CAL) developed a strategy to achieve right wing hegemony through strategic alliance with drug lords. (p.87)

MAS (muerte a sequestadores) was a death-squad created in 1984 through the collaboration of Colombian cartels, death-squads, and military forces. Santiago Ocampo from the Cali cartel served as president President while Jorge Ochoa from the Medellin cartel served as treasurer. (p.87)

Paul Helliwell, a long-time CIA asset, worked with the opium trafficking Guomindang troops in Burma through his Miami based company Sea Supply Inc, laundered CIA and mafia funds through his Castle Bank in the Bahamas, and laundered funds for the CIA and Ferdinand Marcos, the dictator of the Phillipines, through his investment firm. (p.92)

Meyer Lansky related property firms laundered drug money from Thailand and Burma. (p.92)

The Nugan Hand Bank of Australia served as a major financier of drug deals until its collapse in 1980. Donald Beazely, an executive at numerous money laundering fronts including the Great American Bank of Miami, the National Bank of Homestead, formerly owned by Paul Helliwell, and the City National Bank of Miami, became Nugan’s president in in 1979. The City National Bank of Miami was connected to the Colombian cartels and financed a number of Jeb Bush construction projects. (p.92)

In 1981 William Casey, the CIA director, created the narco-guerilla hypothesis that linked the FARC and the Sandinistas to the Medellin cartel and blamed them for the drug crises in the US. (p.95)

In 1982 George Bush formed a S. Florida task force with the mission to keep drugs out of Florida. The group aggressively attacked the Medellin cartel hold on the market while strengthening its bond to Cuban and Cali traffickers. (p.96)

Troilo and Fernando Sanchez’s control of traffic in Costa Rica was broken after the1983 DEA bust of the San Fransisco syndicate the brothers were exporting to. The case came to be known as the frogman case and occurred 1 month after Adolfo Calero was chosen by the CIA to replace Aristides Sanchez, a close relative of the brothers, in commanding the FDN troops. $36,020 of the siezed drug money was returned to contra leaders who claimed it was their property. The family and friends of contra leader Fernando “El Negro” Chamorro replaced Sanchez family control of the trade through Costa Rica. Mike Harari arranged the Chamorro family connection to Colombian coke transported through Panama. The involvement of traffickers in Miami’s Cuban community to the contra supply operation was arranged by Oliver North, John Hull, and Robert Owen and flourished after CIA dropped support for Eden Pastora’s ARDE faction in 1985. (p.106-9)

The United Nicaraguan Opposition (UNO) party formed by Alfonso Robelo, the Nicaraguan millionair who financed the Sandinistas and the Contras, contained other ex-Sandinistas. (p.114)

The Christic Institute filed a class action lawsuit against Robert Owens that claimed his involvement with Richard Secord, John Hull, and the Miami Cuban traffickers constituted a criminal conspiracy. (p.118)

strengths/weaknesses/implications in context: Dale Scott’s section of Cocaine Politics demonstrated how, through the arrangement of the contra supply apparatus, the CIA unified small scale syndicates throughout Latin America and allowed them, through protection and logistical support, to transform into an international transportation and distribution network for cocaine. The traffickers supported by the CIA were responsible for a vast amount of the cocaine imported to the US in the early 1980s at the initial onslaught of the crack epidemic. This implies that the CIA was implicit in the creation of the drug crises that has cost taxpayers billions to fight against. The only downfall to this work is that it is very dense with names and events that are oftentimes difficult to connect to each other on the first read-through.

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