CIA's Report on the Contras and Cocaine
by Frederick P. Hitz, IG CIA
Statement of Frederick P. Hitz
Inspector General, Central Intelligence Agency
Before the Select Committee on Intelligence United States Senate
October 23, 1996 Regarding Investigation of Alleged Connections
Between CIA, the Nicaraguan Contras and Cocaine Trafficking in
the 1980s
Chairman Specter, Vice Chairman Kerrey and members of the
Committee, I appreciate very much the opportunity to appear and
discuss the investigation my office has been asked to undertake
into recent allegations that persons associated with CIA and the
Nicaraguan Contra movement may have had some role in the
introduction of cocaine into the United States. You have asked that
I address the nature of the allegations, the scope of our
investigation and the results of any relevant previous reviews
conducted by CIA.
As you know, the recent controversy regarding these allegations
began with a three-part series published by the San Jose Mercury
News on 18, 19 and 20 August 1996, discussing the misdeeds of
several individuals who have been implicated in cocaine trafficking
in California. The series alleged that at least two individuals had
applied their illegal profits to benefit the Contras in their armed
resistance to the Nicaraguan Sandinista Government in the 1980s.
As several news organizations--including The Washington Post,
The Los Angeles Times, and even the Mercury News itself--have
pointed out, the series included no evidence to indicate that CIA
played a role in the emergence of crack cocaine in America.
Nonetheless, the Mercury News series quickly has come to be
represented as having established that the CIA was responsible for
the widespread availability and use of crack cocaine in Los
Angeles, throughout Southern California and other American cities.
On 3 September 1996, Director of Central Intelligence Deutch
wrote to me that he had "no reason to believe that there is any
substance to the allegations published in the Mercury News."
However, he requested that I initiate an immediate inquiry into the
matter "because of the seriousness of the allegations and the need
to resolve definitively any questions in this area." At that time, DCI
Deutch also requested that I submit a report to him within 60 days
containing our findings and conclusions.
In 4 September 1996 letters to several members of Congress, this
Committee and its counterpart in the House of Representatives,
DCI Deutch explained his decision to request an Inspector General
investigation. He also stated that a review of Agency files,
"including a study conducted in 1988 and briefed to both the
intelligence committees, supports the conclusion that the Agency
neither participated in nor condoned drug trafficking by Contra
forces." Further, according to the DCI, the Agency never had any
relationship with the two individuals alleged by the Mercury News
to have funneled drug trafficking profits to the Contras. Also, the
DCI stated that the Agency had never sought to have information
concerning these individuals withheld in a drug-related prosecution
of a third individual as alleged in the Mercury News.
We also recognized the seriousness of these allegations. Thus, we
reacted quickly to the DCI's request by organizing an initial team of
three Investigators, an Auditor, a Research Assistant, and a
Secretary to conduct a preliminary review of the scope and nature
of the issues involved. That team developed, and I transmitted to all
Agency components, a 12 September 1996 request for
comprehensive searches of all Agency records systems regarding a
broad range of relevant subjects. The request also called for the
components to designate specific personnel who would be
individually responsible for certifying to the thoroughness of those
searches. We also published a Bulletin to all Agency employees
explaining the nature of our investigation and asking that they
provide us with any relevant information in their possession.
The search request extended to any and all documents and
information, regardless of its form or sensitivity, relating to: (1) any
CIA connection with a number of specific individuals; (2) any
possible drug trafficking and related activities by the Contras or
associated persons; (3) what action CIA took in response to such
information; and (4) any contacts with federal, state, local, or
foreign law enforcement entities in regard to these individuals and
activities. Because of the DCI's request for a report within 60 days,
we established a deadline of 18 September 1996 for the
components to provide our office with copies of all responsive
documents and information. It has since become apparent that there
is absolutely no chance we will be able to meet anything like a 60-
day deadline.
The size of the information base that must be thoroughly reviewed
by the Agency components in order to respond to our request is
enormous. For example, our team has reviewed over 5,000 cables
that were identified in our own preliminary and limited electronic
search of the Agency's cable data base. We have just received our
first several hundred documents from the Directorate of Operations
in response to our request and have been advised that 5-10,000
electronic records are in the final stages of review for relevance to
our tasking, while over 350 boxes of files have been recalled from
Agency archives and must be manually searched for responsive
records. Additional searches are underway in the Directorates of
Aministration and Intelligence, the Offices of Congressional
Affairs and the General Counsel which have provided only very
limited responses so far. We have been told that a search of the
same records base in the 1980s at the request of the Iran- Contra
Independent Counsel took two years and the efforts of 50 to 60
Agency personnel.
While we are attempting to tailor our requests as much as possible,
the bulk of the information that is responsive to our request will
not even be received by my office for at least two weeks. Thus, we
remain in the preliminary stages of our investigation.
Soon, we will face the requirement to review, catalogue and digest
substantial amounts of information in order to move into the
interviewing phase. In anticipation of this requirement, we have
assigned three additional Investigators, an Independent Contractor
and another Research Assistant to our team. Another Auditor and
two Inspectors will be joining the team shortly as well. I am
prepared to assign such additional resources as may be needed to
conduct a thorough and timely investigation. We have also had
preliminary discussions, and are looking forward to working
closely, with the Justice Department Inspector General and his staff
since it is obvious that there will be several areas where our
investigative interests and jurisdiction will overlap and complement
each other.
While we do not have much substantive insight at this point, I can
describe what we have learned from the limited documentation
provided to us thus far regarding the Agency's position when
similar questions were raised in the late 1980s. According to these
records, in early 1987, the State Department requested that the
Agency review all available information relating to the possible
involvement of the Contras in drug trafficking. The 21 January
1987 paper that resulted was described as coordinated through the
Intelligence Community and with DEA. It began: Review of
information available to the Intelligence Community gives no
indication that anti-Sandinista groups that have received or now are
receiving support from the US Government have engaged in drug
trafficking to fund their operations. Some allegations of "Contra"
involvement in drug trafficking have surfaced over the past few
years . . . DEA and FBI officials, along with Intelligence
Community leaders, however, say no credible information exists to
support such allegations.
The paper went on to discuss allegations regarding certain
individuals that had been received and acted upon by the Agency.
Just over a year later, on 28 March 1988, then-Deputy DCI Robert
Gates sent a memorandum to the Agency's Deputy Directors for
Intelligence and for Operations asking for a briefing concerning
"Contra involvement in narcotics-related activities to include any
pilots involved in the resupply effort who may have had past or
current (sic) ties to narcotics-related activities." He indicated in this
memorandum that he wanted to be "fully informed on the facts"
because "so many" questions and allegations were being raised
about these subjects. The memorandum also suggested that "there
may be some merit in setting all of this down on paper for the
record--perhaps to be provided to both the [President's Intelligence
Oversight Board] and to the Oversight Committees (of the
Congress]." According to the memorandum, the briefing was to
include "specifics and comprehensiveness."
This request appears to have produced at least two written
responses. One is an undated and unsigned paper entitled,
"Allegations of Resistance Activities in Narcotics Trafficking." It
begins by stating:
All allegations implying that the CIA condoned, abetted or
participated in narcotics trafficking are absolutely false. The
Agency constantly checks for any evidence of drug smuggling by
Nicaraguan Resistance members and any person or entity found to
be involved in such activity must be separated from the resistance.
In addition, the Agency has consistently informed the
Congressional Oversight Committees of any Resistance drug
activities in briefings and in written responses.
The paper then goes on to describe a variety of allegations as to
specific individuals and how the Agency responded to each.
The second apparent response is a 31 March 1988 memorandum to
DDCI Gates entitled, "Pilots, Airplanes and Shipping Companies
Used in the Resupply Efforts That May Have Had Past or Current
Ties to Narcotics Related Activities." This memorandum was
prepared by the Central America Task Force which was responsible
for managing the Agency's program in support of the Contras. It
begins as follows:
During the past several years there have been numerous allegations
in the media that pilots and airline companies that the Agency has
used in the resupply effort of the Democratic Resistance have been
involved in narcotics activities. To our knowledge no pilot or crew
members have engaged in il
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