Gave Contras $4 Million, Drug Smuggler Testifies

April 08, 1988 |PAUL HOUSTON | Times Staff Writer WASHINGTON A convicted drug smuggler testified Thursday that he contributed $4 million to $5 million to the Nicaraguan Contras and flew weapons to them after two rebel leaders promised in 1984 to use their CIA connections to get him out of trouble with U.S. prosecutors. George Morales, who subsequently went to prison on drug charges, told a Senate hearing that his planes were loaded with weapons in Florida, flown to Central America and then brought back with cocaine on board.

He has charged previously that the CIA and Drug Enforcement Administration were "very, very aware" of the flights, which Morales said encountered virtually no efforts to interdict them. Both agencies have denied the charges. Although Contra leaders repeatedly have denied any involvement in illegal drug trafficking, Sen. John F. Kerry (D-Mass.) said that the testimony before the Foreign Relations subcommittee he heads "makes it very clear that narcotics dollars were involved in the Contra support process." He also said the testimony indicates that Reagan Administration officials "turned their back" on drug trafficking in the interest of pressing their support of the Contras' guerrilla war against Nicaragua's Sandinista government. The subcommittee is investigating links between Latin American officials and the illicit drug trade. Morales, brought here from his Florida prison cell to testify, said that his Florida-based aviation firm made six flights in 1984 and 1985 to landing strips on or adjacent to the ranch in Costa Rica of John Hull, an American-born farmer. Gary Betzner, 47, another convicted smuggler who piloted Morales' aircraft, testified that after weapons and other supplies were taken off the plane in the presence of Hull, duffel bags of cocaine were put aboard for the return flight. Morales, a 38-year-old native of Colombia and a world speedboat champion, added that he did not know who picked up the narcotics at his firm's air terminal in Opalocka, Fla. But he said that he was paid an unspecified amount to bring the cocaine back and that Betzner kept part of the shipments as payment for his services. Morales claimed that the supply flights were solicited by three leaders of a faction of the Contras based on the so-called "southern front" in Costa Rica. He identified the three as Adolfo (Paco) Chamorro, Marcos Aguado and Octaviano Cesar.

Morales said that their request came shortly after he was indicted in March, 1984, on marijuana smuggling charges. He said that he agreed to make the flights after Aguado and Cesar told him they were CIA operatives and "perhaps they could do something about the indictment." He also said that he gave "several million dollars" to the Contras from money he earned in drug operations. At the hearing, Kerry played a videotaped interview with three Contra leaders--Aguado, Cesar and a man identified as Karol Prado--in which they confirmed the weapons flights, admitted receiving contributions from Morales and that they were aware that some weapons suppliers were smuggling drugs.
http://articles.latimes.com/1988-04-08/news/mn-1147_1_drug-smuggler

================= U.S. REP Maxine Waters Investigation http://www.scribd.com/doc/117070568/US-Congresswoman-Maxine-Waters-Investigation-of-CIAContras-involvement-in-drug-sales-1996-2000

Exhibit 1: U.S. Attorney General William French Smith replies to a still classified letter from DCI William Casey requesting exemption from reporting drug crimes by CIA assets. Source: https://www.cia.gov/library/reports/general-reports-1/cocaine/contra-story/01.gif

Exhibit 2: DCI William Casey happily agrees with William French Smith and signs the Memorandum of Understanding (MOU) exempting his agency from reporting drug crimes. This agreement covered both the Latin American conflicts and Afghanistan war. It remained in effect until August, 1995 when it was quietly rescinded by Janet Reno after Gary Webb began making inquiries for his series. The 1995 revision of the DOJ-CIA MOU specifically includes narcotics violations among the lists of potential offenses by non-employees that must be reported to DOJ. Source: https://www.cia.gov/library/reports/general-reports-1/cocaine/contra-story/13.gif

Exhibit 3: On February 8, 1985, Deputy Chief of DOJ's Office of Intelligence Policy and Review (OIPR) from 1979 to 1991, A. R. Cinquegrana signed off on this letter approving the MOU. Mark M. Richard, Deputy Assistant Attorney General with responsibility for General Litigation and International Law Enforcement in 1982, states that he was unable to explain why narcotics violations were not on the list of reportable crimes except that the MOU had "other deficiencies, not just drugs." Source: https://www.cia.gov/library/reports/general-reports-1/cocaine/contra-story/14.gif