MT OCA 95?2274 .16 August 1995 MEMORANDUM FOR THE RECORD Briefing for Representative James Leach Regarding in Arkansas in the m?g Late 19805 With 41 July 1995 1. On 21 July 1995, at 1000 hours, in room 2186 Rayburn House Office Building, Chairman James Leach Committee on Banking and Financial Services, and staffer Jamie McCormick, received a briefing, at Leach's written request to the DCI, on allegations of in Arkansas in the late 1980s. Investigative Staff, Office of Inspector General; Chief, Legislation Group, Office of fairs; and the undersigned. NSA participants were: Frank Newton, Inspector General, andl Congressional Affairs. -2. Representative Leach began the briefing by saying that he was not interested in opening a new probe of U.S. Contra?policy or suggesting wrongdoing by either Agency, especially since he served on the October Surprise Task Force, where he was convinced that the Marcos? walked away with billion of dollars. Leach, however, did say he based his request for the briefing on reports that have appeared in the press that refer to secret foreign bank accounts held by prominent people in Mena, Arkansas, land an Arkansas?centered network of 0 (see attached incoming letter). Leach also said that over a period of time he had talked to a lot of people regarding this issue. He said that most of the allegations contained within the articles were probably false, but he felt an obligation to look into Whitewater related allegations on behalf of the Banking Committee. That said, some allegations may be credible, some totally unbelievable, but as information goes out to the American public in non?traditional ways, it becomes more believable. 3- along with Frank Newton, respondet LU Leacn's queStions regarding each Agency's current knowledge on involvement with any of the alleged alle ations contained in his letter. Newton responded to all of the questions posed in the incoming er, ut did, however, provide a brief broadbrush . ~31" log RELEASE BATEIUL2002 - Leach SW saga-31" SUBJECT: Briefing for Representative James Leach Regardingi in Arkansas in the ace iyaus Al July 1995 background briefing on how NSA conducts it normal daily activities said that the capability or the 16 to conduct its 1 depends in part on cooperation by others with CIA and thus far the IG had not look into any of these allegations. However, said as he understood the current issue, a thoroug searc had been conducted by CIA regarding issues relating to Systematics, Inc., Mena, and Hadron, during a much earlier timeframe. Also, he understood that thus far very little information had been found to be responsive to the exact allegations contained in the current letter. however, did say that the Agency had perhaps ma nnections within the larger picture of things. The Agency was aware of Barry Seal, but had no relationship with him nor any records regarding his activities in Mena. Seal?s asSociation with the Drug Enforcement Agency (DEA) was widely publicized,? As for PROMIS, that issue had been looked at inudeptn oyrthe Senate Select Committee on Intelligence (SSCI) and the House Judiciary Committee in 1991 and 1993. The conclusion then and still is that the Agency never purchased any software. IChairman Leach was also informed that we had not found any records related to Systematics of Arkansas, a banking software firm,7T* TU SE SUBJECT: Briefing for Representative James Leach Regardingi in Arkansas in the at: iyous 4i ULly 1995 6. Leach, after listening to the responses to his earlier questions, proceeded to ask approximately 45 other questions regarding the issue, basically repeating many of the issues already addressed. For those questions and responses, please see attached pages from a draft memorandum provided by staffer Jamie McCormick and checked against the persOnal notes of the undersigned. The responses in the draft memorandum correspond correctly to the personal notes of the undersigned. 7. Leach concluded by once again saying he has an obligation to look into the matter on behalf of the Committee, and asked us to inform the DCI and DIRNSA that he may hold hearings on these allegations in the fall. (U) 8. The briefing lasted approximately 90 minutes. Leach was informed that the Agency would continue to check its records, especially on questions relating to: l) Park-o?Meter; 2) relationship, if any, with Terry Reed; and 3) whether the CIA had any connection to Seal?s cargo plane (serial number 54-0679). Liaison Group Office of Congressional Affairs Attachments SE ET SUBJECT: Briefing for Representative James Leach Regardingl in Arkansas in the Late iysus AL duly 1995 (22 Aug 95) OCA 95-2274 Distribution: Original OCA Records (w/atts) 1 (w/o atts) 1 atts) 1 anrODO (w/atts) SE With the Congress 07/25/95 Brie?n for Re resentative Leach on Alle ations of in the Late 1980s On 21 July, Chairman James Leach, Committee-on Banking and Financial Services, and staffer Jamie McCormick, received a brie?ng, at Leach's written request to the DCI, on allegations of Arkansas in the late 19803. Leach based his request for the briefing on reports that have appeared in the press that refer to secret foreign bank accounts held by prominent people in Mena, Arkansas, and an Arkansas?centered network of banks formed to Of?ce of Inspector General, and Office of Congressional airs, a ong with Frank Newton, NSA's Inspector General, responded to Leach's questions regarding each Agency?s current knowledge on involvement with any of the alleged allegations contained in his letter. Newton responded l: to all of the questions posed in the incoming letter, but did, however, provide a brief broadbrush background on how NSA conducts it normal daily activities Eaid that a thorough search had been conducted by CIA, and thus ar very tt in orma on a een found to be responsive to the exact allegations contained in the letter. however, did say that the Agency was aware of Barry Seal, but had no re anons w1t him nor any records regarding his activities in Mena. As for PROMIS, that issue had been look at in-depth by both SSCI and the House Judiciary Committee in 1991 and 1993. The conclusion then and still is that the Agency never purchased any software. Chairman Leach was informed that we had not found any records related to Systematics of Arkansas, a banking software firm I Leach, after listening to the responses to his earlier questions, proceeded to ask approximately 45 other questions regarding the issue, basically repeating many of the issues already addressed. Leach said he had talked to a lot of people regarding this issue, but he emphasized that he was aware that most of the allegations were false. Leach also said that he has concluded that some allegations may be credible, some totally unbelievable, but as information goes out to the American public in non?traditional ways, it becomes more believable. He has an obligation to look into the matter on behalf of the Committee, and asked us to inform the DCI and DIRNSA that he may hold hearing on these allegations in the fall. (U) Sara 3526 Follow Up Actions: Provide McCormick with a copy of SSCI letter regarding PROMIS. OCA/LiaisonGrp Responses to Chairman Leach's Prepared Questions of 7/21 Q: Have any of you or anyone else at either the CIA or NSA discussed this inquiry from us with anyone at the White House, the Department of Justice, or any other governmental organization? A: No, not in response to Chairman Leach's letters requesting a briefing. Q: Does the CIA or NSA have knowledge of or any involvement in clandestine activity by the U.S. Government or any private parties in or near Mena, Arkansas, in the 19805? A: CIA's knowledge Q: Have any reports on activities in and around Mena been prepared for the DCI, Specifically, for former Director Woolsey? A: No. The only reports the CIA has were prepared in, conjunction with the Chairman?s requested briefing. A. Gun Smuggling Q: Did the CIA or NSA have any involvement in, or knowledge of, any operation by the U.S. government or the scacalled "private benefactors" (led by retired Gen. Richard Secord) to train pilots and/or ship arms from the Rich inter?mountain regional airport at Mena to the Nicaraguan Contras? A: NSA, CIA.representatives replied that they "did not think so." noted that.the IG had checked back records on this issue in 1994 and had discovered no responsive information. CIA noted parenthetically that-the operational activities of the-private benefactors were mainly conducted from southern Florida. Q: (Skipped) If so, did any such activities take place with the knowledge or approval.of other Federal officials?. Q: (Skipped) Did any such activities take place with the knowledge or approval of Arkansas state government officials? Q: (Skipped) Did the CIA contract with any .Arkansas manufacturers to build automatic weapons for the Nicaraguan Contras? - Q: Does the CIA or NSA have any contractual or other relationship with, or knowledge of, an Arkansas company called- Park-O'Meter, also known as Do you have any reason to believe that POM produced disposable fuel tanks for use by Barry Seal and possibly others in connection with supplying arms to the Contras? A: NSA CIA had no knowledge, but would check and 'get back to the hairman. B. Barry Seal and Associates Q: (Skipped) Did the CIA or NSA have any contractual or other relationship with the late Adler Barriman "Barry"'Seal (Seal was murdered, allegedly at the direction of Columbian drug lords, in Feb. 1986)? Q: To your knowledge, did any other government agency (such as the DEA or DIA) have any contractual or other relationship with Barry Seal? 7 A: CIA had no confirmation from any other USG agency, including EA, that Seal had any government contracts Q: Is the CIA or NSA aware of any IRS determination that money earned by Seal between 1984 and 1986 was not illegal because. of his alleged CIA-DEA employment? A: NSA, CIA, no. Q: Did the CIA have any involvement in, or knowledge of, the installation of cameras on Seal's C-123K transport plane for use in a 1984 "sting" operation against the Sandinista official Federico Vaughan? . . A: CIA, no. A Q: Was Seal's C-123K cargo _plane, christened Fat Lady (serial number 54?0679), sold by Seal to the CIA or any other U.S.- government related entity? Was this the plane later shot down over Nicaragua with a load of arms destined for the Contras? A: CIA, no records suggested it was. Q: Did the CIA have any contractual or other relationship with Terry Reed, :1 former Air Force intelligence officer (who claims he had a relationship with the CIA in the 19805) and author of Compromised: Clinton. Bush and the A: CIA had no knowledge, but would check further. 9: Did the CIA ever have dealings with former Arkansas State Trooper L.D. Brown?? A: CIA no, not beyond as stated earlier in their presentation. Q: Is the CIA or NSA aware of any attempts by federal or state officials to interfere with or terminate any investigation [by] the IRS, Justice Department, Arkansas State Police or any other law-enforcement authorities into Mena-related criminal conduct? A: CIA, no. NSA, C. Narcotics Smuggling Q: Did the CIA or NSA have any knowledge of or involvement in illicit narcotics trafficking, possibly by rogue operatives, in or near Mena, Arkansas? As you know, there have been allegations that on their return flights from Central America, pilots smuggled more than 20 tons of cocaine into Mena. A: NSA, RCIA no. oted that CIA had also checked with it nter?narco ter, which reported no responsive information available. Money Laundering Q: Did the CIA or NSA have any indication thatl [ll ?local bu51nesses and Arkansas! A: CIA, no., Q: Does the CIA or NSA have any indication that Barry Seal or his associates attempted toj? . A: NSA, no. Q: Does the CIA or NSA have any indication that the proceeds from illicit narcotics trafficking might. have been laundered through the Arkansas Development Finance Authority A: NSA, CIA, no. Q: Does the CIA or NSA know of any secret or more ever held by U.S. citizens domic1led in Arkansas at anytime between 1988 and now? A: NSA I CIA representatives stated that, to the best of their knowledge, CIA maintained the same policy. CIA also stated that any records it might have had would have been . I Q: (Not directly asked, referenced indirectly in the eighth question in this section) Is the CIA or NSA aware, directly or indirectly, of any efforts byJ?? I 9' Does the CIA or NSA have the capability of CIA epresentatives had no spec1tic know1edge w;tn_respect any_ such agency capability,r4? does CIA and/or NSA have the capability,. irec or er party, of A: Newton.stated.NSA.has] Q: (Skipped) Does CIA or NSA have the authority to] Q: (Skipped) Has CIA or NSA everl Q: Does the CIA maintain a team of skilled computer hackers who routinely break into the electronic data systems of foreign banks? According to one source, this group is informally known as the Fifth Column. Correct? (Skipped) Does NSA Q: Does .the or NSA know of or has either agency participated in, directly or indirectly, efforts to sell software -- notably versions of a program in use at the Justice Department called PROMIS or other devices to foreign banks for the purpose of facilitatingl of their electronicidata systems? A: NSAI Q: (Skipped) Does the CIA or NSA know of customers to whom this software has been sold? Is the CIA or NSA aware of any attempts byJ_ A: NSA, CIA, no. Q: Does CIA or NSA knew of any efforts byr?_ A: NSA, CIANSA received any indication that proceeds from the sale of PROMIS or similar software were used to finance arms shipments to the Contras? A: CIA, no. NSA, Q: (Skipped) Are there any indications of cooperation by Q: (Skipped) Is the CIA or NSA aware of any unauthorized efforts, possibly in the margin of legitimate intelligence operations, Q: Does CIA or NSA know of a Charles Hayes, who was born on 4/27/35, whose social security number is and now resides in Nancy, Kentucky? A: CIA, no. NSA, Q: If so, has Hayes ever had any ties to the CIA or NSA or any other U.S. government agency? Have these ties been severed? A: CIA, no. NSA, Q: Hayes claims to be able to break into the electronic data systems of foreign banksCIA aware of_an account, number at the Banca Della Svizzera Italiano in Chiasso, said to have belonged to [the late] Vincent Foster? A: NSA, CIA, no. ?7 Q: Does the CIA or NSA know of any secret Swiss bank account that used to belong jointly to Vincent Foster and others that supposedly contained contributions 1x) the Clinton presidential campaign? A: CIA, no. NSA, Q: Is the CIA or NSA aware of a fund known variously as the Medders or Meeders or Meadows or Meadors or Meaders Trust or Estate? The fund was allegedly first deposited.at Pittsburgh?s Mellon Bank some 50 years ago and is now reportedly worth billions. The allegation is that a legally ungoverned trust is under control of a bank or group of banks under prOSpective legal challenges from alleged heirs and that income is so large that it is used as a: secret source of funds by banks and high-ranking officials for sensitive political and economic purposes. The money and its movements, it is alleged, are hidden in a complex web of electronic transactions among the banks in the group. A: CIA, no. NSA, Q: Is it possible, and does CIA have any information that might suggest, that alleged Mena?related activities stemmed from private Nicaraguan assistance groups, perhaps under the supervision, or at least knowledge of, Colonel North? A: NSA, CIA was not aware of any such activity in or around Mena Q: Did either NSA or CIA ever request that any government organization cooperate or not interfere with aircraft operating out [of] Mena? A: CIA, no. NSA, Q: Is either the NSA or the CIA aware of any foreign governments who might have provided arms, money or any assistance to any group operating out of Mena?? A: NSA, CIA, no. .S RET APPROVED FOR . RELEASEDDATE: . OCA 95?2274 28-Sep?2009 15 August 1995 MEMORANDUM FOR THE RECORD SUBJECT: Briefing for Representative James Leach Regarding? in Arkansas in the (bX1) Late 19808 With NSA 21 July 1995 . 1. On 21 July 1995, at 1000 hours, in room 2186 Rayburn House Office Building, Chairman James Leach Committee on Banking and Financial Services, and staffer Jamie McCormick, received a briefing, request to the DCI, on allegations of - in Arkansas in the late 1980s. Agency participants were: Investigative Staff, Office of Inspector General; \Chief, Legislation Group, Office of Congressional Affairs; and the undersigned. NSA participants were: Frank Newton, Inspector General, and Congressional Affairs. 2. Representative Leach began the briefing by saying that he was not interested in opening a new probe of U.S. Contra?policy or suggesting wrongdoing by either Agency, especially since he served on the October Surprise Task Force, where he was convinced that the Marcos? walked away with billion of dollars. Leach, however, did say he based his request for the briefing on reports that have appeared in the press that refer to secret foreign bank accounts held- by prominent people in Mena, Arkansas, i. and an Arkansas?centered network of banks formed to? ?see attached incoming letter). Leach also said that over a period of time he had talked to a lot of people regarding this issue. He said that most of the allegations contained within the articles were probably false, but he felt an obligation to look into Whitewater related allegations on behalf of the Banking Committee. That said, some allegations may be credible, some totally' unbelievable, but as information goes out to the American public in nonwtraditional ways, it becomes more believable. 3 along with Frank Newton, responded to Leach's questions regarding each Agency's current knowledge on involvement with any of the alleged allegations contained in his letter. Newton responded 0 all of the questions posed in the incoming out did, however, provide a brief broadbrush 12 mag; YH SE ET SEQBET SUBJECT: Briefing for Representative James Leach Regarding in Arkansas in the uaLC - 41 July 1995 background briefing on how NSA conducts it normal daily Iactivities isaid that the capability of the IG to conduct its function depends in part on cooperation by others with CIA and thus far the IG had not look into any of these allegations. However, said as he understood the current issue, a thoroug search had been conducted by CIA regarding issues relating to Systematics, Inc., Mena, and Hadron, during a much earlier timeframe. Also, he understood that thus far very little information had been found to be responsive to the exact allegations contained in the current letter. however, did say that the Agency had perhaps made some connections within the larger picture of things. The -Agency was aware of Barry Seal, but had no relationship with him nor any records regarding his activities in Mena. Seal?s association with the Drug Enforcement Agency (DEA) was widely publicized, i As for PROMIS, that issue had been looked at inadepth-by the Senate Select Committee on Intelligence (SSCI) and the House Judiciary Committee in 1991 and 1993. The conclusion then and still is that the Agency never purchased any software.! . Chairman Leach was also informed that we had not found any records related to a bank' 3% SUBJECT: Briefing for Representative James Leach Regarding in Arkansas in the a 7 uly_l995 6. Leach, after listening to the responses to his earlier questions, proceeded to ask approximately 45 other questions regarding the issue, basically repeating many of the issues already addressed. For those questions and responses, please see attached pages from a draft memorandum provided by staffer Jamie McCormick and checked against the personal notes of the undersigned. The responses in the draft memorandum corres ond correctly to the personal notes of the undersigned. 7.7 Leach concluded by once again saying he has an obligation to look into the matter on behalf of the Committee, and asked us to inform the DCI and DIRNSA that he may hold hearings on these allegations in the fall. (U) 8. The briefing lasted approximately 90 minutes. Leach was informed that the Agency would continue to check its records, especially on questions relating to: l) Park-o?Meter; 2) CIA relationship, if any, with Terry -Reed; and 3) whether the CIA had any connection to Seal? cargo plane (serial number 54? 0679). Of ice of Congressional Affairs Attachments 3 5mg SE RET SUBJECT: Briefing for Rep: Leach (R-IA) Regarding in Arkansas in the ate 19805 21 July 1995 (22 Aug 95) OCA 95-2274 Distribution: Original OCA Records (w/atts) 1 (w/o atts) (w/o atts) 1 1 -hrono (w/atts)' SE SECREA CONFNENTIAL. . i th 19 July 1995 m, Note to: Acting DCI From: Acting Director of Public-Affairs Subject: - Mena The August issue of The American Spectator takes up the Mena story in a way that is likely to resonate on the Hill (see attached article). It alleges, explicitly and implicitly, that an aircraft operated by a CIA front company in 1984 used the airfield at Mena, Arkansas, as a staging point for weapons supply flights to the Centres in Nicaragua; on the return flights from_ Honduras, the airCraft allegedly carried illegal narcotics to Mena. The narcotics runner, Barry Seal, allegedly paid off then-Governor Clinton's protege, L. D. Brown, and one Dan Laseter, a Clinton contributor. . This is the latest repackaging of allegations previously made by the Wall Street Journal. -I understand that Fred Hitz or someone from his staff, along with other CIA officers will brief Congressman Leach on Friday 21 July in an attempt to address his concerns about these and other allegations. In the mean time, we are receiving media queries'on Mena, most recently from Michael Isikoff of Newsweek on 18 July. With the publication of The American Spectator article, we, expect more. -- At present, although there is no reason to believe any of the allegations, we are declining to comment publicly, pending exhaustive searches of DO files, as tasked by OCA. As soon as those searches are complete, we hope to have a crisp . public statement that distances us from the allegations~eif the Agency IG's look into them does not constrain us from doing so. CC: EXDIR, GC, ADDO, ADDI, DDA, Memorandum for the Record Page 1 EVENT: MEMBER BRIEFING TIME: 1000 PLACE: 2186 RHOB FOR: REP LEACH SUBJ: MONEY LAUNDEFIING (PARTICIPANTS) ASSOC NAME REP. LEACH, JAMES A. CIA TBD CIA luau/0cm EXECUTIVE SUMMARY) STATUS: COMPLETE ROLE BRFR SPRT t. On 21 July 1995, at 1000 hours, in room 2186 Rayburn House Office Building, Chairman James Leach (Fl IA) Committee on Banking and Financial Services, and staffer Jamie McCormick, received a briefing, at Leach' 5 written request to the DCI, on allegations of in Arkansas' In the late 1980s. Agency participants were: Investigative Staff Office of Inspector General; EChief, Legislation Group, Office of Congressional Affairs; and the undersigned. NSA participants were: Frank Newton, Inspector General, an Congressional Affairs ADDITIONAL INFORMATION 2. Representative Leach began the briefing by saying that he was not interested in opening a new probe of US. Contra-policy or suggesting wrongdoing by either Agency, especially since he served on the October Surprise Task Force, where he was convinced that?the Marcos' walked away with billion of dollars. Leach, however, did say he based his request for the briefing on reports that have appeared in the press that refer to secret foreign bank accounts held by prominent people in and an Arkansas-centered network of banks formed Id: see attached incoming letter). Leach also said. that over a period of time he had talked to a lot of people regarding this issue. He said that most of the allegations contained within the articles were probably false, but he felt an obligation to look into Whitewater related allegations on behalf of the Banking Committee. That said, some allegations may be credible, some totally unbelievable, but as information goes out to the American public In non-traditional ways, it becomes more believable. 3. along with Frank Newton, responded to Leach's questions regarding each Agency's current knowledge on Involvement WIth any of the alleged allegations contained in his letter. Newton responded to all of the questions posed in the incoming letter, but did, however, provide a brief broadbrush background brie?ng on ow NSA conducts it normal daily activities said that the capability of the IG to conduct its unction depends in part on cooperation by others with CIA and thus far the IG had not look into any of these allegations. However, Ssaid as he understood the current issue, a thorough search had been conducted by CIA regarding PROMIS/lnslaw issues relating to Systematics, Inc., Mena, and Hadron, during a much earlier timeframe. Aiso, he understood that thus far very little information had been found to be responsive to the exact allegations APPROVED FOR RELEASED DATE: 28-Sep-2009 Lo seminar Page 2 ?Memorandum for the Record contained in the current letter however, did say that the Agency had perhaps made some connections within the larger picture of things. The Agency was aware of Barry Seal, but had no relationship with him nor any records regarding his activities in Mena. l? i As for PROMIS, that issue had been looked at in-depth by the Senate Select Committee on Intelligence and the House Judiciary Committee in 1991 and 1993. The conclusion then and still is that the Agency never purchased any software. ?Chairman Leach was also informed that we had not found anv records related to Systematics of Arkansas. a banking software firm.? i 6. Leach, after listening to the responses to his earlier questions, proceeded to ask approximately 45 other questions regarding the issue, basically repeating many of the issues already addressed. For those questions and responses, please see attached pages from a draft memorandum provided by staffer Jamie McCormick and checked against the personal notes of the undersigned. The responses in the draft memorandum correspond correctly to the personal notes of the undersigned. 7. Leach concluded by once again saying he has an obligation to look into the matter on behalf of the Committee, and asked us to inform the DCI and that he may hold hearings on these allegations in the fall. (U) 8. The briefing lasted approximately 90 minutes. Leach was informed that the Agency would continue to check its records, especially on questions relating to: 1) Park-o-Meter; 2) ClA?s relationship, if any, with Terry Reed; and 3) whether the CIA had any connection to Seal's cargo plane (serial number 54-0679). Liaison Group Office of Congressional Affairs APPROVED FOR - . RELEASEDDATE 28-Sep-2009 Briefing for Chairman Leach, House Banking Committee What we found from our searches 3) PROMIS We have searched our files extensively in response to previous congressional inquiries on ISLAW's PROMIS (Prosecutor's Management Information System). As noted in the DDCI's response to Chairman Brooks on 18 Nov 91, and a similar letter from to the SSCI on 2 Aug 93, we have found no records about PROMIS software, or the allegations that it had been misappropriated, distributed or used in the manner alleged in these articles. As noted in the letter to the SSCI, the Department of JuStice appointed a special counsel to investigate the INSLAW matter and a report was submitted to the House Judiciary Committee on 17 June 1993 that may be of assistance to your review. 4) We have no found no record of any CIA contact or contracts with Systematics, Inc. of Arkansas, nor any information about the allegations that Systematics, Inc. monitored or engaged in illegal activities. 5) We have found no record of a Charles Hayes who was a operative in Latin America or Central America.? 6) We have found no records of CIA activities at the Mane airfield during the 1980?s. CIA's Iran~Contra files were searched and found no reference to Mena or its use by the ?private benefactors?, a term used to refer to the unauthorized Contra support operation run by Oliver North. 7) Adler Berriman ?Barry? Seal has been the subject of several CIA records searches over the past decade, most recently in June 1995 at the request of HPSCI. No records of any contact with Seal or information about his alleged activities has ever been discovered during these searches. Our searches did determine that a person named Lawrence D. Brown, DOB 2 Oct 1958, applied for CIA employment in 1988. Following routine processing his application was rejected in November 1988. Without further biographic information, we cannot determine if this is the same L.D. Brown mentioned in the articles. . from the Office of Inspector General will . 0 her issues mentioned in your letter. 3399-1 . btogg APPROVED FOR RELEASEDDATE: OCA 964151 3? . 23-Sep-2009 13 March 1996 MEMORANDUM FOR: Inspector General FROM: Director of Central Intelligence SUBJECT: Allegations of Money Laundering and Other Activities in Mena, Arkansas. 1. Chairman Leach of the House Banking Committee wrote and requested that the Inspector General investigate various allegations of money laundering in Connection with activities in and around Mena, Arkansas. I have told the Chairman your office would investigate the issues raised in' his letter. I request that you issue a report, including an unclassified version, if possible, which will address the following core issues: 0 What, if any, information does CIA have that indicates it had any contact with the individuals or businesses identified in the Chairman?s letter of 8 February, or of money laundering, narcotics trafficking, arms smuggling, or other illegal activities (including illicit aircraft modifications) based at, or operating through, the airport at Mena, Arkansas, from 1980 to the present; 0? What was the extent of CIA's contact or relationship with Adler Berriman ?Barry? Seal; 0 Whether CIA tried to directly or indirectly influence or request that the Department of Justice or other Federal agencies alter any investigations or prosecutions of money-laundering in or around Mena, Arkansas; 0 Whether CIA, or anyone acting on CIA's behalf, has carried out any activities in Mena, Arkansas, or the area north of Mena, known as Nella, Arkansas, and if so, did CIA brief, or otherwise communicate this information to Arkansas state officials in the 1980s. 2. The Chairman has also requested that all related documents be made available to appropriate Committee staff. I will wait until your inquiry is completed before acting on this request since traditionally classified documents SUBJECT: Allegations of Money Laundering and Other Activities in Mena, Arkansas involving operational matters are provided only to our oversight committees, and I have shared this view with Chairman Leach. 4. Once you have an opportunity to review the Banking Committee request, please provide me with an estimate of when you will be able to produce a report, and I will provide that estimate to Chairman Leach. John Deutch RELEASEDDATE: APPROVED FOR 28-Sep-2009 Joanne Isham Status Report on Inquiry from Chairman Leach (bX6) House Banking and Finance Committee ?Briefing Request 0 Chairman Leach wrote you on 11 July 95 seeking your help in ?verifying or laying to rest various allegations of money laundering in Arkansas in the late 1980s.? (Copy of letter attached as Tab A). 0 He asked for a briefing from the Inspector General to address 7 topics ranging from efforts to \to whether the Agency was aware of certain companies and individuals who allegedly Operated in or around Mena, Arkansas. 0 The worst of these allegations, faxed to us before the briefing, credited to a CIA source in a magazine called media_?ypass, is that the CIA discovered that Vince Foster was a spy for the Israelis, and used a Cray supercomputer at-CIA?Headquarters to surreptitiously drain $2.73 million from Foster?s secret Swiss account. The article goes on to speculate that Foster committed suicide because he discovered his account-had been drained. (Copy of article attached as Tab B.) 0 A similar briefing request was sent to NSA. Briefing July 95, Congressional Affairs and Inspector General representatives from CIA and NSA met with Chairman Leach and his assistant staff director, James McCormick. 0 Chairman Leach was very cordial at the briefing, but his first question was whether anyone at either agency had discussed his inquiry with anyone at the White House, the Department of Justice, or any other governmental organization and he was told we had not discussed this outside the agency. 0 The CIA's IG had not conducted investigations into -5 these allegations and had a limited role in the briefing. The Agency?s OCA representative advisedri i753 that we had not finished our records review, but we were aware of one of the individuals identified in the Chairman?s 11 July letter, Barry Seal (now deceased). We knew of Seal because of previous inquiries (in connection with criminal prosecutions of other individuals), but advised we had no relationship to Seal nor any records regarding his activities in Mena, Arkansas. We also advised him that both the the House Judiciary Committee conducted in?depth reviews in 1991 and 1993, respectively, about another subject of his 11 July letter inquiry, PROMIS software. The conclusion then and now, is that the Acrencv never anv qnfi-warp During the briefing, Chairman Leach readifrom a list of additional questions provided to us after the briefing. The briefers indicated that we could not answer all of these questions conclusively, and Chairman Leach asked for some limited follow?up searches. (Copy of additional questions attached as Tab C.) IG had no information about the questions . posed in the 11 July letter, but did provide a brief broadbrush background on how NSA conducts its normal daily activities We are continuing to search our records for responsive information and once the review of these materials is completed, we will brief the findings to our oversight committees, the NSC and Chairman Leach. F, Vim, - MCCOLLUH. FLORIDA . CHARLES E. BCHUMER. NEW YORK mac I BOUKIMA. NEW JERSEV DOUG OEREUTEH.NEBWKA ROTHAMBCONHN U.S. HOUSE OF REPRESENTATIVES _7 - esteem: EARNEY FBMK. MMCHUAETTB PAUL PENNSYUIANM Lt i 77/ HENRY I. GONZAUZ. TEXAS 7 . . JAMIZ A, LSACH, IOWA. CHAIRMAN . JOHN J. NEWYORK Joeem r. xinnmv a, MAsucHuam-s spams: menus. m. Mum MHZHAEL CASTLE. DELAWARE . MAXINE WATIHS, mm; mm mm. ~1wvonx COMMITTEE ON BANKING AND FINANCIAL SERWCES m. 0mm UTAH towns nova. uummu menu a. MALONEY. new Von: FRANK n. was. OKLAHOMA LUIS V. JERRY WELLER. ILLINOIS ONE HUNDRED FOURTH CONGRESS LUOLLS Roan-Aluao. cum-3m.? in ARIZONA I - s, mmaviwggi?mm ACK wruu wumna'ro 4 - mm mm: scum BONO.CALIIOHNIA 212B HAYBURN HOUSE OFFECE BUILDING 1 ALBEHTH.W1NH.W0 hall" NEY OHIO '3 ELEO LOUISIANA mum 1. issues, unnmun no NGTON, DC 2051518950 :4an WATT. NOHTN mum not MM. aeonou . Mules; MAURICE Hmvonu mo: csmuan. MLCHIGAN A i am NW vomc mu: cnmsawa. OHIO 4/ 5 KIN nun-Faeoemcx Himsmm. NORTH canons 3 In, suntan. VERMONT am: nocxww. mu: - HIWJIHSEY 1m} I'm-mo: .C. A . KLAHOMA -. . sun von 4? 11in Hon. John M. Deutsch Director Central Intelligence Agency LQZJ Washington, D.C. ,20505 Dear Director Deutsch: I am writing to seek your agency's help in verifyingwor laying to rest various allegations of money laundering in Arkansas in the late 1980s. For that purpose, I would request a briefing from the Inspector General on Friday, July 14 before 1:00 if that is not possible, Monday; July 17, would also be a conve? nient day. The reports I have in mind have appeared in the general press and, sometimes in sensational form, in more narrOWrgauged out? lets, including the Internet. They speak of secret foreign bank accounts held by prominent people in Arkansas, special software to monitor bank transfers, an Arkansas-centered network of banks formed to launder money, and similar tales. I would like to determine whether there is any substance at all to these stories. Specifically, I would like your Inspector General to tell me whether the Agency: - (1) knows of any secret bank accounts held by U.s. citizens ydomlciled in Arkansas at any time between 1988 and now; (2) is aware, directly or indirectly, of any efforts by computer hackers, U.S.-government related or otherwise, to penetrate banks for the purpose of monitoring accounts and transactions; (3) knows of or has participated, directly or indirectly, in efforts to sell software?-n0tably versions of a program in use at the Justice Department called clandestinely produced devices to foreign banks for the purpose of collecting economic intelligence and information of illicit money transfers: page two is cognizant of any attempts by Systematics Inc, an Arkansas? based electronic data processor that is now a division of All? tell, to monitor or engage in the laundering of drug money or proceeds of other illegal activities, notably those conducted through Mena, Ark.; xx. {?22 (5) can provide information abodt Charles Hayes, a businessman in . Nancy, Kentucky, who claims to have been a CIA operative in Latin and Central America, among other places; (6) knew of or was involved in, directly or indirectly, any . covert activities by the 8. government or any private parties C32 (the so? ?called "private benefactors") in or arOund Mena, Arkan? sas, in the late 19805; (7) had any contractual or other relationship with the late Adler Barriman ?Barry" Seal in the 19805 or knew about his activities in conn - action with MENA. -11 5%,ikt ?)3yy,i I would appreciate your help in shedding light on these matters. i . .1 Si :erely, {l ?4EEL5iitlh "?i;53ie?g J- Leach . . - man <15 - its-la a Investigate Mena ""For more than a year we have been reporting on the mysteries of tiny Mena airfield in western Arkansas. The clouded tale of drug smugglers and spy operations in the 1980s is a po- tential embarrassment to the Democ- ratic governor who ran the state and the Republicans who ran the White House. But the big story here is not primarily about who did what 10 years ago. It's about a very 19905 concern: drugs. How has our system broken down so that illegal drugs can be moved into this country on such a large scale? This week. the American Spectator magazine adds another piece to the Mona puzzle with a story about Arkansas State Trooper L.D. Brown written by Spectator editor R. Emmett Tyrrell. Now, the account's weakness and strength are one and the same?- L.D. Brown himself. Its weakness is that it is a single-source account; its strength is that L.D. Brown is an im- portant source. A potentially key player in the Whitewater saga. Mr. Brown corroborates part of David Hale's claim that Mr. Clinton put pressure on him for ?nancial help. Mr. Brown now says that while working on then-Gov. Clinton's secu- rity detail, he applied to the Central Intelligence Agency. with the gover- ndr's support. Following CIA testing 7 and an exchange of letters-supplied toIMr. Tyrrell by Mr. Brown?the state claims he was contacted by Mena drug smuggler Barry Seal. Soon after, he was on two Central American ?ights from Mena airport aboard Mr. Seal's C-123K, running guns to the Contras. Mr. Brown. a former 'nar? cotics of?cer, says that when Mr. Seal showed him cash and cocaine ship; ments. he quit. When he confronted Gov. Clinton about .the drugs and money. Mr. Brown allegedly was told not to worry about it. "That?s Lasater's deal,? Mr. Brown claims Gov. Clinton told him. - To be sure, Dan Lasater is a color- fut ?gure. He ran a free-wheeling bond house in Little Rock. and was friend and campaign supporter to Bill Clinton. In 1986. in a case that also in- volved Mr. Clinton?s brother. Roger, Mr. Lasater pleaded guilty to a co- caine distribution charge and went off to prison for a brief stay. The federal prosecutor who handled the case was George Proctor, a Carter-era ap? pointee who now heads the Justice De partment's Office of International Af- fairs; Mr. Proctor?s of?ce has author- ity over aspects of another of our long- standing concerns, of Mr. Proctor's predecessors at OIA. Michael Abbell. 'was in the news rev 'centiy when he was indicted on racke- teering charges in connection with the Calidrug cartel. . Our own reporting about Mena points more toward Washington than Arkansas. We want to know what the federal government knew about drugs and money ?owing through.the area. Our Micah Morrison has painstak- ingly separated fact from ?ction garding Mama and Barry Seal?s in- volvement with the CIA. the Contras and cocaine traffic. Mr. Seal, a some- time informant for the Drug Enforce- ment Agency. smuggled several bil- lion dollars' worth of drugs into the country. In our October 18 story "The Mena Coverup." we detailed the short- circuiting of nine separate state and federal probes into Mena. Reliable sources in the intelligence community now tell us that in the years after Mr. Seal?s death, some activities contin- ued around Menu: an AWACs-Patriot system was. tested, CIA contract planes were repainted. and the area was included in a counterterror exer- cise run out of nearby Fort Chalice. ?But the heart of Mena, we suspect, is narcotics, and on this aspect an- swers are lacking. Drugs? Arkansas of?cials wave off the question, saying Mena was a federal responsibility. The CIA blames a ?rogue DEA opera- tion;" the DEA isn?t talking; the FBI says ?no comment.? . - The betting around here is that L.D. Brown and others in the Arkansas State Police know a lot more about the matter?including what the feds were up to-than they are letting on. State police officers are starting to show up all over the Mena story. While we dis- count the extreme speculation in self- proclaimed CIA operative Terry Reed?s book about Mona. "Compro~ mised," it's interesting to note that Mr. Reedis makingheadway in Little Rock with his lawsuit against former state troopers Tommy Baker- and Buddy Young; Mr. Young also served for a time as Gov. Clinton's security chief. Mr. Reed's lawyers have deposed sev- - eral state troopers in connection with the case, Mi'. Tyrrell says. Last year Evening News? reported that a top Arkansas State Police. of?cial played a role in derailing an early ef- fort to advance the Mona probe. Some reports to the contrary, we see no indication? that Independent Counsel Kenneth Starr is investigat- ing Mena or Mr. Basater. Mr. Starr appears to be sticking close t0\ his mandate to examine matters arising from Madison, the Whitewater Devel- opment Co., or Mr. Hale?s Capital Management Services. Yet Mona cries 'out for investiga' tion. A congressional committee with resources, subpoena power, and the perseverance displayed by some past chairmen should look into this. If some chips fall on the Republican side, so be it. Important questions need to be an- swered. 7 Was Mena simply a remote outpost of the Cold War? was it a major transshipment point for- drugs and money laundering? To what degree were government officials involved? Where did all the cocaine and cash ina volved in the Barry Seal operation go? Were Arkansas ?nancial institutions involved in laundering drug money? Again. how Mena worked is of some present moment as the U.S. con- tinues to wrestle with illegal drugs? their use apparently on the increase again among teenagers-and the at tendant corruption. Mona may pro- vide a window intoione of the big sources of this problem. Big Temptation Philanthropic and productive are Bank a bit from the real nr matamm- schbach, By CHRISTINA Horr Somareas New Jersey sponsors the "New Jersey Project": Its goal is to "transform? the curriculum in higher education to make it more multicultural and "inclusive." The project circulates a "guideline" captioning that ?much previous scholarship has of- fered a white. male. Eurocentric. hetero- sexist, and elite view of ?reality."? Citing the words of feminist historian of science Elizabeth Fee. the guideline explains how male scientists exploit nature the way a vi~ olent man exploits a helpless woman: ?Na- ture was female, and knowledge was cre- ated as an act of aggression~a passive na- ture had to be interrogated. unclothed, penetrated. and compelled by man to re- veal her secrets." The document is striking because it em- anates from an official government agency. But it is the kind of attack that has been routinely leveled at science by multi- culturalists, radical environmentalists. feminist theorists and others on the cul? tural left' for the past several years. One example from academia is a 1986 convoca- tion address delivered by Donald Han? ward. then vice president of academic af- fairs at the College of Wooster in Ohio. Mr. Harward informed the students that ?there is no objectivity even in science." and put them in the know by telling them that ?learning and teaching have less to do with truth. reality and objectivity than we had assumed." He has since gone on to be come president of Bates College in Maine. An Active Defense Until quite recently, professional scien- tists studiously avoided reacting to these sort of ?criticiiles.? Fortunately. some are beginning to realize that "anti-science? is a serious threat that calls for an active de- fense. Last month, under the auspices of the New York Academy of Sciences. Uni- versity of Virginia biologist Paul Gross and Rutgers mathematician Norman Levitt helped organize ?The Flight from Science and Reason." a high-level confer- ence of more than 200 scientists. physi- cians and humanists who met ?to consider the contemporary flight from reason and its associated anti-science.? The distinguished panelists. who in- cluded Harvard economist Henry Rosovsky and Nobel Lam-cafe Dudley Her- explored ?fashionable irra- tionalisms," and examined ?the threats. or the damage already done. to public un- derstanding . . . and considered practical . possibilities for effective responses" In one damage report Prof. Gerald - in American Life." blight physicist at Harvard Univr Smithsonian Ins American Chemic a more telling er. politics at the Sm notorious Enota In 1989. the Smithsonian Muse to design a permar urally expected an triumphs of 20th cc and did not imagin spelled out in the and $5 million later was an exhibition can science as a 5. and environment - A com scientists, up against roshirha and Nagas- Canal. Three Mile sion of the space sh opposed to showing science and techno.? ing failures and ho- exhibit took an ove- view of American St Head curator A: moved by the ACS's hibit lacked balanc magazine, "The p' something about the The curators defenc- as if theirs was the .. ?We know it is imp integrity of the Smit American preem high technology is the 20th will go do- American century. 5 well as dismaylng, ti dians feel morally American science or. how it has dramatic life. Negotiations be and the Smithsonian but a happy ending i Martin Lewis, a ronmentalist at Di formed the conferen science. coupled wi? reason. is the norm in?uential group of the study of . . . en The greatest illusion in business is that employees work for managers; this. of course. is exactly the inverse of reality. As the unions learned in the 19203, the day that? a. significant group of employees chooses to stop working. managers are helpless to carry out the tasks of business. If you are a. manager. the workforce ar- rives at your doorstep every day primed to observe how you teach and implement the corporate culture and to measure how you exercise the standards your organization purports to honor. If the employees believe . in you. they reward you with superior ef- forts. If you fail to meet their expectations. they punish you with substandard quality and efficiency. Workforce productivity is a fair measure of how employees rate a manager?s performance. If you accept this premise, then you also will recognize that managers are primar- ily in the teaching business. Every philos- ophy. attitude and business practice used by a manager in dealing with his employ- ees ultimately will be re-expressed by the employees through the quality of their. work. Show me an organization with a - high absentee'rate. problems with expense accounts. or a cover~your-butt_ mentality. and I'll show you a manager who is se- ered or the nature of tained. Managers re sweet and sour. Some years back. with Jay Chiat, foun ica's most honored a ?You know.? Jay sa continuously contact stars and seduce the salaries and lots of i press. Yet, a year or these young stars just Manager By J: face of the earth.? Win hired his hotshots. couldn't buy were Chi vironment and the sup of talented colleagues alive person's work so Jay's point applies Great work doesn?t )1 minds of one or two produced by an entir- understands and encc mixer-UK naiat?pitwaum House Of?ce Building 4?72 . One Hundred Fourth conmgs JUL 1 8 1995 Republican Staff By .13 Lb communes on BANKING and FINANCIAL SERVICES Subcommittee on Domestlc and International Monetary Poilcy Washington, D.C. 20515 Phone (202) 226-0473 Fax (202) 226-0537 To FROM M6 I ATE 0 PAGES (including cover sheet) 6 RE gym/1: 5:355 541 5g}- [ff 50:. Saw an adu?nce ?wit {1 4,50 77"? f5 Mul- Carm? 797g jean. I?ve fee/l UN 71"- 4O m/amsrk 7-0 a 1f based ?t 1 hull-ii: :9th Pessmesozme ?FOStergate? By James R. Norman Was White House Deputy Counsel Vince Poster Selling 1.1.5. Secrets to Israel? The CIA Suspects He Was. 195? NORMAN lemma: WITH MISSION wo weeks More his death on July 20. 1993. White House [)0qu Counsel Wnoent W. Foster went into a deep funk. The of?cial cause a! death. ?ver) by Independent Counsel Robert Fluke Jr.. wu suicide driven by depreealon over. Imoni other things. some newmap?er editerlelz. But ?nee Foster bed a much bigger and duller reason to be serioosly bummed out He heel be Wee under investigation [or espionage. Outrageous? To say the lent. But a has locat-_ ed more than a dozen sources with connec- tions to the intelligence community who oon- ?rm shocking story of money hundorlna and espionage connected to the highost lowle of the White House. Without. ennui of immunity. the ., source: rink going to prison for violation of I the National Security Act. Virtually all hove demanded anonymity. According ta 3 veter- an lerel Intelligence PHONE NC: . Agency operative close to the Foster Fosterfe ?rst indication of trouble came when he inquired about his coded bank account at ?ance. Dell: Svizzere Italian?. in Chiueo. end found the account empty. Poster wee shodced to learn from the bank that someone unlna?his secret authorization code had withdrawn all $2.73 million he had meshed there and hed moved It 8124?7867? Jul. to. a! all plow. the US. menu. Then. encoding to credit and recmls revimd by A private lnvoetl' gum- who he: revealed them. Poster annealed the two-day round-trip and Swiss Air plane tickets to Geneva he had purchued on his Amoriean Express card through the ,Whito Home travel omce on-July 1. Discretely he began asking what we; mot. say: the CIA touree con. . that someone in the wen. Home Upped him all. was hm news. The CIA had Foster under serious invoutlguion for looking high-level secrets to the State of lax-no}. For months. a. smell cadre of CIA computer beckons know as the Fifth Column. umod with Cray lupereomputer. had been monitoring Poster?s Swiss account. They hed loaned it by treeklng money flown mom variant: Israeli gm? ernment ?counts ehor ?nding Pastor's name while secretly snooping through the files of larul'e Massed. Then by moopinc through the bank ?les, they AUG 1995 Media eypm Magazw 1-m-Bypm I 14 1995 11:1ggm p3 FQCH PHon? N0. 9124779572 n1. 14 1995 11:15am P4 it gaihorod all the information nocdod to withdr?nw the money. Foster was just one or the (?u-st oi scores of high loVoi U.S. politiul figures to thus have their Morel Swim: accounts looted of illicit [and]. according to both this veteran CIA source and capo-rate neuron in another intolligonce agency. Ovor the pool two yous. they any. more than $2 billion has boon swept out of dishon- bani: accounts belonging to figures connected to tho U.S. gov- ornmont with my a poop from the victim: or their bonito. 1114 claim that Factor other US. ligum how had offshore accounts has boon canal-mad by Iopnrato high-ranking CIA aouroo and another in the Department of Justice. Various auto-col. some of them oontronrninl. how contributed other to this puzzlo. Whamur thoir motivations. thou source: luv. {Jr-oven remarkably comment. Their alter a most plausible explanation for Foster?s mysterious deputation. It would also explain Washington'n determined olrort to distrust the Poster amlr as a tragic but simple suicide. Vlnco Foster a spy? Actually. it to much worse that. that. i! the ClA?s suspicions are oon?nmd by tho ongoing foreign oountorintolliganco probe. Ho would have ban an invaluable doublo 1.ng with poten- tioi moon to not only high-level political information. but the to oodo, and don moron. the stuff by which modern was in won or lolt. That is becanu [or my run. according to nine current and former US. 11w aniorcemont or intelligentsia of?cials. Potter had boon a manager of I. by lupporl company in one of tho biggest. most morotivc spy allot-ts on record. the oilcm surveillance of banking truncations bath hon and abroad. This bank snooping amt: began in (inmost won that Ronald Reagan become proaidantin 198). It: prima- ry aim was to track the money behind international terrorist: group; and soon mine to be dubbed. ?Follow the stories jibe well with known loot: ond money". according to the orignotor of the program Norman Bailey. Now a privnte Washington comulutnt. on international banking. Bailey In economist und Reagan advisor .on tho Notional Soourity Counsol. it was Bailey's ides to begin tiling powerful new oompmer and electronic onco- drooplnn lodInOlo?'leB then margin: to lot the lntailisonoe community monitor the previously con?dential now of bank wlro trmfora. This was no small mic.- moro than $1 trillion a day move: through New York alone. Bailey himoli? constrained by tho Various sources. some of them controversial. have contributed other pieces to this puzzle. Whatever their . motivations, those sources have proven remarkably consistent. Their storiasjibo well with known facts and afar a most plausible explanation for Foster?s mysterious depression. Notional Security Act. claims he don- n't know ouctly how the downturn collected. But in con?rms that with. in slow yam the National 30::th Aether. tho cipala- intellinanco 1m of the government, had ,hog'un Vim}. timing to; mountsins oi am by lic- tening in on bank win truf?e. it become a joint effort of neural Western governments with tho l-rullo playing a. leading role. since they were the main tug? of terror-11m. Other amt-u any the ?ow a! bito and bytes captured by vat-iota moons; om up- ping phonc lines to ouatomizod chip- ln but! computer- to atom up and periodically bunt- transmit data. to passing van. or AUG 1995 Media 33pm: Magazw i-SOO-bBym low-?ying ?gig-int? or signal. gmoo ntollita. Another part oi tho problem was to get tho World's but; to aundardizo tholr data no that it could be coolly attained. And that brings us to poworl?ul tracking software developed for the us. Government ond then further unlimited by 1 little company called imlaw inc. PROHJS lands for Prosecutor's Management information System: and was designed to manage legal cues. in 1982. just as Builey's loiiovv-tho-monay effort woo gaining clown. tho Roam Juntloa Depart. moot ?atly mapped up newt version 01' P301415. But the gowmt ram-ad to my the $6 million owed for it. claiming part of the was not fulfilled. lowed into Chopior it wormin- tlon. and nearly driven to quick liquidation by the government and in forms! hotly denied that claim. Ultimately. a bankruptcy judge ruled tho government stoic tho PROMIS '0?th by 'tricltory. fraud and dmit'. - Why Beau? it wu adoptable. Booldos trucking legal cocoa. it could ho easily mounted to track mythinz iron: oomputor chip design to complex moiety truanc- tions. it was apodaily mom] for tracking criminals orlunt plain politi- cal Mots. balm-I oloimlthololt- mm It" eventually illegally sold to their poke. military or intolligonoo wand?. including ouch bloody rogima as Guatemala. South may and (before tho 1990 lnvulon of Kuwait}. Pro?t: on than onion. lnalaw claims. wont mainly into tho private pockets of Republican politic-l crania- in the 19808. including Reagan confidant Eorl Brain. format part-omen of and PM. Among the biggest pro?tom on PROMIS. wording to the 1992 book by format obit-terrorism mils: Ari Ben-Mmobc. for- rnor aim publisher Bob Howell. 0n bond! of tho Intuit, Mutual} marketed doctorod version of equipped with one or morn 'baolt dooro? to allow an out- sider to tap into the user?s dots. baac uLi'ill Di-?ti?bx ICicuupiaf . withoutloovmg an nudiitnil. In fact, it may have boon such rigged pro- gram that nilowod noted Imoll spy Jonathan Pollard. from his oompum terminal 1i tho Ofiico of Naval Intelligence in Washington, to down- lood vut unounta of top aunt U.S. nucer weapons and code dot; in the mid-1980:. According to huvily-rodaotod New Mexico FBI conntorinhlligonco report. Maxwall was opptronily allowed to roll Mo copies of ?201415 book to tho US. weapons lobe at Sandia. and Ahmed. for what lnolaw claim: was I hu?clv in?uod price of $37 million. That would hue allowed Pollard. if he Wu mini tho ?air-d progrm. to obtain U5. mlesila targeting duo long bolero lane] had in own oorollito capability. thus mak- ing It a moi nudou throat to the Savior. Union. Pollard was of espionage and oomonood in 1986 to life imprisonment. US. of?cials hnvo whomentiy oppolod ailorts to gain his only rolouo Muwell. loom-ding to Bon- Maoaacho Ind nlno other sources. was ulna soiling pirated unions of PROMS to molar world bath for use in their wire troml'or rooms to luck the blizzard ol numbon. autho- rization coda! md con?rmntions roquirod on each wire Marion. 0013?: oxpoct any bank: to ulmit run- ning PROMIS. 'l?noy probably now know it ma pillorod. But 1.th rudi- ly took it both because it was tho but tucking nonworo Ivalhblo at the time md lat-auto the US. sawm- meni ms tacitly lashing on them to go dong with the suwoillmco affair!- cr loco rognhtory rcpt-lull or proso- oution on money laundarin; drug?. With the widespread adoption of PROMISE. the data bowno standard- izod and much easier to analyze: by the NBA. lt took tome o?ort to install and support PROMIS In tho banking indium. Thu?l whore Vince Poster come In. Sources say that nine: at lent the Mo 19709. Footer bod but: a silent. behind-tho-aconea overseer on bohalf ot? the NSA lor I mull Little Rock. Ark? bunk dun marina company. its namo was Synonmics launchod in 1967 and handed ond conirollnd for most 01 Illa funPHGNE NO. 1 812477867 by Arbour billiomira Jooluon Stephens. I 1946 Naval Acuiarny graduate along with Jimmy Caner. Poster was one of Stephena? muted deal makm st tho Rosa Law Firm; where he was putnar with Hillary Rodham Clinton. Webstor Hubball' nod William Kennedy (whoa [other wu n. Synormticn director). Hubboll tho played 1n current role" at Systematics for the NSA {or some your; nocording to intelligence mural. Syotomatioo but had GINO ties to tho NSA CIA over time its fomd~ Sources say that since at loos: tbe'late 19703. Faster had . been a silent. behind- tho-scenes overseer on born? of the NSA for a smaI Little Rock. Art, book- data processing company. Its name was aromatics Inc, loam: ed in 1967 and funded and controlled for most of its life by Arkansas billionaire .10an Stephen. a- 1946 Naval Academy graduate. ins. sources any. a money-shuttle: for court oporndoni. It in no mot tbu than were billion: of donor: moving around in "blnolr? account: -- tom buying and sailing mm to tho Control. 1111;. lnq. Angola our! other to paying CIA opentim and honouring money from clmdu- ?m CIA drug dealing. Having tuber: ova: the complete mourn: room in scores of small 11.5. banks In ?oui- sourood' supplier or data. prooeosin?. Symuu was in 1 unique position to mm that cotton money ?ow. Soumos us the monoy was moved nt- theenxi ?everyday disguised or routine bunk-to-bank out of View of bunk regulators and own the banks them- Ielveo. In short. it home cybor- monay. I won anon conduit for tho mndn" known within the agency in the PRONIS than for banking and other- - nor? on troll with othor sources. lion. Starters: luliltod on having AUG 1W5 Malia Bypass Alastair?: "r 14 1995 ile-mm Pt) Jill Ono mm who uncoverud the link boiwoon Systematics, Poster and seven money movements from arms and drugs was Bob Bickol. who was an umlermm Custom investigator in the 19601. ?No lound Systematics in' arm! md drug transactions, n39 Bleltnl. now living in Texas: ?They won the money changers.? His mory in corroborated by 1 {armor CIA employer: who says it wu wall late 1970I that Factor Wu involved with Symmuico in covert money manommnm. Another Iourco it Michael Roommate. former research dimo- tor at tho covert arm- oporotion oi Coulomb's tiny Cnbozon Indian ?esonntiun in the only 1930:. ?Riomciuto claim- hio crew of com- purer programmers helped customize use. He 5 now towing 30 years in a South Catalina federal prison ostensi- bly on an: ohms. Though mybe not crediblo semen his own. his Systematico? money-laundering role for the intelligent? camunity might holp ?plain why Jackson Stopbmn triad to ink: over thing- ton-baud Fbuncinl Canon! Bonk- ohuu in 1978 on behalf of Arab of the Bonk of Credit and Common. International. links to global corruption and intelligence apnotionl bu boon won documented. though mow mymrioo remain. Awarding lo lowmlt ?lod by the Soouritiu and Exchange Commis- thonvilny Systormtioo brought in to Niko over nil of dot: Bopruonting Syltemotics in tin: 1978 528 one: Hillary Rodhu?n Clinton Ind Webster Hubboll; Stephan: was blocked In thot bloom. But FGB. later rammed First Amadeus. ultimotoly (all under the mogul domination of. BCCI thromh Robert Altman and lorrmr Defense Savoury Clark Cii?ord. According to a. mohnidm who workodlorFiniAmaricaninAtloom. Systamatia become 3 Roy oompumr contractor thorn anyway. in the 1980'. butl- nesa boomod. When it ?rst sold aioclr - BYIXerox Ielecopier 702} 7-21-33 budPM tuouomomm . One Hundred Fourth 7 i . JUL 21 1995 Republican. sum 5m. 5550 mammals on BANKING and awcm Subcommittee: on Doma?c and International Monetary Policy .3403 mm Home Of?ce Building Washington, n.c. 20515 - Phone (202) 226-0473 Pu: (202)2260537 T0 mt? DATE Ir RE 779/? ?g . - ,2 ?60if: :69 gaff ?ue (614?: no? Wf/J/i", a I with. ?rm: fiv ??97 . an. ?ggff ruqsor?bs' JCNI IULI I Fail-a.) L-Uur'm I, 7/21/95 Questions for CIA and NBA representatives nd 5 . As you know, there have been many published reports and allegations that the airport in Mena, Arkansas, was the base for a signifi- cant operation, allegedly in support of con? tra operations in Central America. Planes reportedly flew arms to the Centres in' Nicaragua and returned from Central America with drugs, and the proceeds from the sale of these drugs was then supposedly in Arkansas, possibly with the knowledge of state authorities and the involvement of companies called Park-o-Meter,and Systema? tics. There are tale i Please understand that I am not interested in launching a new probe of our Contra policy 7 with the intent of suggesting wrongdoing by your agencies. What I am obligated to do is probe Whitewater?related allegations so that they can be proven true or false, as well as certain other issues that fall under the jurisdiction of the Banking and International Relations committees on which I serve. There is a lot of smoke here and possibly very little fire. Nevertheless, it is important that I be able to affirm that all allegations have been thoroughly reviewedr L) I .LnUuupevo IUL- I . .. General Questions Have any of you or anyone else at either the CIA or the NSA discussed this inquiry from_ue with anyone at the White House, the Department of Justice or any other government organization? Does the CIA or NSA have knowledge of or any involvement in clandestine activity by the U.S. Government or any private parties in or near Mena, Arkansas, in the 19805? . Have any reports on activities in and around Mena been prepared for the D21, Specifically, for former Director Woolsey? A. Gun Smuggling -- Did the CIA or NSA have any involvement in, or knowledge of, any.opera- tion by the U.S. QOVernment or the eo-called "private benefactors? (led by retired Gen. Richard Secord) to train pilots and/or ship arms from the Rich inter-mountain regional airport at.Mena to the Nicaraguan Centres? If so, did any such activities take place with the knowledge or approval of other Federal officials? Did any euch activities take place.with the knowledge or approval of Ar- kaneae etate government officials? abu'ivLJU?O IN- whit? un ututbuwavn I 0 vu lu' -- Did the CIA contract with any Arkansas manfacturere to build automatic weapons for the Nicaraguan Contras? I . Does the CIA or NSA have any contractual relationship with, or knowledge of, an Arkansas company called Park?o~Meter, also known as Do you have any reason to believe that POM produced disposable fuel tanks for use by Barry Seal and possibly others in connection with supplying arms to the Contras? B. Barry anal and Associates -- Did the CIA or NSA have any contractual or other relationship with the- late Adler Barriman "Barry" Seal (seal Was murdered, allegedly at the direction of Co- lumbian drug lords, in Feb. 1986)? To your knowledge, did any other government agency (such as the DEA or DIA) have any contractual or other relation- ship with Barry Seal? Is the CIA or NSA aware of any IRS determination that money earned by Seal between 1984 and 1986 was not illegal because of his alleged employment? Did the CIA have any involve- ment in, or knowledge of, the installation of cameras on Seal?s C-123K transport plane for 3 I I.) Iblc?iuP?1984 "sting" operation against the Sandinista official Federico Vaughan? -- Was Seal' 9 123K cargo plane, christened Fat Lady (serial number 54? 0679), sold by Seal to the CIA or any other U. S. - government related entity? Was this plane later shot down over Nicaragua with a load of arms destined for the Contras? Did the CIA have any contrac~ tual or other relationship with Terry Read, a former Air Force intelligence officer (who claims he had a relationship with the CIA in the 19803) and author of Clin~ Did the CIA ever have dealings With former Arkansas State Trooper L. D. Brown? Is the CIA or NSA aware of any attempts by federal or state officials to interfere with or terminate any investigation the IRS, Justice Department, Arkansas State Police or any other law?enforcement authori? ties into Mena-related criminal conduct? C. Narcotics Smuggling -- Did the CIA or NSA have any knowledge of or involvement in illicit nar? cotics trafficking, possibly by rogue opera~ tives, in or near Mena, Arkansas? As you know, there have been allegations that on 4 . . do"! Iu-Leuyitu JULI I 1 LI .. vuluu their return flights from Central America, pilots smuggled more than 20 tons of cocaine into Mena. Did the CIA or NSA have anv indication that? Does the CIA or NSA have any 7 indication that by Barry Seal or his associ- ates attempted to? Does the CIA or NBA have an? indication that? Does the CIA or NSA know of any or more ever held by U.S. citizens domiciled in Ar~ Ikanaas at anytime between 1988 and now? ?Ie.the CIA or NSA aware, di~ rectly or indirectly, of at?. Lapyvpiul Ive: I 9 LI 9 L-Iulm . vu?ruLeU?oii?f -- jDoea the CIA have the capabili- ty of? Does the_NSA have the capabili- Ity of doee CIA and/or NBA have the capability, directly or through another party, of Does CIA or NSA.have the authority to -- Has CIA or -- Does the CIA maintain a team of skilled computer hackers who routinely break into the electronic data systems of foreign banke? According to one source, this group 6 cum avLI . . Liv-9;! LI 04 I L'uurm is informally known as the Fifth Column. 'Correct? -- poes the NSA -- Does the CIA or NSA know of or has either agency participated in, directly or indirectly, efforts to sell software-? notably versions of a program in use at the Justice Department called PROMIS -?or other devices to foreign banks for the purpose of facilitating their electronic data systems.- Does the CIA or MBA know of customers to whom this software has been sold? . Is the CIA or NSA aware of any attempts by? Does CIA or NBA know of any efforts by JCIH icldbuplci' tut: L'nu'm Has the CIA or MBA received any'i indication that proceeds from the sale of PROMIS or similar software were used to fi- nance arms shipments to the Contrae? Are there any indications of Is the CIA or NSA aware of any unauthorized efforts, possibly in the margin of le itimate inte Does CIA or NSA know of a Charles Hayes, who was born on 4/27/35, whose social security?number is ?and who now reeidee in Nancy, Kentucky? -- If so, has Hayes ever had any ties to the CIA or NSA or any other U.S. government agency? Have these ties been sev? -ered? -- Hayes claime to be able to break into the electronic data eyeteme of foreign banks. Has -- Ie NSA or CIA aware of an ac? count, number at the Banca Della Svizzera Italiana in said to have belonged to Vincent Foster? :uoeuzbahm.? cam ui-ntauk ICIUMUULEI rut: . 9?4 .m?m Is either the CIA or NSA aware of any foreign governmenta that might have provided arms, money or assistance to any group operating out of Mena? . ?p