Reporting Potential Crimes to Department of Justice
Background. For over 20 years, CIA had broad discretion to
report or not report information that came to its attention regarding potential
violations of federal law by its employees, assets and other persons. According
to a 1954 memorandum from CIA General Counsel Lawrence Houston to the DCI,
Houston discussed the issue of reporting Federal criminal violations to the
Department of Justice (DoJ) with Deputy Attorney General William P. Rogers on
February 18, 1954. According to that memorandum, Rogers and Houston agreed that
CIA would be responsible for determining whether a potential violation of
criminal law by persons associated with CIA would be referred to DoJ for
prosecution. This arrangement was based on the belief that CIA was in the best
position to determine whether classified information might be revealed in the
course of such a prosecution. The memorandum also stated that CIA would be
obligated to refer to DoJ potential criminal matters that could be prosecuted
without revealing classified information, and that any doubts would be resolved
in favor of referring the matter to DoJ. Finally, Rogers and Houston agreed,
according to the memorandum, that it was not necessary at that time to enter a
formal agreement of any kind that would embody these understandings.
In the mid-1970s, this arrangement became more widely known and was
subject to criticism by the Congress(6) and others. Then-Assistant
Attorney General for DoJ's Criminal Division Richard Thornburgh wrote CIA
General Counsel John Warner on July 24, 1975 to remind CIA of its duty to comply
with 28 U.S.C. 535, a provision of law that imposes a duty on every department
and agency in the Executive Branch to report promptly to the Attorney General
any information, allegations, or complaints relating to possible violations of
Title 18 of the United States Code by officers and employees of the U.S.
Government. Warner responded on July 29 and acknowledged that "any
other informal referral agreement that may have been in effect in the past was
abrogated." At the same time, however, Warner noted that the DCI was
charged under the National Security Act of 1947 with "protecting
intelligence sources and methods from unauthorized disclosure" and that CIA
would be seeking DoJ's advice as to fulfilling this responsibility in regard to
"cases that will be reported."
CIA Regulation Regarding Crimes Reporting. As of November 28,
1975, CIA's policy for reporting information regarding potential violations of
federal criminal law by employees and others was set forth in Headquarters
Regulation (HR) 7-1 a(7). That regulation provided:
Information, allegations, or complaints of violations of the criminal
provisions of the United States Code by CIA officers and employees, or relating
to CIA affairs, shall be reported immediately by an employee to the Inspector
General, who shall inform the General Counsel. Information, allegations, or
complaints of violations of Title 18 of the United States Code involving
Government officers and employees shall be expeditiously reported to the
Attorney General by the General Counsel in compliance with 28 U.S.C. 535. Such
report to the Attorney General shall include an evaluation of the impact, if
any, of a prosecution on the national security or foreign relations of the
United States, including intelligence operations which may be jeopardized or
intelligence sources and methods which may be compromised thereby. CIA will not
exercise a prosecutorial function.
E.O. 11905. A presidential directive that CIA report
information to DoJ concerning potential violations of certain federal criminal
laws by employees and non-employees was first established by President Gerald
Ford in Executive Order (E.O.) 11905, dated February 18, 1976. The pertinent
part of E.O. 11905--Section 4(a)--stated:
In carrying out their duties and responsibilities, senior officials
[including those at CIA] . . . shall:
. . . .
(5) Report to the Attorney General that information which relates to
detection or prevention of possible violations of law by any person,
including an employee of the senior official's department or agency:
. . . .
The preamble to Section 4 stated that:
Unless otherwise specified within this section, its provisions apply to
activities both inside and outside the United States, and all references to law
are to applicable laws of the United States.
The reporting obligations imposed upon CIA and other U.S. intelligence
agencies by this provision exceeded those required of other federal agencies.
Whereas the responsibilities of other agencies in this regard are limited by 28
U.S.C. 535 to potential violations of Title 18 by U.S. Government employees,
E.O. 11905 required CIA and other intelligence agencies to report all
possible violations of any law by any person.
A May 7, 1976 opinion by DoJ's Office of Legal Counsel confirmed the
breadth of Section 4(a)(5) of E.O. 11905 by concluding that it required reports
of possible violations of any law, civil or criminal, with respect to which DoJ
had either investigative or prosecutorial jurisdiction. This opinion
also noted, however, that the agencies were required to report such information
to the Attorney General only when such information was acquired by them in the
exercise of their functions under the E.O.
E.O. 12036. On January 26, 1978, President Jimmy Carter signed
E.O. 12036, "United States Intelligence Activities," which
superseded E.O. 11905. Section 1-7 of E.O. 12036 contained the following
language regarding the obligation to report federal crimes:
The senior officials of each of the agencies within the Intelligence
. . . .
(1-706) Report to the Attorney General evidence of possible violations
of federal criminal law by an employee of their department or agency,
and report to the Attorney General evidence of possible violations by any
other person of those federal criminal laws specified in guidelines adopted
by the Attorney General.
. . . .
Section 4-204 of the E.O. defined "employee" as:
Employee means a person employed by, assigned to, or acting for an
agency within the Intelligence Community.
E.O. 12036 thus narrowed the CIA's responsibilities with respect to
reporting employee violations because it expressly limited the requirement to
federal criminal violations. On the other hand, E.O. 12036 continued to require
that intelligence agencies report any federal criminal violation by their
employees, not just Title 18 violations. For example, most narcotics violations
fall under Title 21 and would not be reportable by other U.S. Government
agencies under a literal reading of 28 U.S.C. 535. Moreover, E.O. 12036 did not
alter the fact that only the Intelligence Community agencies were required to
report federal crimes by non-employees, although it did recognize that the scope
of this portion of the reporting requirement could be narrowed by Attorney
On September 15, 1978, CIA amended HR 7-1 to incorporate the changes
required by E.O. 12036. With respect to the obligation for reporting potential
crimes, the revision read:
. . . . Information, allegations, and complaints of possible violations of
Federal criminal law by CIA employees or any other person shall be reported
immediately by any employee to the Inspector General who shall inform the
General Counsel. The Inspector General shall provide to the General Counsel an
evaluation of the impact, if any, of a prosecution of such a violation on the
national security or foreign relations of the United States, including
intelligence operations which may be jeopardized or intelligence sources and
methods which may be compromised. Pursuant to 28 U.S.C. 535 and Section 1-706
of Executive order 12036, evidence of possible violations of Federal criminal
law shall be reported expeditiously to the Attorney General by the General
Counsel in accordance with procedures and guidelines adopted by the Attorney
. . . .
Attorney General Procedures for Crimes Reporting. On August 15,
1979, pursuant to section 1-706 of E.O. 12036, Attorney General Griffin Bell
promulgated two sets of guidelines. One guideline pertained to the reporting of
federal crimes committed by employees of agencies in the intelligence
community. The other related to the reporting of federal crimes
committed by non-employees.
The August 1979 Attorney General employee crimes reporting
guidelines defined "employees" to include not only persons covered by
the definition of that term in Section 4-204 of E.O. 12036 (i.e., those who were
employed by, assigned to, or acting for an intelligence agency), but also any
former employees when the offense was committed during their employment or
related to potential violations of statutory restrictions on the post-employment
activities of former employees. With respect to employees of intelligence
agencies, the guidelines required the General Counsel to refer to DoJ any "allegations,
complaints, or information tending to show that any officer or employee may have
violated a federal criminal statute that the agency cannot establish as
unfounded within a reasonable time through a preliminary inquiry."
The August 1979 Attorney General guidelines for reporting crimes
committed by non-employees set forth several categories of federal
crimes as to which reporting would be required:
Crimes involving intentional infliction or threat of death or serious
physical harm (e.g., homicide, kidnapping);
Crimes impacting on the national security, defense, or foreign relations
of the United States (e.g., espionage, sabotage, violations of the Trading with
the Enemy Act, neutrality offenses); and
Crimes involving foreign interference with the integrity of United States
Government institutions or crimes committed on behalf of a foreign power or in
connection with international terrorist activity (e.g., bribery, election
contributions, aircraft piracy, transportation of explosives).
Potential violations of federal criminal provisions relating to narcotics
trafficking were not included among the categories of reportable crimes by
non-employees. The guidelines did, however, include language also authorizing
the General Counsel to report information concerning any offense that the
General Counsel believed should be reported to the Attorney General.
On November 21, 1979, following the adoption of the August 1979
Attorney General guidelines, CIA amended HR 7-1. HR 7-1a (7) of that regulation
Any employee who, in the course of official duty, becomes aware of any
information, allegation, or complaint of possible violations of Federal criminal
laws by any person, including a person employed by, assigned to, or acting for
the Agency, is required to report immediately such information, allegation, or
complaint to the General Counsel. The Office of General Counsel shall consult
with the Office of Security and the Office of Inspector General when necessary
in conducting a preliminary inquiry to determine whether a basis for referral
exists and shall obtain from concerned Agency components an evaluation of the
impact, if any, of a prosecution of such a violation on the national security or
foreign relations of the United States, including intelligence operations which
may be jeopardized or intelligence sources and methods which may be compromised.
Pursuant to 28 U.S.C. 535 and Section 1-706 of Executive Order 12036, evidence
of possible violations of Federal criminal law shall be reported expeditiously
to the Attorney General by the General Counsel in accordance with procedures and
guidelines adopted by the Attorney General . . . .
This major revision of HR 7-1 established a requirement that CIA employees
report information, allegations and complaints regarding possible violations of
federal criminal law by any person directly to the General Counsel instead of
indirectly through the Inspector General.
On November 21, 1979, CIA issued Headquarters Notice (HN) 7-39, "Supervisors'
and Managers' Responsibility to Report Evidence of Crimes to the Attorney
General--Executive Order 12036, Section 1-706." Section 4 of the
HN addressed the issue of reporting potential crimes by employees:
. . . . a. Employees. Senior officials of the Intelligence Community are required to report to the Attorney General evidence of possible violations by an
employee of their department or agency of any Federal criminal law. The
Executive order defines "employee" more broadly than the general or
dictionary meaning of the word. "Employee" for the purpose of
reporting crimes means a person employed by, assigned to, or acting for an
agency within the Intelligence Community. Thus, for example, an agent, a
safehousekeeper, a contract employee, or an independent contractor performing
services for CIA is considered an employee.
In view of these obligations, all employees have been instructed to
report to the Office of General Counsel when, in the course of official duty,
they become aware of (a) any information, allegation, or complaint that an employee
may have violated any Federal criminal law, and (b) any facts or circumstances
that raise a suspicion in the employee's mind that a Federal criminal offense
has been committed by a nonemployee . . . .
On the same day, CIA issued a companion notice, HN 7-38, "Employee
Responsibility to Report Evidence of Crimes to the Attorney General--Executive
Order 12036, Section 1-706." This HN provided the following guidance to
. . . . 3. In summary, all employees are instructed to report to the Office of
General Counsel when, in the course of official duty, they become aware of (a)
any information, allegation, or complaint that an employee may have violated any
Federal criminal law, and (b) any facts or circumstances that raise a suspicion
in the employee's mind that a Federal criminal offense may have been committed
by a nonemployee.
. . . .
HN 7-38 did not define the term "employee," but referred to HN
7-39 and noted that it dealt with the same subject in much greater detail. HN
7-38 also advised employees who wished further clarification to contact their
supervisor or Office of General Counsel (OGC).
E.O. 12333. On December 4, 1981, President Ronald Reagan
signed E.O. 12333, "United States Intelligence Activities," which
revoked E.O. 12036. The provision of E.O. 12333 requiring reporting of crimes
to the Attorney General was not revised in any substantive way, except for
adding a specific reference to protecting intelligence sources and methods.
Unlike the two previous Executive Orders, however, E.O. 12333 required the head
of an intelligence agency and the Attorney General to agree on crimes reporting
Section 1.7(a) of E.O. 12333 stated that heads of departments and
agencies in the Intelligence Community should:
Report to the Attorney General possible violations of federal criminal
laws by employees and of specified federal criminal laws by any
other person as provided in procedures agreed upon by the Attorney General
and the head of the department or agency concerned, in a manner consistent with
the protection of intelligence sources and methods, as specified in those
Section 3.4(c) of the E.O. defined "employee" in the same way as
that term had been defined in E.O. 12036:
Employee means a person employed by, assigned to or acting for an agency
within the Intelligence Community.
As had been true under E.O. 11905 and E.O. 12036, the reporting obligations
imposed upon CIA and other U.S. intelligence agencies by these provisions
exceeded the obligations of other federal agencies. Whereas the
responsibilities of other agencies in this regard are limited by 28 U.S.C. 535
to potential violations of Title 18 by U.S. Government employees, E.O.
12333 requires CIA and other intelligence agencies to report all possible
violations of any law by any person.
1982 DoJ-CIA Memorandum of Understanding. To implement section
1.7(a) of E.O. 12333 and replace the August 1979 guidelines promulgated by
Attorney General Bell under E.O. 12036, a MOU between CIA and DoJ regarding
crimes reporting was signed by Attorney General William French Smith on February
11, 1982 and DCI William Casey on March 2, 1982. (See Exhibit 1 for the full
text of this Memorandum.) The MOU defined "employee" for crimes
reporting purposes as:
A staff employee or contract employee of the Agency;
Former officers or employees of the Agency, for purposes of offenses
committed during their employment; and
Former officers or employees of the Agency, for offenses involving a
violation of the statutory limits on activities of former U.S. Government
This definition of "employee" was narrower than the definition of
that term in Section 3.4(c) of E.O. 12333 which included any person "employed
by, assigned to or acting for an agency within the Intelligence
Community." (Emphasis added.) The effect of this omission was to move
persons "acting for," but not employed by or assigned to, CIA from the
"employee" to the "non-employee" category for crimes
The list of non-employee crimes that were required by the 1982 DoJ-CIA
MOU to be reported to the Attorney General was essentially the same as had been
included in the August 1979 Attorney General guidelines. The only substantive
change was that the 1982 MOU added certain violations of the Atomic Energy Act.
As was the case with the 1979 Attorney General guidelines, the 1982 MOU did not
include any type of narcotics violation among the lists of reportable crimes by
non-employees. However, in language similar to that used in the portion of the
1979 Attorney General guidelines that applied to non-employees, Section IV D. of
the 1982 DoJ-CIA MOU stated:
Notwithstanding any of the above provisions, the General Counsel may
report any other possible offense when he believes it should be reported.
On February 11, 1982, Attorney General Smith sent a letter to DCI Casey
notifying him that he had approved the MOU and was sending it to Casey for his
signature. (See Exhibit 2 for the full text of this letter.) The letter
stated, in part:
I have been advised that a question arose regarding the need to add
narcotics violations to the list of reportable non-employee crimes . . .
. 21 U.S.C. §874(h) [sic](7) provides that "when
requested by the Attorney General, it shall be the duty of any agency or
instrumentality of the Federal Government to furnish assistance to him for
carrying out his functions under [the Controlled Substances Act] . . . ."
Section 1.8(b) of Executive Order 12333 tasks the Central Intelligence Agency to
"collect, produce and disseminate intelligence on foreign aspects of
narcotics production and trafficking." Moreover, authorization for the
dissemination of information concerning narcotics violatons [sic]to law enforcement agencies, including the Department of Justice, is
provided by sections 2.3(c) and (i) and 2.6(b) of the Order. In light of these
provisions, and in view of the fine cooperation the Drug Enforcement
Administration has received from CIA, no formal requirement regarding the
reporting of narcotics violations has been included in these procedures. We
look forward to the CIA's continuing cooperation with the Department of Justice
in this area.
The letter did not request that DCI Casey concur in the expectations
expressed by Attorney General Smith. On March 2, 1982, Casey signed the MOU.
The first part of the Attorney General's letter referred to 21 USC
873(b). That statute provides:
When requested by the Attorney General, it shall be the duty of any
agency or instrumentality of the Federal Government to furnish assistance,
including any technical advice, to him for carrying out his functions under this
subchapter [Title 21 of the United States Code]. . . .
The authority of the Attorney General to prosecute and litigate is not
contained in Title 21 but rather is found generally in sections, 509, 516, 519,
and 547 of Title 28. Those sections do not create a requirement to report
narcotics violations to the Attorney General.
The second part of the Attorney General's letter referred to Section
1.8(b) of E.O. 12333. Section 1.8(b) states that the CIA shall "Collect,
produce and disseminate intelligence on foreign aspects of narcotics production
and trafficking." That section also does not create a requirement to
report narcotics violations to the Attorney General.
The third part of the Attorney General's letter referred to sections
2.3(c) and 2.6(b) of E.O. 12333. Section 2.3(c) states that DCI and Attorney
General-approved collection procedures shall permit an intelligence agency to
collect, retain and disseminate "Information obtained in the course of a
lawful foreign intelligence, counterintelligence, international narcotics or
international terrorism investigation." Section 2.6(b) states that an
intelligence agency is authorized to:
Unless otherwise precluded by law or this Order, participate in law
enforcement activities to investigate or prevent clandestine intelligence
activities by foreign powers, or international terrorist or narcotics
Those sections do not create a requirement to report narcotics violations to
the Attorney General.
The Attorney General's letter also stated that:
In light of these provisions [discussed above] and in view of the fine
cooperation the Drug Enforcement Administration has received from CIA, no formal
reporting requirement of narcotics violations has been included in these
However, reporting of narcotics intelligence information to the Drug
Enforcement Administration would not satisfy the requirement of section 1.7(a)
of E.O. 12333 that potential criminal violations be reported to the Attorney
General. While the 1979 Attorney General Guidelines under E.O. 12036 permitted
reporting of potential federal crimes to appropriate law enforcement agencies in
certain circumstances in lieu of reporting to the DoJ Criminal Division, the
1982 CIA-DoJ MOU required notification to the Criminal Division of any such
referral to an investigative agency or to a United States Attorney.
On March 2, 1982, DCI Casey wrote to Attorney General Smith stating
that he had signed the procedures. DCI Casey's letter did not refer to the
issue of reporting narcotics violations and did not indicate whether he agreed
or disagreed with the statements in the Smith letter.
On February 8,1985, A. R. Cinquegrana, Deputy Counsel for Intelligence
Policy at DoJ, wrote a memorandum to Mark M Richard, Deputy Assistant Attorney
General, Criminal Division, in which he stated:
Pursuant to our discussion yesterday, attached are copies of the
procedures governing CIA's reporting of crimes and the transmittal letters
between the [Attorney General] and the DCI. As you can see, alleged violations
of Title 21 [narcotics violations] by non-employees are not covered by
the procedures to be reported. In lieu of formal reporting, however, the
Attorney General's letter notes "the fine cooperation the Drug Enforcement
Administration has received from CIA" and the Department's expectation of "continuing
cooperation . . . in this area." Accordingly, it would appear that if CIA
and DEA can work out a mutually satisfactory arrangement regarding the kinds of
offenses at issue, there would be no need to modify the procedures, at least so
far as non-employees are concerned.
(Emphasis in original.)
On January 5, 1988, in a letter to William F Weld, Assistant Attorney
General for the Criminal Division that provided information regarding a possible
violation of U.S. narcotics laws by Adolfo Chamorro, CIA General Counsel David
Doherty noted that "Although this non-employee crime is not required to be
reported under the Attorney General-approved guidelines, I am making this report
because of the serious nature of the alleged offense." No information has
been found to indicate that DoJ responded to this statement by the General
On December 23, 1987, the CIA's HR 7-1 was revised to incorporate the
changes that had been established six years earlier by E.O. 12333. With regard
to crimes reporting, Section d of the revised HR stated:
. . . . (5) All employees shall report to the General Counsel via their
components facts or circumstances that appear to indicate the commission of a
criminal offense . . . . Pursuant to Section 1.7(a) of E.O. 12333, CIA is
obligated to report, through its General Counsel, to the Attorney General
possible violations of Federal criminal laws by employees and of
specific Federal criminal laws by any other person as provided in the
crimes reporting procedures in Annex D.
Annex D of the revised HR 7-1 consisted of the 1982 MOU between CIA and DoJ.
The February 11, 1982 letter regarding narcotics violations that had been sent
by Attorney General Smith to DCI Casey along with the 1982 MOU was not included
in Annex D.
1995 Revision of the DoJ-CIA MOU. In August 1995, DoJ, CIA and
other Intelligence Community agencies agreed to a revised MOU governing the
reporting of crimes that superseded the 1982 MOU on that subject. This revised
MOU remains in effect.
Section II.A of the 1995 MOU defines an "employee" as
. . . a staff employee, contract employee, asset, or other person or
entity providing service to or acting on behalf of any agency within the
Thus, the broad requirement to report any potential violation of law by any "employee"
has been extended once again beyond persons employed by CIA and to include those
who are "acting on behalf" of the Agency. Also, for the first time,
potential violations of U.S. laws related to narcotics trafficking are
specifically included by the 1995 MOU in the categories of potential violations
by non-employees that are required to be reported to DoJ.
Coordination with DEA. On April 25, 1984, DEA and CIA revised
an August 1978 MOU between them. The revised 1984 version of the DEA/CIA MOU,
entitled "Procedures Governing Conduct and Coordination by CIA and DEA
of Narcotics Activities Abroad," focused on the collection and sharing
of strategic narcotics intelligence and the issue of coordination at the field
level. It did not mention CIA's crime reporting responsibilities under the 1982
MOU between DoJ and CIA.
The introduction of the revised MOU states that:
[The MOU is] intended to promote coordination between the DEA Special Agent
in Charge (SAC) and the CIA Chief of Station (COS) in matters of mutual
interest, timely sharing of strategic narcotics intelligence and the prompt
resolution at the Headquarters level of difficulties or disagreements. CIA and
DEA have legitimate functions with regard to monitoring and countering
international narcotics trafficking and production.
The revised MOU defines "strategic narcotics intelligence" as:
. . . includ[ing] information regarding the influence of narcotics
production and trafficking on the economy of a country, possible corruption of
government officials, geographic areas of narcotics production, narcotics
trafficking routes, financial intelligence (movements of funds attributable to
narcotics production and trafficking) and estimates of narcotics production.
Individual Views of CIA Responsibility to Report Narcotics
Violations Under E.O. 12036 and the 1979 Attorney General Guidelines.
Bernard Makowka, an attorney in OGC from 1975-1989 and Chief of the Intelligence
Law Division in 1982, states that narcotics violations by agents or
assets did not have to be reported under E.O. 12036 and DoJ guidelines that
existed at the time. According to Makowka, both CIA and DoJ were comfortable
with this arrangement. Makowka says CIA did not want to be involved in law
enforcement issues while DoJ did not want "tainted leads" from CIA
which could not be used in criminal prosecutions because of national security
Makowka also states that E.O. 12036 restricted CIA from disseminating
information on U.S. persons and therefore certain narcotics violations could not
even be reported to DoJ. Makowka further states that the definition of "employee"
in HN 7-39 is not consistent with the way that the OGC interpreted the term "employee"
as it applied to E.O. 12036. According to Makowka, HN 7-39 could be
read so as to require the reporting of agent crimes only when an agent was
acting on behalf of CIA and that when the agent was acting on his own, no report
would have to be made.
Edmund Cohen, an OGC attorney and Chief of the Administrative Law
Division in 1982, states that there had been an agreement between CIA and DoJ
under E.O. 12036 that CIA would not necessarily have to report crimes, including
narcotics violations, if such crimes involved classified information.
The OGC attorney who served as Makowka's deputy in 1982 remembers being
told by senior attorneys in OGC that there was a distinction made for reporting
narcotics violations under E.O. 12036 in which the CIA would only report major
narcotics violations to DoJ. He also notes that, in the late 1970s,
CIA was not heavily involved in the collection of narcotics intelligence and it
was not a high priority.
A. R. Cinquegrana, Deputy Chief of DoJ's Office of Intelligence Policy
and Review (OIPR) from 1979 to 1991, states that he does not believe that the
1979 guidelines required CIA to report narcotics trafficking violations as
potential crimes by non-employees since the definition of "employees"
under those guidelines included agents and assets.
Negotiation of 1982 DoJ-CIA Crimes Reporting MOU. According to
the OGC attorney who served as Makowka's deputy in the Intelligence Law Division
in 1982, CIA and DoJ entered into discussions over an MOU to establish crimes
reporting procedures shortly after E.O. 12333 was issued by President Reagan.
Approximately two months transpired between the issuance of E.O. 12333 and an
agreement between the CIA and DoJ.
The OGC attorney who served as Makowka's deputy in the Intelligence Law
Division in 1982 states that CIA General Counsel Daniel Silver assigned him the
task of writing the first draft of the MOU. He says that he used the Attorney
General guidelines under E.O. 12036 as a starting point regarding the list of
reportable crimes. He did not add any new crimes to the list in his draft MOU
and instead simply took the list of crimes from the 1979 guidelines. He also
states that he received specific instructions from Cohen to narrow the
definition of "employee" in the draft MOU from the definition in E.O.
12333. He recalls that there were not many changes between his draft MOU and
the final MOU.
Makowka remembers that the negotiations for all the E.O. 12333
procedures took a long time to complete. Makowka oversaw the MOU negotiations
for CIA but was one step removed from the day-to-day activities. Those
responsibilities were handled by Cohen and his deputy for OGC, and says Makowka,
the DO/Policy and Coordination Staff also was involved. Makowka also recalls
that DoJ questioned everything in the E.O. 12333 procedures and says he assumes
that DoJ carefully reviewed the MOU as well.
Cohen recalls that the MOU was thoroughly coordinated with DoJ. Cohen
says that the negotiations over the MOU involved the competing interests of DoJ
and CIA. DoJ's interest was to establish procedures while CIA's interest was to
ensure that the MOU protected CIA's national security equities.
George Clarke, OGC's Chief of Intelligence Community Affairs in 1982,
remembers that there were many discussions between CIA and DoJ but does not
recall the specific issues. Clarke does not recall any interagency disagreement
over the crimes listed in the 1982 MOU.
While personnel from the DoJ's Criminal Division were not involved in
the day-to-day negotiations, Cinquegrana says that OIPR kept them fully advised
and consulted with them regularly as the draft developed. Cinquegrana says he
and Mark Evans represented DoJ in the negotiations.
Mark Evans and Jerry Schroeder, both of whom were OIPR staff attorneys
in 1982, state that they have no recollection of having worked on the 1982
Crimes Reporting MOU, although both worked on other aspects of implementing
other provisions of E.O. 12333. Neither had any idea of who else may have
worked on this issue. Cinquegrana states that Deputy Assistant Attorney General
Mark Richard and OIPR Chief Mary Lawton(10) participated in some of the
Richard says he probably had some input into the MOU, but that it was
negotiated by Cinquegrana, as Lawton's deputy.
Exclusion of Narcotics Violations from Scope of Reportable
Non-employee Crimes. Makowka remembers that the issue of narcotics
violations was thoroughly discussed between DoJ and CIA before the MOU was
signed. According to Makowka, DoJ questioned everything in the MOU and was very
particular about every procedure listed in the MOU. He recalls that DoJ and CIA
discussed the issue of whether narcotics violations should be in the list of
reportable crimes and the parties arrived at an understanding where CIA would
only report "serious, not run-of-the-mill, narcotics violations."
Makowka believes that this represented a decision by CIA and DoJ to continue the
practice established under the previous Executive Order in which only
significant violations would be reported. Subsequently, Makowka added that DoJ
and CIA agreed that significant narcotics transactions would continue to be
reported even though not technically required under the MOU.
According to Cohen, CIA's main concern was the collection of
intelligence on narcotics, not law enforcement. He recalls that the only
discussion between CIA and DoJ in terms of reporting narcotics violations to DoJ
was in the context of Agency employees and the Agency reporting potential
violations of law picked up through applicant and employee polygraphs. The
deputy to the Chief of OGC's Intelligence Law Division in 1982 believes that the
1982 MOU was intended to be a continuation of existing practices under E.O.
Cinquegrana states that DoJ's Criminal Division reviewed and concurred
with the non-employee criminal violations listed in the MOU. He believes that
the Criminal Division had a better appreciation than OIPR for the kinds of
crimes that should be included in the MOU. According to him, the list of crimes
in the MOU seemed to represent at the time the categories of crimes that DoJ
might expect to come to the attention of an intelligence agency during the
course of its business. Cinquegrana does not remember any disagreements between
DoJ and CIA relative to specific types of violations. From his perspective in
OIPR, he believes the failure to include narcotics on the list of reportable
non-employee crimes was an omission and not a conscious decision to exclude such
Mark Richard, Deputy Assistant Attorney General with responsibility for
General Litigation and International Law Enforcement in 1982, states that he
probably had some input into the MOU. He was unable, however, to explain why
narcotics violations were not on the list of reportable crimes except that the
MOU had "other deficiencies, not just drugs."
Purpose of the February 11, 1982 Smith Letter. Cinquegrana
says he remembers getting a telephone call "at the last minute" from
Makowka who pointed out to him that the MOU failed to include the reporting of
narcotics violations by non-employees. The draft MOU had already been cleared
by all DoJ components--and was about to be signed by the Attorney General--when
Cinquegrana reportedly found out about this omission. Instead of reopening the
negotiations and clearing a revised MOU, Cinquegrana states that he and OIPR's
Mark Evans prepared a letter from the Attorney General to DCI Casey. The letter
was designed to show the importance of the subject of reporting narcotics
trafficking without reopening negotiations, and that it was DoJ's expectation
that CIA would understand DoJ's intent. Evans has no recollection of working on
such a letter.
Cinquegrana states that the letter was designed to create an
expectation in the CIA that narcotics violations would be treated in the same
way as the listed reportable crimes would be treated. Cinquegrana says that at
that time DoJ hoped CIA would include guidance on narcotics trafficking
reporting along with any guidance disseminated to its employees with respect to
the MOU. Cinquegrana states that "we [DoJ] were trying to build the best
case. . . . We anticipated that [narcotics violations] would be hard for the
Agency to say 'no' to in terms of accepting the need to report such violations.
And that 'responsible officials' would so realize." However, when asked
about the specific effect of the Smith letter, Cinquegrana states that it would
be going "too far" to conclude that the Smith letter added narcotics
trafficking to the list in the MOU.
For his part, Makowka has no recollection of having a conversation with
Cinquegrana about the fact that the 1982 draft MOU did not include narcotics
violations as reportable crimes. He attributes the Smith letter to someone at
DoJ becoming uncomfortable at the prospect of the MOU not including any mention
of narcotics. Makowka believes that the letter reflects the understanding
between DoJ and CIA that only serious, not run-of-the-mill, violations would be
reported. Makowka does not believe that the letter changed the list of
violations that were required to be reported to DoJ.
Cohen believes that the failure to add narcotics to the list of
reportable crimes was an oversight by DoJ and that someone at DoJ became
embarrassed on realizing that DoJ forgot to include narcotics violations in the
list of crimes reportable to DoJ. Cohen speculates that the letter from DoJ was
a "cover your ass type of document." His interpretation of the letter
is that it implies CIA should keep doing what it had been doing before the
signing of the MOU. Cohen believes that the language was vague and did not add
narcotics trafficking to the list of crimes CIA is required to report, although
as a practical matter he believes that it was better to err on the side of
Clarke believes the intent behind the letter was that it was an
oversight not to include narcotics violations in the list of reportable crimes.
Thus, DoJ sought to make it clear that it expected the Agency to report such
Makowka's deputy in OGC's Intelligence Law Division in 1982 believes
that the intent of the letter was for the Agency to continue its past practice
of reporting certain non-employee narcotics violations. He also thinks the
Smith letter may have been a compromise in which CIA would report only major
Defining "Employee" in the 1982 MOU. Makowka recalls
that his deputy and Cohen worked very hard to define the term "agent"
during the MOU negotiations. He believes that an independent contractor is not
a contract employee and therefore is not an employee for purposes of the MOU.
Makowka's deptuy states that he was given explicit instructions from
Cohen to develop a narrower definition of "employee" for the MOU than
the language in E.O. 12333. The reason for doing so was to make a distinction
between those people with staff-like access over whom CIA has a high level of
control and agents and assets over whom CIA has limited control. He does not
know whether DoJ was aware of CIA's reasoning for narrowing the definition. As
previously noted, Makowka states that the definition of "employee" in
HN 7-39 was not consistent with OGC's interpretation of "employee" and
that the 1982 MOU was a joint effort by DoJ and CIA to refine language that
would reflect the existing practice between CIA and DoJ under E.O. 12036.
Cohen says he believes the term "contractor" as defined in
the 1982 MOU means a person with staff access. It was not intended to cover
assets or agents.
According to Clarke, CIA wanted to make crimes reporting procedures
less onerous on CIA. Clarke believes that "employees" were
considered to be individuals who were processed by CIA's Office of Personnel.
Clarke says that crimes reporting requirements concerning employees did not
cover anyone with whom the DO dealt operationally.
Cinquegrana states it was his understanding that agents would not be
considered employees under the MOU, although he would consider independent
contractors as being covered under the category of "employee."
At that time, he considered agents to be similar to informants used by law
enforcement agencies. Cinquegrana also notes that OIPR "only knew what the
Agency told us" regarding the status and duties of agents and assets.
Gary Chase, Chief of OGC's Administrative Law and Management Support
Division from 1986 to 1989, says the term "contract employee" is a
term of art and did not include an asset and probably did not include an
View of CIA Requirements Under the 1982 MOU to Report
Narcotics Violations by Non-employees. OGC attorneys involved in the MOU
negotiations--Makowka, his deputy, and Cohen--agree that the Smith letter did
not--in the case of non-employees--have the effect of adding narcotics
violations to the list of reportable crimes under the MOU.
Prior to the 1982 MOU, Makowka states, CIA could report potential
violations to the Federal Bureau of Investigation (FBI) or DEA and meet its
crimes reporting obligations to DoJ. Under the E.O. 12333 and the 1982 MOU, it
was, however, no longer sufficient for the CIA to report crimes to DEA or FBI.
Such violations would also have to be reported to DoJ, even if reported to the
FBI or DEA. Makowka believes that OGC would take into account statute of limitations
issues when deciding whether to report an allegation to DoJ.
Cohen, who was in charge of making crimes reports to DoJ in the early
1980s, has no recollection of using the statute of limitations to avoid
reporting a matter to DoJ. His view of erring on the side of caution was also
the view of General Counsel Stanley Sporkin that, when in doubt, refer the
matter to DoJ. Even though narcotics violations by non-employees were not
covered by the MOU, Cohen states he would report a matter because not to do so
might come back to haunt the Agency. On the other hand, he says that reporting
of a matter really made no difference because DoJ never acted on the
Gary Chase, responsible for CIA's crimes reports to DoJ between 1986
and 1989, states that he is not familiar with the February 11, 1982 Smith letter
and had not seen the 1982 letter prior to 1997. For him, the 1982 MOU was the
definitive document that established CIA's responsibilities. Chase states that
the 1982 MOU imposed no obligation on CIA to report narcotics violations by
non-employees to DoJ.
Cinquegrana states that he would have expected OGC to report narcotics
violations by non-employees and not to look for reasons not to refer a matter.
He also believes that CIA has no authority to make statute of limitation
determinations because such responsibility lies with DoJ.
Summation. Between August 15, 1979 and March 2, 1982, CIA was
required by the April 15, 1979 Attorney General's guidelines under E.O. 12036
and HN 7-39 to report to DoJ any narcotics trafficking allegations relating to
individuals, assets, or independent contractors who were associated with the
Contras because assets and independent contractors were considered "employees"
for crimes reporting purposes.
As of March 2, 1982, the terms of the 1982 CIA-DoJ Crimes Reporting MOU
under E.O. 12333 no longer required that CIA report to DoJ narcotics trafficking
allegations regarding individuals, assets, or independent contractors associated
with the Contras because assets and independent contractors were not considered
"employees" for crimes reporting purposes.
The February 11, 1982 letter from Attorney General Smith to DCI Casey
that accompanied the CIA-DoJ Crimes Reporting MOU, did not create an additional
requirement that CIA report to DoJ narcotics trafficking allegations regarding
individuals, assets, or independent contractors associated with the Contras.
However, Section IV. D. of the 1982 CIA-DoJ Crimes Reporting MOU gave OGC
discretion to report any offense to DoJ in addition to those crimes specified in
the MOU, including narcotics trafficking allegations regarding individuals,
assets, or independent contractors associated with the Contras.
The April 25, 1984 CIA-DEA MOU and its August 28, 1978 predecessor
defined and established procedures for the conduct, coordination and sharing of
strategic narcotics intelligence information between CIA and DEA abroad.
In August 1995, the 1982 CIA-DoJ Crimes Reporting MOU was revised.
Under that revised MOU, assets and independent contractors are considered "employees"
for crimes reporting purposes, and narcotics violations are included among the
list of "non-employee" crimes that must be reported to DoJ. 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.
Maintenance of Relationships with Persons Suspected of Involvement
in Drug Trafficking. The Department of Defense and Military Construction
Appropriations Act for Fiscal Year 1987, which authorized $100 million for
Agency support to the Contras, included a prohibition on the provision of any
assistance to any group that, among other things, retained in its ranks any
individual "who has been found to engage in . . . drug smuggling . . . ."
See Public Law 99-500, October 18, 1986, Section 204(b)(2). This prohibition
was made known to CIA personnel in three Latin America Division Stations in
March 1987. In January 1988, personnel in those Stations and three other Latin
American Division Stations were informed of the prohibition.
CIA's DO developed a draft DO Handbook in December 1980 that included a
section that focused on restrictions and prohibitions concerning contacts with
individuals who might be involved in narcotics trafficking. The instructions
were not applicable to the Contra-related individuals or independent contractors
discussed in Volume II, however, since none of those individuals or independent
contractors were involved in the collection of narcotics intelligence. A
summary of the 86-page draft DO Handbook was sent to all DO field stations in
July 1982 and stated that the draft had been approved by the DCI and represented
Agency policy. The DO Handbook was not formally issued until January 1996,
however, more than 15 years later.
Headquarters sent a cable on December 14, 1981 to all DO Stations and
Bases notifying Agency personnel that President Reagan had signed E.O. 12333 on
December 4, 1981, thereby superseding E.O. 12036. The main discussion in the
cable concerned "the conduct of intelligence activities involving U.S.
persons." In that context, the cable included reference to the E.O.'s
authority for CIA to collect, retain and disseminate "information obtained
in the course of a lawful . . . international narcotics . . . investigation."
On June 26, 1982, Headquarters sent a cable to all DO Stations and Bases
noting that Attorney General Smith had approved a variety of procedures
implementing E.O. 12333 and governing CIA activities abroad. The cable
transmitted a complete set of these procedures and noted that training teams
would be dispatched to the field to brief personnel concerning the new
procedures. Agency personnel associated with this training confirm that it took
place. One officer associated with the training sessions recalls that questions
regarding Agency dealings with drug traffickers were routinely raised in these
training sessions in the field.
January 4 and April 9, 1985, Headquarters cables to Central and South
American Stations outlined a training program that was to be delivered by
visiting teams of CIA personnel. The cable explained that the training would
cover, among other things, the topics of "accomplishing goals within the
parameters of the law and sensitivity to legal and political considerations."
In a section of the cable addressing reporting of crimes, the cable noted that
"reporting of narcotics violations is not mandatory but [CIA]
policy is to report strategic narcotics movements." (Emphasis added.) The
training also was to address the interface between DEA and CIA outside the
On April 9, 1987, Acting DCI (ADCI) Robert Gates sent a memorandum to
Deputy Director for Operations (DDO) Clair George concerning air flights to
Central America. In this memorandum, Gates addressed the standards for dealing
with air crew members who were operating as contractors or subcontractors for
the Agency. Paragraph two of the memorandum stated:
. . . . It is absolutely imperative that this Agency and our operations in
Central America avoid any kind of involvement with individuals or companies that
are even suspected of involvement in narcotics trafficking. This must be true
not only of those with whom we contract, but also their subcontractors. I
believe it is essential that we obtain the names of all air crew personnel who
have had any association with Agency contractors or subcontractors and vet those
names through DEA, Customs, and the FBI--even though this is likely to be an
onerous and occasionally inconvenient undertaking--and perhaps even hamper
operations at times. . . . .
While several former senior Agency officials recall its substance, no
information has been found to indicate that this memorandum, in its entirety,
was disseminated to anyone at CIA Headquarters other than DDO George. With one
isolated exception, no information has been found to indicate that the text or a
summary of this memorandum was cabled to Agency field personnel who were
involved in the Contra program. Nonetheless, the content of the memorandum was
apparently widely known. For example, then-Central America Task Force (CATF)
Chief Alan Fiers and CATF legal advisor Louis Dupart state that they were well
aware of the ADCI's memo and interpreted it to apply broadly. A July 1987
exchange of cables between Headquarters and a Central American Station, while
not citing the memorandum, did cite Gates' prohibition against using suspected
A March 6, 1987 Headquarters cable concerning Department of State (DoS)
actions regarding Adolfo Chamorro described the statutory provision barring
assistance to a group with members who were found to be involved in drug
Section 204(8) [sic] of the Military Construction Appropriations
Act of FY-87 which authorizes aid to the Nicaraguan Resistance forbids the
provision of any aid to an organization which retains in its ranks any
individual who has been found to engage in drug smuggling.
On January 21, 1988, Headquarters sent a cable to Central American
Stations summarizing congressionally-imposed restrictions on the Contra program.
The cable urged that it be read by all field personnel and included the
. . . . No assistance . . . may be provided to any group that retains in its
ranks any individual who has been found to engage in . . . drug smuggling . . .
. As [addressees] are aware, some individuals within the [Contra] resistance
have been excluded from further participation due to their past and well
documented contact with drug smuggling or drug smugglers. [Addressees] are
reminded that should evidence of involvement of drug use or smuggling come to
their attention, they should report it to [Headquarters] and aggressively follow
up. . . . .
A large number of CIA personnel and other individuals acting on behalf of
CIA were involved in implementing the activities to support the Contras. The
following are the views of individuals concerning--from a Headquarters or field
perspective--what they observed, what they did or what they thought they were
supposed to do in connection with allegations of narcotics trafficking by the
Contras. Those commenting range from an Acting DCI, DDOs, Chiefs of CATF, and
COSs, who dealt with substantial strategic and management issues, to an
independent contractor operations officer who lived with the Contras in their
The Headquarters Environment. Headquarters personnel assigned to
the CATF during the 1980s indicate that CATF perceived itself as a group of
dedicated officers who had one overriding priority: to oust the Sandinista
Government. This task was, in their view, complicated by the actions taken by
Executive Branch officials, intense scrutiny from Congress and the media,
changing congressional restrictions, and independent activities undertaken
through the auspices of the National Security Council (NSC). CATF personnel say
it was understood that congressional restrictions had to be honored to preserve
the program and the Agency's integrity. At the same time, they were determined
that the various difficulties they encountered not be allowed to prevent
effective implementation of the Contra program.
Senior Agency and CATF managers indicate that they were aware of
restrictions regarding Agency dealings with persons or organizations known to be
involved in, or suspected of, drug trafficking. Further, these officers recall
being aware that, if a crime were discovered, it had to be reported to
Robert Gates, who served as Deputy Director of Central Intelligence
(DDCI) from April 1986 to January 1987 and May 1987 to March 1989 and ADCI from
January to May 1987, says that it was his position that CIA had to determine
whether the Contras were involved in drug trafficking. It was "a matter of
self preservation," not only for the Contra program, but for the Agency.
In general, Gates says that the Agency had an obligation to terminate its
relationship with any asset who was suspected by U.S. law enforcement agencies
to be engaged in drug trafficking. Furthermore, Gates states that the Agency
had an obligation to determine whether its assets had past or present
involvement in drug trafficking. Gates says that allegations of drug
trafficking had to be checked out.
Gates states that the intent of his April 1987 memorandum to DDO George
was to instruct the DO not to have anything to do with known or suspected drug
traffickers.(11) Gates believes that the policy from his office
concerning narcotics trafficking was clear and consistent.
John McMahon, who served as DDO from 1978 to 1981, DDI from 1981-1982,
Executive Director in 1982, and DDCI from 1982 to 1986, recalls that CIA was
obligated to report individuals who were suspected of narcotics trafficking. As
DDCI, McMahon says that any criminal violation, including narcotics, had to be
reported to the DoJ. Agency relationships with assets associated with the
Contra effort who were suspected of drug trafficking should have been terminated
and the information reported to DEA, McMahon says. The Agency had an obligation
to determine whether individuals or organizations with which it became involved
were engaged in drug trafficking. It was not enough just to terminate a
relationship when narcotics trafficking was suspected, states McMahon.
John Stein, who was the Associate Deputy Director for Operations (ADDO)
from 1978 to 1981, DDO from July 1981 to July 1984, and Inspector General from
1984 to 1985, recalls that specific laws governed reporting of possible criminal
activity. Stein says that Station officers and managers were supposed to report
on narcotics matters and that "narco-trafficking had to be reported in all
conditions." Stein says it would then be up to the DDO to decide how, but
not whether, the information should be disseminated. "[Dissemination] is
the only wise thing to do bureaucratically," states Stein.
Former CATF Chief Fiers stated in his written response to CIA/OIG
questions that the April 1987 Gates memorandum prohibiting use of suspected drug
traffickers was ". . . seen as a clear, direct instruction. It was
understood to apply broadly, but it was equally understood that the area of
concern was the logistics chain--also known as the Contra supply network. The
memo was taken seriously."
Louis Dupart, CATF's legal advisor from mid-1985 to mid-1988, says that
documents such as the 1982 CIA-DoJ MOU regarding crimes reporting served as
guidelines, but CATF took a "common sense approach" on the issue of
crimes reporting. According to Dupart, directives are written for those who do
not exercise good judgment, those "who operate too close to the edge."
Dupart states that criminal activity would have been reported by CATF to the
OGC lawyer who served as principal legal advisor to the DDO and the information
would then have been referred to DoJ or the FBI.
According to Dupart, CATF did not want anything to do with "tainted
people," so it would not have to explain later why it dealt with such
people. He points out that, beginning in the fall of 1986, the Iran-Contra
scandal had broken and "we knew we could not deal with anyone who was
tainted. Everyone was looking for drug involvement by the Contras: Congress,
law enforcement, the media, everyone." Dupart says that,
although the April 1987 Gates memorandum to DDO George was adhered to, the
memorandum had little real impact because it merely reflected previously
established CATF policy.
An officer who served as Chief of CATF/Nicaraguan Operations Group (NOG)
from 1985 to 1986 and as CATF Deputy Chief from 1986 to July 1987, recalls that
CATF management regarded drug trafficking as a "peril" to the Contra
program because of the persons with whom CATF had to deal. However, he says
that information relating to drug trafficking was not considered a collection or
operational priority per se.
An officer who served in the CATF from 1984 to 1985 as Executive Officer
and the first NOG Chief recalls that there was "no time to pursue
drug-related leads or information" due to the "press of business."
He recalls that he just tried to stay ahead of the cable traffic and Bill
Casey's desire to be more creative.
An officer who was assigned to CATF in late 1987 and was CATF Chief from
1989 to 1991, notes that the top priorities were implementation of the Contra
programs as well as foreign intelligence collection. As he recalls,
Headquarters expected the Stations to report any information they acquired
concerning the possible involvement in drug trafficking of individuals or
organizations affiliated with the Contras or the Agency's Contra program.
However, he says there was no requirement at the time to seek out such
information systematically and aggressively.
This officer states that the narcotics issue was a target of opportunity.
He observes that all of the Central American Stations were seeking information
that would link the Sandinistas to drug trafficking. The goal was to diminish
the image of the Sandinistas.
An officer who was LA Division Chief from 1986 to 1989 and CATF Chief
from 1982 to 1983, stated in his written response to CIA/OIG questions:
During the time I was C[hief]/CATF . . . , I recall there was little
evidence of significant drug trafficking in the areas where the Contra forces
were active (Honduras, Nicaragua, Costa Rica) except perhaps for some
involvement by the Sandinistas. Later in the decade, cocaine from South America
began to move more substantially into the US through the Central American area
as pressure on trafficking in the Caribbean and other blue water areas
increased. . . . Given the lack of credible data regarding Contra involvement
in narcotics trafficking during the earlier years, however, I believe the
primary focus with respect to drug trafficking was the continual monitoring
required by our long-standing policy of insuring no involvement with any
individuals or organizations involved in narcotics trafficking.
The only rumors or reports I recall hearing of alleged Contra
involvement in drug trafficking were anecdotal remarks I heard upon returning to
LA Division in . . . 1986 from CATF personnel, particularly C/CATF [Alan Fiers]
(who had direct responsibility for management of the Nicaraguan and Central
American programs), to the effect that there had been some credible reporting of
narcotics trafficking in the Southern Front (Costa Rica) . . . .
While I cannot recall the existence of any reporting on any alleged
Contra involvement in drug trafficking, I do not believe there were any
requirements for special handling of such reporting nor do I recall any
opposition or reluctance on the part of Agency officers to report on such topics.
The officer also recalled:
Everyone in LA Division and CATF was aware of the controversial
political nature of the Nicaraguan and Central American programs, and everyone
knew that special vigilance was required to ensure that there were no violations
of law or policy guidelines in the implementation of the program, particularly
regarding criminal activity, narcotics trafficking, human rights abuses, etc.,
on the part of members of the Contra movement. Further, no . . . programs ever
conducted by the Agency during my tenure was [sic] ever run as
transparently as the Central American and Nicaraguan programs. Congressional
members and staffers traveled frequently throughout the area and received
extensive and detailed briefings on virtually every aspect of the program. Over
a period of years the staffers became intimately familiar with the Contra
program, and they would have been the first to call our attention to any
problems in reporting on allegations of drug trafficking by Contras or
Contra-related individuals. Further, State Department officers were deeply
involved in political aspects of the program and were equally attuned to the
The 1987 funding resolution requiring a funds cutoff to any organization
involved in drug trafficking had no special impact other than to reinforce a
policy that was already in effect to eschew any contact with groups or persons
credibly suspected of involvement in drug trafficking. I believe our principal
reaction to the resolution was to re-emphasize the importance of remaining
vigilant to this danger.
The Gates memo in April 1987, insofar as it referred to drug
trafficking, repeated and reinforced a policy already in effect. As I recall,
the memo was written in the aftermath of a problem involving an Air Branch
proprietary or contractor and US Customs.
The officer who was LA Division Deputy Chief from 1980 to 1981 and LA
Division Chief from 1984 to 1986, recalls that narcotics allegations regarding
assets would be reported and the relationship with the asset would be
terminated. "Handling assets with narcotics allegations in Central America
[was] a no-no," he recalls. He says "Narcotics was a large
issue with Latin America Division. What was not large was Contra involvement
An officer, who served as NOG Chief from 1986 to 1988, says that "the
general thing about people who would cause trouble was not to deal with them."
However, there needed to be a basis for suspicion and a threshold, i.e., "suspected
by whom and on the basis of what."
The OGC attorney who succeeded Dupart in 1987 as the CATF legal officer
states that the Agency decision regarding whether to use an individual who was
subject to a drug trafficking allegation depended on the strength of the
allegation and the reliability of the source.
Despite this general understanding of Agency policy regarding drug
allegations, CATF managers' recollections of the impact of the April 1987 Gates
memorandum prohibiting the use of contractors or subcontractors who were
involved in CIA air operations and were even suspected of drug trafficking
indicate no specific implementation of that policy. The former NOG Chief, for
example, does not recall anything specific about the April 1987 Gates
memorandum, but recalls that it was around that time that CATF began to use more
restrictive criteria for recruiting and maintaining relationships with
individuals associated with the Contra program. He states that the
instructions left no room for interpretation and that it was clear that CIA had
to terminate its relationship with individuals who were suspected of drug
trafficking. He notes that such decisions would have been made by CATF Chief
Fiers in almost all cases.
One of the former Deputy Chiefs of CATF does not recall any specific
discussion in CATF about the April 1987 Gates memorandum, nor does he recall a
change in policy or more restrictive vetting criteria for assets and contractors.
Two branch chiefs who served in CATF from 1986 to 1988 and 1987 to 1991,
respectively, also do not recall any specific discussions about the Gates
memorandum. One of the former Chiefs of CATF says he recalls the
Gates memorandum and also that Agency relationships with some pilots may have
been terminated as a result. He believes that the policy of vetting contractors
and subcontractors was strictly adhered to.
The Chief of CATF's Special Activities Branch from 1986 to 1988 recalls
Fiers discussing the Gates memorandum and that the general thrust of the
discussion was that CATF could not deal with any subcontractors or purchase any
aircraft that had previously been implicated in drug trafficking. He says that
Fiers did not express displeasure with these guidelines during the discussion,
and that Fiers said the Agency had to be totally clean with regard to
individuals and aircraft. He indicates, however, that the Gates memorandum had
little practical impact because CATF "already had [relationships with] the
FDN pilots," meaning that new pilots were not needed.
Procedures for Vetting Contractors and Others. The April 1987
Gates memorandum included a requirement that contractors and subcontractors be
vetted through DEA and Customs as well as the FBI. On March 31, 1988, CATF sent
a memorandum to then-DDCI Gates regarding use to support the Contra program of
pilots and companies that may have been involved in drug trafficking. The
memorandum, among other things, set forth CATF's approval criteria for
individuals and companies that were involved in transporting equipment for the
Contra program and indicated that, per Gates' instructions of "a year ago
[that] the Agency has been extremely careful to properly vet all pilots,
mechanics, and companies . . .," and explains that if "some derogatory
information is found or alleged, but the various agencies do not believe it
would be a problem for the U.S. Government to have a contract with the
individual or company, a special approval is required which is signed by the
chief of the division."
A former Chief of CATF does not recall that a focused, "across-the-board"
policy for vetting Contras with respect to drug trafficking was ever
established. He states that, if there had been information supporting drug
trafficking allegations against an individual, CIA would have "pulled out
all the stops" to collect more information about the allegations.
He recalls that there was a well established policy in CATF to vet Contra
pilots to ensure that they were not linked to drug trafficking. He
says, "The Agency has been extremely careful in properly vetting all
pilots, mechanics, and companies."
The former Deputy Chief of CATF says that, if someone had a background
in narcotics or there were allegations of narcotics activities, the information
was "checked out." He says that the narcotics problem was
particularly difficult to deal with when it came to the leasing of aircraft. He
observes that it was hard to find a plane without a drug record and most DC-6s
had been placed on watch lists by DEA.
The Chief of CATF's Special Activities Branch from 1986 to 1988 was
responsible for vetting air crews and other support personnel. He says that he
does not recall any specific guidelines regarding the use of pilots who were
known or suspected drug traffickers. In fact, he recalls that the
whole policy was "bizarre" because the vetting process was focused on
ensuring that the aircraft that were being used had no prior history of
involvement in drug trafficking. He recalls that there was great sensitivity to
making sure the aircraft were "clean" so as not to run afoul of the
congressional oversight committees and that it was as if the planes,
not the individuals, were the narcotics traffickers.
The former NOG Chief says he does not recall the specific criteria for
terminating a relationship with an individual who was alleged to be involved in
drug trafficking. In his view, CATF was obligated to consider all derogatory
information to be accurate. Back then, according to him, derogatory information
from DEA or Customs, even if not substantiated, would have been enough to cause
The Field Environment. Managers and officers who were assigned
to Central America during the 1980s recall that the overriding priority task of
their Stations and Bases was to support the Contras. In the field, CIA sought
to develop and support military forces that could successfully engage the
Sandinista Army. This effort, along with the maintenance of relationships with
the Contra leaders, dominated Station and Base efforts and resource allocations.
Recollections are mixed regarding the extent to which drug trafficking
allegations became known and were reported.
A Central AmericanStation's officers, who were responsible for
handling Contra paramilitary activities in the 1980s, recall that the Station's
main priority was to support the war effort. A former Deputy Chief of Station
(DCOS) and Acting COS, says that "the Station was focused 99 percent on the
[Contra] war effort" and that the "focus was always on the
program." A Station officer states, "The focus was to get the job
done, get the support and win the war." Another officer assigned to this
Station adds that "the primary mission at [the] Station was supporting the
Contras [and two other missions]." Another officer who was
assigned to the Station in the mid-1980s says, "There was a war going on.
The primary mission for seven years was fighting the Sandinistas."
A paramilitary officer assigned to the Station in the mid-1980s recalls that
his "only job was to train [Contras] in camps."
Most Station officers state that they would have reported to their
supervisors or Headquarters for appropriate action any narcotics trafficking or
criminal information they acquired. Most officers recall no allegations of
trafficking by the Contras, although some do recall unsubstantiated rumors
concerning individuals associated with Eden Pastora.
A Central American COS states that "narcotics was not something
[Station personnel] were looking for in the 1980s, but that does not mean they
would have ignored it if they had seen it." He says that his
understanding of crimes reporting obligations since 1980 was that anything that
looked to be criminal in nature should be reported to Headquarters.
The COS says he became aware of drug trafficking allegations against
the Contras "fairly early" during his assignment. He says
there was a group of "ne'er-do-well" people surrounding Eden Pastora
who had histories that included criminal activity. He continues that "there
was a range of derogatory information that may have included narcotics
activities. Early traces revealed these folks should be treated carefully.
Some were scoundrels." He indicates that the Headquarters
reaction to derogatory information concerning Pastora's associates has to be
considered in the context of DCI William Casey's overriding political
objectives. As the COS explains:
. . . yes, there is derogatory stuff and we would be careful in terms of
counterintelligence and operational security, but we were going to play with
these guys. That was made clear by Casey and [then-LA Division Chief Duane]
The COS says he is fairly certain that there was never any large infusion of
drug money to the Contras because they "never hit the jackpot" in a
way that would have indicated drug money or a substantial contribution.
A Central American Station DCOS recalls that he "did not know
anyone with drug connections."
Another Central American Station DCOS states that he has "no
knowledge of any Contras who were alleged to be involved in narcotics
trafficking." He adds that, "if narcotics trafficking had been
conducted by the Nicaraguan Contras, Agency officers would have found out."
He emphasizes that Station officers "would have jumped out of their skin
had allegations of trafficking into the U.S. been made."
An officer who served as an Acting COS states that he did not recall
any enunciation of a specific reporting policy regarding narcotics trafficking,
noting that "if there was a crime, it was reported."
An officer who served as DCOS, recalls that "counternarcotics was
dealt with within the context of the Contra Program; when it came across the
Station's screen it was reported, but otherwise it was not a factor."
An operations officer assigned to a Central American Station recalls
that "it went without saying that if one came into a situation involving a
serious criminal allegation, it would be raised with Headquarters and made a
matter of record." He also says that he did not at any time
believe that Pastora or anyone associated with the Contras was involved in drug
An officer assigned to a Central American Station states that
information on aircraft and personnel--including Contras--possibly involving in
drug trafficking was reported to Headquarters and the DEA office in 1984-85. He
recalls that the "CIA policy on drug-related information was [to] report
the matter to CIA Headquarters, develop the information, run traces where
possible and that CIA Headquarters was supposed to forward the information to
the DEA." Another Station officer says, "Narcotics was just
not on the radar screen at the time and [the country where he was assigned] was
not a big transshipment point." He adds, however, that standard
worldwide DO practice was to report any criminal activity to the COS who would
then be responsible for forwarding the information to Headquarters.
An officer assigned to a Central American Station recalls that she "never
heard any rumors of drug trafficking" by the Contras. Another officer
assigned to the Station recalls no allegation of trafficking by the Contras. He
adds that "Contras may have been doing things we weren't aware of and we
always didn't know what they were doing," but he didn't believe they were
involved in narcotics.
The former Acting COS says that he does not recall the procedures for
vetting assets and contractors, but that "it was not normal to check
automatically with law enforcement agencies."
One Station officer recalls that, in effect, there was not much vetting
of Nicaraguan assets. The officer recalls that she was not aware that any drug
trafficking was taking place.
An independent contractor operations officer, who was assigned to train
and support the Contras in their camps, recalls that he never saw anything to
indicate drug trafficking on the part of the Contras with whom he dealt. He
says that in every place he served in connection with the Contra program he had
access to everything about the Contras. Although there were a few individuals
who used marijuana personally, he says he never saw anything that
suggested drug trafficking.
The independent contractor operations officer recalls that he was never
tasked by the CIA officers with whom he dealt to determine whether there was any
narcotics trafficking in the Contra camps. However, the officer also
says that he believes that the allegations of narcotics trafficking by the
Contras were "just something someone made up to cover up something else."
He states that it was too evident that the Contras were getting money and help
during the U.S. funding hiatus from somewhere and that narcotics trafficking
allegations stemmed from efforts to explain the source of the support. In this
light, he notes that Contra logistical personnel with whom he worked speculated
that the flights that were sponsored by the U.S. private benefactors to support
the Contras, must have been funded from the profits of narcotics trafficking.
The independent contractor operations officer says that the Contra logistical
personnel, noting that the Contras continued to receive food, medicine,
ammunition and other aid during the U.S. Government cut-off of funds, "probably
made the assumption that narcotics was paying for this."
The independent contractor says he believes that these suspicions were
unfounded. He describes the Contra logistics personnel suspicions as "just
comments" and says:
. . . it was an ideal situation to send drugs from [Central America] to
the United States, but the Americans were too professional and had no reason to
do so. Narcotics trafficking allegations were just rumors. If there was
narcotics trafficking, it was probably from Nicaragua to the United States
conducted by the Medellin cartel.
An officer, who was a Central American COS and later Deputy Chief of LA
Division in the late 1980s, says that Honduras was not an attractive location
for drug traffickers during this time period. A war was going on, it was a poor
country, there were large numbers of U.S. military forces at Palmerola Air Base
and elsewhere, there was a large U.S. radar system in operation that tracked
aircraft throughout the region, and Airborne Warning and Control System aircraft
operated in the area. Additionally, he recalls that the Contras controlled few,
if any, airfields in Honduras. The geography of the country also was not
conducive to drug trafficking by air. He notes that, for the most part, the
land resembled a crumpled sheet of paper with few flat spots for landing strips.
He says that, in his opinion, Guatemala, southern Mexico, or the Yucatan
Peninsula were more desirable transshipment and refueling points for drug
traffickers than Honduras.
He says he recalls reports that members of Eden Pastora's Southern
Front organization may have engaged in drug trafficking activities and that
Pastora may have later made admissions to that fact. There were also rumors
that Mario Calero, the brother of Contra Northern Front leader Adolfo Calero,
may have been involved in drug trafficking. He notes:
The rumors that Mario Calero may have been involved with drug
trafficking while running an [aircraft] from Louisiana were not believed to be
true and no credible reporting on any such activity was ever received.
He says it was his understanding that the U.S. Customs Service and possibly
the Immigration and Naturalization Service (INS) inspected all Contra-sponsored
flights into and out of the United States to ensure there was no contraband,
such as narcotics and weapons, on board.
He notes that Adolfo Calero and Enrique Bermudez had modest homes in
Miami during this time period. In Honduras, they lived even more modestly. He
says he once visited Bermudez' home in Miami and was struck by the fact that
Bermudez' wife had set up a hair salon in their home as a means of producing
income. He comments that they certainly did not live as if they had access to
large amounts of drug money.
He says that, if CIA or other U.S. Government organizations operating
in Honduras had acquired information indicating that the Contras were engaged in
narcotics trafficking, it would have--or should have--been disseminated in
intelligence reports. He makes clear that CIA was not alone in its intelligence
collection and reporting efforts in Honduras and that large amounts of
intelligence were collected by other U.S. Government agencies. Reports of
Contra drug trafficking, he says, would probably have been a topic of discussion
at the Interagency Working Group that was run by DoS official Elliott Abrams.
For example, according to him, there may have been discussions at the
Interagency Working Group concerning a Contra who was caught by the Contras
growing a patch of "pot." The offender, as he recalls, was
court-martialed by the Contras.
An officer who was a Central American COS in the late 1980s and LA
Division Chief from 1989 to 1993, recalls in his written response to OIG
questions that a case involving Juan Rivas, a.k.a. "Quiche," was:
. . . the only instance [he] can remember of a member of the [Contra's]
Northern Front being tied to narcotics trafficking. [Northern Front leader
Enrique] Bermudez himself . . . had never been accused to [his] recollection of
carrying out or tolerating trafficking or traffickers. [He] recall[s] no sign
that the Northern Front received money from traffickers. In fact they owed lots
of money to the Hondurans for food during periods when we could not support them.
An officer who served as a Central American Acting DCOS in the
mid-1980s does not remember the provision in the FY87 $100 million funding
legislation for the Contras directing that no funds could be provided to
organizations whose members engaged in drug trafficking. Further, he does not
recall receiving any special briefing regarding this condition for the funding.
He observes, however, that such a condition would have been closely adhered to
since such programs were very strict about compliance issues.
A Station operations officer in the mid-1980s says he does not recall
any rumors of Contra involvement in drug trafficking during his tour.
Another Station officer says that there is "no way" the allegations
contained in the San Jose Mercury News can be true.
A logistics officer assigned to Central America in the mid-1980s says
he once heard a rumor that the Contras had included marijuana in an air drop of
supplies to troops in Nicaragua, but says he heard nothing more about the
allegation. He says that it was his impression that the Contras were "military/ideological
people rather than a criminal element." He observes that, from a
logistical point of view, Contra operations were not conducive to drug
trafficking. The material all came from "the North to the South."
He does not recall any cargo going "from the South to the North"
and believes the media allegations "sounded preposterous."
An operations officer says that he never heard anything about drug
trafficking and never saw any evidence of drug trafficking. In fact, he recalls
that the Contra camps did not even have alcohol available and no drinking was
allowed. A Station staff officer says that she does not recall
hearing anything about drug trafficking in connection with the Contras at that
An operations officer says that he obtained no information and heard no
rumors during his tour about Contras engaging in drug trafficking.
Noting that he had been a law enforcement officer prior to joining CIA, he says
he saw no sign of drugs, "not even one marijuana cigarette,"
during his assignment. An officer assigned to Central America says that he was
unaware of any Contra being involved in drug trafficking. The officer
who served an Acting DCOS also says that he does not remember hearing any rumors
or obtaining any information during his tour that linked the Contras in the
country where he was assigned with drug trafficking.
A Station operations officer says that he did not hear any rumors of
drug trafficking by Contra members. However, he vaguely remembers hearing about
the lack of security at one of the air bases and how easy it would have been to
move drugs in and out of the base. However, he says he cannot recall the name
of the base.
A Station operations officer says that any information regarding drug
trafficking by Contra leaders or any other asset would have been passed to
Headquarters. He also states that he is unaware of any suppression by his
supervisor or colleagues of information concerning Contra drug trafficking.
A Station operations officer recalls that CIA personnel serving in the
country "clearly understood we were to have nothing to do with anyone
involved in narcotics trafficking and to my knowledge no one ever did."
He says that any drug trafficking information would have been handled in regular
intelligence reporting channels. He says he recalls no management resistance at
all to processing any reporting on drug trafficking and adds, "If someone
attempted to hide such information, I would report them."
Finally, a Station operations officer says he does not believe that
information regarding drug trafficking was ever suppressed by his colleagues or