Cocaine Dealer Tells Panel He Smuggled Contra Drugs

A convicted cocaine trafficker told Congress Wednesday that he helped the Nicaraguan contras smuggle drugs into the United States and ship automatic weapons and explosives to Central America.

George Morales, who is serving a 16-year federal prison sentence in Miami, also said he made payoffs to officials in Cuba and the Bahamas--countries he said were used to transship drugs and launder money. Panama was another money-laundering point, he said.

The 38-year-old Colombian-born American citizen described for a Senate Foreign Relations subcommittee on drugs a large-scale smuggling operation that used airplanes, helicopters and boats to make millions of dollars.

The contras have repeatedly denied allegations of drug-smuggling. Contra spokesman Ernesto Palazio said the rebel organization is “more interested than anyone else in finding out if any of our people” were involved in such activity, so that action can be taken.

But Palazio dismissed Morales’ allegations, saying: “We’ve heard this gentlemen’s accusations before. He is a convicted drug dealer.”

Morales, who testified in the custody of federal marshals, said he had nothing to gain from appearing before the subcommittee, which is headed by Sen. John Kerry (D-Mass.). He volunteered to take a lie detector test to demonstrate the truthfulness of his statements.

Because of the nature of the drug business, Kerry said his panel was forced to gather information from witnesses who had been involved with narcotics. The overall aim of hearings, he said, is to find out “what steps we can take in lessening the role that narcotics can play” in the international arena.

Morales said his involvement with the contras began after he was indicted on a drug charge in March, 1984. About a month later, he said, he was approached by a group of men associated with the contras.

In exchange for Morales’ help, the men promised to “take care of my (legal) problem and to a large extent they did.” The men represented themselves as having connections with the CIA, Morales said. The CIA has repeatedly said it is not involved in drug smuggling.

Morales, an internationally known speedboat racer, said his involvement with the contras lasted from June, 1984, until January, 1986, six months before he was arrested and jailed.

On at least seven occasions, Morales said his airplanes--part of his air cargo company--were loaded with weapons and flown to Costa Rica or El Salvador for use by the contras. The planes were then packed with drugs and brought to Florida.

Morales said his operatives sold the drugs and returned the profits to the contras.