CIA Finds No Significant Drug-Contra Tie

The Central Intelligence Agency said Thursday that a 17-month internal investigation has found no evidence that the U.S.-supported Nicaraguan rebels of the 1980s received significant financial support from drug traffickers.

CIA Inspector General Frederick P. Hitz, releasing the first volume of a two-part report on the drug issue, said his findings contradict widespread charges that the agency was involved in drug trafficking as a means of funding the Contras.

The investigation was touched off by allegations that three California drug traffickers introduced crack cocaine to Los Angeles and funneled millions of dollars to the Contras under protection from the CIA.

“No evidence has been found . . . that the CIA as an organization, or any of its employees, engaged in drug trafficking in support of the Contras or to raise funds for Contra-related programs,” Hitz said.

He said the inquest found that cocaine traffickers in California had donated between $6,000 and $80,000 to the Contra movement, adding that he considered the smaller sum more likely.

Asked whether investigators had detected any significant flow of drug money to the Contras from any source, in California or elsewhere, Hitz replied: “No.”

CIA Director George J. Tenet praised the investigation. “I am satisfied that the IG has left no stone unturned in his efforts to uncover the truth,” he said in a written statement.

But Rep. Maxine Waters (D-Los Angeles), who demanded the inquest, said she was not satisfied.

“There are undeniable connections between the drug dealers and the Contras that raise questions still,” she said. “Where there’s this much smoke, there must be some fire.”

The allegations that led to the inquest were reported in the San Jose Mercury News in 1996. Other newspapers, including The Times, investigated the same allegations and found evidence that the traffickers had contributed some money to the Contras, but no proof that the CIA knew of the pipeline.

Hitz’s report, based on 365 interviews with former CIA officials and Contra leaders, as well as 250,000 pages of documents, said two traffickers had contributed money to the rebels, but in amounts well short of millions.

“Based on figures they gave us . . . we believe they contributed in the order of $3,000 to $4,000 each” from drug operations in California, Hitz said.

One of the traffickers, Oscar Danilo Blandon, told CIA investigators he donated about $40,000 to the main Contra organization, the FDN, through a San Francisco-based support group. Blandon estimated that his partner in drug trafficking, Juan Norvin Meneses, also contributed about $40,000 to the organization.

But Hitz said his investigators concluded that Blandon was “exaggerating” the amounts of aid.

The report quoted Blandon as saying he met with the Contras’ military commander, Enrique Bermudez, four times during his drug trafficking career. At a 1982 meeting in Honduras, he said, Bermudez asked him and Meneses for financial help, saying: “The end justifies the means.” But he added that Bermudez did not specifically ask him to raise money through drug trafficking. Bermudez, who long denied any relationship with drug traffickers, was assassinated in 1991.

Waters pointed to those meetings as a reason for continued suspicion. “Bermudez was the CIA’s man,” she said. “It is difficult for me to believe that with Bermudez looking for money, there was never a discussion between Bermudez and his CIA contacts about his ongoing meetings with Blandon and Meneses.”

The first volume of the CIA report focused on Blandon and Meneses and their operations in California. “The notion that we and [Los Angeles drug dealer] Ricky Ross invented crack--we discard that entirely,” Hitz said.

A second volume, to be released next month, will contain findings on broader questions of CIA complicity in drug trafficking in Central America during the Contra war.

But Hitz previewed its findings in an interview, saying the inquest found evidence of several links between Contra leaders and drug traffickers, but no CIA complicity and no major sums of drug money.

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For example, Nicaraguan rebel leader Eden Pastora told CIA investigators that he received $40,000 and the loan of two helicopters from one drug trafficker, $40,000 and the use of two airplanes from another, $20,000 from a third, $25,000 from Panamanian Gen. Manuel Antonio Noriega, and about $6,000--plus two pickup trucks--from the ubiquitous Blandon.

In another case, the report said the CIA learned in 1982 of a possible deal among Contra groups and an unnamed U.S. “religious organization” to exchange narcotics for weapons. But CIA headquarters concluded that the report “simply does not make sense,” and did not pursue it vigorously.

The volume released Thursday did not include findings on many of the apparent links between the Contras and drug traffickers that have been reported before--in a 1987 U.S. Senate investigation led by Sen. John F. Kerry (D-Mass.), for example. “Volume 2,” Hitz promised.

The Senate and House committees on intelligence said they were studying the report and planning to hold hearings on it, probably after the second volume has been released.

No matter what their findings, Tenet said he doubts that the agency will ever fully shake its drug-tainted image.

“I must admit that my colleagues and I are very concerned that the allegations made have left an indelible impression in many Americans’ minds that the CIA was somehow responsible for the scourge of drugs in our inner cities,” he said. “Unfortunately, no investigation--no matter how exhaustive--will completely erase that false impression or undo the damage that has been done.”