In 1982, U.S. Attorney Gen. William French Smith wrote CIA Director William Casey a letter establishing a policy of not reporting, investigating or prosecuting drug crimes by CIA agents, assets and contractors.
Two letters — one from Smith thanking Casey for his request, and a followup by Casey — are both available. They were released as part of a internal CIA report that explored allegations of CIA involvement in drug trafficking.
In the first document, Smith thanks Casey for his letter (the one that isn’t public), and he writes:
… 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.
On Feb. 11, 1982, Smith wrote again to Casey, repeating the policy:
I have been advised that a question arose regarding the need to add narcotics violations to the list of reportable non-employee crimes … [N]o formal requirement regarding the reporting of narcotics violations has been included in these procedures.
On March 2, 1982, Casey responded happily, thanking the attorney general for his understanding:
I am pleased that these procedures, which I believe strike the proper balance between enforcement of the law and protection of intelligence sources and methods, will now be forwarded to other agencies … [Full document]
The two men then codified their agreement in a memorandum of understanding (MOU). According to the agreement, intelligence agencies would not have to report any of their agents involved in drug running. (By agents, the agreement meant CIA sources and informants. Full-time employees still couldn’t deal drugs.) That understanding remained in effect until August 1995, when then-U.S. Attorney Gen. Janet Reno rescinded the agreement.
The operating loophole here is the term “assets.” This is what has opened the way for a protected crime syndicate of dark alliance crime syndicate operatives.
It’s reasonable that the CIA would not disclose that some of its agents are involved in minor illegal affairs. And, presumably, some of the value of informants comes from the fact that they keep company with shady characters who engage in unlawful activities.
But why would the CIA ask to be exempt specifically from drug enforcement laws?
It was Congresswoman Maxine Waters (D-Calif.) who called for full disclosure of the facts. She spoke truth to power, because her community was being impacted by the dark alliance.
Takeaway: In this era Waters was a pistol and a courageous investigator. We have no idea what happen to her, or if she is even the same person.
“The CIA knew that the Contras were dealing drugs,” Waters said. “They made this deal with the attorney general to protect themselves from having to report it.”
In response to the book “Dark Alliance,” Waters investigated Contra crack dealing and found that the CIA’s OIG report was tampered with before being released to Congress, and that a U.S. employee was in charge of the drug ring.
“Several informed sources have told me that an appendix to this report was removed at the instruction of the Department of Justice at the last minute,” Waters said. “This appendix is reported to have information about a CIA officer, not agent or asset, but officer, based in the Los Angeles Station, who was in charge of Contra-related activities.
“According to these sources, this individual was associated with running drugs to South Central Los Angeles, around 1988. Let me repeat that amazing omission. The recently released CIA Report Volume II contained an appendix, which was pulled by the Department of Justice, that reported a CIA officer in the L.A. Station was hooked into drug running in South Central Los Angeles.”
It was Waters who located the Smith-Casey memorandum.
“My investigation has led me to an undeniable conclusion: that U.S. intelligence and law enforcement agencies knew about drug trafficking in South Central Los Angeles and throughout the U.S., and they let the dealing go on,” she said.
“Quite unexpectedly, on April 30, 1998, I obtained a secret 1982 memorandum of understanding between the CIA and the Department of Justice, that allowed drug trafficking by CIA assets, agents, and contractors to go unreported to federal law enforcement agencies. I also received correspondence between then Attorney General William French Smith and the head of the CIA, William Casey, that spelled out their intent to protect drug traffickers on the CIA payroll from being reported to federal law enforcement.”
This secret agreement detailed a long list of crimes that the CIA was required to disclose to federal law enforcement agencies. It included homicide, kidnapping, assault, bribery, possession of firearms, as well as illegal immigration, election contributions and perjury. Amazingly, the MOU did not require the CIA to report drug trafficking or other drug law violations by CIA assets to the Department of Justice.
In other words, CIA assets, who were smuggling narcotics into the U.S., did not have to worry about being reported to the DEA or other federal law enforcement agencies.
After the publication of a 1996 news article in The San Jose Mercury written by Webb, who exposed the complicity of the CIA in the L.A. crack epidemic of the 1980s, Waters called for an investigation. She questioned whether the U.S. government paid or organized operatives to smuggle, transport and sell crack to Americans. Ultimately, this inquiry was stonewalled.
Webb was eventually transferred to a different beat and removed from investigative reporting. In 2004, he was found in his apartment with two bullet holes in the back of his head. His death was declared a “suicide.”
An investigation by former U.S. Sen. John Kerry also found “individuals who provided support for the contras were involved in drug trafficking, the supply network of the contras was used by drug trafficking organizations, and elements of the contras themselves knowingly received financial and material assistance from drug traffickers. In each case, one or another agency of the U.S. government had information regarding the involvement either while it was occurring, or immediately thereafter.”
The timing of the MOU was also quite the cowinkydink.
In late 1981, U.S. President Ronald Reagan authorized covert aid for the Contras via the CIA. Just two months later, the CIA and the attorney general carved out an exemption for CIA assets and agents that were dealing drugs in a new MOU.
The secret MOU was in effect for 13 years, from 1982 until 1995. This covered the entire Contra war in Nicaragua and the era of deep U.S. involvement in counterinsurgency activities in El Salvador and Central America.
The MOU was evidently very successful in protecting these drug traffickers and CIA assets.
Based on statements in Michael Bromwich’s recently released investigation, CIA Station Chief for Central America Alan Fiers said he recalled of only one instance when the CIA passed Contra and narcotics-related information to the DEA.
The Kerry Committee was baffled by the lack of intelligence reporting of drug trafficking activity. Despite finding widespread trafficking throughout the war zones of northern Costa Rica, the Kerry Committee was unable to find a single case that was made on the basis of a tip or report by an official of a U.S. intelligence agency.
The reason is now clear: The CIA knew of their drug trafficking, but the MOU protected them from having to report it to law enforcement.
The 1982 MOU that exempted the reporting requirement for drug trafficking was no oversight or misstatement.
“There is no question in my mind that people affiliated with, or on the payroll of, the CIA were involved in drug trafficking,” Kerry said.
Simply stated, the attorney general consciously exempted reporting requirements for narcotics violations by CIA agents, assets and contractors. And the CIA director was pleased because intelligence sources and methods involved in narcotics trafficking could be protected from law enforcement.
Remarkably, the committee’s findings went virtually unreported when they were released.
Allegations in the Joaquin ‘El Chapo’ Guzman Case
Numerous witnesses in the trial of Mexican drug lord El Chapo have testified. One of the most damning allegations to emerge from the trial is the claim that Guzman paid former Mexican President Enrique Peña Nieto $100 million to stop looking for him while he was on the lam. The revelation came from Alexander Cifuentes, a former cartel member who used to be Guzman’s most trusted secretary.
Cifuentes said Peña Nieto first wanted $250 million from Guzman in order to agree to stop hunting “the most wanted man in the country,” the The New York Times reported. Guzman offered $100 million instead, which Nieto took, according to The Times.
In January 2019, Vicente Zambada Niebla, a high-ranking functionary in the Sinaloa drug cartel, offered more insights into similar capture. He is the son of the Sinaloa cartel leader.
Niebla claims that for years he worked secretly as an “asset” and spy for the DEA, swapping information about his rivals in exchange for the ability to run his business freely.
While American authorities have acknowledged that Niebla met with federal agents, they have long denied there was any quid pro quo agreement.
In a recent ruling, Judge Brian M. Cogan, who is hearing the Guzman case, said that Zambada’s claim regarding his cooperation with the Americans cannot be mentioned at the trial.
Under that agreement, the Sinaloa cartel under the leadership of Jesus Zambada’s father, Ismael Zambada and ‘Chapo’ Guzman were given carte blanche permission to continue to smuggling tonnes of illicit drugs into the U.S., and they were protected by the U.S. government from arrest and prosecution in return for providing information against rival cartels, Niebla’s lawyers wrote as part of his defense.
“Indeed, the United States government agents aided the leaders of the Sinaloa Carte,” his lawyers said.
Zambada also testified that in 2007 he met with a group of “high-level politicians” and representatives from Pemex, Mexico’s national oil company, to discuss a scheme to ship 100 tons of cocaine in a tanker vessel owned by the firm.