Conspiracy Nation -- Vol. 2 Num. 53

("Quid coniuratio est?")

By Dennis Bernstein and Howard Levine
From The Texas Observer

This article is posted to the internet by permission of the authors. NOTE: Permission is NOT given for distribution beyond the internet; for such permission, contact the authors.

CN -- This info was sent to me by a reader of Conspiracy Nation. This reader has also, in the past, sent me an excellent article regarding the crash of Pan Am Flight 103 which (though it's on my list of things to do) I have yet to cover in Conspiracy Nation.

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If Iran-Contra prosecutor Lawrence Walsh had wanted to know the extent of former Colonel Oliver North's involvement in the smuggling of drugs from Central America to the United States, Walsh might have made at least one phone call to Celerino 'Cele' Castillo in San Antonio.

Between 1985 to 1991, Castillo was the Drug Enforcement Administration's main agent in El Salvador, where, he says, he uncovered "and reported" a huge drug and gun smuggling operation that was run out of the Ilopango military airport by the 'North Network' and the CIA.

North, now the Republican nominee for the U. S. Senate in Virginia, prevailed at the nominating convention last weekend by positioning himself far to the right of his rival, former Reagan budget director James Miller III, promising that if elected he will work to "clean up the mess" in Washington, and cultivating the support of the same fundamentalist Christian Republicans who responded to the direct-mail campaign to finance the North defense committee.

But Castillo, the first government official with first-hand knowledge of North's drug dealing to speak publicly about it, says North belongs in prison, not in the U.S. Senate. "We saw several packages of narcotics, we saw several boxes of U.S. currency, going from Ilopango to Panama," Castillo said.

According to Castillo, the entire program was run out of Ilopango's Hangars 4 and 5. "Hangar 4 was owned and operated by the CIA and the other hangar was run by Felix Rodriguez, or 'Max Gomez,' of the Contra operation [directed by North]. Basically they were running cocaine from South America to the U.S. via Salvador. That was how the Contras were able to get financial help. By going to sleep with the enemy down there. North's people and the CIA were at the two hangars overseeing the operations at all times," Castillo said.

CIA spokesman David French said Castillo's allegations are "not something that we would comment on."

Cele Castillo joined the DEA in 1979, after a tour with the First Cavalry in Vietnam, where he earned a bronze star, and a six-year stint as a police officer in Edinburg. His first DEA assignment was in New York, working undercover investigating organized crime. After that, because of his Vietnam experience, he was transferred to Lima, Peru, where he conducted air strikes against jungle cocaine labs and clandestine airstrips. In 1985, he was transferred to Guatemala, where he oversaw DEA operations in Belize, Honduras and El Salvador. Castillo posed as a member of one of the drug cartels, he said, and almost immediately became aware of the drug smuggling operations at Ilopango's hangars 4 and 5. "We took several surveillance pictures...and they were running narcotics and weapons out of Ilopango, with the knowledge of the U.S. embassy."

Though Castillo had been reporting his findings all along, to no avail, a December 1988 report prepared by the Congressional Subcommittee on Terrorism, Narcotics and International Operations (the Kerry Committee) confirmed Castillo's allegations and concluded: "There was substantial evidence of drug smuggling through the war zones on the part of the individual Contras, Contra pilots, mercenaries who worked with the Contras, and the Contra supporters throughout the region."

The committee, chaired by Massachusetts Senator John Kerry, also found that on March 16, 1987, a plane owned by known drug smugglers was seized by U.S. customs officers after dumping what appeared to be a load of drugs off the Florida coast: "Law enforcement personnel also found an address book aboard the plane, containing among other references the telephone numbers of some Contra officials and the Virginia telephone number of Robert Owen, Oliver North's courier," the committee reported. And on July 28, 1988, DEA agents testifying before Kerry's committee said it was North's idea in 1985 to give the Contras $1.5 million in drug money being used by DEA informant Barry Seal in a sting operation aimed at the drug cartels.

If that wasn't enough to compel investigators to pursue North himself as a drug dealer, Castillo provided them with what should have been the clincher. In a February 14, 1989, memo to Robert Stia, the country attache in Guatemala, Castillo laid out in minute detail the structure of the Ilopango operation and identified more than two dozen known drug smugglers who frequented Hangars 4 and 5.

Huge quantities of drugs and guns were being smuggled through Ilopango by mercenary pilots hired by North, Castillo wrote. "Now, all these contract pilots were documented [in DEA files] traffickers, Class I cocaine violators that were being hired by the CIA and the Contras," the memo stated. "And the U.S. embassy in El Salvador was giving visas to these people even though they were documented in our computers as being narcotics traffickers."

Among those Castillo identified was Carlos Alberto Amador, "a Nicaraguan pilot mentioned in six (6) DEA files....The DEA was advised by a source at the U.S. embassy in San Salvador that personnel from the CIA had allegedly obtained a U.S. visa for Amador." Amador, Castillo discovered, kept four planes at Ilopango, and a frequent companion of his was was Jorge Zarcovick who "is mentioned in twelve (12) DEA files," and "was arrested in the U.S. for smuggling large quantities of cocaine."

Walter 'Wally' Grasheim was another smuggler tagged by Castillo. "He is mentioned in seven (7) DEA files," Castillo wrote. "He is documented as a cocaine and arms smuggler from South America to the U.S. via Ilopango airport. He utilized hangars 4 and 5. Grasheim is also known to carry DEA, FBI, and CIA credentials to smuggle cocaine." "Wally Grasheim," Castillo said, "was an American working hand-in-hand with Colonel Oliver North." Grasheim lost his life while accompanying CIA contract arms smuggler Eugene Hasenfus, whose plane was shot down during a clandestine flight over Nicaragua in 1986.

When the DEA raided Grasheim's house in El Salvador, agents found explosives, weapons, radio equipment and license plates, Castillo said, adding that much of the weaponry and other material was traced back to the U.S. embassy in El Salvador. Castillo said that when he tried to gather more information on the munitions, he was told by the Pentagon to drop the investigation.

It would not be the last time Castillo was told to back off. Nor was it the last time he ignored such an order and kept on digging.

Much of Castillo's information came from a DEA informant who had worked at the Ilopango airport, doing flight plans and keeping flight logs. The informant, who used the pseudonym 'Hugo Martinez,' was in an ideal position to witness and document North's drug deals. Martinez passed the information he gathered on to Castillo. In an interview, Martinez confirmed Castillo's story about widespread drug and arms dealing by the CIA and the North network at Hangars 4 and 5.

Castillo said additional information obtained after he was transferred from El Salvador to San Francisco confirmed what he had learned in El Salvador. While tracking drug smuggling into Miami, Texas and San Francisco in 1991, Castillo arrested the wife of Carlos Cabezas. In an attempt to make a deal for his wife, who had attempted sell Castillo five kilos of cocaine, Cabezas, a Nicaraguan, told Castillo that he was one of the pilots who had worked for North, smuggling vast quantities of cocaine into the United States from Ilopango. Cabezas described in detail the operations at Ilopango and identified many of the traffickers who worked there. The information he provided matched Castillo's own findings.

Beginning in 1986, Castillo tried to report what he had discovered, launch a full-scale investigation, and shut down the smuggling operation. On several occasions, he met with Edwin Corr, the then-U.S. ambassador to El Salvador, to tell him about the operation. "His words to me were that it was a covert White House operation run by Colonel Oliver North and for us to stay away from the operation. My feeling was the fact that Corr did not agree with what was going on at Ilopango but his hands were tied. He was only following orders from the White House to give all the assistance he could to Oliver North and his covert operation." Corr, now a professor at the University of Oklahoma, would only say, "I deny Cele's allegations that I told him to back off on the basis of White House pressure."

Castillo even managed to give the information he had gathered directly to George Bush. On January 14, 1986, Castillo met the then-Vice-President at a cocktail party at the ambassador's house in Guatemala City. After describing his job to Bush, Castillo detailed North's operation. Without missing a beat, Castillo said, Bush "shook my hand and he walked away." [CN -- "This scourge must stop!"]

Even though Castillo couldn't get anyone to act on his Ilopango information, in July 1987, attache Robert Stia recommended him for a bonus and a promotion. "Castillo is an extremely talented agent," Stia wrote, "...a tireless worker, exceeding all requirements of overtime and work hours. His administration of cases is outstanding."

Nevertheless, as Castillo continued to pursue the North investigation, he fell from favor with his superiors, who suspended him for three days in 1990, and then in 1991 transferred him to San Francisco, where he worked undercover, investigating Hells Angels in Oakland. In June 1992, after further conflicts, Castillo resigned from the DEA.

Before resigning, though, in 1991, he tried to give the government one last chance to use the information he had gathered on North. He secretly met with FBI agent Mike Foster, who was assigned to Special Prosecutor Lawrence Walsh. "Foster said it would be a great story, like a grand slam, if they could put it together. He asked the DEA for the reports, who told him there were no such reports. Yet when I showed him the copies of the reports that I had, he was shocked. I never heard from him again."

On May 4, 1989, North was convicted on the relatively minor offenses of illegally accepting gratuities (his famous security fence), interfering with a Congressional investigation and obstruction of justice. But even those convictions were overturned when an appeals court ruled that they were based on testimony North gave under a grant of Congressional immunity.

Although they talked about drugs, neither Walsh nor the Iran- Contra committee ever seriously investigated the drug-dealing charges. North, who did not return phone calls made to his campaign headquarters in Virginia, has consistently denied having been involved in drug smuggling.

Another former DEA agent, Michael Levine, said he has pored over North's diaries and found "hundreds" of references to drugs that "have never been investigated." For example, Levine said, on July 9, 1984, North wrote: "RDEA, Miami. Pilot went, talked to [Federico] Vaughn, wanted aircraft to go to Bolivia to pick up paste, want aircraft to pick up 1500 kilos."

"My god," said Levine, author of The Big White Lie, "when I was serving as a DEA agent, you gave me a page from someone in the Pentagon with notes like that, I would've been on his back investigating everything he did from the minute his eyes opened, every diary notebook, every phone would have been tapped, every trip he made."

But both Levine and Castillo said the investigation never happened. (DEA officials have not returned repeated phone calls.) In an interview, the FBI's Foster said, "Of course I can't confirm or deny that [his interview with Castillo]. I am aware of Mr. Castillo and his position on Central America," Foster said. "In the course of the Iran-Contra investigation, it's no secret that I was involved in that and was the FBI investigator in that, but I am prohibited from commenting." Foster said he is very skeptical about the drug claims generally. "There are individuals that have a loose relationship with the government and those people are not all choirboys and they have been doing all kinds of weird things. But I think you would be hard pressed to show a concerted government backing or involvement in [drug trafficking]."

It is just that kind of attitude, Castillo said, that led officials to ignore North's operation, allowed him to evade prosecution for drug dealing, and now has him poised to move into the United States Senate.

"There was nothing covert going on in El Salvador regarding the Ollie North operation and narcotics trafficking," Castillo said. "What we're talking about is very large quantities of cocaine and millions of dollars."

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The Texas Observer, 307 W. 7th St., Austin, Texas 78701. For a free sample hardcopy of this article call 512-477-0746. [CN -- I'm not sure of the exact title of the article; I received it under the subject heading, "Ollie North and Drugs".]

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Aperi os tuum muto, et causis omnium filiorum qui pertranseunt. Aperi os tuum, decerne quod justum est, et judica inopem et pauperem. -- Liber Proverbiorum XXXI: 8-9

Brian Francis Redman "The Big C"

"Justice" = "Just us" = "History is written by the assassins."