http://www.sjmercury.com/drugs/postscript929.htm
                        [Welcome to Mercury Center]

                                [Postscript]
                              [Dark Alliance]
                        Frames: [ Enable | Disable ]

 Gag order concealed possible CIA drug ties

 But records were copied secretly

 Published: Sept. 29, 1996

 BY GARY WEBB
 AND PAMELA KRAMER
 Mercury News Staff Writers

 A legal motion filed in a 1990 police corruption trial in    [Other stories]
 Los Angeles indicates that the drug ring of former
 Nicaraguan government official Danilo Blandon -- which       South
 helped fuel the crack cocaine explosion in black America     Central
 -- was connected to the Central Intelligence Agency and      residents
 efforts to launder drug money to finance anti-communist      condemn
 Nicaraguan rebels.                                           CIA's
                                                              reported
 Ten pages of records seized from a money launderer tied to   role
 Blandon were ordered sealed in that case. Court records      Published:
 show the defense attorney who had the papers was hit with    Sept. 29,
 a gag order shortly after he revealed their existence.       1996
 U.S. Representative Maxine Waters, D-Los Angeles, said she
 will immediately seek to have the documents made public      Activist
 since they could provide evidence of government              vows to
 involvement in cocaine trafficking.                          continue
                                                              protests
 Los Angeles attorney Harland W. Braun said Friday he was     over alleged
 given the documents by an officer who had participated in    CIA-crack
 their seizure and copied them without the government's       link
 knowledge. Braun said he read the documents before turning   Published:
 them over to the court, and that he based his motion on      Sept. 27,
 the records, and from statements from two of the officers    1996
 who conducted the search.
                                                              Previously
 The exact nature of Blandon's connection to the CIA has      published
 been a matter of considerable debate since a Mercury News    postscript
 series last month revealed his role in flooding South        stories
 Central Los Angeles with cocaine in the 1980s. Blandon, a    Last
 marketing expert who now works as an informant for the       updated:
 Drug Enforcement Administration, has testified that he was   Sept. 28,
 one of the founders of the Los Angeles branch of the         1996
 Nicaraguan Democratic Force, a guerrilla army created and
 run by the CIA.                                              Gary Webb
                                                              radio and TV
 He has testified that after he met with the CIA agent who    appearances
 ran the army's military operations in late 1981, he began    Last
 selling cocaine in South Central to raise money for that     updated:
 army. His biggest customer, he testified, was legendary      Sept. 28,
 L.A. drug dealer ''Freeway'' Rick Ross, who turned           1996
 Blandon's cocaine into crack and sold it to the Crips and
 Bloods street gangs.                                         The original
                                                              series
 CIA director John Deutch has said that Blandon had no        Published:
 relationship with the CIA, and a CIA spokesman has called    Aug 18-20,
 the Mercury News series ''ludicrous.''                       1996

 But the motion filed six years ago in the corruption trial
 of former L.A. County Sheriff's Deputy Daniel Garner says    [document link]
 Blandon's drug operations were aligned with the spy           Biographical
 agency.                                                       information
                                                                 on Oscar
                                                                  Danilo
                                                               Blandon and
                                                                Rick Ross

                                                              [document link]
                                                                  Motion
                                                                regarding
                                                               government's
                                                               request for
                                                               restraining
                                                                  order

 Drug raid

 In late October 1986, Blandon's home and several other
 locations in suburban Los Angeles were raided by L.A.
 County narcotics detectives. According to the search
 warrant affidavit, the deputies believed Blandon was
 selling cocaine and laundering large sums of money ''to
 buy arms for the Contra rebels in the war in Nicaragua.''
 Blandon, his wife, Chepita, and several other Nicaraguans
 were arrested on narcotics and weapons charges.

 Deputy Garner participated in those raids, according to
 Braun, a prominent defense attorney who has handled cases
 ranging from the Rodney King civil trial, where he
 successfully represented an officer charged in the
 beating, to the fatal Twilight Zone accident case. Garner
 and several other members of the 1986 raid team were later
 caught up in a corruption scandal that swept the sheriff's
 drug units. He and nine other officers were indicted in
 1990 on charges of stealing more than $1.4 million in
 seized drug cash.

 During Garner's trial, according to an Oct. 24, 1990 story
 in the Los Angeles Times, Braun told reporters that he
 could prove ''that the U.S. government was laundering drug
 money for South American cartels and siphoning some of the
 cash for its own clandestine operations abroad.'' Braun
 said he hoped that by making the CIA an issue in the case,
 federal prosecutors would drop the charges against Garner.

 But prosecutors immediately asked U.S. District Judge
 Edward Rafeedie to issue a gag order to keep defense
 lawyers from talking about the case, records show. Braun
 filed an unsuccessful motion to fight the order. The gag
 order expired at the end of the trial.

 In the motion, Braun stated Garner's raid team burst into
 the house of a ''money launderer who they knew was
 associated with a major drug and money laundering ring
 connected to the Contras in Nicaragua. Notification was
 made to the federal government that the search warrant was
 going to be served ... When the search warrants were
 served, the houses were found substantially vacated.''

 Lots of evidence

 But the police hardly came away empty-handed.

 ''Officers discovered films of military operations in
 Central America, technical manuals, information on
 assorted military hardware and communications and numerous
 documents indicating that drug money was being used to
 purchase military equipment for Central America,'' Braun's
 motion stated. ''Officers also discovered blown-up
 pictures of the suspect in Central America with the
 Contras showing military equipment and military bases ...
 Officers also pieced together the fact that this suspect
 was also working with the Blandon family, which was
 importing narcotics from Central America into the United
 States.''

 When the police first arrived at the house, Braun wrote,
 ''the suspect identified himself as a CIA agent, gave the
 name of his CIA contact in Virginia and requested that the
 (police) confirm his status and leave the premises. The
 suspect was allowed to call Virginia and notify the
 Central Intelligence Agency, but the officers took the
 position that they had a search warrant and they would
 continue to obey the orders of the court.''

 In the 1990 Times story about the gag order, a CIA
 spokesman said the agency ''has not and has never been
 directly involved in laundering money.''

 Within 48 hours of the man's records being seized, Braun's
 motion stated, ''federal agents swooped down on the
 sheriff's headquarters and removed all the recovered
 property. Mysteriously, all records of the search, seizure
 and property also "disappeared' from the sheriff's
 department.''

 When the Mercury News requested the case files last year,
 a sheriff's department spokesman, Ron Spear, said they
 could not be found.

 Documents preserved

 ''Unbeknownst to the federal government,'' Braun wrote,      [document link]
 ''10 pages of the documents seized from the CIA operative      Mention of
 were copied and preserved. These documents give the name         State
 of CIA operatives in Iran, specifically mention the            Department
 Contras, list various weaponry that was being purchased,       in Senate
 and even diagram the route of the drug money out of the        Committee
 United States, back into the United States purchasing          Report on
 weaponry for the Contras as well as naming the State           Drugs, Law
 Department as one of the agencies involved.''                 Enforcement
                                                               and Foreign
 Copies of the 10 pages seized from the money-launderer          Policy
 were submitted to Judge Rafeedi under seal, according to
 Braun, who said they are still being held in secret. Braun
 said he did not keep copies.

 While Braun's motion doesn't identify the suspect by name,
 the 1986 search warrant affidavit for the raids identifies
 two men who police believed were laundering and
 transporting money for Blandon's cocaine operation. They
 are:

 --- Nicaraguan businessman Orlando Murillo, an economist
 and former Miami resident now running for the Nicaraguan
 Congress. Murillo, an uncle of Blandon's wife, was the
 Nicaraguan representative of two Swiss banks for more than
 12 years and was a member of the Central Bank of Nicaragua
 -- similar to the U.S. Federal Reserve Bank -- under the
 government of the late dictator Anastasio Somoza.

 Corporate records show Murillo was a vice president of a
 Miami-area brokerage firm identified in the 1986 search
 warrant affidavit as the bank through which Blandon
 laundered money for the Contras.

 ''I have never been involved in drugs and I have never
 been involved in the Contras,'' Murillo said in an
 interview Friday from Managua. ''I am a serious person and
 I have a good reputation.'' Corporate records show one of
 the Los Angeles companies raided by the deputies was owned
 by Murillo and the Blandons.

 --- Former Laguna Beach burglary detective Ronald J.
 Lister, who quit the police force in the early 1980s. He
 started a security firm that, according to a former
 company official, had a U.S. government contract to
 protect a military airbase in El Salvador.

 ''Ronald Lister ... sells cocaine for the Blandon
 operation and transports money to Miami. He has turned
 over a residence at 796 Deer Trail, Crestline, to Blandon.
 The house now belongs to Orlando Murillo, Blandon's uncle
 and money laundered (sic) in Miami. Cocaine is regularly
 stored at this Crestline location,'' the affidavit states.

 Murillo acknowledged knowing Lister, calling him ''a drug
 dealer'' he met through Blandon. Murillo also confirmed
 that the house was in his name, but said Blandon did that
 without telling him.

 Recently declassified FBI records say Lister claimed in
 late 1986 to be a CIA agent and said he was raising funds
 for the Contras.

 Shortly after the raids, FBI records say, Blandon's          [document link]
 defense attorney, Bradley Brunon, called the sheriff's        FBI Teletype
 office and told them the ''CIA winked at this sort of          regarding
 thing ...(Brunon) did not specifically discuss drug           conversation
 trafficking or arms sales but only referred generally to      with Ronald
 the activities of Blandon and Lister.''                         Lister's
                                                               real estate
 Neither Lister nor Garner, both recently paroled from            agent
 federal prison, could be reached for comment. Lister
 pleaded guilty to cocaine trafficking in January 1991 and
 Garner was convicted of the corruption charges in December
 1990.

----------------------------------------------------------------------------

                       Go to: Home | Dark Alliance:

----------------------------------------------------------------------------

                                  [Toyota]

          | Mercury Center Home | Index | Feedback | NewsLibrary |
   1996 Mercury Center. The information you receive on-line from Mercury
     Center is protected by the copyright laws of the United States. The
   copyright laws prohibit any copying, redistributing, retransmitting, or
              repurposing of any copyright-protected material.
