The Strength of the Wolf (29 page)

The flaw in Anslinger's theory of a communist drug conspiracy was revealed in August 1955. In testimony before the Daniel Committee, Anslinger had said that Kuomintang troops were not growing opium in Burma, and that Thailand was likewise uninvolved in the drug trade. But one week later, Thailand's prime minister fired police chief Phao Sriyanond for awarding himself (in his dual role as finance minister) a $1 million reward for having seized twenty tons of opium on the Thai–Burma border. Shocked that an official would do such a thing, US Ambassador John Peurifoy criticized Phao and urged the Thai military to take over drug law enforcement. Seeking vindication, Phao revealed that the seized opium belonged to the Kuomintang.
¹³

One month later, in October 1955, the
Nation
reported claims by UN officials that the PRC's role in the drug trade was diminishing, if not gone. It also reported a claim, made by a Russian delegate to the UN, that fabricated files about the drug trade had been planted in the UN's Secretariat. The article quoted British Customs officials in Hong Kong calling Anslinger's reports “political exaggerations,” and noted that Hong Kong's biggest bust in 1955 occurred when an American soldier was jailed for importing and possessing drugs.
¹⁴
The article's author, John O'Kearney, reported that Interpol had arrested twenty-seven Chinese in 1954, but none were communists. He cited India, Lebanon, and Iran as bigger sources, and noted that the FBN had no agents assigned to the Far East, but depended on foreign sources, most in Kuomintang-controlled Taiwan.

Reporter Darrell Berrigan expanded on O'Kearney's observations in an extraordinary article in the May 1956
Saturday Evening Post
. Flying in the face of Anslinger's propaganda, Berrigan reported that Taiwanese businessmen financed the drug trade in Bangkok in league with South Vietnamese generals. He traced the $70 million-a-year business to the 1947 truce between Thailand's police chief and General Sarit Thanarat. “By accident of history,” Berrigan wrote, “the middlemen between Yunnan and Thailand are … 3,000 KMT troops who turned over the famous 20 tons in the summer of 1955.”
¹⁵
Berrigan tied the KMT to an international ring, with ships and planes, as well as secret airfields in Laos, and the CIA.

Anslinger was quoted in Berrigan's article as saying that the PRC was smuggling half-ton loads of opium to South Vietnam. But Anslinger had studiously ignored the fact that Thailand had an opium monopoly, an opium processing plant, and fifty tons of opium in its larder. He also ignored the fact that the CIA was facilitating Thailand's drug business through the Sea Supply Corporation, a Miami-based CIA proprietary formed, with the legal assistance of former OSS officer Paul Helliwell, to advise the Thai police and clandestinely provide arms to KMT troops spread along the Thai–Burma border.

Paul Helliwell is the personification of the CIA's respectable, financial aspect of international drug trafficking. While serving as an Army intelligence officer in the Middle East in the Second World War, he was drafted by William Donovan to manage OSS Special Intelligence operations in China. In that sensitive position, Helliwell worked with Chiang Kai-shek's intelligence chief, General Tai Li, and through him the drug smuggling Green Gang in Shanghai. Under his direction, OSS officers also employed opium as a weapon of political warfare. As historian Richard H. Smith informs us, “Through his agent, Le Xuan, [OSS officer] Roberts bribed
an old Vietnamese nationalist with a pouch of opium and thus secured a full dossier on Ho's revolutionary background, including the record of his years in Moscow.”
¹⁶

This was no small event. The discovery of that dossier convinced the Americans not to back the Vietnamese nationalists against the French in Indochina, and turned the tide of history.

After serving as chief of a Strategic Services Unit in the Far East, Helliwell joined a Miami law firm in 1947. A specialist in private financing, he helped set up the CIA proprietary companies Civil Air Transport (later renamed Air America) and Sea Supply in Thailand, and in 1952 became general counsel to Sea Supply and the Thai Consulate in Miami. A mover and shaker in the Florida Republican Party, Helliwell reportedly helped Thai officials invest their drug profits in Florida land deals through Miami's National Bank and Lou Chesler's General Development Corporation, and at the same time Meyer Lansky and the Kuomintang were doing likewise.
¹⁷

Anslinger knew this; however, in order to get Congress to pass tougher drug laws, he propagated myths that not only obstructed any long-term solution to the problem – they had a deleterious effect on the morale of his own agents. None of this was widely known in 1956, and making matters worse, no one within the FBN dared to contradict Anslinger's self-serving pronouncements.

In 1956, Anslinger still firmly controlled FBN policy. But by then it was evident that he would never resign, a realization that had prompted Mal Harney, who had long aspired to Anslinger's job, to accept an appointment as the Treasury Department's assistant to the secretary for law enforcement – in theory, if not practice, becoming Anslinger's boss. Legal counsel B. T. Mitchell temporarily filled the enforcement assistant position after Harney's departure and, with Deputy Commissioner George Cunningham, managed the Bureau's daily operations. Meanwhile the agents knew that Anslinger's days were numbered, and as he approached mandatory retirement in 1962, they were quietly forming factions in anticipation of the battle to succeed him. The main contenders were Charlie Siragusa, Henry Giordano, and Lee Speer.

After serving as district supervisor in Kansas City, Giordano in July 1956 became the FBN's field supervisor, and in September its deputy assistant for administration. A year later he replaced Mitchell as enforcement
assistant, the number three job at headquarters. He was assertive, and the aspirant in the best position to promote his backers, a strength he demonstrated by creating a fifth Enforcement Group in New York so that his disciple, Mike Picini, could gain management experience as a group leader. And as Anslinger's valued liaison to prominent Congressmen on technical matters, Giordano was, overall, the strongest candidate.

A better-qualified candidate, according to many agents, was Charlie Siragusa, whose worldwide operations had generated the intelligence that had resulted in so many domestic arrests and seizures. But his chances were based on Anslinger's promise to back him for the job, and that promise was based on the condition that he return to Washington to assume a headquarters position. Thus Siragusa faced the dilemma of having to abandon his overseas power base, to placate Anslinger.

Speer was the odd man out. Upon returning from Japan, he became one of the FBN's two inspectors, along with Bill Tollenger. Keeping track of agent infractions gave management the leverage it needed to dismiss troublemakers, and for doing that unenviable job, shooflies were rewarded with a measure of influence at headquarters, where they were assigned. Plus Speer had Texas Senator Price Daniel in his corner. As Daniel's chief investigator, Speer had played a major role in the passage of the Daniel Act, and partially on the basis of that triumph, Daniel was elected governor of Texas. In return, Daniel entrusted Speer's career to fellow Texas Democrat and Speaker of the House, Sam Rayburn. Although he mistrusted Speer, Anslinger was in Daniel's debt and had no choice but to abide when Rayburn insisted that Speer fill the enforcement assistant position that opened up in November 1958, when Giordano became Deputy Commissioner. At this important turning point, Speer became a powerhouse, and launched his own campaign to succeed Anslinger.

With Harney's promotion to assistant secretary, the FBN gained greater influence within the Treasury Department, the Bureau of the Budget, and the Appropriations Committee. But his promotion was an ominous development, for it pit Giordano against Siragusa, and both of them against Speer, who had little support among the agent population. Indeed, Speer's biggest mistake was his forthcoming war on corruption and, as the antagonist of George Gaffney and the case-making agents in New York, he would bring about his own undoing.

While the FBN was bracing for the battle to succeed Anslinger, the Mafia was gearing up for a bloodletting of its own. Santo Trafficante Sr, the patron saint of traffickers, died in 1954, and his namesake son inherited his rackets in Cuba and Florida, as well as his father's partnership with
Meyer Lansky. Having taken over the Mangano family after spending ten months in prison on a tax evasion charge, vicious Albert Anastasia decided that Lansky and Trafficante Jr. (hereafter referred to simply as Trafficante) were being greedy, and thinking they were weak, he made a grab for the Havana action. The resulting mob war would begin in 1956 and intersect with the FBN's own increasing internecine strife.

The FBN's ability to pursue international drug traffickers was enhanced in late 1954 when, at the urging of the Treasury Department's assistant secretary for law enforcement, the US government decided to become a dues-paying member of Interpol. At this point, Charlie Siragusa, as supervisor over the newly created District 17 in Rome, started attending Interpol's annual General Assembly meetings and getting together regularly with top policemen from around the world. Through these official Interpol connections, Siragusa gathered support for his investigations and increased his own and the FBN's stature abroad.
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As the government's premier law enforcement agency, the FBI was the logical choice to work with Interpol, but J. Edgar Hoover considered the Paris-based organization a security risk and refused to participate. The CIA, however, wanted to penetrate Interpol precisely because it was based in Paris. But the spy agency needed a surrogate to provide it with deniability, so at the insistence of the White House, Treasury Agent Fred Douglas was allowed to serve as the government's official representative to Interpol. Douglas functioned as a back channel to the CIA on Interpol affairs, as did Siragusa – and in this way, and several others, the CIA grew ever closer to the Treasury Department and the FBN. Specifically, the CIA began using the Treasury Department's Attaché slots and its customs service and FBN positions overseas as cover for its agents. Plus which it used six national
coordinator positions, which the Treasury Department's Enforcement Board had created and spread evenly across the country under the supervision of the chief coordinator, as cover positions for CIA officers operating domestically within the US.
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Interpol now provided significant information on important narcotics traffickers to the four FBN agents assigned on a permanent basis in Rome: Charlie Siragusa, Paul Knight, Hank Manfredi, and Jim Attie. For these four men, and the temporary duty agents who assisted them, the ability to claim they were working with, or at times for Interpol contributed largely to their successes. But the challenges of undercover narcotics operations were enormous, and the agents suffered failures too, as illustrated by the Dominick Albertini case. Perhaps the largest producer of illicit heroin in 1955, Albertini managed several clandestine labs in France and dealt with Sami Khoury in Beirut and Mafiosi in Italy and America.

The Albertini case began in 1954 when Giovanni Mauceri, an Italian fugitive in the Orsini case, offered to sell Paul Knight ten kilograms of heroin. Though he never actually sold the drugs to Knight, Mauceri faced a charge of attempted sale, and in October 1955 he agreed to help the FBN entrap his source, Dom Albertini. By coincidence, Albertini's chemist had recently been arrested, and Albertini was looking for a replacement to manage his labs in France. Seizing the opportunity, Siragusa devised a bold scheme with the French authorities in which Jim Attie was taught how to convert morphine base into heroin. Six weeks later, Mauceri introduced Attie to Albertini as an underworld chemist from Beirut, and trusting Mauceri's word on the matter, Albertini hired him. But someone, either Mauceri or a corrupt French official, betrayed the daring, isolated undercover agent. Attie barely managed to escape with his life, months of costly preparation were wasted, and it would be fifteen years before Albertini's heroin conversion labs were located in and around Marseilles.

Devious informants and corrupt officials were not the only problems disrupting District 17 in Rome. Stress was taking a toll, too.

“Jim had been an amateur boxer,” Paul Knight explains, “and all the fights may have contributed to the problem. But after the beating he got by Haj Touma [as described in
chapter 8
], Jim seemed narcoleptic: one minute he was wide awake, the next he was falling asleep at his desk. His speech was impaired, and when he spoke he'd say funny things. He thought Israeli intelligence was after him. I was concerned for his health, so I told Charlie, and Charlie insisted that Jim be admitted to a hospital in Rome. And that's when we found out that he had encephalitis. Jim was sent to a veterans' hospital in Detroit, and Charlie, mistaking encephalitis for syphilis,
wrote a terrible letter saying that Jim didn't deserve health benefits, because he had contracted a venereal disease.”

Confused about the nature of Attie's illness, Siragusa accused him of being a malingerer and tried to have him fired. Luckily, headquarters realized that a mistake had been made, and after Attie was released from the hospital, he was allowed to return to duty in Chicago under District Supervisor Al Aman. He was bitter, however, and still showing signs of weakness, and his bosses doubted his ability to function. Aman wouldn't even let him drive a company car. But they did let him work dangerous undercover cases against the Chicago Mafia, and deep inside Mexico, and despite his health problems, brave Jim Attie remained one of the FBN's premier case-making agents.