The Strength of the Wolf (66 page)

These impressive facts confirm that the CIA, through Castellani and other drug traffickers, manipulated political developments in France to its advantage. And decent FBN agents felt the sickening effects. As Vic Maria ruefully recalls, “I had a Corsican informer in the Attia Gang who said that Attia was definitely not into drugs. But the CIA said to pursue it, even if he wasn't. That's how they operated. They'd front you, then tell you to fade the heat, which in this case meant that cooperation with the French authorities ended for quite some time after the Barka affair.”

On the other hand, the successful elimination of Ben Barka helped certain FBN agents grow in the CIA's esteem, and it widened the gap between SDECE's warring factions, which were still reeling from Angleton's allegations that they were penetrated by the Russians. Convinced that the CIA had arranged Barka's murder through double agents within SDECE, de Gaulle fired SDECE chief Paul Jacquier. What he didn't know was that the CIA plot “went beyond certain French Intelligence units to … the men closest to de Gaulle.”
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In this way the Ben Barka affair assured de Gaulle's demise, and Pompidou's ascent, thanks in part to the CIA's successful exploitation of a self-serving faction in the FBN.

One other important development began with the Ben Barka affair. Joseph Zurita, the man who fed the phony CIA article to
L'Express
, established narcotics connections in New York in April 1966 through Maurice Castellani. He did this on behalf of the emerging Lyon Gang, which was chiefly involved in armed robbery, but in 1965 switched to the more profitable and less dangerous activity of narcotics smuggling. Within a few years, as the new French connection, it would rival the Corsican gangs for supremacy in this arena.
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The changing face of French politics was reflected in the movement of Corsican smugglers to Latin America and the emergence of the Lyon Gang in Paris. Composed primarily of French nationals, the gang's involvement in drug trafficking was uncovered by François Le Mouel and the Paris Brigade of Intelligence and Intervention. Formed in 1964 to disrupt an armed robbery ring, Le Mouel's Brigade learned in 1965 that Lyon Gang members were smuggling heroin on biweekly flights to New York. When the Brigade learned that seven false passports had been obtained in Belgium, surveillance of the seven suspects was initiated at Orly Airport. The first arrests were made within ten days, in late November 1965, and the Lyon Gang's contacts were identified in New York, Montevideo, Spain, and Montreal. New York buyer Oswaldo Alfonso was identified, and leads were initiated into parallel rings managed by Domingo Orsini and Jack Grosby. What the Brigade had uncovered, without the aid of the FBN, was an entirely new French narcotics network. It also represented a new determination on the part of certain French officials to combat narcotics trafficking in France.
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After Pompidou's election as president of France, François Le Mouel would assume national responsibility for narcotics investigations and, between 1972 and 1974, with the assistance of Paul Knight, would smash, once and for all, the criminal element of the French connection, without implicating either country's intelligence services. But that development was years away, and in the mid-1960s, the French connection was still flourishing, primarily as a function of unconventional political warfare waged by SDECE and the CIA.

In the Ben Barka case, the CIA used Vic Maria and Jack Cusack to frame and murder a political enemy. Having undermined the FBN's investigation of Maurice Castellani and Irving Brown, the CIA also enabled Joseph Zurita to meet with Castellani and establish contacts for this new French connection on behalf of the Lyon Gang. For its part, SDECE had protected Michel Mertz since March 1961, when he first delivered 100 kilograms of heroin, concealed in a Citroen, to New York. Mertz made another delivery in October 1961, which, ironically, may have been the source in the 1962 French Connection case.
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This makes it likely that either Mertz, his courier Jean Mounet, or Maurice Castellani was mystery man J. Mouren.

Consider also that SDECE had wiretaps on its own agent, Achille Cecchini, and these generated the Nebbia case. This action was taken in
November 1965, on the heels of the assassination of the Ben Barka scandal; and that sequence of events raises the distinct possibility that Mertz and the pro-de Gaulle faction within SDECE sacrificed Nebbia as a way of focusing public attention on the role of the CIA and US Army – which had already been exposed by the arrest of Major Hobbs in Saigon – in Southeast Asia's narcotics trade. This tit-for-tat explanation is not mere speculation. As Frank Selvaggi says, “The French let a hundred shipments go through, then they give us Conder. But we weren't supposed to make that case, and a lot of people were mad as a result.”

A temporary end to good relations with the French was not the only price US drug law enforcement paid for its role in the Barka affair: Customs officer Jacques Changeux, an undercover CIA agent, was forced out of his position, and his replacement refused to cooperate with Vic Maria. Maria was further isolated when George White's partner in the Luciano Project, John Hanly, arrived in Paris as the new Secret Service officer. Hanly, probably at the insistence of the CIA, refused to allow Dick Jepson to assist the FBN, forcing Maria to look for a new informant. Fortunately he found one. A Greek photojournalist living in Belgium, Constantine Fondoukian was fluent in seven languages. And through Fondoukian's courage and initiative – and the assistance of SDECE Agent Lopez – Maria would develop significant leads into the Lyon Gang and Ricord's Group France in South America.

Meanwhile, the king of Corsican drug traffickers, soft-spoken Paul Mondoloni, would continue to represent Marcel Francisci in their mutual dealings with the Orsini–Spirito organization. Of all the Corsican clans, the Franciscis alone maintained protection in France after 1965. Most of the drug smuggling Corsicans were betrayed by de Gaulle, and in 1964, former SAC veteran Armand Charpentier – a member of Ricord's Group France – tried to assassinate the French president in Argentina.
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Knowing that the shadow war against the CIA, along with his former Corsican allies, had spread to South America, de Gaulle in 1965 assigned Dominic Ponchardier (the former chief of his private security corps) as ambassador to Bolivia, and he posted Colonel Roger Barberot (former chief of the Corsican-staffed, anti-OAS Black Commandos in Algeria) as ambassador in Uruguay.
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The CIA, then cuddling up with every dictator in South America, did not welcome the intrusion. On 12 July 1966, a cocaine lab in Montevideo exploded, killing Ricord's chief chemist, Luis Gomez Aguilera.
²⁴
The explosion signaled a new
sale guerre
in South America, and after June 1966, every Corsican with SDECE or SAC credentials seemed to arrive at the Club Ex Combatants in Buenos Aires,
ready to rumble. The most prominent of the new arrivals was Christian David. A former SAC agent, David had killed Robert Blemant's assassin in the fall of 1965, at the same time that Blemant's successor as head of Les Trois Canards, Maurice Castellani, was under FBN surveillance at Attica Prison. Once thought to be a member of the Guérini gang, David was actually a double agent working against Guérini on behalf of the Francisci clan, with the approbation of de Gaulle's closest advisor on such dubious affairs of state, Pierre Lemarchand.
²⁵

Then in a development that ties Blemant's assassination to the CIA sponsored assassination of Mehdi Ben Barka, David shot and killed police inspector Maurice Galibert on 2 February 1966. The circumstances are revealing. While investigating the murder of Ben Barka, Galibert was told that a suspect could be found at the Saint Clair restaurant in Paris. When Galibert arrived, he found David playing cards with Belkacem Mechere, “the deputy prefect of the interior ministry police.” According to Henrik Kruger, “When Galibert invited David to police headquarters for questioning, Mechere protested. David flashed his SAC ID card, but Galibert stood his ground.”
²⁶
At which point David shot and killed the policeman and fled to Uruguay where, on behalf of Barberot, he infiltrated the Tupimaros revolutionary group, while engaging in extensive extortion and drug smuggling ventures with Ricord's Group France.

The CIA was ready and waiting for the influx of exiled Corsican murderers and drug smugglers. Its station chief in Uruguay, John Horton, had served in Hong Kong for the previous three years, and understood the central role that self-financing drug smugglers played in the
sale guerre
. Within weeks of Horton's arrival in Uruguay, the CIA-advised Uruguayan secret police force was also working diligently to suppress the Tupimaros and its foreign links, and had chased the Continental Congress for Solidarity with Cuba to Chile, where Che Guevara was rumored to be setting up cocaine labs for the Communist Chinese.
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None of the politically related drug trafficking incidents and developments described above would have been possible without underworld financing. The US Treasury Department was aware of the shift in drug money to South America, and that in July 1966, Meyer Lansky's broker, John Pullman, was in Bogotá, Colombia, negotiating a lucrative mine deal. Lansky's Bolivian venture was, according to Professor Alan Block, “one part
of an elaborate organized crime network of businesses” that “permitted organized crime enormous flexibility in moving and laundering funds as subsidiaries were placed in the United States, Europe, and the Caribbean.”
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Following the Mafia's drug money trail was essential to smashing the French connection, and the money trail inevitably led to Meyer Lansky, the Mafia's banker since the 1930s. It was known that he invested $10 million in Italian real estate through the Banque de Crédit International (BCI) in Geneva. The problem was that Tibor Rosenbaum, a Mossad agent, owned the bank. Rosenbaum was close to the Italian royal family and James Angleton, and his institution laundered money for the Latin American clients of Investors Overseas Services (IOS).
²⁹
Founded by flamboyant Bernard Cornfeld, and very likely a CIA front company, IOS was an international mutual fund for anonymous investors in, among other things, Vietnamese and Israeli bonds. IOS employees funded the company through a clever “equity participation” scheme that freed them from Security and Exchange Commission oversight. Cornfeld's chief advisor was Rosenbaum, “one of organized crime's Swiss bankers.”
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Rosenbaum's activities and connections underscore the Mossad's involvement in international narcotics trafficking, and its apparent subsidizing of Lansky's ventures in Acapulco, where former Mexican president (1946–52) Miguel Aleman had developed a chain of hotels and casinos. Aleman worked with a cousin of Italy's Princess Beatrice (the introduction was certainly made by Rosenbaum), and deposited his money in the Banco Mercantil de Mexico, “the correspondent bank to Bank Leumi,” the “Israeli banking giant” that served “as a major laundering vehicle for the revenues of international dope traffic.” As reported in
Dope, Inc
., Leumi's president sat on BCI's board of directors in Geneva, and owned a company that moved diamonds between Israel and Hong Kong – a perfect channel for smuggling drugs.
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James Angleton alone possessed the coveted Israeli account; and through his relationships with Italian royalty, Rosenbaum, Charlie Siragusa, Hank Manfredi, and Mario Brod, he was certainly aware of Lansky's central role as the Mafia's banker in the Caribbean – where Lansky's mob associate from Las Vegas, Moe Dalitz, opened an account at Castle Bank
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– as well as in Mexico, where Angleton's friend, Winston M. Scott, was station chief, and certainly kept tabs on Lansky's associate, former Mexican president Miguel Aleman. As ever, Angleton and Lansky were the dark stars of the intelligence and financial aspects of international drug smuggling.

Federal law enforcement officers knew all this, and that the prestigious Mary Carter Paint Company had decided to build a resort hotel on Paradise
Island in the Bahamas in 1965. This was perfectly legal, but when the company teamed up with Wallace Groves to open a casino, US Attorney Robert Peloquin, having just conducted a narcotics investigation in Puerto Rico with the FBN, was sent to investigate. In his report, Peloquin cited a situation that was “ripe” for a Lansky skim.
³³
But the venture went forward anyway, because the CIA had hired Groves and Mike McLaney, manager of Lansky's Miami Beach dinner club, to suborn the Bahamian government. Indeed, the venture not only went ahead, but Peloquin and former Justice official William Hundley would leave government service and join in the profiteering by forming a private firm to provide security for Resorts International, the company that owned the Paradise Island hotel and casino.
³⁴

With the CIA running interference, the Mafia washed its drug and gambling money in the Bahamas, Las Vegas, and Mexico; then brought the cash back to Miami where Lansky divided the proceeds among his investors. The bagmen included Benny Sigelbaum (a partner of LBJ's erstwhile personal secretary, Bobby Baker), and Sylvain Ferdman, a close associate of John Pullman and Tibor Rosenbaum, who functioned as the link between Lansky and IOS.
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Lansky was the financial nexus, and for decades the FBN kept him under surveillance, hoping in vain to tie him to a narcotics conspiracy case. In November 1965 – in the midst of the Castellani, Nebbia, and Barka affairs and the emergence of the Lyon Gang – Al Garofalo wrote a report on Lansky's French connection associates in Nice. Based on this document, FBN headquarters concluded that Lansky's front men were traveling the world to purchase drugs and make arrangements for their boss's smuggling operations.
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But the mingling of Mossad, CIA, and Mafia funds in offshore banks provided the crime lord with an invisible protective shield. When it came to Meyer Lansky, the FBN, as ever, was stymied. It could only do what had been done for years; and that was to make cases on individual drug smugglers.