The Strength of the Wolf (71 page)

Having been left on his own, Dunagan initiated his first narcotics case in typical case-maker style: Marty Saez, his former partner in Miami, had given him the telephone number of a suspected drug trafficker, so Dunagan called the suspect “cold,” without an introduction. The suspect agreed to meet and Dunagan flew to Guadalajara. He made the first two buys alone, but for the third buy and arrest he brought along Ray Maduro and a team of MexFeds as backup. “We found the lab,” Dunagan recalls, “and the guy admitted that he'd been dealing to Canada for twenty-five years. I'm in seventh heaven, but when I get back to Mexico City, Durkin's in a rage. Without consulting with him, I'd asked the comptroller to pay to send my youngest daughter to school. Headquarters was upset that I'd done that and Durkin, who was ‘The Company Man,' told me to drop the suit.

“ ‘No,' I said. ‘I'm allowed.' And eventually I won. They called it ‘the Lisa Decision' after my daughter. But Durkin never forgave me. He dummied up my promotion, and it just sat on his desk with no signature.”

Dunagan sighs. “Things get worse. Durkin sends me to Bogotá with an unproven informant, a Peruvian they'd caught in New York with five kilos of cocaine. I get there and we're set up by the deputy chief of police. Punches get thrown, knives come out, I pull my gun. It's a standoff, and nobody's made, because they're all cops! I return to Mexico City with a bleeding ulcer and dysentery, and what does Durkin do? He sends me to Guadalajara with Hymie Wallberg, a top MexFed who was later busted in a stolen car ring.

“Hymie and I go to the mountains to get a sample of opium. The farmers have it stashed in fifteen-gallon cans, but the MexFeds won't go in. The Army won't go in either, so I go in alone. But it's a premature bust and the
bad guys put a carbine to my head. Finally Wallberg shows up, but too late.” After a pause, Dunagan says very softly, “Maduro was there as my back-up. Well, that was the last time I worked with Ray, who quit shortly thereafter.”

Maduro, notably, quit the FBN to take a job as assistant director of security for the Swiss-based mutual fund Investors Overseas Services, the “fast-money laundry for organized crime, corrupt Third World dictators, wealthy expatriates, and freelance swindlers.”
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Beginning in June 1967, Maduro developed a commercial intelligence network for IOS throughout South America. “I'd been a grade twelve for four years,” he explains, “and I wanted out of Mexico. My dream was to open an FBN office in Madrid, but that never happened. Then I met a Naval officer who'd run boat operations in Vietnam. He was working for IOS and he offered me a job. After Durkin got the okay from Gaffney, we took a trip to Geneva to see Bernie Cornfeld. There was a chance to make lots of money, so I joined.”

Maduro joined IOS despite the fact that the IRS was investigating its links to the Meyer Lansky gambling excursion scam on Paradise Island in the Bahamas. The IRS had also linked IOS with Billy Hitchcock, alleged financier of the Brotherhood of Love, which was manufacturing LSD and smuggling marijuana from Mexico and hashish from Afghanistan, and distributing its products through the infamous Hell's Angels motorcycle gang. Hitchcock reportedly had a secret account at a Bahamian bank that lent several million dollars to the operators of the Paradise Island casino, including Lansky associates Lou Chesler, CIA Agent Wallace Groves, and Eddie Cellini.
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IOS was known to be moving money from South American investors to the Banque de Crédit International (BCI) in Geneva. As mentioned in
chapter 23
, BCI was owned by Tibor Rosenbaum, a likely Mossad agent and business associate of Meyer Lansky. The IOS operation was featured in an 8 September 1967
Life Magazine
article, “The Brazen Empire of Crime,” in which Lansky boasted that organized crime was “bigger than US Steel.” Genovese family member “Fat Tony” Salerno from East Harlem and Florida was invested in IOS, as was Carlos Marcello. But CIA clients were mingling their money in IOS too, so the IRS investigation fizzled out, and equity participant Ray Maduro eventually moved into the Nixon administration.

Back in Mexico, Rick Dunagan was experiencing the usual unusual. “I'd been down near Guatemala for a week, just before Christmas 1966, waiting to do a deal that never happened. As I look back, I realize I was sent there to get me out of the way. So I come back for Christmas and as we're landing, the plane quits.” Dunagan describes climbing out of the
wreckage, commandeering a taxicab, arriving at his home, tired and shaken, just glad to be alive. “On Christmas Day,” he recalls with emotion, “Durkin calls and says, ‘I'm sending you to Lima tomorrow.'

“Jim Daniels had been sent to open a one-man office in Lima, but he couldn't make a case. So Durkin sent me down with an informant who owned an Oldsmobile dealership and was close to the Peruvian president. I'm there undercover, and Daniels cuts me into an Italian. The Italian cuts me into a Japanese chemist, and I arrange to buy five kilos of coke. But when it comes time for delivery, the Peruvian cops won't get out of their cars, and I have to make the seizure myself – at which point the cops descend, steal the cocaine, and turn the informer into a smuggler!”

Dunagan shakes his head in disbelief. “Then Durkin leaves and George Emrich arrives from Chicago as the new agent in charge. I'm working on Paul Mondoloni's partner, Jorge Moreno Chauvet. Moreno had been sent to jail in 1965, but in 1967 he's living six blocks from my house! I persuaded my wife to go along. She pretended to be my girlfriend. We knock on his door and I ask for Chauvet by name. They say that Chauvet's in bed, and they ask who's calling, and I give the name of a guy we'd busted in Detroit. They bring me inside and when I look around, I see two MexFeds I know in the living room.
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“Everything down there was so bizarre,” Dunagan says in disgust. “Basically, I hated it. I have five daughters and two sons, and people were trying to entice them. One of those people was the son of the minister of the Mexican Navy. He was paid off the first time, but after it happened the second time, I'd finally had enough.”

The culture shock that upset Rick Dunagan's family, and the official corruption that disrupted his professional investigations in Mexico, were also present in Turkey, where the FBN's influence, thanks to Agent Dick Salmi, had been growing since he, Hank Manfredi in Italy, and Bob DeFauw in France had joined forces to make the seminal Watermelon case of 1966. Medium-built, blond, and brave, Salmi was born in Santa Monica, California. While attending the University of Perugia in Italy in 1958, he read about Andy Tartaglino's work on the Nick Gentile case and decided to become a federal narcotic agent. After a stint in the Santa Monica Police Department, and a two year hitch with the Office of Naval Investigations, Salmi's dream came true, and in April 1962 he was inducted into the wolf pack.

“Charlie Siragusa came out to Los Angeles,” Salmi recalls, “and I told him I wanted to work overseas. He said okay, but that I had to prove myself undercover first, so I started doing a lot of work in Mexico and Southern California. I did well, and I was sent to Las Vegas with a prostitute who had volunteered to take an undercover agent around the hotels. I pretended to be her pimp from Hollywood, and through her I started making buys from Italians. Then came the Bobby Baker surveillance, after which I got my reward. When I was sent to Istanbul in 1966,” Salmi says with unabashed pride, “I was only the seventeenth FBN agent overseas.

“It was incredible. I had no language training, and the conditions we lived in were primitive; when my wife gave birth to our first child in an Istanbul hospital, the baby nearly died of a staph infection. I can remember the bloody bandages on the floor. There was a lot of anti-Americanism too, and FBN agents were the low men on the Embassy totem pole. We were given the worst space available in a room over the Embassy garage. But unlike what happened to Rick Dunagan in Mexico, we had a tight community.

“The agent in charge, Nick Panella, returned to New York about six months after I arrived, and Charlie Casey, who'd spent the previous two years in Bangkok posing as a down-on-his-luck seaman, replaced Nick as agent in charge. Charlie was close to the military, and they provided us with a lot of support. But I did all the undercover work.

“There were three defining issues in 1967,” Salmi asserts; “the Arab–Israeli Six Day War, Vietnam, and opium coming out of Turkey. And once we had established that Turkish opium was a major source of French connection heroin, the Istanbul office became the FBN's center of overseas activity, encompassing a network of informants and operations throughout the Middle East. The problem was that the Turkish farmers would grow one hectare of opium for the government, and another for themselves. So we tried to seize the raw opium going to the bad guys, and interdict the morphine base at the labs, or on its way out of the country.”

According to Salmi, Turkey's underworld was comprised of ten families, whose biggest criminal enterprise was smuggling opium and morphine base out of the country, and arms back in. The arms were sold to the Kurds, a disenfranchised minority group in Eastern Turkey, fighting insurgent wars in Iran and Iraq. Narcotics going out of the country were often hidden in the trucks and cargo of Turkish workers going to Germany. One group of smugglers set up the Overland Company specifically to move morphine base to Europe and return with weapons. “It was an Overland truck that was carrying the drugs in the Watermelon case,” Salmi says, “but we didn't
learn about the guns until a few weeks later, when another Overland truck, packed with weapons, was seized in Austria on its way back to Turkey. So by 1967 there was a proven correlation between arms and drug smuggling. We knew which Turks were involved, how the payoffs were made, and the routes they used through Bulgaria and Hungary.”
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The involvement of East Europeans in the drug trade and the movement of guns to the Kurds were issues of tremendous interest to the CIA station in Turkey. As a way of exploiting the situation for its own purposes, the CIA convinced the FBN that a surge in terrorism in Turkey was not the result of internal political unrest, but of the KGB's control of the Bulgarian drug trade. The FBN was glad to assist the CIA by providing the spy agency with Interpol reports identifying drug traffic transit points in Bulgaria. The CIA also professed to share an interest with the FBN in making a case on the Kulecki and Cil clans, the dominant alliance in the guns-for-drugs trade between Turkey and Bulgaria. But both families were very well protected. Mehmet Kulecki, owner of the Kennedy Hotel in Istanbul, was arrested in 1965 for possession of 147 kilograms of opium, but before the case got to court, the opium was exchanged for river mud and Kulecki was set free. Huseyin Cil, the owner of several hotels on the Syrian border, was so well protected that he actually got away with murder. But daring Dick Salmi decided to go after them anyway.
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The case against the Turkish crime lords began in February 1967, when an American soldier of fortune, Tom Garrity, was arrested for conspiring to smuggle 48,000 bullets to Kulecki. Garrity, between 1964 and 1967, had smuggled over 15,000 guns into Turkey; he knew the smuggling business from top to bottom, and his decision – made with the consent of Turkey's CIA-advised secret police force – to work for the FBN was a major breakthrough. Agent-in-Charge Charlie Casey put Garrity with undercover Agent Salmi, and they set up a sting with the Turkish secret police, its CIA advisors, and the US Air Force Office of Special Investigations (OSI). Covering for the CIA, OSI agents helped with the surveillance of Kulecki and Cil, and provided the FBN with cars and flash rolls.

Mercenary Tom Garrity initiated the case in September 1967 when he arranged to buy fifty kilograms of morphine base from Yuksef Sedef, Cil's front man in Ankara. A few days later, Garrity introduced Salmi to Sedef. Posing as an arms smuggler, Salmi said he would smuggle the fifty kilograms of morphine base to France, sell it there, and return with weapons for Sedef. Sedef agreed, but on the condition that Salmi proved that he was a real criminal by delivering a load of semi-automatic pistols to Istanbul.

Although it was illegal, the Turks, at the urging of the CIA, agreed to let the deal go down, and that night Salmi drove with a group of arms smugglers to Istanbul. To his surprise, he ended up in a garage half a block from his house. The smugglers put a hundred pistols in his car, and Salmi drove back to Ankara, where the receivers purchased the guns. The CIA-advised Turkish security police tailed the receivers to their Kurdish contacts, as the CIA had planned all along.

Sedef, meanwhile, was in another part of Ankara, waiting to sell the first thirty kilograms of morphine base. Salmi hustled over to Sedef's house and made the buy, at which point Casey, the Turkish police, and several OSI agents descended and arrested everyone. Garrity then drove to Kilis, a town on the Syrian border, and contacted Cil's supplier, Mr. Kayican. Unaware that Sedef had been busted, Kayican agreed to sell the remaining twenty kilograms of morphine base directly to Salmi. A few days later, Huseyin Cil arrived in Gaziantep and the deal went down. As Salmi recalls, “Garrity and I inspected the base in the presence of Kayican and Cil. When I was satisfied as to the quality of the contents, I gave a prearranged signal from a window, and Casey, the Turkish police, and the OSI agents entered the hotel and assisted in the arrests.” Cil, however, having bought protection, was found not guilty in the Gaziantep court.

“The big problem was corruption,” Salmi reiterates. “The average Istanbul cop made about fifty dollars a month, and his rent was sixty, which meant that a lot of cases were sold out.”

The illegal activities of the Turkish police force were well known at FBN headquarters. In 1962, Jack Cusack had reported that the chief of the Central Narcotics Bureau in Ankara “extorted kickbacks from informants.” Istanbul's police chief considered the traffic of morphine base “a source of revenue,” and the head of Istanbul's narcotics unit believed the problem was the importation of drugs by non-Turkish citizens. The only reliable cop was Turkey's Interpol representative, Halvit Elver. But Elver was on the CIA's payroll and was shunned by his colleagues, who called him disparagingly “the American tail.”
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