PART 1 OF 2CHAPTER 6
At Michael Riconosciuto's trial in Tacoma Washington, Peter Videnieks testified that while working for the Justice Department he had contact with the PROMISE software. He "conducted the competitive contract competitive procurement for acquisition of the services to implement PROMISE." Under cross examination hetestified that "it required preparation of a request for proposals issuance of that document to industry ... negotiating, selecting, and awarding the contract. Then after award, administering the contract to see that the work that the government paid for was properly performed."
So, essentially, Videnieks administered the Inslaw contract with the government. His employment record included work with the Internal Revenue Service as a revenue officer from 1964 to 1967. From 1967 to 1972 as a contract specialist with NASA. From 1972 to 1973 with Customs as a contract specialist. From 1973 through 1975 back at NASA as a contract specialist. From 1975 through 1981 as a contract specialist with Customs, supervisory at this time. From 1981 through September, 1990, with the Department of Justice as a contract specialist. And from September 1990 through present (January 1992) as a supervisory contract specialist at Customs again.
Thomas Olmstead, Riconosciuto's attorney, showed Videnieks the Inslaw affidavit signed by Riconosciuto. Videnieks said he had seen the affidavit prior to court, but testified that he'd never heard of the Wackenhut Cabazon joint venture and never visited the Wackenhut Cabazon facility in Indio, California. He also testified that he'd never met Earl Brian.
Olmstead asked Videnieks if he knew Robert Chasen [Executive Vice President of Wackenhut]. Videnieks testified that he knew him "by name since he was head of Customs for about a three-year period, from about 1977 through 1980. I met him once in the line of my duties."
Interestingly, according to his resume, Robert Chasen was Commissioner of Customs in Washington D.C. from 1969 to 1977, then Executive Vice President of Wackenhut from 1981 to present (1991). And Peter Videnieks, a contract officer at Customs in Washington D.C. from 1972 to 1974, then again at Customs from 1976 to 1981, said he did not know Robert Chasen. How could that be? Videnieks had worked in the same department with Chasen, off and on, for at least three years.
Videnieks also testified that he met Chasen in the line of his duties sometime between 1977 and 1980. Yet, Chasen no longer worked at Customs between 1977 and 1980.
Olmstead asked Videnieks to reiterate his position with the PROMISE software. "I worked on the [PROMISE] contract. ...The procurement was assigned to me by a lady named Patricia Rudd. ...My function was to conduct a competitive procurement, negotiate an award of contract, and then administer the contract."
Olmstead: "What time frames are we talking when you were ...?"
Videnieks: "We're talking about from the day that I reported for duty at Justice, which was in September 1981, through about 1985."
Olmstead: "Are you familiar with Hadron Company?" (This was a loaded question because Earl Brian, who Videnieks testified he did not know, owned Hadron Company at the time of the court proceedings.)
Videnieks responded, "Yes, I am."
Olmstead: "Have you done work for Hadron Corporation in your procurement contract;'"
Videnieks: "I supervise currently a contract specialist who is administering a contract with Hadron."
Olmstead: "Prior to supervising someone, did you personally handle that particular contract?"
Videnieks: "I have administered well over a hundred contracts, maybe a couple hundred or several hundred over my career, and I don't recall whether I have or not."
Olmstead: " And you have never given a deposition in regards to the Inslaw matter?"
Videnieks: "My recall is not that good. Like I said, I have administered hundreds of contracts, and I may or may not have administered one with Hadron."
Again Olmstead asked Videnieks if he knew Earl Brian. Videnieks responded, "No, sir."
Olmstead: "Do you know who owns Hadron?"
Videnieks: "I really don't. I've heard I mean, I don't want to speculate now. He may be an officer with Hadron. He may be."
Olmstead: "You don't recall any questions in any depositions at all regarding that?"
Videnieks: "I do recall questions along these same lines. But again, from general knowledge, I think he is an officer or has been an officer with Hadron."
Olmstead: "In fact, in your deposition, you admitted you knew that he was an officer of Hadron, didn't you?"
Videnieks: "I would like to see my transcript from my deposition as to what I said ..."
Olmstead went on to question Videnieks about "Modification No.12" of the PROMISE software. Videnieks stated that he knew what Modification No.12 was, but repeatedly refused to discuss it until someone produced the original Inslaw contract. Finally, under pressure to give a general recollection, he said it dealt with the twelfth modification to the PROMISE software.
Olmstead asked, "Were you personally chastised as a result of Modification No.12 in the way you handled that?"
Videnieks: "Please define 'chastised.'"
Olmstead: "Were you told that you took, converted, and stole six million dollars worth of Inslaw software through the way you handled Modification No. 12?"
Videnieks: "A judge in the bankruptcy court ruled that. Since then the record was erased. And that language should not be the way a non-lawyer like me understands, it is no longer in existence ...'
It is necessary to digress here to disclose the magnitude of the apparent government cover-up relative to Riconosciuto's case. About two weeks before Riconosciuto's trial began, I had received a call from Michael asking me to contact Brian Leighton, a former assistant U.S. Attorney in Fresno, whom Michael claimed to have provided information to. Michael was lining up his ducks. Essentially his defense rested on his ability to prove he worked for the U.S. government in intelligence operations, but his lawyer was behind schedule in making the contacts.
Brian Leighton had been instrumental in prosecuting 29 members of a drug/arms organization called "The Company." The Company had been written up in the San Francisco Chronicle on April 28, 1982 under the heading "Story of Spies, Stolen Arms and Drugs." According to reporter Bill Wallace, The Company consisted of (quote) "about 300 members, many of them former military men or ex-police officers with nearly $30 million worth of assets, including planes, ships and real estate."
The article went on to say that "federal drug agents said the organization had imported billions of dollars worth of narcotics from Latin America, and was also involved in gunrunning and mercenary operations." Specialized military equipment consisting of nine infrared sniper scopes, a television camera for taking pictures in darkness, 1500 rounds of small arms tracer ammunition for night combat, a five foot remote control helicopter, and secret components from the radar unit of a Sidewinder guided missile were stolen from the U.S. Naval Weapons Station at China Lake in the Mojave Desert.
Federal agents said some of the stolen equipment was going to be used to make electronic equipment for drug smugglers and some was traded to drug suppliers in Columbia. Twenty nine members of the Company were indicted by the Fresno federal grand jury in 1981. Amongst those indicted was Andrew "Drew" Thornton, 40, a former narcotics officer.
On September 13, 1985, the Los Angeles Times published the story of Thornton's death, entitled, "Former Narcotics Officer Parachutes Out of Plane, Dies with 77 Pounds of Cocaine." The article said Thornton was indicted in 1981 for "allegedly flying a plane to South America for a reputed drug ring known as 'The Company.'" In an interview with the Los Angeles Times, Brian Leighton said, "I'm glad his parachute didn't open. I hope he got a hell of a high out of that ..."Thornton's mysterious death
was discussed at length in a book written by Sally Denton entitled, "The Blue Grass Conspiracy." Part of The Company was headquartered in Lexington, Kentucky. Prosecutors in Lexington, Fresno, California (Brian Leighton), and Miami, Florida were working together in a faint effort to bring down The Company.
The San Francisco Chronicle noted that in January, 1982, Gene Berry, a state prosecutor in Charlotte Harbor, Florida, was shot in the face as he answered his door. Police subsequently arrested Bonnie Kelly as Berry's murderer. Bonnie's husband, Mike McCIure Kelly, was a suspected member of The Company who later pleaded guilty in the Fresno, California case.
In Michael Riconosciuto's documents, I discovered a letter dated March 24, 1982, written on Cabazon letterhead to Michael McCIure at Hercules Corporation from Art Welmas, President of the Cabazon Band of Indians. Copies (cc:) were also noted to Marshall Riconosciuto and Michael Riconosciuto. The letter complimented McCIure's competence in presenting a clear and lucid explanation of a power pack under development at Hercules. (Hercules was owned by Marshall Riconosciuto, Michael Riconosciuto and Patrick Moriarty, the Red Devil fireworks mogul. More on Moriarty later.)
Throughout Michael's documents, I found references to Michael McCIure and Bonnie Lynne G. Kelly. Michael's code word for Mike McCIure was "Gopher."
Journalist Danny Casolaro had been communicating regularly with Michael Riconosciuto and obviously learned about The Company. It is not to be overlooked that coincidentally or not, Ari Ben Menashe (a former Israeli intelligence agent who lived in Lexington, Kentucky) told Bill Hamilton that two Lexington FBI agents had been en route to meet with Danny at the Martinsburg Hotel on the day of his death. The Company was headquartered in Lexington. Danny was not meeting with the FBI relative to PROMIS, he was preparing to turn over drug trafficking information on The Company.
Ben Menashe further told Hamilton that one of the agents, E.B. Cartinhour, was angry that the Justice Department was not pursuing Reagan administration officials for their role in the October Surprise.
Meanwhile, it was necessary to contact Brian Leighton to corroborate Riconosciuto's story that he had been instrumental in helping Leighton identify members of The Company.
I did not directly contact Leighton, who had resigned from the U.S. Attorney's office shortly after the prosecutions and entered into private law practice, but asked the Secret Service agent in Los Angeles who had visited my home regarding the "Queen's accident" in Mariposa (mentioned in the first chapter of this book) to run a check on Riconosciuto.
Instead, he called Brian Leighton and when I checked back with him, he acknowledged talking to Leighton about Riconosciuto. Leighton confirmed to the Secret Service agent that he recalled a three-hour face-to-face meeting with Riconosciuto and remembered him well. He gave specific details of Riconosciuto's cooperation with the U.S. Attorney's office. I thanked the Secret Service agent and hung up.
I next contacted a retired police officer and colleague in the Mariposa investigation, and asked him to put me in touch with someone trustworthy in government who could corroborate Leighton's information. The contact was made and this individual agreed to call Brian Leighton to see if he could glean further details of Michael's cooperation with the U.S. Attorney's office. For purposes of anonymity, this source will be identified as "R.J." When I checked back, he confirmed that Leighton did indeed remember Michael's help with the case and, in fact, said Michael led law enforcement officers to a marijuana cache belonging to members of The Company.
At that point I was satisfied that Michael had been operating within the framework of The Company and had spoken accurately about his cooperation with Brian Leighton. I called Thomas Olmstead, Michael's attorney, and related the above information.
Two weeks later, on January 15, 1992, at Michael's trial in Tacoma, Washington, Brian Leighton testified that the case in question involved the theft of military equipment from the China Lake Naval Weapons Center in California. "The FBI and Naval Intelligence Service began the investigation," he said; "and there were several people that were targets of the investigation. One of those targets began cooperating with us and then it became a DEA and FBI investigation. The thefts occurred in 1979 and 1980, and the case continued on for a couple of years."
Leighton testified that he "could not recall ever meeting personally with Mr. Riconosciuto and he didn't know if he spoke to him personally or spoke to him through a government agent." Under cross-examination, Leighton testified that he thought Riconosciuto was brought to him by an agent Barnes from the Oakland or San Francisco office of the FBI, but he couldn't remember exactly ..."
After Leighton's testimony, Michael called me and asked, "What happened?" I was astonished at Leighton's testimony. What was at stake here? Michael speculated that Leighton was operating out of fear. He said Leighton retired from the U.S. Attorney's office shortly after prosecuting members of The Company, and recalled that the prosecuting attorney in Florida had been shot in the head.
I called the Secret Service officer and R.J. individually and asked them to repeat what Leighton had told them before the trial. They both repeated verbatim what Leighton had told them the first time about Michael Riconosciuto. I said it appeared Leighton had perjured himself in court. Neither could understand why.
In August 1994, I received from a friend of Bill Hamilton's (President of Inslaw), a Declaration, signed by Hamilton, which stated that " ...On or about April 3, 1991, I spoke by telephone with Mr. Brian Leighton, an attorney in private practice in Fresno, California. He stated that during the early 1980's, while serving as an Assistant United States Attorney in Fresno, California, he had investigated a nationwide criminal enterprise known as 'The Company' which was engaged in illegal drug trafficking on a massive scale.
"Mr. Leighton told me that (A) Michael Riconosciuto had furnished Mr. Leighton 'valuable intelligence' on illegal drug activities and The Company; (B) Mr. Leighton had been unable to use the information in prosecution but (C) the failure to use Mr. Riconosciuto's intelligence information was not because of any fault of Mr. Michael Riconosciuto."
Also mentioned in the affidavit was corroboration of Riconosciuto's work in the defense and national security fields. Section six of the affidavit noted that during the course of a telephone conversation with Robert Nichols on or about April 18, 1991, Hamilton learned that Nichols had attended a meeting that had been organized by a Colonel Bamford, an aide to General Meyer, then Chairman of the Joint Chiefs of Staff. Others participating in the meeting were department heads from Department of Defense scientific facilities.
Michael Riconosciuto was the principal presenter to this group of senior level national security research and development officials. According to Nichols, Riconosciuto made a day long presentation to this meeting of scientists lasting from approximately 9 a.m. until approximately 4 p.m., answering questions from the participants and filling the halls of the conference facility with his hand printed notes on the scientific andtechnical issues that arose in the course of his presentation.
I was able to locate in Riconosciuto's files, a letter written on July 20, 1983 from Tom Bamford, Vice President of Research and Development at FMC Corporation in Santa Clara, California to William Frash in Escondido, California. At that time, Frash, a retired USMC Colonel, was Chairman of the Board and Chief Executive Officer of Lilac Corporation.
Essentially, the letter expressed enthusiasm for the potential application of technologies being proposed to FMC Corporation by Meridian Arms, and called for a list of all active participants in the joint venture. At that time Riconosciuto was vice president of Meridian Arms. Bamford added, "...You may want to do this only for Mike at this stage."
Frash hastened to respond to Bamford on July 27, 1983 to apprise him of a meeting between himself and Michael Riconosciuto, Robert Booth Nichols, Peter Zokosky and Patrick Moriarty (Michael's father's business partner) regarding "energy transfer phenomena." A proposal was underway to outline technology in the form of patents applied for jointly between Meridian Arms and FMC. Frash noted that the technology would "supercede all existing world patents in the field."
"Had we patented previously, it would only have announced our 'edge' in the field," he wrote. Three of the four major patents that would be forthcoming were (1) the application of Perturbation Theory to enhanced energy transfer, (2) the application of stationary methods with powders and aerosols to enhanced energy transfer and (3) the application of Perturbation Theory to hydrodynamic flow regimes.
It is noteworthy that the submarine propulsion system depicted in the movie, "Hunt for Red October" utilized this theory. Frash concluded, "Tom, as you well know, Mike's tried and true value is in the field of high voltage and electrostatics and their application. The meetings in San Jose highlighted application of this technology in over one hundred areas that are in-house FMC." He added, "...Per your reference to meetings in Washington, D.C., I assume the meetings with Dr. Fair, Admiral Renkin and the ACCOM people will suffice in this matter. In closing we are very enthused, Tom, and we look forward to an expeditious closing. Sincerely, William Frash."
Frash's payment for putting together the above referenced joint venture, if successful, would be $500,000 for the first fifteen million invested, or $166,666.66 for only five million invested, a one-hundred-thousand-dollar per year salary for a period of 20 years, and a 2% share in the gross profits. This, according to a Letter of Understanding sent to and signed by Robert Booth Nichols and Michael Riconosciuto in July, 1983.
In questioning Michael Riconosciuto about the FMC agreements, he said he attempted to break away from Robert Nichols in 1984. "The guy nearly got me terminated," declared Riconosciuto. "At the time I was working with Nichols on a proposal to FMC Corporation, which is Food Machinery Corporation, they produced the Bradley Personnel Carrier. I've got a complete paper trail on the technology that was being presented. We conducted a test demonstration of an enhanced airfield device which I developed. We also conducted a test of a hydrodynamic implosion type of explosive device.
"The implosion device settled the Nevada Test Range by about 30 feet. The Lawrence Livermore Labs and the Gallup Ordinance people built a prototype of the device, but they overbuilt it because they wanted an impressive demonstration. It created an international incident because the demonstration was picked up by Soviet monitoring satellites.
"Anyway, the bona fides were established. The next thing was to get the business done and get me into harness in a program. I was all for it, but Bob [Nichols] started getting spooky on me. He wanted to receive the setup of our end offshore, in Singapore. He wanted to receive $20 million dollars in cash in Singapore, and he wanted to use certain of the technology overseas, namely in Australia, OK?
"Bob started drinking a lot. He was obviously under a lot of pressure from somewhere, and his facade of respectability started to crack. About that time Bob began pressuring me to do things a certain way. We'd already been approved at the executive level by FMC. But we still had to go through the legal department and FMC is a publicly held stock corporation. So we still had to go through the shareholders for about eight months, which put us about a year away from consummating the deal.
"So, I asked Bob for some extra money to meet my everyday expenses, but Bob said, 'Hurry up and get the business done and then you'll have plenty of money.' I tried to explain to Bob that there was no way he could expedite this thing, and so on and so forth. Well, Bob became really overbearing. And that's when he demanded that I state things in the contract proposal to FMC which would have been misstatements, to the point of being illegal. That's when I started having second thoughts about it.
"There were other people involved in the development of that technology. Bob wanted me to pay him out of my share and make no reference to the other people in the agreement. But when you've got the University of California and the University of Chicago having 16 percent of your company, having 16 percent of Hercules Research and Interprobe, you know, how could I misrepresent the interests of my dad, Moriarty and [Admiral] AI Renkin in a deal with a U.S. publicly held corporation [FMC]?
"At that time, Riconosciuto had been Vice President of Meridian Arms, a subsidiary of Meridian International Logistics. But he was also technical advisor for F.I.D.C.O. (First Intercontinental Development Corporation) of which Nichols was on the Board of Directors. Noted Riconosciuto, "I walked into F.I.D,C.O. in equal good faith. And that also turned sour because Bob wanted me to illegally take embargoed technology out of the United States, to run an operation with embargoed armaments and high technology outside of the United States.
"So I walked out on Bob. And Bob put the heat on me and they wouldn't leave me alone. When I got remarried [to Bobby Riconosciuto], they continued to harass me by putting out false intelligence reports on me to law enforcement ..."
I asked Michael why he didn't fight back? Michael responded, "You don't seem to understand. All my involvements were under closely controlled situations. There's only one time in my life when I was planning on doing something off-color, and it never went anywhere. All the rest of the time, everything was under complete controls. I never took any elective actions. Everything was, you know, on direct orders. And I got to the point where I balked with Bob Nichols and that's when he went ballistic on me."
Riconosciuto said he was in the process of cleaning up his life in Washington state when a private investigator from Inslaw contacted him. "I didn't want to get nailed for piracy of that software, so I talked to my attorney, who talked to the Inslaw attorneys, and I gave them a declaration. And about that time, Peter Viedenieks, who was an associate of both Robert Booth Nichols and Dr. John Nichols, called me and told me I was my own worst enemy. He said if I didn't cool it, if I didn't stonewall any further requests for information from the House Judiciary Committee, I was going away forever. I told Viedenieks that I was already in too deep, and he repeated that 'I was my own worst enemy.' Seven days later I was arrested on drug charges."
Ted Gunderson was one of the few "cooperating" witnesses at Michael's trial. Through his affidavit and testimony, Ted hoped to supply the defense with needed corroboration of Michael's covert government sanctioned activities. Unfortunately for Michael, Ted could not disclose numerous activities which had included Robert Booth Nichols. At one time Gunderson, Nichols and Riconosciuto had been inseparable, like the three musketeers. But, Nichols was currently under investigation by the Los Angeles FBI for alleged involvement in organized crime in the U.S. and abroad.
Fortunately, however, Gunderson's resume added credibility to the provocative affidavit he entered into court on Michael's behalf. He had been Senior Special Agent in Charge (SAC) at Los Angeles FBI headquarters from 1977 to 1979 when he retired from the FBI and went to work as chief investigator for F. Lee Bailey, Esq. Prior to that, from 1960 to 1965, Gunderson was Special Agent Supervisor at FBI headquarters in Washington, D.C. Interestingly, amongst a prestigious list of positions nationwide, he was also SAC from 1973 to 1977 in Dallas, Texas (where he became friends with Clint Murchison, Jr., according to his live-in partner, J.M. J.M. stated in phone interviews that she and Gunderson attended parties with Murchison in Dallas, and Gunderson phoned him often from their Manhattan Beach home).
In 1979, Gunderson received the Alumni Highest Effort Award in the Field of Law Enforcement from Sigma Alpha Epsilon Social Fraternity at the University of Nebraska. In 1979, he also received the Distinguished Alumnus Award from the University of Nebraska in recognition of distinguished arid devoted service to his country.
Gunderson's handwritten affidavit, submitted to Michael's lawyer on September 27, 1991, read as follows (excerpted): "I, Ted L. Gunderson, make the following free and voluntary statement. No threats or promises were made to get me to make this statement. I was born 11/7/28 at Colorado Springs, Colorado.
"In early 1986, I met one Ralph Olberg through a friend of mine, Bill Sloane. Sloane is a former official with HUD. Sloane was appointed by President Ronald Reagan to the HUD position after the president was elected in 1980.
"Olberg is a prominent American businessman who was spearheading procurement of U.S. weapons and technology for the Afghanistan rebels.
"In late Spring or early summer of 1986, Ralph Olberg, one Tim Osman, Michael Riconosciuto and I met in a room at the Hilton Hotel, Ventura Blvd., Sherman Oaks, California. I accompanied Michael Riconosciuto, and Osman and Olberg were together. We were there to discuss Olberg's role with the worldwide support network involving the Mujahaden, Afghanistan Resistance Movement against the Soviets.
"In particular we discussed the ability of the Mujahaden's willingness to field test weapons, new and esoteric in the field and to return a research report, complete with photos.
"We also discussed the capture and/or defection of high ranking Soviet military personnel who had sensitive compartmentalized information and the availability of their briefings. We discussed one person who was a Soviet defector and was a communications officer who had detailed information of the highest levels of Soviet military C31 (Command Control Intelligence and Communications).
"We also discussed the Soviet directed weapons system referred to in the conversation as' Blue Death.' Michael and I were told by Olberg that witnesses stated the corpses did not decay even after being exposed and unburied for six months.
"We discussed the possibility of Michael analyzing one of these units captured in the field by the Afghan rebels for the purpose of having Michael help their technical experts develop effective countermeasures.
"We discussed a military joint venture in Turkey to produce specialized ammunition. We discussed a lobbying effort to legally obtain Stinger II missiles as well as the various Stinger post and Stinger alternates. Michael was to formulate a plan to sanitize the electronics of any Stingers that would be at risk of Soviet capture so any information gained from a captured Stinger could not be effectively used against the U.S. or NATO forces.
"This report was to be presented to a Congressional position as support for the lobbying effort to convince Congress to legally sanction the shipment of these missiles to the Afghan rebels.
"We discussed Michael's proposed modification of Chinese 107 MM rockets and how to reconfigure the package into a backpack portable effective artillery counter battery system.
"We discussed Michael's connection with the Chinese weapons position, Norinco, to provide the basic components for the unassembled rocket system. We discussed the modification and assembly of these 107 MM rockets and their launchers at a facility in Pakistan known as the Pakistan Ordinance Works.
"It was my understanding from the discussion that we were working on a legally sanctioned arms assistance project to the Afghan rebels and that Ralph Olberg was working through the Afghan desk at the State Department as well as through Senator Humphreys office. "This was subsequently confirmed by journalist Danny Casolaro who was recently 'suicided.'
"Olberg indicated a potential turf battle problem with certain factions of the CIA and his group MSH (Management Science For Health). In negotiations and/or lobbying efforts with Congress, the CIA MSH people were arguing that Ralph and Tim Osman's group did not truly represent the leadership of the Afghan rebel resistance.
"Tim and Ralph proposed calling their people and having an unprecedented leadership meeting in Washington D.C. to prove that their group did in fact represent the full leadership of the Mujahaden."
"When I recently called Ralph, he denied that the above meeting had taken place and then after prodding, he finally admitted to it and he asked me not to talk about it. This five page statement is true and correct to the best of my knowledge. Ted L. Gunderson."
Later in my investigation, I obtained from Michael Riconosciuto's files in the desert, a handwritten note from "T.G." to "Michael" which read as follows: "Raymond is arriving at LAX 7:55 p.m. Air Canada via Flight 793 from Toronto. Will have to go through Customs. This will give us another member for our drug/arms operation." The note gave a telephone number where "T.G." could be reached. "Raymond," referred to in the note, is presumably Raymond Lavas, Gunderson's former forensic's expert during his tenure in the FBI.
Michael's trial was not going well. He called and asked me to contact R.J. and bring him to my house. Michael was ready to talk. He wanted me to set up a phone conversation in which he could preliminarily open negotiations for entry into the Federal Witness Protection Program. I was out of my depth here. I had no idea whether R.J. would cooperate with such a request. Nevertheless, I called him and related Michael's proposal. He said he had no authority to approve such a request, but he would take the information and pass it along.
He arrived at my home early the following week and Michael called as scheduled. Excerpts from that first tape-recorded conversation went as follows: (Michael did most of the talking) "...In the Fresno area, there was a group of people known as the Fresno Company, and the Bernard brothers were involved in it and Jamie Clark was involved and all of these people seemed to have charmed lives ...
"The Company was originally out of Lexington, Kentucky and Mena, Arkansas. Brian Leighton was the assistant U.S. Attorney who was the most effective person in formulating a strategy in the Justice Department to go after these people.
"We recognized what they were, for what they were, at that time, and there were a few ATF guys down in Los Angeles that recognized them for what they were, OK? Here was a group of over 300 people, most of them ex law enforcement and ex military , ex intelligence people involved in a major drug and smuggling operation. And they were involved in compromising activities. The bottom line was espionage.
"And all Leighton served to do was vaccinate the group against further penetration. Just hardened them. And all the major sources that were developed from inside turned up dead. A federal judge in Texas turned up dead.
" ...This is a nasty bunch of people. And they're still alive and well. Now where that dovetails into my current situation, is in 1984 I was involved with Robert Booth Nichols who owns Meridian Arms Corporation and is a principle in F.I.D.C.O., First Intercontinental Development Corporation. The CEO of FIDCO is George Pender and Bob Maheu was Vice President ...
"FIDCO was an NSC [National Security Council] corporate cutout. FIDCO was created to be the corporate vehicle to secure the financing for the reconstruction of the cities of Beirut and Damour in Lebanon. And they were working out of an office in Nicosia, Cyprus.
"...And here I got involved with a group of people that were all high profile and should have been above reproach. FIDCO had a companion company called Euramae Trading which operated throughout the Middle East. I came in contact with the PROMISE software (unintelligible). Euramae had a distribution contract with several Arab countries and I was asked to evaluate the hardware platforms they had chosen. That was IBM/AS400 stuff ...
" ...That had come from IBM Tel Aviv but it came through a cutout, Link Systems, because they couldn't deal directly with the Arabs.
"And I came across a guy named Michael T. Hurley and I thought he worked for the State Department but it turned out he was in-country attache for the DEA in Nicosia, Cyprus. [Nicosia is the capital of the island of Cyprus, off the coast of Lebanon]. Now, the DEA had no real presence in Lebanon. Neither did anybody else, including the Israelis. They had their usual network of contacts but it was very ineffective. The only way to penetrate that situation, was to get into the drug trade.
"Euramae got into the drug trade and I was told that it was a fully sanctioned NSC directed operation, which it turns out that it was ...All those operations were bonafide and all the people who were in them were definitely key government people, although they were not who they said they were.
"They all worked for different agencies other than was stated. Probably part of the normal disinformation that goes with that. And I was technical advisor for FIDCO and we had auspices through the government of Lebanon to get in and out of Lebanon.
"But as far as going to the eastern part of Lebanon, unless you were connected "with the drug trade, your chances were slim coming out unscathed ...They built a network throughout the Bekaa Valley, and [Robert Booth] Nichols ...he is under Harold Okimoto from the Hawaiian Islands.
"Harold Okimoto was represented to me as being an intelligence person, which he is. He has worked under the auspices of [Frank] Carlucci for years. [Carlucci was former CIA deputy director and former Defense secretary]. Apparently Harold performed services for the U.S. government during World War II. He's of Japanese ancestry. I guess he was rewarded for services well done.
" ...Harold operates through a company called Island Tobacco Corporation. He has contracts for all the condiments at all the casinos in Atlantic City, in Reno, in Vegas, in Macao, China...he's got contacts in Honolulu, the Orient ...a couple of Jews he knows in Bangkok ...and there is a casino, no a city about 15 miles north of Beirut that Harold has his fingers in.
"When FIDCO was wheeling and dealing on financing for the reconstruction of the infrastructure of Beirut, they were making sweetheart deals with Syrian mobsters and the brother of the president of Syria, Hafez Assad.
" ...The intelligence people in their infinite wisdom decided to capitalize on the longstanding battle between Rifat Assad and his group and the Jafaar family. Selectively they were backing both people, but they were also playing them off against one another, developing networks. They got a bunch of prominent Syrians thoroughly compromised and they were in tow in the intelligence game. And they had people that could get me in and out of the Bekaa Valley, even out of certain areas of Syria.
"From an intelligence standpoint, it was a success. But to maintain the credibility of those intelligence operations the heroin had to flow. To make it real. And the stuff was starting to accumulate in a warehouse outside of Larnaca. "I personally was in a warehouse where Hurley and George Pender and George Marcobie (phonetic spelling) told me there was upwards of twenty-two tons. And even though it was packaged for shipment, the smell of it in that closed warehouse was overpowering. You know, white heroin like that has a certain odor because of the way it's processed.
"They had authorization for what they called 'controlled deliveries' into the United States. And they would target certain cities and then follow the stuff out, ostensibly unmasking the network and conducting prosecutions.
"However, the operation became perverted at the U.S. end of the pipeline. Controlled heroin shipments were doubled, sometimes tripled, and only one third of the heroin was returned to the DEA.
"At a certain transfer point at the airport in Larnaca, the excess baggage from the original controlled delivery would be allowed to go through. I was given the names of the narcotics people who were handling that. But there were a couple of agents who were on the up and up, and they had suspicions.
"An intelligence agent who worked with DIA is now deceased. His name was Tony Asmar and he got on to the operation early on, and started going toe to toe with Hurley [DEA]. He died in a bomb blast and it was ascribed to terrorists. And it actually was terrorists who did it, but his cover was deliberately blown. Myself and others suspected Hurley and Bob Nichols and Glen Shockley were responsible for that ..."
After researching Michael Riconosciuto's information, R.J. noted to me that Michael gave mostly valid information, but he could not prove that Michael had been involved. He did, however, verify (through Customs) that Michael HAD been in Lebanon, but he could not verify the details of the drug operation.
Michael responded (on a taped message to R.J.) by visually recounting the DEA apartment/condo in Nicosia, Cyprus: "The DEA had a condo, I think it was on Columbra (phonetically spelled) Street, in Nicosia, Cyprus [off the coast of Lebanon].
"They had a ham radio station there. It was an ICOM single side band amateur radio setup, with a linear ..."
"Were you actually there?" I asked. Michael quipped, "Yes, I was there," then continued. "I can describe the antenna system, on the top floor and the way it's wired up and everything. Unless you were there, you wouldn't know it was ICOM equipment.
"Now, the game plan with Euramae and Hurley's operation ..." Pause. " ...
You need to understand that the airport in Lebanon was closed down. I took the ferry from Larnaca to Jounieb. Now Jounieb was slightly south of where the casino city was and the casino city was intact. Beirut was a nightmare, and so was Damour, because the PLO destroyed the infrastructure by burrowing bunkers, and there was no water, electricity or phones. It was a combat zone.
"The Syrian mob controlled the Casino du Liban in a little city north of Beirut. It was used as a front by narcotics people. Island Tobacco, owned by Harold Okimoto, sells all the cigarettes there. Now, I could give you the names of the families. They pitted them off against one another. F.I.D.C.O. was to finance the reconstruction of the infrastructure of the cities of Beirut and Damour. Deals were cut as to who got what concessions. There were certain families, like the EI Jorr family that had to be placated. And there was Rifat Assad and his group. "Tony Asmar figured out what was going on with Hurley, that they were shipping 'noncontrolled' loads of heroin back to the U.S. They killed Tony ..."
"What were the names of the people you were working for over there? ," I asked. Michael's time was always limited on the phone.
"Ok, there was a man named Maurice Ganem. He had a relative, either a brother or a cousin, who is a senior DEA official with Michael Hurley. I can't remember his name right now. Anyways, Maurice was agency, you know, in country, in Lebanon. And Maurice and I and George Pender worked together."
"Which agency? CIA or DEA? ," I asked.
"CIA." Michael continued. " ...And then there was Danny Habib. Danny Habib and Bob Nichols worked out of Cario (phonetic spelling) and Italy."
"And Bob was NSA or ..." "No, Bob was NSC at that time."
"George Pender and Bob Clark were the high level contacts on all of this. Bob Clark got drummed out because he was clean. And McFarland then took over, OK?"
"So, it was George Pender and McFarland and Michael McManus [Assistant to President Reagan at the White House]."
I asked, "What was your involvement with that particular operation?"
"I handled communications protocol. All the communications and financial transactions. If I could get my records on line I could show all the money flows, everything."
Michael called back later that day and we continued our conversation. He was intent on talking to someone in FinCen (Financial Crimes Enforcement Network). !"...The keystone cops are working on my defense. You know it's really an ordeal. Have you talked to R.J. again?"
"No Mike, he's not giving much information."
"Listen, tell him that not only am I willing to polygraph, but I need some expert help and I think he needs some expert help. In the league we're playing in, the only guys we can get that have the where-with-all are with FinCen. That stands for Financial Crimes Enforcement Network. Get me a technical guy that speaks my language."
"Alright, Mike ..."
"I'm talking about Swift Chips. That stands for Clearing House Interbank Payment System, Ok?"
"I'm mad, OK?"
"I'm real mad. The government has all my files and records. They've got all of my optical storage disks. Each of those optical storages, 130 of them, contains 20,000 plus pages. They jacked me around so bad ..."
" ...Get an expert that speaks my language, and I'll tell him everything I know and he can do so much damage, they won't need my testimony or anything else."
"Mike, everything you know about what?"
"Tell R.J. it goes all the way back to the Cayman Islands and the Bahamas and Castle Bank. Norm Caspar ... Resorts International Bank ..."
"How'd you get this stuff?"
"I handled the money for them, OK?"
" ...For the Wackenhut people. For Norm Caspar who was a Wackenhut employee during all of this. Now, there was the Workers Bank in Columbia. I can't pronounce the Spanish name for it, I just know it as Workers Bank. I set up their virtual dead-drops ..."
"It's a way to get around A.C.H. reconciliations on a daily basis. It'll take an expert, you know, I can't even talk to a normal human being about this ..."