PART 4 OF 5
CONCLUSION
Was CIA involved in the investigation of The Frogman Case? No information has been found to indicate that CIA or anyone acting on behalf of CIA was involved in the criminal investigation of Julio Zavala and his associates, though a relative of one of those arrested or charged did have a relationship with CIA until mid-1982.
To what extent, and why, did CIA become involved in the prosecution of The Frogman Case? What was the effect of CIA involvement in the prosecution?
CIA Records. CIA records indicate that the Agency first learned of The Frogman Case on July 30, 1984 when a cable from an LA Division Station informed Headquarters that the local representative of a U.S. law enforcement entity had brought a DoS telegram to its attention. The DoS telegram indicated that an AUSA for the Northern District of California and an FBI Special Agent were requesting permission to travel to San Jose to question two "anti-Sandinistas" in connection with the prosecution of a cocaine trafficking case identified as U.S. v Zavala.
Although the AUSA and the FBI Special Agent were not identified by name in the LA Division cable, the DoS telegram did identify them. Further the DoS telegram stated that AUSA Zanides and the FBI Special Agent would be attending "court-ordered depositions on Francisco Aviles Saenz and Vincente [sic] Rappaccioli Marquis."
Vicente Rappaccioli Marquis, who was proposed to be deposed, is identified in CIA records as having been a member of the board of directors of the PCNE. No information has been found to indicate that CIA ever had any relationship with this individual. However, CIA personnel in the LA Division Station apparently misidentified him as a former Agency asset.
In its July 30, 1984 cable informing Headquarters of the planned depositions in San Jose, the LA Division Station identified Francisco Aviles Saenz by name. However, the LA Division Station cable did not provide Headquarters with the name of the second individual. Instead, the Station cable referred to this second individual by a CIA cryptonym that had been assigned in 1980 to the misidentified former asset. According to the Station cable, the misidentified former asset had also been associated with the Contra movement.
The Station also reported that both Francisco Aviles and the misidentified former asset had been members of a Nicaraguan exile group. Although that group is not further discussed in the Station cable, Agency records indicate that the group unwittingly received CIA support.
The July 30, 1984 cable from the LA Division Station also asked Headquarters and several other field stations for any additional information that might be available in their files concerning Aviles and the misidentified former asset. The cable also asked for information regarding who Zavala was, the charges against him and whether there was any connection between Zavala, Aviles and the misidentified former asset. In closing, the LA Division Station noted that it was "concerned that this kind of uncoordinated activity [i.e., the AUSA and FBI visit and depositions] could have serious implications for anti-Sandinista activities in Costa Rica and elsewhere."
Agency records indicate that Vicente Rappaccioli Marquis--who was to be deposed and with whom the Agency had no relationship--was born on July 15, 1928. The misidentified former Agency asset differed in age from Rappaccioli by more than 10 years. By mid-1981, regular CIA contact with the misidentified former asset had ceased, and all contact appears to have ended sometime in 1982.
A Headquarters desk officer assigned to the DO/Central America Task Force (CATF) preliminarily responded to the LA Division Station in an August 1, 1984 cable. The CATF cable cited a 1983 media report that identified Zavala as a 39-year-old illegal alien from South San Francisco named Julio C. Zavala Moreno. The cable also reported that CIA had no information in its records concerning Zavala.
With respect to Aviles, the August 1, 1984 CATF cable stated that CIA records indicated that Aviles, a member of the Nicaraguan Democratic Conservative Party (PCN), had attended an August 1982 conference in Miami in which senior members of the PCN had created a faction of the party in exile--the PCNE. At that conference, according to CIA records, Aviles had been elected to be the secretary of the PCNE's board of directors. The August 1, 1984 cable also stated that the Agency had no information to indicate any connection between Aviles, Zavala and the misidentified former asset. Finally, the cable stated that the Agency was contacting the FBI for information regarding Zavala.
CIA records also show that the CATF desk officer sent a brief note and a copy of the July 30, 1983 LA Division Station cable to the Freedom, Privacy and Litigation Group (FPLG) of the DO's Information Management Staff (IMS). At that time, FPLG was the DO's focal point for matters relating to litigation that involved DO information.
An August 2, 1984 memorandum from FPLG to the CATF desk officer in CIA records indicated that the Agency's Office of General Counsel (OGC) had been made aware of the case, probably by FPLG, by that date. The memorandum stated that the proposed depositions of Aviles and the misidentified former asset would relate to whether approximately $30,000 that was seized from Zavala at the time of his arrest was acquired through business transactions, rather than cocaine trafficking. Further, the memorandum indicated that FPLG and OGC representatives were planning to meet with "the AUSA" on August 7, 1984, following which "the AUSA" would go to Costa Rica to take the depositions later in August. The FPLG memorandum did not specify the identities of the Agency's representatives or the location of the planned meeting with the AUSA.
The August 2, 1984 FPLG memorandum also asked that the CATF desk officer provide a "summary" of the activities of Aviles and the misidentified former asset in preparation for the FPLG and OGC meeting with the AUSA. Finally, the FPLG memorandum indicated that, once "the AUSA" provided further details, the Agency could "determine whether our equities will be affected." No information has been found to indicate any CATF response to this memorandum's commentary or request for a summary of the activities of Aviles and the misidentified former asset.
On August 3, 1984, Headquarters advised the LA Division Station of what had been learned about the Zavala case. The cable, originated by FPLG, indicated that the depositions that were scheduled for August 16, 1984 in Costa Rica were in response to a motion by Zavala's attorney and are "subject to court order that [the U.S.] Government not interfere or discourage compliance." The genesis for this statement may have been a recently unsealed transcript of a June 12, 1984 in camera proceeding relating to a motion by Zavala's attorney under Rule 15 of the Federal Criminal Code and Rules which pertains to depositions. The transcript of that proceeding indicated that the late Robert Peckham, the presiding U.S. District Court Judge, stated at that time, in part:
Now, there is a serious problem, though, that perhaps we should mention now, and perhaps even address first, and that is, that in the papers Mr. Zavala, through his counsel, indicates that the deponent's identify [sic] must remain secret to prevent the CIA from coercing the witnesses and to altering their proffered testimony.
The August 3, 1984 Headquarters cable to the LA Division Station also indicated that testimony in the Zavala case would concern the "source of money confiscated in cocaine raid in San Francisco." The Station was advised that--to avoid giving Zavala's defense attorneys a "possible issue"--the Station should make no effort to contact the two individuals who were to be deposed. Further, Headquarters advised the LA Division Station that there was no reason to believe that Zavala's attorneys were aware that the misidentified former asset had any association with CIA. The Headquarters cable also stated, without further explanation, that the depositions "may be avoided if planned legal action is successful." Finally, the Station was informed that FPLG and OGC representatives "will meet 7 August with Assistant U.S. Attorney to draft [a] course of action."
On August 3, another LA Division Station responded to the request for information about Aviles and informed Headquarters that Aviles was not well regarded. The Station further reported that Aviles had been asked to leave a Contra support group in Costa Rica around August 1983 when questions were raised regarding his handling of the group's funds.
The exact date of the FPLG and OGC meeting with the AUSA has not been determined although, as indicated earlier, the meeting was scheduled for August 7, 1984. On August 16, 1984, the U.S. Embassy in San Jose informed the LA Division Station that the planned visit of AUSA Zanides and an FBI Special Agent had been canceled. The Station informed Headquarters of this development on August 17, 1984 and indicated that an Embassy official had said that the visit of the "U.S. Attorney" had been canceled by the "Funny Farm," a term that the LA Division Station took to mean CIA. The LA Division Station went on to say that it had told the Embassy official that CIA had no interest in the case following receipt of the August 1, 1984 cable from the CATF branch. The Station also suggested that Headquarters might "wish [to] ascertain if [the "Funny Farm"] reference was indeed to [CIA] and, if so, correct the misunderstanding." Additionally, Headquarters was asked to inform the LA Division Station of any actions it had taken in regard to the depositions so that "we may reassure the [Embassy official] that [CIA] had no hand in cancellation of trip."
On August 14, 1984, a memorandum to FPLG from another IMS entity provided additional information concerning the results of the review of CIA records for any information regarding Zavala. The memorandum stated that there was no indication that Zavala was in the United States illegally or that he had he ever been the subject of any request for CIA records under the Privacy Act or Freedom of Information Act. On September 28, 1984, Chief/FPLG forwarded the memorandum to OGC for information.
On August 24, 1984, Headquarters sent a cable to three LA Division Stations informing them that CIA had indeed been a factor in the decision of the San Francisco United States Attorney's Office to return the money to Zavala and cancel the deposition trip to Costa Rica. This cable stated:
Following discreet approach to senior Department of Justice official, [OGC] personally contacted the Chief of Criminal Division and Chief of Drug Task Force in U.S. Attorney's Office in San Francisco to ascertain details of the subject prosecution and to avoid inquiry into activities or other [CIA] interests.
We were advised that Zavala had been arrested on 13 February 1983 in San Francisco and subsequently indicted on charges of "possession with intent to distribute" and "continuing criminal enterprise (CCE)." At the time of his arrest, a substantial quantity of cocaine was seized in addition to approximately $36,000 in U.S. currency. Although Zavala has pleaded guilty to "possession," he will require the U.S. to go to trial on the CCE charge which carries a minimum sentence of 80 months. Prior to Zavala's arrest, he had been the subject of a wiretap for some four months. During this period he and certain family members had inexplicably traveled to San Jose.
On the day of the [OGC] visit to San Francisco, the U.S. Attorney learned that one Francisco Aviles Saenz had executed an affidavit in San Jose which claimed that the money seized from Zavala belonged to [a Contra support group], that it had been collected from supporters of the party, and that these supporters included certain unnamed but official United States "organs." The copy which we saw, but could not retain pending authorization from the Court, was an official English translation and appeared to be one of many that had been made by defendant or his attorneys.
With a general briefing concerning the background of and relationship between [the misidentified former asset], Aviles and [CIA] interests, it was agreed by all that any litigation concerning the currency seizure would be fruitless. In essence the United States Attorney could never disprove the defendant's allegation that his was [a Contra support group] or [CIA] money, especially in light of the roles which [the misidentified former asset] and Aviles have played in the anti-Sandinista community. Accordingly, at [OGC's] request the U.S. Attorney has agreed to return the money to Zavala and to make no use of it during the trial of Zavala on the CCE charge.
It was for this reason that the scheduled depositions in San Jose have been canceled. Notably, [OGC] also learned that both [the misidentified former asset] and Aviles were volunteer witnesses for the defendant and planned to testify at their deposition as to the source of the money in question. We can only guess at what other testimony may have been forthcoming. As matter now stands, [CIA] equities are fully protected, but [OGC] will continue to monitor the prosecution closely so that any further disclosures or allegations by defendant or his confidants can be deflected.
While this particular aspect was successfully resolved, the possibility of potential damage to [CIA] interests was not lost on the U.S. Attorney or [Headquarters]. By virtue of [the misidentified former asset's] relationship as former [covert action] asset and member of board of directors of [a Contra organization], Aviles role as director of the [Contra support group] office in San Jose, and their formal claim of drug-tainted money, case could be made that [CIA] funds are being diverted by [CIA] assets into the drug trade. Indeed, close relationship between Zavala, a convicted drug dealer, and [the misidentified former asset] and Aviles could prove most damaging especially if any relationship, no matter how indirect, were to continue. As long as [the misidentified former asset] and Aviles continue to play any role in the anti-Sandinista movement, any public disclosure of the foregoing would have as a certain element the fact that they were "linked to" or "assets of" [CIA].
While the United States Attorney was most deferential to our interests, it was strongly suggested that we take every measure possible to ascertain any involvement by [the misidentified former asset] or Aviles in narcotics trade and/or the possibility as to whether [CIA] funds given to [a Contra support group] might arguably have been diverted. No action other than discreet inquiries should be undertaken without [Headquarters] approval and no discussion of U.S. vs. Zavala issue with Aviles or [the misidentified former asset] may take place without U.S. Attorney approval. We would appreciate any information [twoLA Division Stations] can provide to clarify these issues.
8. . . .
9. . . .
10. . . .
(Emphasis added.)
No further information has been found in CIA files regarding the precise nature of the "discreet approach" to DoJ that was referred to in the first sentence of this cable. It also has not been possible to identify with any degree of certainty the senior DoJ official who reportedly discussed the Zavala case with an OGC attorney. A number of former OGC officials believe that Criminal Division Deputy Assistant Attorney General Mark Richard was the person most likely to have represented DoJ in such a discussion, but he has no recollection of the matter.
Information in the OGC file regarding the Zavala case appears to indicate that the majority of the text of the August 24, 1984 cable was originally written by OGC, although the Chief of the CATF branch concerned was indicated as the originator of the cable. The OGC file contains eight documents, including handwritten notes. One of the documents is a draft of the August 24, 1984 cable to the three LA Division Stations. With the exception of minor revisions and the addition of operational information in paragraphs 8, 9 and 10, the text of the cable sent to the three LA Division Stations on August 24, 1984 is the same as that contained in draft form in the OGC file.
An August 22, 1984 OGC cover note to FPLG, subject "United States v. Zavales [sic]" and signed by OGC Assistant General Counsel Lee S. Strickland, stated:
Please find attached a proposed draft cable for [the LA Division] station concerning the subject prosecution. While paragraphs 6 and 7 are rather strong, I believe the station must be made aware of the potential for disaster. While the allegations might be entirely false, there are sufficient factual details which would cause certain damage to our image and program in Central America.
OGC travel records for the period have been destroyed in accordance with routine U.S. Government records management schedules. A surviving abstract summary of those records is of insufficient detail to establish whether it was in fact Strickland who traveled to San Francisco on behalf of OGC during the relevant time period. Entries in the abstract summary indicate that a number of OGC personnel traveled during the general time period but the name of the traveler, the specific dates of such travel and the destination are, in many cases, not specified. Several entries in the abstract summary list San Francisco as one such destination, but the name of the traveler is not specified.
The LA Division Station, in a September 8, 1984 response to the August 24, 1984 Headquarters cable, reported that it had additional information pertaining to the misidentified former asset. According to the report, the misidentified former asset had last been seen about March 1982 in Managua, Nicaragua. Since that contact, the misidentified former asset had reportedly married and was currently living somewhere in a foreign country. According to the report, the misidentified former asset was a "good man."
An OGC weekly report regularly prepared by General Counsel Stanley Sporkin for senior CIA officials made reference to the Zavala case. The October 26, 1984 report contained several factual errors, including mischaracterizing Aviles as a CIA assettating his position with the Contra support group. The relevant portion of the weekly report, which closely approximated the wording of the August 24, 1984 Headquarters cable to the LA Division Station in many respects, stated:
U.S. v. Zavala: During our quarterly review of Agency litigations, we decided to provide summaries of cases which the Director might find interesting. This is such a case. Several months ago, the [the LA Division] station queried Headquarters concerning a proposed visit by two U.S. Attorneys from San Francisco to interview two individuals who were assets--one [the misidentified former asset] and one the Chairman of the Board of Directors of a [Contra support group] funding mechanism (Francisco Aviles). Following a discreet approach to a senior Department of Justice official, we contacted the Chief of Criminal Division and Chief of Drug Task Force in U.S. Attorney's Office in San Francisco to ascertain details of the subject prosecution.
We were advised that Zavala had been arrested on 13 February 1983 in San Francisco and subsequently indicted on charges of "possession with intent to distribute" and "continuing criminal enterprise" (CCE). At the time of his arrest, a substantial quantity of cocaine was seized in addition to approximately $36,000 in U.S. currency. Although Zavala has pleaded guilty to "possession," he will require the U.S. to go to trial on the CCE charge which carries a minimum sentence of 80 months. Prior to Zavala's arrest, he had been the subject of a wiretap for some four months. During this period, he and certain family members had inexplicably traveled to San Jose.
Contemporary with our visit to San Francisco, the U.S. Attorney learned that Aviles, one of our assets,uted an affidavit in San Jose which claimed that the money seized from Zavala belonged to [a] political exile party . . . , that it had been collected from supporters of the party, and that these supporters included certain unnamed but official United States "organ[ization]s." The copy which we saw was an official English translation and appeared to be one of many that had been made by defendant or his attorneys.
This matter raises obvious questions concerning the people we are supporting in Central America and we are continuing our inquiry into this matter internally in conjunction with all concerned components.
Then-Counsel to the DO Ernest Mayerfeld forwarded the OGC weekly report to the Deputy Director for Operations with a brief memorandum on October 30, 1984. Mayerfeld's memorandum suggested the Zavala case was not as serious as portrayed in OGC's weekly report:
This is an item taken from weekly news sheet put out by Stan Sporkin. This one covers last week's events. I don't know whether you had heard about this case - I had not. I talked to the lawyer that is handling this case, who tells me that the graymail aspects of this case are quite routine and he has every reason to believe that he can avoid, with the excellent cooperation of the San Francisco prosecutor, any public disclosure of our involvement. I do not think this is a big flap and ought not to be made into one. On the basis of what I know so far, I feel the final paragraph of the attached [weekly report] overstates things.
On November 2, 1984, Headquarters sent a cable to two LA Division Stations asking for information regarding Aviles and his role in Contra support groups. The Stations both responded on November 5, and one of them suggested that Headquarters contact a CIA officer who had formerly been assigned to that Station and might possess relevant background information. On November 7, 1984, Headquarters sent a cable to that officer explaining that certain information was needed by Headquarters "to prepare a report regarding the involvement of . . . Francisco Aviles in U.S. v. Zavala case now in litigation in San Francisco." In a November 8 response to Headquarters, the CIA officer said he had no information to offer.
U.S. District Court/U.S. Attorney's Office Records. During the prosecution of Zavala, the defense attorneys filed a motion in June 1984 to place under seal the Aviles and Rappaccioli letters and other related documents that claimed that the money seized from Zavala's home belonged to the Contras. The motion was granted by the Court. On August 8, 1984, the U.S. Attorney's Office's motion to remove the documents from under seal was granted by the Court. However, the next day, the Court vacated the unsealing order. AUSA Zanides recalls that, upon learning of the contents of the letters when they were unsealed, the U.S. Attorney immediately moved to re-seal the materials pending a further review. This was done because the U.S. Attorney did not know whether the persons named in the letters were assets of CIA.
The documents that had been sealed have now been removed from seal by the U.S. District Court for the Northern District of California after CIA and DoJ asked the U.S. Attorney's Office to file a motion requesting that this be done. The documents that were formerly under seal include:
Document number 639--a Supplemental Declaration of Judd C. Iversen in Support of Deposition that was filed with the Court on June 18, 1984;
Document number 730--a transcript of a June 12, 1984 in camera proceeding involving arguments by the defense and the prosecution relating to the Rule 15 motion;
Document number 745--a Declaration of Judd C. Iversen in Support of Motion for Order Granting Leave to Take Deposition dated June 4, 1984 and filed with the Court on August 28, 1984. This document included as attachments:
An unsigned receipt for $45,000 in Spanish on PCNE letterhead that is dated January 24, 1983 and with an English translation of the Spanish text typed above the PCNE letterhead. A forensic analysis requested by CIA/OIG from DoJ's INS Forensic Document Laboratory indicates that the receipt is a composite document, i.e., it is a photocopy of two documents butted together;
A photocopied document--in Spanish--titled TESORERIA ("Treasury"), signed by Vicente Rappaccioli, on PCNE letterhead. In the document, Zavala is identified as having been named "ASISTENTE DE ESTA TESORERIA GENERAL DEL PARTIDO CONSERVADOR, AUTHORIZADO PARA COLECTAR DENTRO DE LOS ESTADOS UNIDOS DINERO PARA LA LIBERACION DE NICARAGUA DEL COMUNISMO INTERNACIONAL." ("Assistant to the General Treasury of the Conservative Party, authorized to collect within the United States money for the liberalization [sic] of Nicaragua from international communism.");
An unsigned photocopy of an English translation of document (b) but with different type face and on plain bond paper;
A photocopied document--in Spanish--addressed A QUIEN CONCIERNE ("To Whom It May Concern") on PCNE letterhead. The document is signed by Aviles as the "SECRETARIO POLITICO" ("Political Secretary") and by Rappaccioli as the "TESORERO" ("Treasurer"). Following a brief description of the PCNE's goals and objectives, the document continues that Zavala:
". . . . ES MIEMBRO DEL PARTIDO CONSERVADOR COMO ASISTENTE DE TESORERIA Y SE ENCUENTRA EN LOS ESTADOS UNIDOS DE NORTE AMERICA PROMOVIENDO LA REINSTAURACION DE LA DEMOCRACIA EN NICARAGUA, PARA DICHA MISION LE FUE ENTREGADA LA CANTIDAD DE CUARENTA Y CINCO MIL DOLARES EN EFECTIVO, EN LA ULTIMA SEMANA DE ENERO DE MIL NOVECIENTOS OCHENTA Y TRES EN SAN JOSE, COSTA RICA. LA RETENCION DE ESTE DINERO PERJUDICANDO EL PROCESO DE LIBERACION, CON SUS CONSECUENCIAS NATURALES. (". . . is a member of the Conservative Party as assistant treasurer and is located in the United States of America promoting the reinstatement of democracy in Nicaragua, for which mission he received forty five thousand dollars in cash, on the last week of January, 1983 in San Jose, Costa Rica. The retention of this money is prejudicing the progress of liberation, with natural consequences.")
ROGAMOSLE MUY ENGARECIDAMENTE A LAS AUTORIDADES CORRESPONDIENTES DEVOLVERNOS DICHO DINERO." ("We dearly implore that the corresponding authorities return said money.");
An unsigned photocopy of an English translation of document (d) on plain bond paper;
Several photocopies of newspaper clippings. One of the clippings was of a front page article from the July 14, 1983 edition of the San Francisco Examiner titled "CIA Buildup in Nicaragua." The other article was from an unidentified Spanish-language newspaper pertaining to The Frogman Case and was titled "Somocistas en Trafico de Drogas." ("[Counterrevolutionary] Drug Trafficking");
Document 684--a notarized letter in Spanish, signed by Aviles, on UDN letterhead. It appears to be an original and is dated May 15, 1984. In addition, it has attached to it a separate English language "official translation" notarized on May 29, 1984 by an officer of the U. S. Embassy in San Jose. Following a brief introductory paragraph regarding the goals and objectives of the UDN, the letter--and its "official translation"--includes the following statements by Aviles:
"Qué el señor Julio Cesar Zavala Moreno es miembro de esta organización desde hace varios anos." ("That Mrs. Julio Cesar Zavala Moreno [sic] is a member of this organization since several years ago.")
"Antes de la última semana de enero de 1983 hizo varios viajes a Costa Rica trabajando para ésta organización." ("That before the last week of January, 1983 he made several trips to Costa Rica, working for this organization.")
"En su último viaje se le entrego la suma de cuarenta y cinco mil dólares en efectivo para compras propias de nuestra actividad." ("That on his last trip the amount of forty-five thousand dollars in cash was given to him for purchases characteristic to this organization.")
"Dicho dinero fué recaudado entre nuestros coloboradores aquí en Costa Rica." ("That said money was collected amongst our collaborators, here in Costa Rica.")
"El Organismo del Gobierno Americano, varias veces nos ha prestado ayuda para la lucha anticomunista que se realiza en Nicaragua." ("That the American Government Organism [sic] has assisted us many times in the anticommunist fight which is taken [sic] place in Nicaragua.")
"La retención de dicho dinero esta perjudicandonos el proceso de liberación que ya estamos en la etapa final." ("That the retention of said money is damaging the freeding [sic] process which is in its last stage.")
"El suscrito firmante esta dispuesto de ofrecer testimonio de lo anteriormente relacionado ante la Embajada Americana en San José, Costa Rica, si fuese necesario." ("That the undersigned is willing to offer evidence with regard to what has been stated above before the American Embassy in San Jose, Costa Rica, if necessary.")
Other documents relating to the Rule 15 motion found in U.S. Attorney's Office records may have been subject to the original sealing order. However, the documents described above are the totality of documents that the U.S. District Clerk's Office identified as removed from seal by virtue of the August 6, 1997 U.S. District Court order.
A September 25, 1984 memorandum from OGC Attorney Strickland to FPLG indicated that the U.S. Attorney's Office consulted with CIA on September 24 regarding the sealing of documents relating to the letters. In discussing a declaration in which defense attorney Iversen alleged, among other things, "that the CIA has engaged in the cocaine trade," the Strickland memorandum stated:
The U.S. Attorney, as he did in the previous instances, asked if there was any reason to seal this declaration. For the same reasons as with the Avilies [sic] affidavit, I indicated there were none but that I would check with the Directorate of Operations.
Please advise me by telephone if you agree with our assessment.
No information has been found to indicate that FPLG responded--by telephone or otherwise--to Strickland's memorandum.
The declaration that Strickland referred to in his September 25, 1984 memorandum may be document number 745--Declaration of Judd C. Iversen in Support of Motion for Order Granting Leave to Take Deposition. That declaration by defense attorney Iversen stated, in part:
. . . .
Based on the information I have received, I am informed and believe that agents of the United States government were intricately involved in the alleged conspiracy and either sanctioned the use of cocaine trafficking to raise funds for contra revolutionary activity and/or entrapped Defendant into participating under the belief that such activity was sanctioned.
I am informed and believe that the depositions of the Secretary and Treasurer of the Conservative Party of Nicaraguans (Francisco Avilessanez [sic], Esq. and Vicente Rappaccioli Marquis) are necessary testimony to present the defense of entrapment and/or outrageous Government conduct on behalf of Defendant Zavala.
I am informed and believe that the CIA engaged in drug trafficking during the Viet Nam War [sic] as a means to fund covert operations.
. . . .
The Zavala case files in the U.S. Attorney's Office include an August 6, 1984 memorandum concerning an August 3 telephone conversation between AUSA Zanides and Marvin Cahn, one of Zavala's two defense attorneys. This conversation occurred at least four days prior to any visit by OGC attorney Strickland with Zanides. The memorandum indicated that the seized money and proposed depositions in Costa Rica were among several matters that were discussed. It noted that Zanides told Cahn that "Washington was having fits with the money situation with regard to the trip to Costa Rica."
According to the memorandum, Zanides asked Cahn "what it was that [the Zavala defense attorneys] really wanted from the depositions and if an explanation of the source of the money" was the main issue. Cahn was noted to have said that the money was the major issue, and Zanides wrote that he then asked "Would it be necessary to go to Costa Rica if I decided to forget the money." According to Zanides' memorandum, Cahn "thought that would be okay, but he would have to talk to Judd Iversen and get back to [Zanides]."
The Zavala case files in the U.S. Attorney's Office also contain an August 27, 1984 memorandum concerning an August 20 telephone conversation between Zanides and OGC attorney Strickland regarding information in CIA files pertaining to Zavala.rd to this information, this memorandum noted that:
On August 20, 1984, I returned the call of Strickland . . . .
In sum, Strickland advised that all traces with respect to Julio Zavala had come back totally negative. Strickland advised that he had not merely requested the so-called 201 trace, but a trace for any information whatsoever. It was all negative.
He asked whether or not he could get a copy of the documents currently under seal, and I told him the Court would have to remove the seal before we could obtain any copies.
Subsequently, the U.S. Attorney's Office and Zavala's attorneys agreed in an October 1984 "Stipulation Regarding Disposition of Funds" that:
The U.S. would not introduce the "sum of $36,800" it seized from Zavala's home as evidence; and
A cashier's check for $36,800 would be made payable to Zavala and Aviles "and presented to Julio Zavala through his undersigned counsel in San Francisco."
Relevant U.S. District Court records indicate that the Stipulation was signed by Zavala's defense attorneys Judd Iversen and Marvin Cahn on October 1, by AUSA Mark Zanides on October 2, and by Zavala on October 4, 1984.
Records of the U.S. Attorney's Office indicate that a cashier's check for $36,800, dated September 27, 1984 and identifying Aviles and Zavala as the payees, was hand delivered to defense attorney Iversen in early October 1984. Records of the U.S. Attorney's Office also indicate that AUSA Zanides signed for the check from the FBI on September 27, 1984. A letter transmitting the check from Zanides to defense attorney Iversen is dated October 2, 1984.
The cashier's check was for a total of $36,800, not the $36,020 amount that was reportedly seized from Zavala at the time of his arrest. Although the reason for the discrepancy is unclear, one possible explanation is that the additional $780 represents interest accrued while the money was in the possession of the U.S. Government.
Individual Statements: Aviles. Aviles initially questioned whether the letters he had provided the Court and that had been placed under seal in 1984 had been altered. Aviles examined a photocopy of the May 15, 1984 letter he had sent and questioned whether various paragraphs had been "cut and pasted." Subsequently, Aviles conceded that his earlier statements were not correct and that the letter appeared to be genuine. A forensic analysis of the original letter conducted by the DoJ's INS Forensic Document Laboratory at the request of CIA/OIG found no apparent evidence of tampering.
Individual Statements: Zavala. Zavala recalls that, after the Aviles and Rappaccioli letters arrived from Costa Rica claiming that the money belonged to the Contras, defense attorney Iversen wanted to go to Costa Rica and get depositions from Aviles and Rappaccioli. Zavala also recalls that AUSA Zanides made clear that he did not want to go to Costa Rica to take the depositions, but did not explain why. In any event, Zavala says that Zanides approached Zavala or Iversen with an offer to forego introducing the seized money into evidence if the defense request for the depositions was dropped. Zavala says the money was not his to begin with and that he insisted the money be returned to its rightful owner. Zanides agreed to return the money several days later, according to Zavala.
Zavala recalls that two checks were actually issued. The first was made out to both him and Aviles and was given to defense attorney Iversen by Zanides. Iversen then reportedly turned the check over to Zavala's mother-in-law who had been given limited power of attorney by both Zavala and Aviles. Zavala's mother-in-law's name is the same as that of her daughter, Doris Salomon. Zavala says that his mother-in-law told him that, when she tried to cash the check, the FBI was notified and--apparently believing that Zavala's fugitive wife Salomon was attempting to cash the check--raced to the bank, confiscated the cashier's check and temporarily detained his mother-in-law.
Zavala says he became quite angry at what he perceived to be the U.S. Government's reneging on the agreement to return the money. Zavala says he was also angry that Aviles was made a co-payee on the check. Zavala argues that, since the money was seized from him, the check should have been made out to him exclusively. Zavala claims that, following further negotiations between his attorneys and the U.S. Attorney's Office, a second check was made out to him exclusively. It was cashed at a local savings and loan by his mother-in-law, using the limited power of attorney she had received from Zavala. Zavala recalls that some of the money was returned to Aviles by Zavala's mother-in-law, but does not know the exact amount Aviles received.
Individual Statements: U.S. Attorney's Office Personnel. Joseph Russoniello, the former U.S. Attorney in San Francisco during whose tenure The Frogman Case was prosecuted, says that he was not much involved in The Frogman Case and does not recall many details. Russoniello says that he has no recollection of ever discussing the case with a CIA representative and has no knowledge of anyone in his office being contacted by CIA concerning the Zavala case. Regarding the proposed depositions in Costa Rica, Russoniello recalls that, when he heard that the amount of money in dispute was about $36,000, his "first and last reaction" was that it would cost a great deal to take the depositions and that "it wasn't worth it."