SINGLAUB AND GEOMILITECH
The bombing attempt carried out by Summit Aviation foreshadowed some of the later activities of the Enterprise. For example, there was the case of Civilian Materiel Assistance (CMA), a militia group – likely a cover for members of the 20th Special Forces Group – that managed a Contra-support network and conducted cross-border raids with Contra forces from Honduras into Nicaragua.103 The CMA’s active presence in the conflict was revealed in 1984 when one of its helicopters was shot down, killing two of the group’s members. Despite the exposure, the CMA’s head, Thomas Posey, continued the Contra support operations and was linked to arms deals taking place at John Hull’s ranch.
Working closely with the CMA, and then later with the Enterprise, was Gen. John K. Singlaub. Singlaub was a veteran of the old OSS China network, which means that his entry into the world of covert activities took place alongside seasoned operators such as Paul Helliwell and E. Howard Hunt. After the war, he continued his military career while serving as one of the CIA’s clandestine warriors, popping up in special operations the world over. By the late 1970s, he departed from a high-ranking military position to protest Carter administration policies. It parallels the attitude of Shackley, with whom Singlaub was reportedly associated in Vietnam.
During the 1980s, Singlaub headed the US Council for World Freedom, the US branch of a global network of spies, criminals, Nazi exiles, fascist operators, and death squad leaders belonging to the World Anti-Communist League.104 By 1984, he was serving as the chairman of the league itself. Prior to this, some of the leading lights of the organization included Roger Pearson, an anthropologist who maintained ties to groups such as Willis Carto’s Liberty Lobby. Another was Swiss attorney Pierre Schifferli, who was rumored to have been involved in arranging massive weapon deals for UNITA in Angola.105 When he wasn’t arranging falsified end-user certificates for arms transfers or cavorting with a group called the Pinochet Foundation, Schifferli worked as one of the attorneys retained by Bruce Rappaport to represent the interests of Inter Maritime Bank.
The World Anti-Communist League and the US Council for World Freedom were interlaced with a host of like-minded pressure groups, dark-money fronts, private-intelligence apparatuses, and closed-door meeting places. These groups pressed for rolling back Cold War policies and boosting defense spending. More specifically, they pushed for the continuation and deepening of covert wars across the world; free trade policies, and other packages beneficial to multinational corporations; and the curtailing of civil and labor rights. Some of these, such as the American Security Council, appear to have participated in psychological operations aimed at the domestic population of the United States as well as abroad. Others, such as the Council for National Policy, helped broker the cozy relationship between evangelical Christians and the emergent New Right. High Frontier lobbied for the Strategic Defense Initiative, while the US Strategy Council brought together intelligence operatives with representatives of the Unification Church to coordinate policy and public relations activities, particularly through the Unification Church-controlled Washington Times.
Another group that operated in close proximity to the World Anti- Communist League was the Western Goals Foundation, a private-intelligence outfit set up by Congressman Larry McDonald in 1978. McDonald envisioned Western Goals as a clearinghouse, working in tandem with other private groups and law enforcement agencies to collect and share information on domestic groups deemed threatening to prevailing power structures. They engaged in propaganda via book publishing and, at one point, “solicited funds to create a computer database on American subversives.”106 During the 1980s, Western Goals fell under the control of Spitz Channell, who used it as one of the vehicles for private fundraising on behalf of the Contras.107 Notably, Western Goals’ effort to create a database on “American subversives” would be realized as part of the “Continuity of Government” protocol, which was developed by key players in the Enterprise and Iran-Contra and is discussed in chapter 9 in the context of the PROMIS scandal.
A Western Goals letter from 1983 lists a number of intriguing individuals comprising the advisory board. There was John Singlaub himself, as well as Adm. Thomas Moorer from the Nixon days. At this point, Moorer worked at both the American Security Council and H & K. Another Western Goals advisor was Roy Cohn. A 1982 New York Times article states that Cohn joined the foundation after being satisfied that it had “no ties to the right-wing John Birch Society” – despite Western Goals founder Larry McDonald having been a John Birch leader, and Cohn’s fellow advisory board member Roger Milliken having funded the society.108
Cohn’s interest in Western Goals may have been tied to the wider pro-Contra networks that were coalescing across the United States in the early 1980s. At the time, Cohn was serving as an attorney to his close friend Rupert Murdoch. (Robert Parry has written that the two first became close due to their mutual support for Israel.) According to New York Magazine, “Whenever Roy wanted a story stopped, item put in, or story exploited, Roy called Murdoch.”109 After Murdoch bought the New York Post, Cohn “wielded the paper as his personal shiv.”110
At the same time, Cohn was forging close ties with the director of the US Information Agency, Chad Wick, even hosting a luncheon in Wick’s honor that was widely attended by influential figures in the conservative press, as well as US senators and representatives. Soon after, then CIA director William Casey was spearheading an extensive propaganda campaign to shore up public support for Reagan’s Latin American policies, including support of the Contras.
This domestic effort was technically illegal, which caused the CIA to outsource the job to the private sector. As Robert Parry reported in 2015, Wick took the lead in obtaining private funding for the effort, and, just a few days after Wick promised to find private support, Cohn brought Rupert Murdoch to the White House. Parry later noted that, after this meeting, “documents released during the Iran-Contra scandal in 1987 and later from the Reagan Library indicate that Murdoch was soon viewed as a source for the private funding” for the propaganda campaign.111
After that meeting, Murdoch became the top media ally of this Casey-directed propaganda effort and also became increasingly close to the Reagan White House. Murdoch, as a consequence, benefited greatly from Reagan’s policies and his friendship with the administration, which allowed Murdoch to increase his US media holdings and to create the Fox Broadcasting Corporation in 1987.
In addition, Singlaub was named as a “consultant” to a Florida-based company called GeoMiliTech Consultants Corporation (GMT), which had been put together by Barbara Studley, a beauty queen turned conservative talk show host in Florida. Studley had also operated as a lobbyist and had worked at the Pentagon. The National Security Archive’s Iran-Contra Chronology suggests that Studley may have even set up GMT at the behest of Singlaub, as he was reported to have “suggested” to Studley that she start the company in 1983.112
GMT worked with various arms dealers to source and transport munitions to conflict zones such as Nicaragua and Afghanistan. Among the arms dealers it worked with were Ernest Werner Glatt and his sometimes partner, Samuel Cummings. Cummings, by way of his company Interarmco, was a longtime weapons merchant for the CIA. Cummings’ brother-in-law was none other than Senator John Tower, who in December 1986 was tapped by President Reagan to oversee the initial inquiry into the Iran-Contra affair.113 This was a conflict of interest of immense proportions. In addition, Tower, at the time, was close to Robert Maxwell, who had his own role in the Iran arms deals of this period and was actively working for Israeli intelligence. Also, by this point, Maxwell had secured Tower a place on the payroll of Israeli intelligence.
It is not surprising, then, that GMT had extremely close ties to Israel.114 The outfit’s executive vice president, Ron Harel, was a “veteran of the Israeli Air Force who specialized in ‘tactical cargo and light and early warning aircraft.’”115 He managed GMT’s overseas offices, which was conveniently located in Tel Aviv.
A sister company to GMT, Global Technologies Ltd., was also stationed in Israel and was overseen by Joel Arnon, an Israeli diplomat and military officer who was also a vice president of GMT. Global Technologies was located in Tel Aviv’s Asia House, a striking Bauhaus-style building that housed various diplomats and embassies. Asia House had been owned by the Israeli billionaire Shaul Eisenberg, who – as mentioned in chapter 3 – enjoyed close relations with the Israeli intelligence and security apparatus. In addition, GMT’s Israeli offices utilized the banking services of Israel Discount Bank. In 1986, portions of the money that were provided to Frigorificos and Ocean Hunter was deposited in Israel Discount Bank.116
Incredibly, there appears to have been ties between GMT and the clandestine activities of Robert Maxwell and those in his orbit. Key here was Nicholas Davies, the globe-trotting foreign editor for Maxwell’s Daily Mirror – where he was often known by the nickname that his boss had bestowed upon him: “Mister Sneaky.”117 According to Ari Ben-Menashe, Davies, like Maxwell, worked on behalf of Mossad, having been recruited in the 1970s from Strategic Intelligence Services, a British intelligence front led by a Special Air Service veteran named Anthony Pearson.118 By the 1980s, Davies – with Maxwell’s knowledge – was using his Daily Mirror duties to act as a cover for his involvement in Mossad-sanctioned arms trafficking.
Besides the Mirror, Davies also acted as the manager and representative of the Ora Group, “an Israeli company based in London.”119 Headquartered at Davies’ London home, Ora was set up with the aid of Ari Ben-Menashe, and operated as a key node in global arms flows. Among the “clients” that received arms – in this case weapons from the Soviet bloc – with the help of Davies and Ora was GMT.120 In his book Profits of War, Ben-Menashe reprinted a number of internal documents illustrating the role played that Davies played in these affairs, including communications between Ora and GMT.121
Davies vigorously denied the allegations made by Ben-Menashe, and the Daily Mirror made a number of counter-allegations, including the charge that the documents in question were forgeries. Another contested claim was that Davies had traveled to Ohio to meet with arms dealers.122 Davies went out of his way to claim that he had never been to Ohio, yet this was quickly proven to be false by various journalists.123 Likewise, the British Observer turned up other Ora-related documents, which included a telex from Davies to “renowned American arms merchant, Richard J. Breneke [sic].”124 Brenneke, as discussed in this chapter, managed an offshore financial apparatus utilized by the American and Israeli intelligence assets active in Operation Black Eagle. Brenneke would later state that he had met Davies, but did not know that he was involved with the Daily Mirror.125
Like all other shadow companies and strange entities that surrounded the Enterprise and Robert Maxwell’s broader network, GMT was involved with the complicated world of offshore banking. To carry out their operations, Studley called on the services of Jean de la Giroday, a managing director at Geneva’s Banque Cantrade, itself a subsidiary of Union Bank of Switzerland with branches in Geneva and on the Isle of Jersey. Together, Studley and Giroday set up a company called Consulentia Ltd.; GMT’s principals were told to avoid maintaining records of this company’s existence. Consulentia is just one of the many enduring mysteries of this intricate web: while GMT’s Consulentia was set up in 1984, Robert Vesco stated that, when he was looting IOS, he utilized the “Consulentia sub of Banque Cantrade” in 1970.
In summer 1985, GMT was involved in the acquisition of arms on behalf of the Contras. According to the chronology published by the National Security Archives, Studley and Singlaub arranged “a $5 million shipment of AK-47 and RPG grenade launchers from Europe to Honduras onboard a 15,000-ton Greek flag freighter.”126 The arms may have been sourced from Eastern Bloc countries like Poland or Bulgaria, as Studley wrote to North in October of that year, “vociferously complaining that another arms dealer, Mario [Delamico], who was associated with the Florida arms dealer Ron Martin, was essentially horning in on their sources of Soviet-style armaments.”127
Several months after the October letter, in late December 1985, Studley and Gen. Daniel Graham – the vice chairman of Singlaub’s US Council for World Freedom and a close associate of CAUSA, the political arm of the Unification Church – attended a meeting with CIA director Casey. An unnamed CIA officer who was present at this meeting was asked by Congressional investigators if the meeting had involved a discussion of a complicated three-way trading scheme, developed by GMT as a means of sustaining finances and equipment for covert operations. The investigators described this scheme as “a circular arrangement in which a trading company would be established to supply freedom fighter movements which Congress was unwilling to support for one reason or another. … Israel would sell certain things, military equipment, to the People’s Republic of China, who would supply Soviet arms, which would then be brokered.… Israel would be benefited by the United States through a high technology support or other compensation.”128
A schematic outline of this trading arrangement that was entered into evidence shows the destination for the arms sourced from China.129 They would go to US-backed rebels in Afghanistan, Angola, Nicaragua, and Cambodia. GMT, in other words, was proposing the creation of a multinational economic arrangement that would bind together the US, Israel, and China through a series of credit extensions, technology transfers, and arms deals.
It is quite possible that this was the ultimate plan for what the Enterprise was intended to become, though the official narrative holds that this arrangement was never completed. It seems clear that certain elements of the plan did go into motion. Israel and China intensified economic and political relations in the 1980s and both actively collaborated with the US in covert operations. Chief among these was the arming of the Mujahideen in Afghanistan. Jeffrey Epstein was later alleged to have been involved in such arms deals, specifically those involving the Mujahideen. It appears that he may have facilitated major facets of something very similar to GMT’s US-Israel-China plan in collaboration with members of the Clinton White House, Chinese weapons firms and Southern Air Transport in the mid to late 1990s (more on this in chapter 17).
GMT’s other claim to fame was that it appears to have been involved in some of the very first arm deals with Iran, ones that predated the Enterprise’s formation but took place alongside the CIA-Mossad relationship during Operation Black Eagle. The plan was a swap: “trade 200 tanks for Iran’s US-built F-14 fighter aircraft,” which had been sold to Iran in the 1970s.130 Per this plan, Israel would have served as a cut-out for the tanks. It is quite possible that the scheme originated on the Israeli side of GMT. According to Alan Block, it was the first thing that Ron Harel had been involved with when he joined the company.
It is also possible that this was the groundwork for later arms-for-hostages arrangements. GMT worked closely with Israel Aircraft Industries (IAI), a major defense contractor for the Israeli military discussed previously in chapter 3. The founder of Israel Aircraft Industries, Adolph “Al” Schwimmer, had been heavily involved in weapons arrangements with Iran during the rule of the shah, and these arrangements had continued in secret after the Islamic Revolution. According to many press reports, it was Schwimmer who first concocted the idea to trade arms in exchange for the (attempted) release of hostage William Buckley.131
EDMOND SAFRA’S FUNNY BANK
Besides BCCI and Credit Suisse, another set of banks utilized by the Enterprise were Republic National Bank, headquartered in New York City, and Trade Development Bank, headquartered in Geneva and sold to American Express in 1983. Both of these banks were controlled by Edmond Safra, a Lebanese- Brazilian businessman who hailed from a long line of bankers. By the early 1990s, Safra was a billionaire, with Republic National among the five largest banks in New York. Both Safra and his bank, however, were dogged by controversy. Safra himself died under suspicious circumstances after his bank was implicated in large-scale money laundering and the possible theft of “stabilization credits” provided by the IMF to a financially devastated, post-Soviet Russia.
A decade earlier, Republic National Bank was named – but never indicted – as having participated in a money-laundering network called “La Mina,” which was the subject of a sweeping federal investigation called Operation Polar Cap.132 La Mina, which washed money for Colombian drug cartels, was composed of a circular daisy chain of banks, mines, gold refineries, precious metal brokers, and jewelry stores and provided the financial infrastructure for “airplane manufacturers and fixed-base operators” as well as “aircraft used to ferry drugs.”133
Unsurprisingly, one of the banks that factored into the La Mina daisy chain was BCCI. Elsewhere, Safra’s Trade Development Bank did business with loyal customers of BCCI such as Altaf Nazerali, a high-flyer in the world of securities fraud.134
Trade Development Bank and Republic National Bank are discussed in the fourteenth chapter of the Congressional report on Iran-Contra.135 There, Republic National is described as having “handled many of the Enterprise’s wire transfers.” Besides these sorts of transfers, the bank was further involved in a clandestine cash delivery system that took place “outside bank channels.” Nan Morabia, an officer at Republic National’s International Division, her husband Elliot, and their son David were utilized by the Enterprise’s money manager, Willard Zucker, to “make cash drops to Hakim, Secord, and others on their behalf.”136 Zucker would contact the Morabias with the amount required and tell them which individual the money was intended for. Then, that amount was deposited in an account at Trade Development Bank under the name “Codelis.” Sometimes, the money drops would take place at Republic National Bank itself. On at least one occasion, Robert Owen received $7,000 from Morabia at the bank in New York City.
Nan Morabia’s FBI 302 (i.e., summary of the FBI’s interview with her) states that she had known Zucker for “approximately 8 to 10 years” and that his “account at [Republic National] was already established when she began working in the International section.”137 She added that CSF maintained accounts at Trade Development Bank and that Safra had “contact with Zucker in Geneva.” She was not able to identify to the FBI, however, any potential business relations between Safra and Zucker, although she made clear that she assumed that such business did actually take place.
Yet, there were direct business relations between Republic National and CSF that were separate from – but by no means unconnected to – the Enterprise. In the summer of 1985, for example, CSF organized a Geneva-based company on behalf of Republic National called Republic New York Corporation Air Transport Services S.A.138 The purpose of this company was to maintain a private aircraft on behalf of Safra’s bank. At the end of 1985, the ownership of the plane was transferred out of the CSF-managed company to a Swiss aviation company called Aeroleasing S.A., which continued to maintain the plane on behalf of Republic National.
Aeroleasing was one of the aviation companies contracted by the Enterprise to ferry personnel around the world for various purposes. The Enterprise’s expenditure lists included in the Congressional Iran-Contra final report show that, under a section titled “Mid-East (Iran Arms),” a total of $226,998 had been paid to the company. The ultimate costs were likely much higher. In his testimony, Secord stated, “We owe an aeroleasing firm in Europe, I am told, about $60,000. Something like that. We still owe the firm Southern Air Transport, here in the United States, quite a bit of money. I think it is something just under $100,000. We can’t pay them.”139
Gordon Thomas, in his biography of Robert Maxwell, states that Safra and Maxwell had enjoyed a long-lasting friendship. They particularly enjoyed, Thomas writes, dining “on board the Lady Ghislaine when the yacht berthed opposite Safra’s home in Monte Carlo.”140 Their relationship was not all pleasure, however. According to Thomas, Safra allowed Maxwell to use Republic National Bank accounts to launder money coming from Eastern Europe.
When Maxwell was active in the Eastern Bloc, his primary base of operations was Bulgaria. There, as will be noted in more detail in chapter 9, Maxwell was deeply involved in the thorny Cold War issue of tech transfers – the often-illicit movement of high technology from the West to the Soviet sphere. This likely brought him into contact with Kintex, a state-owned trading company that had been organized by the Darzhhavna Sigurnost, the Bulgarian intelligence apparatus that was closely aligned with and ultimately answerable to the KGB. A CIA report on Kintex said it was a “central coordinator” of smuggling activities, with a “clandestine charter” to facilitate smuggling for Arab and Balkan drugs and arms traffickers and to “collect items of science and technology interest in the West.”141
Kintex was more than willing to deal arms to right-wing insurgencies as much as left-wing ones, with clients including those who opposed Soviet-backed forces. These included the Christian Falangists of Lebanon, the Grey Wolves of Turkey, and even the Contras of Nicaragua. Also closely tied to Kintex was Mohammed Shakarchi, a prominent Geneva-based currency trader and the owner of Shakarchi Trading. Shakarchi, who from his offices near the Zurich airport ran “the most sophisticated currency exchange and commodity trading operations in Switzerland” and courted state officials in Soviet-allied Bulgaria while being, at the same time, involved in the CIA’s covert support for the Mujahideen in Afghanistan. Between 1981 and 1989, a CIA front company called Argin purchased millions of dollars’ worth of rare currencies from Shakarchi, which were sold to raise money for the rebels.142
One of Shakarchi’s US partners was Capcom, a commodity-futures firm that “was created by the former head of BCCI’s Treasury Department … who capitalized it with funds from BCCI and BCCI customers.”143 This wasn’t the only familiar face engaging in funny banking with Shakarchi. A classified DEA report stated that Shakarchi’s currency-exchange services were “utilized by some of the world’s largest trafficking organizations to launder the proceeds of their drugtrafficking activities” and that part of his network included accounts at Safra’s Republic National Bank.144 Mohammed Shakarchi’s father, Mahmoud, was reportedly close to Safra.
Safra’s name can also be found in Jeffrey Epstein’s contact book, though the banker’s last name is misspelled as “Saffra.” There are two phone numbers listed for Safra and no addresses. Another individual in the book with ties to Safra, albeit through a rather circuitous route, is Michael de Picciotto. Picciotto, who had five phone numbers listed in Epstein’s contact book, has been associated with Engel & Völkers, the massive German real estate company and, since 2020, has served on the board of Aston Martin. He got his start, however, working at Union Bancaire Privée, a Swiss bank controlled by his family. He had joined as the managing director for their London offices in 1988 and eventually became “responsible for UBP’s global financial activities.”145
Union Bancaire Privée began life as Compagnie de Banque et d’Investissements of Geneva, founded by Edgar de Picciotto. Edgar, the uncle of Michael de Picciotto, came from a family with a long history in both banking and European diplomacy. The Picciotto family was fairly close to the Safras, and like Edmond Safra, Edgar de Picciotto was born in Lebanon. As their respective banking enterprises bloomed, the two became friends. In the late 1980s, when American Express disposed of Trade Development Bank, the Geneva bank that had formerly belonged to Safra, it was Edgar who bought it.146 The merger of Trade Development Bank and Compagnie de Banque et d’Investissements led to its reformation into Union Bancaire Privée.
Edgar de Picciotto was also, according to SEC filings, a member of the board of advisors to Quantum Industrial Holdings, a division of the complicated investment network of George Soros. Quantum Industrial Holdings held the majority of the shares of Quantum Industrial Partners, one of the advisors to which was George Soros’ brother Paul Soros. Paul’s son, Peter Soros, appears in Epstein’s black book with addresses in New York City and London and ten phone numbers.
Another item appearing in Epstein’s notebook that ties into this network is Aeroleasing. Both of Epstein’s books contain lists for the aviation company, for both its Geneva and Zurich locations.
THE MAINLAND SAVINGS CONNECTION
hen US arms began flowing to Iran at the end of August 1985, it was Adnan Khashoggi who advanced the initial capital – through his BCCI bank accounts – to put the thrust of the plan in motion. The initial “bridge financing” was $1 million, followed shortly thereafter by an additional $4 million.147 Khashoggi subsequently claimed that this $5 million, “plus an additional $2.5 million whose purpose was unclear” came from a loan provided by Roland “Tiny” Rowland, the well-heeled British tycoon, corporate raider, and member of the Clermont Club who was briefly discussed in the last chapter. While Rowland’s connection to Iran-Contra affair is well documented – and will be discussed shortly – he denied the validity of Khashoggi’s claims.
While this denial might simply be a case of Rowland trying to put distance between himself and the affair, it happens that shortly prior to the initiation of the arms transfers, Khashoggi came into $5 million via a surprising route: Mainland Savings, a Houston-based savings and loan. Mainland Savings, one of the S&Ls that collapsed spectacularly over the course of the 1980s, was plugged into a wider network of crooked land developers, organized crime associates, and other denizens of the murky world of covert operations.
Khashoggi’s ties to Mainland Savings dated back to 1977, when Mario Renda, an ambitious New Yorker with dreams of wealth and power, stepped off a plane in Riyadh, Saudi Arabia. He was then a partner in IPAD – the International Planners and Developers Construction Consortium – that hoped to gain a lucrative contract to build concrete homes in Jidda.148 Khashoggi, it was reasoned, would be the key to unlocking the deep pockets of wealthy Saudis and, after a meeting with Renda, the arms dealer committed himself to the venture. While IPAD’s ambitions were ultimately never realized, it resulted in a long-lasting relationship between Khashoggi and Renda.
After IPAD fizzled out, Renda leveraged the contacts he gained through his introduction into Khashoggi’s inner circle and secured a position as the treasurer of Arab International Bank. Interestingly, in 1973, this bank had formed a joint venture with Lonrho, the corporate monolith controlled by Tiny Rowland.149 Arab International Bank’s specialty was certificates of deposits (CDs): it would use vast petrodollar reserves to shop CDs around the world, seeking out the locations that had the highest rates of return. Renda positioned himself front and center in these efforts, which provided him with the idea for his next venture. In 1978, he returned to New York City and formed Arabas Inc., a “one-man firm” that was intended to broker deposits, likely on behalf of Arab clients.150
The timing was fortuitous. Against the backdrop of early 1980s deregulation fever, Renda became connected to Martin Schwimmer. Schwimmer, rumored to be a money-launderer for the Lucchese crime family, managed the pension funds for several New York unions, including Teamsters Local 810, which was reportedly close to organized crime interests.151 A plan was then hatched: Renda and Schwimmer would begin brokering deposits of union pension fund money into S&Ls across the United States, collecting along the way commissions from lending institutions and fees from the unions. Arabas was renamed First United Fund, and soon Renda and Schwimmer were moving billions into a string of savings and loans.
By the end of the decade, Renda and Schwimmer had deposited money in 130 S&Ls, all of which collapsed. Renda’s CDs were linked directly to massive borrowing at each of these institutions, which were generally unpaid. In addition, quite frequently, the borrowing was carried out by an interlinked network of organized crime associates. That collusion was undeniable. Besides the accusations of Schwimmer’s involvement with the Lucchese family, Renda was rumored to have “controlled a lot of money being loaned for the benefit of Paul Castellano,” the powerful head of the Gambino family and, until 1985, the chairman of the Commission, the Mafia’s governing body.152 Notably, Castellano was one of several organized crime figures who were clients of Roy Cohn.153
Khashoggi stayed close to Renda throughout these developments. One notable example of this involved a mobster by the name of Lawrence Iorizzo, the president of the mob-linked Vantage Petroleum Company. Iorizzo was close to Martin Carey, the brother of New York governor Hugh Carey and oilman Edward Carey. Vantage had taken over Carey’s Petroleum Combustion International, which by that point had already carried out numerous dealings with Iorizzo. Iorizzo would later testify that Martin Carey had been involved in bootlegging gasoline with him and that the profits from these operations had been funneled into Hugh Carey’s re-election campaigns.154
Iorizzo, in other words, was clearly politically connected, and this was what had caught Renda’s attention. Renda had wanted to help Khashoggi, who at the time was struggling to get the proper permits to build a helicopter landing pad at his home just outside New York City. An associate of Renda by the name of Leslie Winkler “told Iorizzo that … Renda might be able to assist Iorizzo in getting a fat oil contract if Iorizzo used his powers of ‘persuasion’ in New York to help Khashoggi.… Renda said if Iorizzo could ‘remove these obstacles,’ Khashoggi would be most appreciative.”155
At the same time that they were concocting a way to get Khashoggi’s helipad up and running, Renda and Iorizzo agreed to embark on a classic bank bust-out scheme, akin to what Renda and Schwimmer were doing with the savings and loans. Renda would make deposits at a bank, which would then make loans to a Panamanian shell company controlled by Iorizzo – loans that would never be repaid.156 The shell company that Iorizzo used was called Houston Holdings, and it had been purchased by Iorizzo from Steven Sandor Samos, a lawyer who maintained a lucrative trade in off-the-shelf Panamanian companies.157 Iorizzo and Samos had been introduced by Renda’s friend Leslie Winkler, and one of Samos’ primary business associates was a Florida banker named Ray Corona – the partner of Leonard Pelullo in Sunshine State Bank.158
Samos also made an appearance in the Iran-Contra affair. Southern Air Transport purchased a Panamanian company called Amalgamated Commercial Enterprises, which it used to “purchase and maintain planes carrying supplies to the contras.”159 ACE was one of Samos’ off-the-shelf companies, and all of the company’s officers were employed by International Management and Trust Corp., a company run by Samos. Another noteworthy link involves how ACE utilized bank accounts at the Banco de Iberoamerica, a location that Samos was accused of using as a conduit for drug money laundering.160 Banco de Iberoamerica was a subsidiary of the Arab Banking Corporation, a major international bank headquartered in Bahrain that offered floating rate notes on the open market on behalf of BCCI.161
Among the S&Ls where Renda and Schwimmer were brokering deposits of union pension fund money was Houston’s Mainland Savings. This same S&L became embroiled in a series of overly complicated financial transactions with Khashoggi and a slew of business partners, the origins of which go back to 1974.162 That was when Khashoggi purchased a large tract of property adjacent to the Galleria, a major shopping hub in downtown Houston that had been developed with the aid of the Marcos family of the Philippines. Khashoggi acted as front man for Imelda Marcos on more than one occasion.163 Khashoggi let the land sit bare until 1979, when he was joined by Clint Murchison Jr., scion of the Dallas oil family. With $15 million in financing courtesy of Texas Commerce Bank, the pair embarked on an ambitious development plan.
The plans never came to fruition and, three years later, Murchison exited the scheme. Khashoggi began looking for buyers for the land and began cooking up other real estate schemes. One of these was in Aspen, Colorado, where he and a developer named John Roberts planned to purchase property using a $44 million loan from Commerce Savings, plus an additional $14 million from San Jacinto Savings. In a now-obvious pattern, this money disappeared into the black void of Khashoggi’s finances. What was left was a staggering debt owed to a string of banks and S&Ls.
Mainland Savings, flush with deposits from Khashoggi’s friend Mario Renda, offered an ambitious way out of these problems by purchasing Khashoggi’s Galleria-adjacent property for the grossly inflated sum of $68 million dollars. Of this, $22 million would be put up by Mainland itself, with the remainder provided by a loan from Austin-based Lamar Savings. The plan was: “The $30 million in prior loans from Texas Commerce Bank and San Jacinto Savings would be paid off. Khashoggi would buy $10 million in preferred stock at Mainland and use $12 million as a down payment to buy foreclosed loans real estate (called ‘cash for trash’), thus boosting its capital and keeping regulators at bay. That left $16 million for miscellaneous costs and Khashoggi.”164
A problem arose when Mainland could only get Khashoggi’s property valued at $55 million, short of the $68 million that they had originally hoped for. They were able to inflate the loan up to $58 million, which covered most of the debts and miscellaneous costs – except for the $10 million that was to be used by Khashoggi to buy Mainland stock and bad assets. Luckily for Mainland, Khashoggi had additional properties next to the Galleria-adjacent tract in question, which he had financed through S&L borrowing. Khashoggi was issued lines of credit by Mainland that were marked for developing those properties, but they were actually used to cover the missing $10 million. But there was something else: “On the same day, Mainland signed a $5 million letter of credit to Khashoggi.”165
The deal between Mainland and Khashoggi over these lines of credit was reached on August 1, 1985, just weeks before the arms transfers to Iran were underway. These transfers, of course, relied on a $5 million advance from Khashoggi. As Pete Brewton notes, the $5 million line of credit from Mainland vexed regulators and attracted the attention of the FBI. It was then discovered that Mainland’s executives had worked to conceal it from the S&L’s board of directors. Khashoggi later denied that the $5 million came from Mainland, instead claiming that Tiny Rowland had been the source of the funds. However, as mentioned, Rowland denied this. Mainland, for its part, insisted the money was a guarantee to Khashoggi for his purchase of $10 million in Mainland stock – $10 million, it must be reiterated, that was coming from Mainland itself.
It might be tempting to write the Mainland events off as a curiosity, another dead end in the hall of mirrors that is the Iran-Contra affair. There are, however, other ties between Mainland and Lamar Savings – the institution that loaned Mainland the bulk of the money for the Khashoggi deal – and the netherworld of BCCI and intelligence agencies. Besides Khashoggi, one of the major borrowers at both of these savings and loans was Mounzer Hourani, a Lebanese-American from Utah with extensive interests in Texas real estate.166 Hourani might have had intelligence connections. “A former high-ranking officer at Lamar Savings,” writes Brewton, “said that Hourani claimed to have ties to the Mossad.”167
Ties to Israeli intelligence or not, Hourani was certainly linked to Utah’s Orrin Hatch, who, as mentioned, was tightly connected to BCCI and to First American. Hatch stated that he had known Hourani “from the mid-1980s and was partly based on their shared devotion to the Mormon faith.”168 Hourani, meanwhile, told NBC News’ Mark Hosenball that he had joined with Hatch and BCCI insider Mohammed Hammoud on “various private schemes to free US hostages held by terrorists in Lebanon.”169
In 1986, Hourani was in hot water over his borrowing at Mainland, which by that point had collapsed and had been taken over by the Federal SavingS&Loan Insurance Corporation. Hatch appears to have tried to intervene directly, penning a letter to the federal institution stating that a possible “resolution” could be found with respect to Hourani’s problems.170 Four years later, as BCCI began to fumble toward collapse, Hatch once again acted as Hourani’s lobbyist. He reached out to the beleaguered bank requesting that they lend money to Hourani for a series of real estate ventures in Illinois, Minnesota, and Texas.171 Hourani himself then sent a proposal for financing. It is not clear if any proposed loans were ever actually provided.
Hatch has one more connection to figures in this saga. In 1985, during the peak of his Mainland borrowing and the initiation of the Iran weapons sales, Khashoggi arrived in Salt Lake City, Utah, with grand plans to build “two goldcolored 43 story office towers that would dwarf the nearby Mormon Church office building, the tallest structure in town.”172 Khashoggi had been a presence in Salt Lake City since the 1970s, and this increased significantly during the 1980s. Yet, by 1987, construction on the towers had been abandoned and Khashoggi had fled Utah, leaving numerous unpaid loans and broken promises in his wake.
It was during this period, Hatch stated, that he had met Khashoggi. Details on their relationship are scarce, but, according to Hatch, their association was the senator “extending the courtesies he would to any big investor in Utah.”173
“A PAN-EUROPEAN PLOT”
A key aspect of the covert operations of the Reagan era that is frequently overlooked is that, with respect to the complex trafficking of arms to Iran, Oliver North and the Enterprise were dipping their toes into a much wider swamp of political and economic corruption, arms trafficking, and money laundering on a truly colossal scale. As the conflict between Iraq and Iran heated up, companies, banks, intelligence agents, and smugglers poured arms and military materials into both sides of a bloody war.
Despite laws barring such activities, the conflict in the Middle East was a boom time for many. For instance, there was the so-called powder cartel, a “pan- European plot” to move propellant powder for artillery and other armaments to Iran.174 At the top of this cartel was Bofors-Nobel, the Swedish arms combine that is now the Swedish subdivision of the massive UK-based defense contractor BAE Systems. Bofors had a close relationship with Iran that predated the revolution. In the early 1970s, the company entered into a business agreement with the country to build an armaments factory. Relations between the two were suspended following the revolution. However, a dip in Bofors’ balance sheet, a product of the downsizing of the Swedish military, led the company to embark on the lucrative path of embargo busting.
Moving propellant powder to Iran required numerous partners, complicit shipping agents, and payoffs to officials. The primary mechanism for coordinating this network was the European Association for the Study of Safety Problems in the Production and Use of Propellant Powders, a public relations group organized and set up by Bofors and other European weapons manufacturers following a series of disastrous plant explosions.175 This provided a convenient cover for these various arms merchants to come together, arrange the logistics for weapons orders, disperse the proceeds, and even inflate prices of their wares.
The Bofors powder cartel made extensive use of Italian companies for arranging shipping and payments. Soon, Italy had become the primary locus of this subterranean arms trade. In an October 1990 exposé in Euro-money magazine, the role of the French arms manufacturer Luchaire in the trafficking of arms to Iran was dissected.176 Luchaire had two subsidiaries based in Italy, SEA and Consar, which were used to arrange the movement of weapons through the Islamic Republic of Iran Shipping Lines. The ships would log false destinations and then make their way to Iran via secret routes. The arms loaded on these ships were not only sourced from Luchaire, as SEA and Consar acted as intermediaries for numerous European companies involved in the trade.
One such firm was Defarm, which was actively collaborating with Bofors in the illicit movement of propellant powder.177 The founder of Defarm was Nicola Dubini, who had cofounded Consar before he sold it to Luchaire. Another firm was a Portuguese arms brokerage called Defex, described in testimony as having a “close relationship” with Richard Secord, after having been introduced by Thomas Clines.178 It became one of the companies utilized by the Enterprise. According to Albert Hakim, Defex sourced weapons from Eastern Bloc arms manufacturers and merchants, which were then purchased and resold to the Contras.
Behind these moves were various European banks, some shadowy and others well known. On the shadowy side, there was International Bankers Incorporated, which issued lines of credit to SEA and Consar.179 The Italian branch of International Bankers Incorporated was located in a building owned by the scandal-plagued Banco Ambrosiano, which had been set up by Jean-Maxime Lévêque in 1982. Lévêque had previously been the president of Crédit Commercial de France, a sizable French bank that, incidentally, had lent Adnan Khashoggi large sums for his Salt Lake City ventures.180 The major shareholders of International Bankers Incorporated included the Saudi businessman Akram Ojjeh, a friend of Adnan Khashoggi’s, and Robert Maxwell.181
More well-known was the French merchant bank Banque Worms, which was nationalized by the Mitterand government in 1982. During the period when the French state owned the bank, it held 23 percent of Luchaire and aided in financing the flow of arms and powder.182 Joining Banque Worms in these efforts was a renowned Italian bank, Banca Nazionale del Lavoro. The interactions were complex, as R. T. Naylor has described in Patriots and Profiteers:
Bank Melli [the Iranian bank handling their side of the financing] would order its Italian correspondent banks to issue LCs [lines of credit] on behalf of Luchaire’s Italian subsidiaries, which sent them to Italy’s Banca Nazionale del Lavoro.… BNL would use the original LCs as security to issue their own LCs in favour of the Luchaire parent firm in France. That firm sent the LCs to Banque Worms for negotiation. When the goods were loaded up on board ships, Banque Worms would present its LCs to BNL for payment, and BNL would do likewise with the correspondent banks of Bank Melli. The use of back-to-back letters of credit was a simple but effective device for breaking up the money trail.183
London was another major hub for these activities, with various arms merchants playing a role in the flow of weapons as far back as 1981. Chief among these were Ben Banerjee, an arms dealer and owner of BR&W Industries, and his close associates Michael and Leslie Aspin. According to Die Welt, Banerjee and Michael Aspin were involved in negotiations between Oliver North and several representatives from the Iranian government in 1984 over the sale of $264 million worth of TOW missiles. Subsequently, evidence was entered as part of a British court case that showed that Banerjee’s BR&W Industries did indeed attempt to move 1,250 TOW missiles to Iran, which were obscured in customs invoices as “lift trucks.”184
These customs invoices were handled by BCCI, and they were “accompanied by telexes and letters on BCCI stationary of a nature and type ordinarily used by BCCI, showing BCCI providing counter guarantees and letters of credit involving the ‘lift trucks.’”185 What is more, according to Michael Aspin’s brother, Leslie, these TOW missile sales were indeed part of North’s operation. Leslie Aspin further claimed that he and North had opened three joint bank accounts at the Paris branch of BCCI to launder money for these sales and that one of these accounts was under the name “Devon Island.” The Senate subcommittee investigating BCCI learned that BCCI Paris did indeed have a Devon Island account, but they were unable to acquire internal documentation for this branch.
The use of suspect invoice techniques, such as classifying TOW missiles as “lift trucks,” seemed to be a habit of Michael Aspin’s. In the early 1980s, he was working closely with a British arms dealer named Leonard Hammond, who also manufactured machine gun parts through his company, Delta Engineering. Hammond and Aspin used Delta Engineering to move machine guns to the Middle East and Africa, with a particular focus on South Africa. By 1981, they were moving arms to Iran.186 Frequently, these arms flows were mislabeled on invoices as “hydraulic lifting tools.”
Aspin and Hammond had a particularly close relationship with Kuehne & Nagel, a large German freight-and-logistics company.187 When the arms dealers moved a thousand rifles to South Africa in 1980 – invoiced as “hi-lift hydraulic machinery spares” – K & N’s subsidiary Air Cargo handled the freight. In 1981, K & N worked with Aspin and Hammond in moving weapons destined for Iran. K & N, according to Aspin, played a role very similar to that which BCCI would later play in moving TOW missiles in 1984. He told Spiegel that “the management of Kuehne & Nagel knew about the illegal arms transports, planned the routes with necessary intermediaries, issued documents and change information.”188
In 1981, right as these operations were being developed, Kuehne & Nagel was acquired by Tiny Rowland’s Lonrho.189 Were these two events connected? It is impossible to say for sure, but there is reason to suspect that this was the case. As previously mentioned, one Lonrho freight cargo subsidiary has been identified as a participant in Edwin Wilson’s covert activities in Libya on behalf of the Shackley network. Lonrho obtained K & N shortly after the loss of that cargo company.
In addition to Italy and the UK, Belgium was a major node in this wideranging European network. Of particular interest are the allegations made in the ATLAS dossier, a confidential report drafted by the Belgian Gendarmerie in November 1994. ATLAS makes a series of startling accusations concerning an entity that they describe as “the Nebula” – a network of Belgian businessmen, politicians, and criminals who were involved in arms trafficking, diamond smuggling, drug running, and the like. At the center of the Nebula was Felix Przedborski, a businessman and Belgian diplomat who, since 1978, lived in Costa Rica, where he maintained dual citizenship.
There is a small, but steady stream of press reports independent of the ATLAS dossier that have linked Przedborski to various forms of corruption. Notably, in 1978, Italian police found drugs in a vehicle belonging to the Costa Rican embassy, with one of Przedborski’s employees at the wheel. That same year, one of Przedborski’s close associates who was serving as Monaco’s diplomat to Costa Rica, was arrested in connection with drug trafficking.190
When the Costa Rican newspaper La Nación published a series of articles probing Przedborski’s connection to various criminal enterprises – based largely on reports already published by European journalists – “Don Felix,” as he was known, responded litigiously. In the end, La Nación’s journalist, Herrera Ulloa, was charged with criminal defamation and forced to pay Przedborski “a fine equivalent to 120 days’ wages.”191
The ATLAS dossier names numerous individuals in Przedborski’s network. Among these were his son Daniel, a Geneva lawyer who was poised to take over his father’s complex. Interestingly, Daniel Przedborski, from 1984 through 2019, had worked at the law firm of Pierre Schifferli – Bruce Rappaport’s attorney who, as mentioned, had been head of the World Anti-Communist League. Documentation from several lawsuits suggests that Daniel worked directly on some of Rappaport’s affairs.
These are not the only familiar faces that appear in the dossier. In a list of banks used by the “Przedborski Group” for money laundering is Republic National Bank, with a note beside it stating that “in this bank it is a certain Safra who would be responsible for special transfers.”192 This, of course, refers to Edmond Safra, thus directly linking the Przedborski Group to Contra support operations and to Republic National. The ATLAS dossier further links the Przedborski Group or Nebula to these support operations: “It is said that some of the weapons of Irangate would have been transferred to the Contras of Nicaragua by this network.”193
ATLAS identifies one of the lesser-known members of the Nebula as Bruno Goldberger, a purported real estate broker from Brussels. It adds that Goldberger worked “for a certain Globus Group,” but the investigators who penned the document stated that they were unfamiliar with this entity. This was likely the Bulgarian state-owned trading company Globus. In Evil Money, Rachel Ehrenfeld cites a DEA report from 1989 that states that Globus “was formerly known as Kintex” – the Bulgarian firm tied to Safra’s friend Mohammed Shakarchi and, possibly, Robert Maxwell.194 The DEA report states Ehrenfeld recounted that “Globus transmitted Middle Eastern drug money to Switzerland via Shakarchi.”195
Przedborski’s time in Costa Rica overlapped with the country being used a major hub for the Enterprise’s pro-Contra efforts. The ATLAS dossier charges that, while he was serving a diplomat, Przedborski had embarked on a major business venture: the construction of a “tourist real estate project” in the Santa Elena region of Costa Rica.196 Intriguingly, North was also using the dense jungles of Santa Elena as cover for secret airstrips that were used for Contra support flights.197
Other connections to the Enterprise’s operations can be seen via another bank mentioned as being part of Przedborski’s network. This was Geoffrey’s Bank in Belgium, described in the dossier as a conduit for arms-smuggling payments. Geoffrey’s Bank had also been intimately connected to some of Roy Cohn’s suspect business activities (see chapter 4). Geoffrey’s Bank was controlled by Arno Newman, a friend of Cohn’s, and his son, Geoffrey, for whom the bank was named. According to Belgian journalist Willy van Damme, the Newmans were closely connected to Pierre Salik, a clothing manufacturer with close ties to Israel’s Mossad.198 Salik, importantly, was named in the ATLAS dossier as a member of Przedborski’s core group: it states that Salik’s daughters “were promised in marriage to the two sons of Przedborski,” though this never took place for reasons unknown.
A frequent visitor to Geoffrey’s Bank – and a close associate of both the Newmans and Pierre Salik – was Jacques Monsieur, described as one of Europe’s biggest arms dealers.199 Like Salik, Monsieur was close to Israeli intelligence. For instance, in 1986, Belgian authorities recovered documentation outlining his contacts with both Mossad and Iran. When he was arrested in Turkey in 2002, in part for having sold “embargoed American spare parts and aviation technology to Iran,” numerous press reports identified him as having been an active participant in the Iran-Contra affair.200
Willy van Damme writes that Monsieur’s introduction to the world of arms trafficking came through a partner of the Newmans named David Benelie. As noted in chapter 4, David Benelie was really David Azulay, the brother of Avner Azulay.201 Avner, a former Mossad agent, is best known as the business partner of the notorious commodities dealer Marc Rich, who himself worked closely with Israeli intelligence. Azulay was put in charge of the Marc Rich Foundation, the philanthropic appendage of Rich’s empire. The foundation has maintained
Rich has other ties to individuals and entities that populate this netherworld. There are rumors – albeit ones that are difficult to substantiate – that he was close to fellow oil trader John Deuss, who retained the services of Ted Shackley while Shackley was running his “private CIA.” There are more demonstrable ties between Rich and Rappaport’s Inter Maritime Bank and BCCI. In 1984, for example, the Rothschild Bank in Zurich loaned Rich the astronomical sum of $50 million Swiss francs. The managing director of the bank at that time was Alfred Hartmann, the money manager for Inter Maritime and a frequent BCCI front man.202
To complete the circle, the report of the US inquiry into BCCI states:
[quote]Marc Rich remains one of the most important figures in international commodities markets, and remains a fugitive from the United States following his indictment on securities fraud. BCCI lending to Rich amounted to tens of millions of dollars. Moreover, Rich’s commodities firms were used by BCCI in connection with BCCI’s involving in US guarantee programs through the Department of Agriculture. The nature and extent of Rich’s relationship with BCCI requires further investigation.203]/quote]
Others named in the ATLAS dossier as involved in Przedborski-linked arms trafficking suggested Przedborski’s group had close connections to the heights of Belgian political power. Featuring prominently among these names was Paul Vanden Boeynants, a meat-packing magnate who had been prime minister from 1966 to 1968 and again from 1978 to 1979. In the interim period, he served as Belgium’s defense minister, where he presided over a series of controversial arms deals and a weapons buildup. An adamant cold warrior, Vanden Boeynants moved among the webs spun by groups such as Le Cercle and the World Anti- Communist League.
Vanden Boeynants had a particularly controversial relationship with Roger Boas, another figure whose name appears extensively in the ATLAS dossier. Boas oversaw the Belgian weapons manufacturer ASCO, which profited handsomely during Vanden Boeynants’ years as defense minister. De Morgen reported that “as soon as the politician came to Defense in 1972, his company had probably not missed a single defense contract. ASCO … saw its profits increase tenfold in the 1970s.”204 Many of these deals bore the unmistakable signs of corruption, and allegations of bribes and kickbacks, embezzlement and money-laundering, harassment and intimidation often followed in their wake.205
There were also the accusations that Vanden Boeynants and Boas made use of a highly connected call girl ring headed by Fortuna Israel, better known as “Madame Tuna.” According to De Morgen, Madame Tuna was placed on the payroll of one of Boas’ ASCO subsidiaries, where her job title was listed as “decorator.”206 This ring had connections to other familiar faces. Madame Tuna, it seems, was also an associate of Adnan Khashoggi, who reportedly called upon her services for help in obtaining lucrative contracts through subterfuge and blackmail. Boas was reported to have been introduced to Khashoggi and Akram Ojjeh – an investor, alongside Robert Maxwell, in International Bankers Incorporated – by the madame herself.
A direct line between this network of connections and the early 1980s flow of weapons to Iran may well exist. Named in the ATLAS dossier as a member of Przedborski’s group was Abraham Shavit, Boas’ general manager at ASCO. The dossier describes Shavit as the “right arm of Roger Boas.”207 Shavit was well connected in Israel. For instance, in the 1970s, he served as the president of the Manufacturer’s Association of Israel and, afterward, had a stint as the chairman of El Al, Israel’s chief airline company that was involved in CIA-Mossad airlifts in the 1980s, including Operation Moses, and has also operated as a front company for Israeli intelligence. He was also reportedly a former Israeli intelligence officer and a close associate of Manuel J. Pires, a CIA-employed arms trafficker.208 Pires would later be identified as one of the Enterprise’s middlemen in the Iranian arm sales.
Prior to the Enterprise’s operations, in January 1983, ASCO’s Malta branch was involved in the transfer of “aircraft parts, weapons and ammunition” to Iran via a contact at Bank Melli.209 Two ASCO Malta invoices for these show that the shipments were underwritten with a line of credit from BCCI’s branch on Brompton Road in London. According to Gary Sick, one of ASCO’s liaisons to Iran for these types of arrangements was the arms dealer Hushang Lavi – one of the witnesses who claimed to have inside knowledge of William Casey’s October Surprise activities.210