Pubdate: Fri, 03 Aug 2001
Source: San Jose Mercury News (CA)
Copyright: 2001 San Jose Mercury News
Contact:  http://www.sjmercury.com/
Details: http://www.mapinc.org/media/390
Author: Kevin G. Hall

JAILED SPY CHIEF OF PERU DRAGS CIA INTO DEFENSE

LIMA, Peru -- The CIA paid the Peruvian intelligence organization run by 
fallen spy-master Vladimiro Montesinos $1 million a year for 10 years to 
fight drug trafficking, despite evidence that Montesinos was also in 
business with Colombia's big drug cartels, the Mercury News has learned.

Montesinos, 56 and in jail near Lima on corruption charges after his 
capture June 23 in Venezuela, is now dragging the CIA into his legal 
battles, asking Peruvian court officials to interrogate two CIA officers as 
part of his defense against charges that he helped smuggle guns to 
guerrillas who allegedly provide protection to big drug cartels.

Despite attempts by the U.S. government to distance itself from the 
powerful former Peruvian intelligence chief, years of cooperation with 
Montesinos, dating to the mid-1970s, may be coming back to haunt the United 
States. New documents obtained by the Mercury News show how the CIA and 
State Department first cultivated Montesinos decades ago, and how the U.S. 
government maintained a relationship with him for a quarter-century despite 
warnings that he was working for both sides in the drug war.

In a document dated July 27, 1991, the U.S. Army Intelligence and Threat 
Policy Center reported that Peruvian Gen. Luis Palomino Rodr(acu)guez had 
showed up at a U.S. defense attache's home wearing a bulletproof vest and 
warned that Montesinos was trying to "frustrate joint U.S.-Peruvian 
counterdrug efforts."

Judge Jimena Cayo Rivera-Schreiber, one of six judges on a special Peruvian 
anti-corruption court that's probing alleged illicit activity by 
Montesinos, said in an interview last week that the former intelligence 
chief had given court officials the names of two CIA officers who can 
provide him with an alibi.

CIA As Alibi

Cayo would not name the officers, but he said Montesinos claims they can 
back his claims that he had nothing to do with a ring that smuggled arms 
from Jordan through Peru to guerrillas in the Revolutionary Armed Forces of 
Colombia.

"He says it's the CIA that told him about this," Cayo said, adding that 
court officials are trying to get sworn statements from the CIA officials.

Officials who spoke on condition of anonymity confirmed to the Mercury News 
that the CIA has told Peruvian investigators that the agency gave 
Montesinos' National Intelligence Service $1 million annually from 1990 to 
2000. The CIA declined to comment.

Investigators are trying to determine whether Montesinos diverted any of 
the money the CIA provided for anti-drug efforts into his own pocket. At 
least $270 million allegedly belonging to Montesinos has been found in 
secret bank accounts in Miami, New York and elsewhere around the globe. 
Former Justice Minister Diego Garc(acu)a-Sayan, Peru's new foreign 
minister, charges that Montesinos may have stolen $800 million.

The judges who are investigating Montesinos, and are able to provide the 
first glimpses of this highly secretive man, describe him as compulsive, 
orderly and accustomed to stature. In prison, he has insisted on dining on 
Gerber baby food -- to soothe his gastritis -- with fancy cutlery brought 
by his family. Appearing to forget that he is imprisoned, he sought 
unsuccessfully to persuade his keepers to allow him a different menu each 
day, and to be served separate courses.

"He is very sure of himself," Judge Magaly Bascones-Gomez Velasquez told 
the Mercury News.

Once a key ally of former Peruvian President Alberto Fujimori and the 
architect of Peru's successful war against leftist rebels, Montesinos now 
faces 57 cases against him and at least 168 criminal investigations, 
divided among the six anti-corruption judges. The probes, which will end in 
public and probably televised trials, cover 24 alleged crimes from money 
laundering, illicit enrichment and corruption to organizing death squads, 
protecting drug lords and illegal arms trafficking.

Since his capture, speculation has been intense that Montesinos would try 
to link the United States to his illicit activities. In the past, the CIA 
and the Drug Enforcement Administration have privately defended him against 
detractors.

Internal Debate

Former Secretary of State Madeleine Albright and former anti-drug czar 
Barry McCaffrey both have publicly said they tried to distance the Clinton 
administration from Montesinos and Fujimori but lost out to the CIA and DEA.

A declassified DEA document written Aug. 27, 1996, shows U.S. authorities 
were aware of allegations that Montesinos and the chair of Peru's joint 
chiefs of staff, Gen. Nicolas Hermoza R(acu)os, also in jail now, were 
taking protection money from drug traffickers.

Newly declassified U.S. government documents, not yet published but 
provided to the Mercury News, show that the State Department and the CIA 
cultivated Montesinos as early as 1974. State Department documents obtained 
under the Freedom of Information Act by the National Security Archive, a 
non-profit foreign-policy center at George Washington University, indicate 
that the U.S. Embassy in Lima identified Montesinos as a potential ally and 
took him to Washington in 1976 when he was an obscure army captain.

Peter Kornbluh, a senior analyst at the archive, predicted that a Peruvian 
trial of Montesinos would produce "ample evidence" of the secret U.S. 
association with the spymaster.

Documents show Montesinos was a political operative in the dictatorship of 
Juan Velasco when the U.S. government first sought him out. When the 
left-wing general was toppled in 1975, Montesinos managed to remain in the 
government led by Gen. Francisco Morales Bermudez and other conservative 
generals.

Washington Visit

Despite Montesinos' low rank, he was brought to the United States from 
Sept. 5 to Sept. 21, 1976, and met with Robert Hawkins in the CIA's Office 
of Current Intelligence along with military officials and the State 
Department's longtime Latin America policy-planning chief, Luigi Einaudi, 
who is now the assistant secretary-general of the Organization of American 
States in Washington.

"In those days, it was a big deal to get one of these paid trips to 
Washington. It had to be someone identified by the agency or embassy as a 
potential recruit for U.S. interests. You didn't nominate yourself," said 
Riordan Roett, director of the Western Hemisphere Program at the Johns 
Hopkins University School of Advanced International Studies in Washington.

Declassified State Department documents suggest why the CIA may have sought 
out Montesinos. At the time, Peru was the only left-wing government in a 
continent largely run by right-wing dictators, and the United States was in 
an ideological war with the Soviet Union and its ally in Cuba. Montesinos 
had information about a potential attack by the Peruvian generals against 
Chile, which was then run by Gen. Augusto Pinochet, an arch-conservative 
U.S. ally.
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