Pubdate: Friday, 17 July, 1998 Source: Seattle Times (WA) Contact: http://www.seattletimes.com/ Author: John Diamond, The Associated Press CIA KEPT WORKING WITH CONTRAS LINKED TO DRUGS, REPORT SAYS WASHINGTON - A second volume of a CIA study into agency connections to Nicaraguan contras in the 1980s supports earlier conclusions that the agency continued to work with individual rebels suspected of drug trafficking. Growing out of a hotly disputed newspaper account about the spread of crack cocaine in American cities, the CIA inspector general's report also confirmed earlier conclusions that there was no evidence that any CIA officials engaged in actual drug trafficking with contra rebels, a U.S. intelligence official said today. Both findings were contained in the first volume of the report released in January and stemming from a 1996 series in The San Jose Mercury-News that alleged a "dark alliance" between the CIA and contra-connected drug dealers. The series created an uproar, particularly in black communities, over the suggestion that the CIA allowed its contacts to engineer the spread of crack cocaine in poor urban neighborhoods. The newspaper later stated that the series was flawed. The 500-page second volume of the CIA inspector's report remains classified because it contains detailed information about CIA contacts and sources who helped the agency through much of the civil war against the communist Sandinista government in Nicaragua. It has been reviewed by the House and Senate Intelligence committees. A U.S. intelligence official said today that while the first volume focused on - and debunked - the so-called California connection, the second volume goes into greater detail on the agency's contacts in Nicaragua. The study found that the CIA occasionally received reports and allegations, some of them originating in newspapers, of drug trafficking by contra rebels or supporters. The inspector general's report criticizes the CIA for poor record-keeping; the report was unable to determine how many of the 50 individuals were further investigated by the CIA after allegations surfaced. The report also notes that more recent CIA regulations governing dealings with potentially unsavory sources would require such inquiries and better record-keeping. The intelligence official said no one should be surprised that some of the guerrilla operators with whom the CIA had to deal in Central America in the early 1980s were unsavory. - --- Checked-by: "Rolf Ernst"