EX-AGENT LOST OUT IN REWALD'S FALL

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00494R001100710081-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: July 26, 2010
• Sequence Number: 81
• Publication Date: August 24, 1985
• Content Type: OPEN SOURCE

Approved For Release 2010/07/26: CIA-RDP90-00494RO01100710081-9
The Honolulu Advertiser
Today is Saturday,
Aug. 24, 1085
'x-agent lost out in Rewald's fall
Invested mother's money
By Walter Wright
Advertiser Staff Writer
A former undercover agent for the CIA
broke down on the witness stand yester-
day when he testified that his aged moth-
er lost $104,000 to accused swindler Ron-
ald Rewald.
John C. "Jack" Kindschi, 58, choked
back tears when he said he had invested
the money in Bishop Baldwin Rewald Dill-
ingham & Wong for his mother, who is 86,
1
MID _40UY ngin ocia1 Security.
-'K,. daehi then regained his composure
and glared across the courtroom at Re-
wald. But Rewald, on trial on 98 counts of
fraud, perjury and tax evasion, didn't
fllheh Wlde! $'s ray stare.
Kindschi denied Rewatdi claim that be
and the CIA created Bishop Baldwin and
instructed Rewald to lie to get investors'
money to maintain a "cover" as a wealthy
businessman.
Kindschi said he and his wife them-
selves lost $187,000 in money investen in
Rewald's Interpacific Sports and in Bishop
Baldwin, including $100,000 he invested
just weeks before the firm collapsed in
July 1983.
All the money was his, none of it came
from the CIA, and he has "given up all
hope" of getting any of it back, Kindschi
said.
He acknowledged he began his business
dealings with Rewald in 1979, while still
=for the CIA. investing $47,000 in
Re 's sporting goods operation. , '
Kindschi, who joined Bishop Baldwin as
a consultant after retiring from the CIA as
field office chief here in 1980, also admit-
ted he had written Bishop Baldwin's
glossy brochure and some economic re-
ports, and a press release about the
company, but said he did 'it ' 8t Rewald's
direction and used only information that
Rewald supplied.
On cross-examination, Rewald's lawyeP
-drew fire when he asked if Kindschi had
instructed Rewald to_lie about a CIA
cover company called H&H Enterprises,
and if Kindschi himself had lied in earlier
refusals to disclose the extent of the CIA's
involvement with Rewald.
Kindschi described H&H as a "notional,"
a cover "even lighter" than ordinary com-
mercial cover, "lighter than air" and used
"to give mobility and security to an offi-'
cer" traveling abroad for the CIA. The
make-believe information given to Rewald
about the company, Kindschi said, was not
a lie, ~bt*t a *creative story."
Oh, said Deputy Public Defender Brian
Tamanaha, "a lie for a good reason is a
creative story?"
"If I were a U.S. officer in an airplane
which had been hijacked by terrorists,"
Kindschi shot back, "I would become a
farmer or a school teacher almost immedi-
ately.
Approved For Release 2010/07/26: CIA-RDP90-00494RO01100710081-9
 Approved For Release 2010/07/26: CIA-RDP90-00494RO01100710081-9
The Honolulu Advertiser
Saturday, August 24, 1985
"At times, all governments must fine
creative innovative statements. An agency
officer can't go around the world and
operate under the CIA flag or he is a dead
duck."
There was laughter and a few handclaps
from the courtroom audience, which in-
cluded some of Kindschi's former com-
rades in the CIA.
Pressed, Kindschi said he didn't consider
the H&H cover "a lie, for the reasons so
stated," and that Rewald was not "lying"
when he gave the H&H cover story be-
cause "he was working for the common
good."
Another such creative story, Kindschi
recalled, was the concealment for two
days of President Dwight Eisenhower's
heart attack in 1955, under the cover of
stomach trouble.
Kindschi also branded as a "false mis-
representation by Mr. (former Rewald
civil attorney Robert) Smith" an assertion
that Kindschi told Smith and others that
Rewald was not a CIA covert agent, but
that he, Kindschi, would lie to protect him
if he were.
"I said I would refuse to answer the
question, but I would not lie. I would wait
until I got proper instruction," Kindschi
-said.
But Tamanaha showed the jury, by lead-
ing Kindschi through previous statements
to grand juries, lawyers and investigators,
that Kindschi had revealed varying de-
grees of information about Rewald's CIA
connection in the early stages of investi-
gation of the case.
Kindschi said he was testifying truthful-
ly in the trial, even about matters once
labeled secret but now disclosed under
court order in the Rewald trial.
Tamanaha also hammered at Kindschi's
failure to re cWt severa checcis_he receiv-
ed,' drawn on Bishop Baldwin and totalling
about $10,000, before the date, be said he
began working for the company in March
1981.
Kindschi said he thought most of the
checks were dividends from his Interpacif-
ic Sports investment with Rewald, and
some may have been related to that firm's
lease of a brand-new Buick automobile for
him.
Kindschi said he was making over
$4,000 a month and several other "perks"
including frequent travel allowances at
Bishop Baldwin when "the crash came. He
said he complained he didn't think he was
earning the salary, but that Rewald insist-
ed and "if they felt I was so valuable, who
am I to say no?"
After all, as he said Rewald had once
told him. "money is a renewable re-
source."
Approved For Release 2010/07/26: CIA-RDP90-00494RO01100710081-9