THE CIA PLAYED A DEVIOUS BUT LEADING ROLE IN THE RISE AND FALL OF BISHOP, BALDWIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000605480122-5
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 12
• Document Creation Date: December 22, 2016
• Document Release Date: March 30, 2011
• Sequence Number: 122
• Publication Date: March 1, 1984
• Content Type: OPEN SOURCE

Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
ARSICLE APP'EAREI
E
o n '
I TO
MARCH1984 R UL2 ~ij< -
The CIA played a
devious but leading
role in the rise and fall of
Bishop, Bald
Ron Rewald's defunct consulting firm was a
front in the most embarrassing tradition.
It's beginning to look like Honolulu
bankruptcy trustee Thomas Hayes
took on more than he bargained for
when, court appointment in hand, be
first strode into the offices of Bishop,
Baldwin, Rewald, Dillingham &
Wong, Inc.
That was early last August and
Hayes' takeover of the Honolulu
investment counseling firm with the
staccato name capped a landslide of
events that in less than a week had
Ron Rewald
toppled the company from
prominence to ruin.
On July 29, a local television station
aired a report that Bishop, Baldwin
Open-and-shut. The next day,
Tom Hayes stepped in as Bishop,
Baldwin's interim trustee and started
treating the company's collapse as an
open-and-shut case. Though Rewald
had ordered certain records removed
the day of his apparent attempted
suicide, Hayes immediately
announced that a quick check of the
company's files revealed that over
300 investors had entrusted about
$17 million to Bishop, Baldwin and
that the only sign of what had
happened to their money was that it
had been spent, not on the high-
yielding investments that had
attracted the depositors but on a
cornucopia of business and personal
expenses that, said Hayes, had
was under investigation by state emptied the company's coffers.
consumer protection authorities and Rewald, declared Hayes to a
hinted that the firm's chairman, 43- stunned Honolulu business
year-old Ronald R. Rewald, may not community, had run an elaborate
be the classy investment wizard that scam. His words were echoed by the
most everyone thought him to be. bankruptcy judge, who labelled
The next day, Rewald was found in -Bishop, Baldwin .a "Ponzi scheme"
a Waikiki hotel room with his wrists wherein investor funds were
slashed. Rushed to a hospital, he siphoned off for ulterior purposes and
quickly * recovered from what the ! paid back only as necessary to keep
police said was an attempted suicide. up the pretence of legitimate
But while Rewald was still in the investments.
hospital, the investment empire he'd To no one's surprise, Rewald was
formed just five years before came arrested on his release from the
unglued. After a half-hearted attempt. hospital on theft charges from two
at business as usual, Rewald's partner, investors. One of them was John C.
Sunlin "Sunny" Wong, promptly .`Jack" Kindschi, a former Bishop,
resigned as company president and Baldwin consultant and close
declared his willingness to cooperate j
with any and all of the state and federal
investigators suddenly gathering on
Bishop, Baldwin's doorstep. The
dapper, 34-year-old Wong was quickly
followed in his hasty exit by many of
the 30 or more attorneys, accountants
and others that Bishop, Baldwin had
brought -on board as well-paid
professional "consultants."
On August 4, a Honolulu federal
`court declared Bishop, Baldwin
involuntarily bankrupt and froze its:
assets, along with those of the
company's still-hospitalized leader,
Ron Rewald.
associate of Rewald's. Kindschi had
been one of Rewald's first visitors in
the hospital. Before he joined Bishop,
Baldwin in 1981, he was the Honolulu
section chief for the Central
Intelligence Agency. Bishop,
Baldwin's records carried Kindschi as
a $185,000 investor in the company.
They also revealed that on the day of I
Rewald's attempted suicide he i
withdrew $140,000 from his account.
Subsequent disclosures show that
prior to his "retirement" from the CIA,
the 56-year-old Kindschi had written
personal checks to Bishop, Baldwin
and three associated companies
totalling about $2,000. The checks, all
Continued
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
in relatively small amounts, were
recorded as payments for telephone
bills. Similar payments were made
after Kindschi joined Bishop, Baldwin
by his successor as the CIA's local
section chief, John Rardin.
Fanned rumors. Such revelations
fanned speculation that Bishop,
Baldwin had somehow been involved
with the CIA. The federal bankruptcy
court at first did little to squelch the
rumor when, acting on the federal
agency's request, it sealed many of the
Bishop, Baldwin files that Rewald had
first removed and after his arrest
surrendered to the court. The court
slapped a gag order on any discussion
of the matters contained in the sealed
documents, but interim trustee Hayes
revealed that a letter missed in the
dragnet indicated that the CIA may
have halted an
Revenue Service
Bishop, Baldwin.
earlier Internal
investigation of
The letter, dated January 18, 1983,
was from Ron Rewald to the CIA's
John Rardin. It asked Rardin to
expedite an earlier request that the
CIA intercede in an IRS audit of
Rewald's personal finances because
they contained some relationships that
he would rather not explain. What
Haves didn't see was a letter written
just 10 days later by Bishop, Baldwin
attorney Dana W. Smith to IRS
Honolulu investigator Joseph A.
Camplone. The_ letter confirmed that
Camplon"e' had been instructed by'
higher ups in the IRS to hold off on the
Rewald investigation.
Speaking with authority, however,
Haves declared that, at the most,
Bishop, Baldwin and its global
network of 17 offices-most of which
he described as no more than "a desk
and telephone"-served as innocuous
mail-drops for the CIA.
Hayes hadn't changed his mind
about either Rewald or his company
when, in February, his office issued a
voluminous report detailing Bishop,
Baldwin's finances. It showed that
between 1979, the company's first year
of operations, and August 4, 1983, the
date it was declared bankrupt, it took
in a total of $20.4 million in
investments. Deducting money paid by Hayes since August, the report
back or spent on behalf of investors, concluded that Bishop, Baldwin had
the company ended up owing more made no legitimate investments. It had
than 300 of its clients $12.6 million. spent all of its investors' money on
And it has no funds left to repay them, indulging Ron Rewald's fancies, on
unless the trustee can collect $2.3 in giving his cronies a ready source of
overdrafts by 80 other investors or cash, and on providing Bishop,
take advantage of a clause in Hawaii's Baldwin's consultants jet-set careers
bankruptcy law that makes those who hopping from one exotic company
take money out of a firm 90 days : office to another.
before its collapse put it back. The There was nothing particularly new
trustee is trying to recapture funds on in the trustee's report; it simply
both counts. But, so far, only ex-CIA documented what Hayes and others
section chief Jack Kindschi has involved in picking up the Bishop,
responded. He has quietly given back Baldwin pieces had been saying for
the $140,000 he took out on July 29. months. The only dissent has come
Further collections are unlikely. from Rewald and some of his former
Most of those investors who drew associates. Though muted by the
more out of their accounts than they court's gag order and fear of, other
put in are former consultants and repercussions, these survivors paint a
others associated with Bishop, far different and more sinister picture
Baldwin who have had to adjust to of Rewald and his mysterious
more modest lifestyles since the firm's company.
Pieces fit. Placed against a different
demise. Even so, the most that h ddb th
h
investors would get back from such
repayments is about 20 cents on the
dollar.
Plethora of purchases. The trustee's
report makes Ron Rewald the biggest
culprit in this debacle. In accounting
"to the penny" what happened to the
missing millions, the report says that
Rewald took $4.7 million from what it
an t o one provt a y e
backdrop t
court and trustee, the jigsaw pieces fit
as they never did for the public
officials. In the picture that emerges,
Bishop, Baldwin's globe-girdling
string of "offices" makes sense, its
multi-million dollar investor "slush
fund" has. a more useful purpose, and
the company's otherwise whimsical
"investments" do produce a yield after
calls his "bogus investment
all. And, the key to it all, the man at the
counseling" concern and used it for
"personal spending." By the trustee's center of the picture, Ron Rewald,
reckoning, he spread money lavishly emerges as a loyal disciple of what has
over a plethora of purchases ranging been called the international cult of
intelligence.
from a suit of armor to decorate his On January 30, Rewald was released
waterfront home to veterinary bills for from the Oahu Community
his stri of polo ponies.Included was _ i Correctional Center after his family
over mi ion spent on two ranches
near Honolulu, one in Waimanalo and scraped together enough assets to meet
the other at Pupukea, and the Hawaii .,his $140,000 bail. In the preceding two
Polo Club, which Rewald bought two months, the bail had been twice
reduced from an original $10 million.
The ranches and Polo Club were
among a long list of enterprises into
which the trustee's printout shows that
Rewald or his firm pumped close to $4
million. Also on the list is MotorCars
Hawaii, a classic auto emporium
where Rewald stabled his personal
fleet of sportscars. But the report
declared that none of these were valid
investments. Reiterating a claim made'
The initial amount, unprecedented in
Hawaii, was set ostensibly to keep
Rewald in jail where he could neither
make good on his supposed suicide
attempt nor skip town with the
illgotten gains that trustee Hayes and
others were claiming he had bilked
from investors. Rewald is now suing
Hayes for such obstructionism and
Continued
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
other alleged offenses. But that isn't
the first lawsuit he has filed since
getting out of jail.
Just days after his release, Rewald
sued the CIA for a whopping $671
million. The suit charges that the
federal agency was not only
extensively involved in Bishop,
Baldwin's activities but that the
3.
excuse for travel. That year, the He made the trip to assess trade
sporting goods firm he had risen to prospects and make contacts for the
head went bankrupt and so did CIA. Because Rewald succeeded
Rewald. In the entanglement, Rewald where many others had failed, he won
got into a scrape with Wisconsin high praise from section chief Welsch,
authorities for violating the state's who was about to be replaced in his
franchising laws. He was also Honolulu post by another agency
concerned about post-Watergate veteran
Jack Kindschi
,
.
federal investigations then being made
Under Kindschi, Rewald's
company, alon with two others was
g of the CIA's domestic spying
specifically formed in the late 1970s on involvement with the CIA moved into
operations, an activity prohibited by high gear. Late in 1978, Bishop,
instructions from the agency. The CIA the agency's charter. Rewald
even picked Bishop, Baldwin's name, expressed his worries to his contact at Baldwin was formed to spearhead two
claims Rewald, because the firm was the CIA's Chicago office and said he other cover operations already
established at the CIA's irection,
intended to concentrate its "business" was thinking about relocating to H
awaii-registered compare escalled H
in the Far East, where the names Hawaii. The agent encouraged him to
Bishop. Baldwin and Dillingham-all ' do so and gave Rewald the name of the & H Enterprises and Canadian Far
East Trade Corp. With Bishop,
prominent in Hawaii and other Pacific agency's man in Honolulu, chief of Baldwin in place, Rewald's old firm,
business circles-would give it section Eugene J. Welsch. I
CMI Investment, was all but
credibility. Rewald and his partner
After Rewald, his wife and five abandoned.
Sunny Wong were the only principals
sted in the company's title whc children moved to Honolulu, Rewald Rewald says that the CIA not only
weren't bogus. re-established CMI Investment, took gave, Bishop, Baldwin its name but an
in local real estate broker Sunny Wong operating budget of "several million"
Rw
ld clai
th
t h
t
d
a
ms
a
e ac
e
I
as a
full-time covert agent for the CIA as a partner and looked up Welsch. It
dating back to 1977, when he moved to was Welsch who gave Rewald his first
Hawaii from his native Wisconsin His major assignment for the CIA.
dollars to get it underway. The claim
differs sharply with the bankruptcy
trustee's report, which purports)
association with the agency goes back Impressing the agency. Working through the five Honolulu bank
even further. In the mid I960s, while a with the Japanese Ministry of accounts it analyzed to account for
student at the Milwaukee Institute o1 Transport, Japan Air Lines had 98% of all funds flowing into Bishop,
Technology, Rewald says that he was developed what it called a high speed Baldwin since its inception. The report
recruited by the agency and employed surface transportation system, or attributes only S2,700 or so in
part-time to spy on student activist HSST for short. Using a top secret ; telephone bill payments to the agency.
groups at the University of magnetic propulsion technique, the Any other CIA contributions, if they
Wisconsin's Madison campus. Over a system was intended for use on trains occurred, must have come in under the
nine-month period in 1967-68, Rewald
was paid $120 a week for his efforts
and reported the results to the CIA's
Chicago office.
Breaking in. After a hiatus of several
years, Rewald began taking more
ambitious assignments from the CIA.
He worked for a sporting goods
company in Milwaukee and made
several buying trips to the Far East.
While there, he carried out relatively
minor intelligence-gathering chores
for the agency and made some contacts
that would later prove useful. One of
the friends he cultivated was a
Japanese sporting goods manufactur-
er whose son worked for that country's
Ministry of Transport.
In 1976, Rewald formed a company
called CMI Investment Corp., a
counseling firm that furthered his
that would carry passengers between guise of investor deposits, says the
Japan's Narita International Airport report. And James Wagner, an
and Tokyo at speeds of close to 200 attorney for the trustee, scoffs at that
miles per hour, slicing travel time from notion. To produce the amount of CIA
the usual 90 to about 15 minutes. The support claimed by Rewald "would
system works, but the problem was require that a large portion of the
and still is enabling passengers to ride investors had to be agents," he says.
safely at such break-neck speeds. Rewald, who despite the massive
Nevertheless, the CIA . wanted the odds against him has maintained a
HSST plans to pass on to U.S. industry steely composure throughout his
and sent Rewald to steal them. ordeal, is unruffled by the trustee's
Through the son of his former sporting claims. He maintains that Hayes, who
goods contact he suceededin doingso is now Bishop, Baldwin's
and the agency was impressed with his administrator, Reynaldo Graulty, an
work. attorney and state legislator who was
Other Far Eastern assignments named permanent trustee, and the
followed. In 1978, just before U.S. lawyers and staff helping them are no
relations with the Peoples Republic of closer to the truth today than they were
China were normalized, Rewald in August.
visited mainland China under the rn COntinUOd
banner of his CMI Investment Corp.
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
Co-mingled funds. Rewald says that
the five Honolulu bank accounts on
which Haves and his associates base
their analysis reflect only part of what
were Bishop, Baldwin's real finances.
Millions more, he insists, were buried
in overseas accounts in which, as in the
Honolulu banks, innocent investor
funds were freely co-mingled with
deposits from the CIA and other,
not-so-innocent "investors."
Hayes acknowledges the existence
of the overseas accounts, but says they
are all but empty. Rewald agrees, but
he claims that that wasn't the case at
the time of Bishop, Baldwin's collapse.
He says that there was then enough
money in the company's foreign
accounts to repay the $10 million that
the trustee now says is owed to
investors, and much more. But the
funds quickly disappeared when
Bishop, Baldwin's operations
disintegrated, leaving a trail that grew
cold while Rewald sat in jail.
But evidence of these accounts and
kheir intended use is murky, obscured
by the court's order against revealing
the contents of Bishop, Baldwin's
still-sealed files and, if the claims of
Rewald and a few others are to be
believed, an elaborate and well-oiled
mechanism with which the CIA and
others in the country's intelligence
network bury their mistakes.
Characteristically, the CIA has
steadfastly denied any role in and
refused further comment on the
Bishop, Baldwin case. Even the clear
involvement of three of its former
Honolulu section chiefs, Jack
Kindschi and, to a lesser extent,
Kindschi's predecessor Eugene Welsch
and his successor John Rardin, has
failed to shake the agency's policy of
silence. The most that it has said came
in response to Rewald's recent damage
suit, when a spokesman contacted at
the CIA's Langley; Va. headquarters
referred a questioner to the ruling
made last September by Bishop,
Baldwin's bankruptcy judge that
the company's scaled documents had
no bearing in its financial affairs.
Yet the jurist concerned, veteran
federal judge Martin Pence, has
privately admitted that he didn't
personally inspect the reams of
documents before, acting on the advice
of the CIA, he sealed them in August.
Nor did the judge read a lengthy
affidavit submitted by Rewald to
explain his CIA involvement before he
sealed that, too.
And Rewald hasn't had much luck
in getting a rise out of his alleged
former employer. A response of sorts
that did come was the reassignment by
the CIA of the head of its litigation
division, John Payton, to the post of
assistant U.S. Attorney in Honolulu.
What might otherwise seem a
demotion for the agency's top lawyer
indicates the importance it places on
Rewald, But so far it has kept that
concern to itself.
Shortly after his imprisonment,
Rewald had his civil attorney, Robert
A. Smith, write a letter to CIA
Director William Casey asking for $10
million in commissions that he said
were due Bishop, Baldwin on an arms
deal it had arranged for the agency in
Taiwan.
Pandora's box. There has been no
direct reply to the letter, but, if the
claim is accurate, it blows wide open a
Pandora's box of covert activities that
Smith's letter and a crazyquilt of other
evidence indicate that Rewald and
certain of his associates performed for
the CIA. Those activities ranged from
selling huge quantities of military
hardware to such strategically touchy
countries as Taiwan and India to
laundering money for political leaders
like Indira Gandhi and big money men
like Philippine banker Enrique Zobel
and the Sultan of Brunei.
It's in this shadowy context that
many of the loose ends left by the
trustee's explanation of Bishop,
Baldwin's affairs fall into place: like
the $600,000 spent on a seemingly
useless network of overseas offices;
nearly $800.000 lavished on two Oahu
ranches that were never really used;
$300,000 pumped into a Hawaii Polo
Club that was about to lose its polo
field; $260,000 for a stable of ponies
and show horses that were rarely
ridden; and nearly $2 million in
salaries and fees paid to a small army
of investment consultants who never
made an investment.
The trustee attributes this wild
spending to Rewald's extravagance.
But it would seem that a master
swindler capable of bilking hundreds
of investors out of $20 million would
be more frugal with his ill-gotten gains.
And he would surely have taken better
care of himself than nearly dying, then
spending six months in jail and coming
out looking for work. For nowhere in
the trustee's exhaustive study of
Bishop, Baldwin's affairs is there the
slightest hint of hidden booty for Ron
Rewald. As Hayes has said from the
start, "He spent all the money."
If such behavior is out of character
for the super-scammer that Rewald
has been made out to be, it is much
more in keeping with the CIA's pattern
of using private U.S. businesses and
institutions as fronts for a potpourri of
clandestine activities.
Nugan Hand. A case in point is the
Nugan Hand Bank, whose spectacular
demise four years ago is still
embarrassing the CIA. The rise and
fall of the Sydney-based bank bear a
striking resemblance to the
rollcrcoastcr history of Bishop,
Baldwin.
ontinuing investigations by an
irate Australian government indicate
that Nugan I-land was set up with CIA
backing in 1973 to carry out an
assortment of covert tasks and dirty
tricks. One of them seems to have been
helping to topple the Labor
government of Prime Minister Gough
Whitlam, who had irked Washington
with his stand-offish attitude toward
the U.S. Whitlam was sacked late in
1975 after a well-aimed misinforma-
tion campaign had scandalized his
government. The CIA calls the
technique "disinformation," which is
the lacing of truth with deliberate lies.
Though they're not certain, the
ntinusd
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
Three years later, though both were,
just out of their 20s, they formed
Australians now sec the CIA's imprint and the need, and they may wait for Nugan Hand Bank, which was quickly
on what happened to Whitlam and years between jobs or be employed to become a major conduit for
they suspect that Nugan Hand helped steadily. The contracts are recruited by transporting CIA funds worldwide.
launder the money that financed his control officers or other agency Things went smoothly for Nugan
fall. professionals who are likely to be, Hand for several years. Attracted by
Typically, the CIA's financial knowingly, the only regular agents interest rates that were higher than any
support of Nugan Hand Bank went they ever meet. The less its contract others around, deposits flowed into
little beyond providing seed money to agents 'know the better, the CIA the bank by the millions. Fueled by its
get it started and standby funds, none figures. successful part in torpedoing the - .. . _ _ That and the usually limited amount Whitlam government the bank's
appearance sake as well as for more contracts a calculated risk for the
practical reasons, agency fronts, called agency. Though when they are given a
"proprictories," are supposed to be not job the agents sign a secrecy pledge,
1 if b t 1'1
t
involving it in projects all over the
world.
But in the late '70s Frank Nugan ran
on y se -suppor
ing u ig Y that doesn't assure their silence. As a
profitable. Nu Hand earned afoul of the Australian authorities. He
p gan result, part-time agents are frequently was accused of cheating shareholders
millions on illicit drug trafficking, recruited from retired military in his family-owned food business in
arms deals and running a laundrorriat careerists, especially high-ranking
Sydney. There was talk of pay-offs
for money used for a variety of shady officers who are accustomed to
purposes. Part of the bank's income handling classified information.
went to support the "legitimate- side of Nugan Hand had several former
its operations, paying big yields to military brass working for it. One was
unsuspecting investors whose funds its president, Earl P. "Buddy" Yates, a
were co-mingled with other income retired Navy admiral and former chief
and high salaries and expenses to both of staff for strategic planning with U.S.
innocent employees and covert agents forces in Asia and the Pacific. Another
who used the institution's 22-branch was retired Army general Edwin F.
international network as a cover. The Black, who once commanded U.S.
rest of the earnings were channeled to troops in Thailand and served as
other CIA fronts, contributing to a Nugan Hand's representative in
vast funding network that is the Hawaii. Such former professionals not
backbone of the agency's global only brought experience and discipline
operations. to their job, but an old-boy network of
Officially, the size and budget of the contacts that could be useful to the
CIA are limited by law and scrutinized CIA.
by both the federal administration and Not too many contract agents,
Congress. But for years the agency has however, can be star-studded veterans.
gotten around these restraints through The bulk are less seasoned and are
the use of front operations and picked for their potential. They have to
contract agents whose existence never prove their mettle before being given
shows up on the official records. The more sensitive assignments.
dodge, paid for through and by Frank Nugan was such a person and
hundreds of agency proprietories, so was his partner, Michael Hand.
swells the CIA's size far beyond its Nugan was a fast-talking, goodlooking
legal limits and makes it almost Australian who moved easily in
invulnerable to budgetary squalls in Sydney's financial circles when he met
Washington. Hand mere in 1970. nanu, an the bank stand to lose millions as
Contract agents. The contract American, was Nugan's antithesis, a authorities hit one blank wall after
agents are a key ingredient in this huge burly, tough-talking ex-Green Beret another in their search for assets. The
subterranean network. They are a who had already done contract work CIA has denied any involvement in the
part-time army of amateurs who join for the CIA in Southeast Asia. The Sydney bank and it and other U.S.
up for the pay, the excitement, or-an pair started an investment counseling agencies have been cool to the
argument frequently used on U.S. business in Sydney, specializing in Australians' requests for help in sifting
recruits-the patriotism. Their advising former U.S. servicemen.' the bank's tangled affairs. The one
assignments may be innocuous or person who might help them the most,
dangerous, depending on their skills Nugan's partner Michael Hand,
disappeared shortly after Nugan's
Continued
of training they are given make the I covert activities also blossomed,
linked to drug trafficking. The trouble
didn't seem to bother the easy-going
Nugan, however, except that he
increased to almost daily visits to his
church. And he kept on spending
money at a dizzying rate, including
$500,000 to remodel his Sydney
waterfront home. And on the day that
he died, Nugan was completing
negotiations to buy a $2.2 million
country estate. -
Ignored evidence. Nugan's body was
found early one morning in January,
1980. He was slumped on the front seat
of his Mercedes, parked on a country
road near Sydney. Nugan was shot
through the head. Beside him was a
rifle that was later discovered to be
wiped clean of fingerprints. A
coroner's jury ruled the death a
suicide, dismissing police arguments
that because of its angle it would have
been nearly impossible for Nugan to'
have fired the fatal wound.
Three months later, the Nugan
Hand Bank collapsed amid a barrage
of official investigations that continue
to this day. Depositors and investors in
S
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
death and hasn't been heard from an alarm that cancelled a CIA-backed
since. expedition to Laos in search of U.S
Though they've been mentioned, the MIAs led by ex-Green Beret officer
similarities between Nugan Hand and James "Bo" Gritz.
Bishop, Baldwin have largely gone Lt. Gen. Arnold Braswell, who
unnoticed since the Honolulu retired in September as the Air Force's
company's demise. The swift dismissal Pacific commander, was an investor in
of a CIA connection by those in BBRD&W and has admitted that he
authority, the court gag order and the was "considering" joining the firm at
silence of the company's survivors, the time of the collapse. Those close to
including most investors, have the company say, hoever, that the
discouraged pursuit of the parallel. So, association was more of a certainty
too, has the departure or submergence than the general lets on and that he
of those most directly involved in had, in fact, done some work for
Bishop, Baldwin's covert activities. Bishop, Baldwin before his retirement.
Jack Rardin, the CIA's section chief General Braswell provided the
in Honolulu during Bishop, Baldwin's company with the names, private
final two years, quietly left his post phone numbers and introductions to
soon after the company's collapse. An three former Air Force generals who
item planted recently in a Honolulu hold key positions at major U.S.
Advertiser gossip column revealed his aerospace manufacturers. The
re-emergence in Florida. contacts were to be used for placing
Multiple "retirements". Jack i orders for such sophisticated hardware
Kindschi, Rardin's predecessor who
supposedly left the agency to become a
Bishop, Baldwin consultant, has
"retired" and gone to ground. This
isn't Kindschi's first retirement from a
CIA cover that was blown. In the early
1970s he was an executive with Robert
R. Mullen & Co., a New York J well-connected Indian national who, with a number of wealthy CIA-
public-relations firm that was deeply
involved in the Watergate scandal.
When the firm folded, Kindschi
submerged and later resurfaced as the
CIA's Honolulu section chief. the talks was Rajiv Gandhi, the onl
in's Y legitimate investors. typicaly a 20%,
Sunny Wong, Bishop, Baldwin's son and a top aide of India's
former resident, has similarly slipped m i n i m u m annual return o n
p Y prime minister, Indira Gandhi. But the investments that, the company
out of sight. So has Russell Kim, big arms_ sale.- which- would-have.
another BBRD&W consultant who generated millions in commissions for claimed to some. were guaranteed by
played a key part in the firm's Far Bishop, Baldwin, was still in the works the Federal Deposit Insurance Corp.
Eastern money laundering activities. when the for up to 5150.000 per account.
y company folded. \obod\? challenged the claim. which
Kim is listed by the trustee as owing the Money-laundering. As part of the
company nearly $500,000 in arms had limited use. until just before
deal, Bishop, Baldwin was to Bishop, Baldwin closed down. The
overwithdrawals from his investment shelter funds for the Gandhi family,
account. including kickbacks to be paid out of insurance incentive. which was clearly
beyond the FDIC's scope, was devised
Bishop, Baldwin's contingent of its commissions, and invest them in the for certain foreign investors and there
former military brass was less U.S. This arrangement was one of the sign nod
developed than Nugan Hand's, but it paramount reasons for handling the
was getting there. Retired four-star
general Hunter Harris, once deputy-
commander of the Strategic Air
Command, was a sometimes
BBRD&W consultant. Concern over
Harris' heavy drinking and
talkativeness caused Rewald to sound
61
transaction under-the-table and
characterizes not only some of the
CIA's money-laundering activities but
its efforts to stockpile markers from
key foreign leaders. The hefty
commissions paid to intermediaries
like Bishop, Baldwin-amounts
usually built into the arms' purchase
price-also provide a convenient way
for suppliers to pay the bribes that are
common in some parts of the world,
but taboo for U.S. companies since the
Lockheed scandal of a decade ago.
One arms sale that was completed
before Bishop, Baldwin's collapse was
the one to Taiwan on which Ron
Rewald's attorney tried to collect the
S 10 million commission. That sale,
which involved such deadly gadgets as
infra-red sights for M-16 rifles,
illustrates yet another purpose of the
CIA's underground arms business: the
avoidance of political repercussions, in
as AWACS and L-1011 transport this case in the U.S.'s fragile relations
planes, part of a huge covert arms deal with mainland China.
that Bishop, Baldwin's contract agents But all of Bishop. Baldwin's coven
were negotiating with the government activities weren't to be as lucrative, at
of India. least at first. Using its impressive name
The transaction was being handled and a growing list of happy investors
for Bishop, Baldwin by S. S. Pasrich, a as entres, the company made friends
acting as a company consultant, had targeted foreigners whose benefit to
established a New Delhi office for the agency was to be long-range.
BBRD&W in the former Soviet On the surface
BBRD&W offered
.
embassy building. His chief contact in them the same bait it used to lure
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
(,
were. in'fact. funds set aside for such a good contact to have in keeping tabs Pupukea and Waimanalo. The
purpose. The FDIC had nothing to do on the oil production plans of OPEC, company had agreed to buy the
with Bishop. Baldwin, but the federal of which his country is a member. Pupukea property for $3.5 million on
agency had been primed to say that it The sultan also offered the agency highly leveraged terms. It had an
did if asked. and its business allies more tangible option to buy the Waimanalo ranch
When the insurance claim spread attractions. Brunei has a $4.5 billion for $500,000. The arrangements
beyond its intended use, the FDIC investment portfolio that before its enabled the. company to spend most of
cautioned the company in a letter independence was managed by the its money on sprucing up the
addressed to its Napa, Calif. office. British. With independence, the purse- properties. T o add to t h e
Napa manager Robert Jinks assured strings passed to the sultan. In one of windowdressing, and Rewald's image
the agency that the claim was the biggest banking coups in years, as an international sportsman, an
employee error that wouldn't happen New York's Morgan Guaranty Bank additional S260.000 in company funds
again and the matter was dropped. and Citibank have replaced London's was lavished on a string of 17 polo
This was last June and the error bankers as managers of the Brunei ponies and show horses.
symptomized a serious problem that portfolio. a job which at the very least But there was a method to this
Bishop, Baldwin was then having in will produce about $30 million a year seeming madness, even though
controlling the growth of its in fee income. Bishop, Baldwin 's trustee chalks it all
investment accounts. Normal money To Bishop, Baldwin and, in up to Rewald's frivolity. The gala polo
market interest rates had fallen well particular, its silk-smooth chairman matches and the showcase ranches, as
below the high returns promised on the Ron Rewald goes at least part of the well as Rewald's fleet of fancy
company's accounts and the firm's credit for this triumph. It came about sportscars and high-rolling lifestyle,
innocent but hard-charging consultant through the sultan's close friendship were really parts of an elaborate
were straining the proprietory's cover with Enrique Zobel, the ties that scheme to enhance Bishop, Baldwin 's
by bringing in more investment clients Rewald forged with the Filipino image of legitimacy, an image that was
than it could comfortably handle. The banker, and the rabid interest all three further fed by the fact that not more
company was. in fact. then trying to showed in the gentlemanly sport of than a dozen of its 115 worldwide
phase out all investment accounts polo, employees were involved in anything
except those that were needed for its The polo connection. Polo was, in other than bona-fide investment and
money-laundering activities. And the fact, in many ways the most successful estate management work.
CIA was pushing for more action on of the fronts that Rewald ran for the In his dual roles as sportsman-
that front. CIA in Hawaii. He used the sport to financier, Rewald visited Buenos Aires
Top elist. Atthetopof ncy's give him and his associates ready during the 1982 Falkland crisis.
target list itt of rich for foreigners gners was Enrique access to the world's elite in an Outwardly, he was there to discuss
Zobel, the Philippine financier who is unguarded atmosphere that they investments and socialize with
reputed to be among he 10 wealthiest ban- might never have enjoyed as mere Argentine polo enthusiasts. But the
kers in the world. . Zobel is along-time con- investment counselors. real purpose of his trip was to assess
fidante and key backer of President Early in 1972, Rewald paid $30,000 for the CIA the safety. of the billions
Ferdinand Marcos and has powerful for the Hawaii Polo Club, a shoestring that U.S. banks have loaned to
political and business ties around the operation that was about to lose the Argentina. Secondarily, he helped
-globe. He was thus not only a good use of its only tangible facility, a polo other CIA agents trace the
man to know for his clout in the field on Oahu's north shore. But the sophisticated weaponry that the
strategically sensitive Philippines. but, $30,000 was only the down-payment Argentines were using against the
properly coaxed. Zobel and his super- e on a succession of related investments British in the Falkland war. One of the
affluent friends could havh become that were to exceed $1.3 million. Over trails led to some of Bishop, Baldwin's
mater contributors to te CIA's the next year or so, Rewald and his contacts in Taiwan.
underground money machine. But the biggest single target of
One of those friends is the Sultan of company poured nearly $300,000 into
the operations of the Polo Club itself, Rewald's polo ploy was Philippine
Brunei, the supreme ruler of a tiny, oil-
rich country on the northern coast of elevating its Sunday afternoon banker Zobel and his global
Borneo which recently gained its matches from sandlot status to lavish connections. Zobel provided ,a window
major-league events. on the inner workings of the Marcos
independence from Britain. Since one
of the ways that the CIA pleases its Closely related, about $800,000 was regime that was unparalleled and the
high-placed allies among the U.S. spent by the company on its ranches at CIA had grown concerned about the
dictator's plans. Through intermedi-
business and political communities is cries, Marcos had purchased two
by providing them with useful estates in Honolulu's fashionable
intelligence. The sultan was reckoned a Makiki Heights and the agency
wondered if he was planning an early
retirement.
Continued
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
S.
That wasn't the limit of Zobel's
usefulness. With the CIA's help.
Rewald was scheduled to accompany
President Ronald Reagan on a visit to
the Philippines last fall. Zobel had
arranged for Rewald to meet privately
with Marcos while he was in Manila.
But Reagan's trip was cancelled and
Rewald couldn't have gone by then,
anyway. He was in jail.
Looming profits. When its roof fell
in, Bishop. Baldwin was about to se!l
its interest in the Waimanalo ranch to
Zobel for S1.5 million, which would
have given it a respectable 200% profit
on that investment. The company's
Pupukea ranch was being groomed to
sell to Zobel's buddy, the Sultan of
Brunei. Bishop, Baldwin figured to
clear about S I million on that deal.
Even the Hawaii Polo Club was
slated to turn a profit. Northwestern
Mutual Life Insurance Co. had
acquired the land under and around
the Mokuleia field as part of plans to
develop the area into pricey homesites.
A big reason for turning the Polo Club
into a showcase operation was to
convince Northwestern that it should
use the club as a centerpiece for its
Mokuleia development. Rewald had
worked out a deal with the giant
insurance company. to relocate the
Polo Club to posh permanent facilities
near its present makeshift site. The
new site would have been deeded over
to the club by Northwestern at no cost,
giving it an asset worth close to $3
million, Rewald figured.
While these negotiations were going
on, Rewald was also using the Polo
Club to cement his ties with fellow-
r: 7-1-1 Last June
e
the Sultan of Brunei was supposed to The basic premise of the study, as its
have put up $7 million to get the title implies, was that the smart money
project rolling and millions more were is leaving Hong Kong by the planeload
to follow. Both the money invested in in anticipation of its takeover by
Soto Grande and the profits from its China-an event that's technically still
sales to wealthy ? Europeans-an 13 years away, when Britain's lease on
expected $20 million or more-were to most of the colony's real estate is due
be channeled through Ayala Hawaii to expire. The Bishop, Baldwin report
Corp., where the proceeds would be matter-of-factly accepted that this will
split between Zobel and Bishop, spell the end of Hong Kong as a center
Baldwin. And if that venture worked of international investment and went
successfully, other profitable on to describe how Hawaii can cash in
partnerships were to follow. on the resulting capital exodus. The
At about this time, Rewald also real purpose of the report, however,
formed two other joint ventures that was not to describe an event that was
had ulterior motives. These were called happening, but to help cause it.
Hawaiian-Arabian Investment Co. To its chagrin, the CIA has largely
and U.S. and United Arab Emirates been unable to penetrate China's
Investment Co., both registered in power structure and influence its
Hawaii. These were ventures with strategic decisions. In its drive for
Indri Gautama, a wealthy Indonesian, industrialization, China badly needs
and Saud Mohammed, a crown prince foreign exchange and a Hong Kong
of the United Arab Emirates. The under its direct control could give it a
companies were to be involved in major, established source of such
investments ranging from tea currency-providing, that is, that the
plantations to resorts, but never got far huge trading center maintains its
off the ground. prominence in world commerce. If
Hong Kong project. But potentially Hong Kong were to lose that position,
the biggest project of all those that it could force China to make
were nipped in the bud by Bishop, concessions to the West it might not
otherwise make. Hong Kong is thus
Baldwin's collapse focused on Hong seen by the CIA as a weak link in
Kong, where the company had picked
up the pieces left by the earlier China's otherwise impenetrable
explosion of the Nugan Hand Bank. armor. If the agency could trigger,
Hong Kong was one place where the even at this early date, a panic among
covert activities of Nugan Handand the colony's already uneasy investors it
Bishop, Baldwin didn't just run might deny the Asian superpower a
parallel, but converged. It as valuable pawn in the Third Kingdom
primarily to penetrate this marked with role it's trying to play between the U.S.
its untold billions in the hands of and the Soviet Union.
nervous investors that Bishop, Typically, most of those consultants
Baldwin was devised. involved in preparing the Bishop,
In the weeks just before it closed, Baldwin study saw it as a legitimate
h t
t
k
,
sportsman nriqu
the pair formed Ayala Hawaii Corp. Bishop, Baldwin published a
in handsomely bound volume entitled
for the purpose of engaging
unspecified land developments. But "Capital Flight from Hong Kong and
Ayala Hawaii, whose ownership was How Hawaii Can Benefit." The 300-
split 50-50 between Zobel and Rewald, page study had been nearly a year in
actually had some very ambitious the making and purportedly had
objectives. involved extensive on-the-scene
It's namesake, Manila-based Ayala research by Bishop, Baldwin
Corp., is Zobel's vehicle fora wide range of consultants. Included were dozens of
international business ventures. One interviews with those who control the
of these was to be a big resort Crown Colony's fortunes, all
development at Soto Grande, on conducted under Bishop, Baldwin's'
Spain's Costa del Sol. Zobel's friend familiar-sounding banner and in the
name of legitimate research.
ou
ing, accepting wi
underta
question the data and key contacts
provided them in Hong Kong by years
of CIA spadework. One of the
consultants, who like most insists in
anonymity, says that he thought that
the Hong Kong report was aimed
primarily at the Hawaii Legislature
COMM
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
9.
because of the changes in state laws it
recommended to make Hawaii more
attractive to overseas investors.
I ndccd, most of the report was devoted
to describing flaws in the state's
business climate and the improve-
ments that it said are needed. But
underlying the criticism was the
implication that if Hawaii didn't get its
act together it would miss its share of
Hong Kong's hemorhaging investment
dollars.
Spark in it tinderbox. Although
Bishop, Baldwin's contribution can't
be proved, Hong Kong definitely
experienced a major economic crisis in
1982-83 that toppled stock and real
estate prices and caused a flight of
investment capital. While the outflow
semis to nave sioweo, to part oecausc
of hasty assurances from Peking, the
colony's economy remains shaken and
jittery, a tinderbox that another spark
like the Bishop, Baldwin study could
ignite once again.
Even though the report appeared to
be tailored for Hawaii consumption,
its distribution reveals its true intent.
compiaint nas occn quietly aruppeu. he says. "We had a meeting and
No trials? And there is speculation nobody even suggested that the
that none of the chargcs against company was in danger. The next day,
Rewald will ever go to trial. On the there was almost nobody in the office
theft counts, the prospect of Rewald and one of the older consultants
facing in an open courtroom his suggested I go home and stay there."
former close associate Jack Kindschi, A lot focuses on what happened to
the major complainant, might produce Ron Rewald. A la Nugan Hand,
more embarrassment than the CIA Bishop, Baldwin's covert activities
could tolerate. were, as much as possible, shunted to
in fact, everybody - s e e m s other CIA proprietories. The handful
embarrased by the Bishop, Baldwin of agents involved either followed
debacle except the even-tempered them or, like old pro Jack Kindschi,
Rewald. Hawaii's news media, after simply retired.
spotlighting the Hong Kong report The other company activities have
when it first came out quickly either quietly folded up or, as in the
condemned it when the company fell case of the two Oahu ranches, reverted
from grace. Big-league publications to former owners. Enrique Zobel is
like Time and Money magazines still interested in buying the
jumped on the bandwagon and Waimanalo ranch, but now he wants
labelled Rewald a swindler, echoing to get it for $1 million instead of $1.5
the line that the local media had picked million. The Hawaii Polo Club isn't
up from interim trustee Hayes and the having much of a season this year.
courts. BBRD&W's trustee has given up the
But now the anti-Rewaid chorus hab lease on the company's once-spacious
grown silent and it may be the offices in Honolulu's Grosvenor
erstwhile financier's turn at bat. Center and sold off its furniture and
Rewald is filing lawsuits against Time equipment. A floor-to-ceiling
Of the 800 copies printed, less than half and Money and against his nemesis waterfall that once decorated Rewald's
remained in Hawaii, including about Tom Hayes. He has even turned down private office has been donated to
100 that are now in the hands of the an oblique payoff overture from the Icharity. Rewald's former waterfront
trustee. Most were distributed CIA that would have given him the residence, which he bought for
overseas to the financial press, $10 million he asked for last August.
investment houses and other opinion- That's not enough, Rewald figures, to
shapers. . ~ repay Bishop, Baldwin's investors and
Since his release from prison, Ron makeup for the other losses suffered.
Rcwald has been busily preparing his He has retained famous trial lawyer
defense against the two token theft Melvin Belli to help him got alot more
$950,000 in 1980 and figured was
worth $2.4 million, is being put up for
sale at an undetermined price. So is his
fleet of sportscars and his stable of
polo and show horses, though the
former have weathered their inactivity
charges on which he was jailed and in what could be a turnaba,tt that will since July far better than the latter.
other complaints that may be in the make his old company's cash flow look ' Worse-off, however, is Bishop,
wings. Among the many ironies in tnc modest by comparison. Baldwin's human debris. The
case, Rcwald has done his work in the What emerges as the most intriguing company's 300-plus investors have
downtown Honolulu offices of his civil aspect of Bishop; Baldwin's whole been left empty-handed. Their only
h
attorney, Robert Smith. Next door to tangled tale, however, is the
Smith is the office of BBRD&W suddenness and completeness of the
administrator Tom Hayes. When company's - collapse. It left both
Hayes and Rewald meet in in the hall, investors and employees bewildered.
they don't speak. "What happened to Ron?" One
Platoons of FBI and other agents
have been using Hayes' office on and brand new consultant who reported
or k on A.
the first
ust 1
f
g
,
o
off since August to work on what may r w
an a
hope for recovering more t
fraction of their lost millions is in,
getting the CIA to own up to some
responsibility for their predicament.,
The courts won't allow the investors to 1
join in Rewald's suit against the
agency. Ted Frigard', a retired
chiropractor who lost $300,000, is
workday following Ron Rewald s
be federal charges against Rewald, leading a band of them- in a separate
ll
th
i
id
d
e, reca
s
su
c
e action, through Melvin Belii.So is
even though an earlier securities fraud attempte
of tk.,t .tsar "P ,, ar}anAar uric - _ ---
guessing what had happened to Ron,"
BBRD&W consultant who openly
claims that he worked for the CIA...
Continued
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
links, a California attorney, virtually
moderated the first segment of a
television series being done by the
British Broadcasting Corp. about
Bishop. Baldwin.
Out of work. Most of the company's
ex-employees are having a tough time
finding work. Those who have
relocated feel that they're lucky. They
don't talk about their previous
employer, partly because their new
employers don't want them to,
Ron Rewald is one of those still
looking for a job. He thought he had
one lined up through Honolulu
Teamsters boss Art Rutledge, but that
fell through. The other offers he's had
called for use of his selling skills, but he
says he's no salesman. He's not sure
anybody would buy from him,
anyway. Meantime, Rewald is living
with friends, driving a borrowed car
and mooching quarters to feed the
parking meter. A year ago, he was
making $20,000 a month and
expenses.
Rewald's fortune might change once
again, of course, if he forces the CIA to
relent. Rewald has steadfastly refused
to discuss his role with the CIA, as well
as the covert chores performed by his
company. But his recent lawsuit
against the agency and a welter of
records and comments of others that
have gradually surfaced say a great
deal for him. They paint Rewald as a
,all guy in the Nugan Hand tradition.
The big question is, who meant him
to fall?
Whose fall guy? Was it the CIA? Did
it fear that a routine state investigation
would blow Bishop, Baldwin's
elaborate cover and thus abandoned
the company and its leader in the
prescribed manner? Did the agency
feel that it couldn't stop or divert state
investigators where it could so easily
manipulate federal probes? Are
proprietory companies and their
agents and victims so expendable that
they are dumped no matter what the
cost at the first hint of trouble? Is the
CIA's skin that thick? Is it above the
law?
Or was somebody else behind
Rewald's downfall and the CIA forced
to react to a situation suddenly sent
out of control by the flood of publicity
attending Rewald's apparent suicide
attempt and his company's spectacular
collapse? Rewald's meteoric rise and
aristocratic lifestyle invited plenty of
critics who were only too happy to
condemn him when the roof fell in.
He may also have had some
downright enemies. Rewald kept a
squad of bodyguards on his payroll
and one was never far from him or his
family. When he was in jail, there was a
man who tried repeatedly to see
Rewald, posing first as a minister and
then as a prison guard. He was
reputedly an associate of Bo Gritz who
had gone on the aborted Laos mission.
Acting on a tip that the man was more
than he pretended, state authorities
intercepted him before he could reach
Rewald and deported him to the
mainland.
There is a theory about Rewald's
downfall that. could have been lifted
from a Robert Ludlum thriller. It goes
like this: It was the Chinese who
fingered Rewald: They wanted to
discredit the Hong Kong study and
figured that exposing the man behind
it as a croak would do the trick. And
Rewald was an easy mark. He had a lot
of critics who would believe the worst
of him. A push in the right piacewould
bring down his house of cards 'The
CIA would do nothing to protect him
once his cover was threatened because
that's its policy with contract agents.
In fact, it would help discredit him by
jerking what was left of his cover.
Vanished records. On a wall in
Rewald's former office at Bishop,
Baldwin hung two diplomas from
Marquette University. Both were fakes
but up until last July Rewald was
carried on the Milwaukee institution's
alumni roster. After July, the school
told inquiring reporters that it had
never heard of a Ron Rewald.
Then there was Rewald's
professional football career. Though
that was part of an earlier cover and
seldom mentioned in Ilawaii, Rewald
claimed that he had once played for the
Cleveland Browns, the Kansas City
Chiefs and the Baltimore Colts. Media
inquiries last summer produced no
confirmation, though Rewald has
copies of contracts signed with all
three clubs during the mid-1960s.
Other probes into Rewald's past
yielded similarly damaging
revelations. A purported high school
chum and football coach, interviewed
by a TV reporter in Milwaukee,
portrayed Rewald as a mediocre
achiever who fantasized a good deal.
Rewald denies knowing either the
coach or the "friend."
The most damaging of all the
revelations, of course, were the
trustee's statements that Bishop,
Baldwin had never made a legitimate
investment and that Rewald had
squandered millions of its funds
without a thing to show for them. The
records of Bishop, Baldwin's
involvement in over 50 companies and
partnerships have either been lost or
discounted completely, just as have the
records of its two dozen or more
foreign bank accounts.
As it claims, the trustee's accounting
is probably accurate as far as it goes. It
will likely never be known what
Bishop, Baldwin's records would have
looked like prior to August 4. Possibly
little different, since large quantities of
cash moved in and out of its global
operating accounts in mysterious
ways. And there was no separate
ledger kept for what was legitimate
and what wasn't. The CIA doesn't
observe normal accounting practices
in keeping track of its investments and
their returns.
Key weekend. A mystery that's even
more intriguing because it seems more
solvable is what happened to Ron
Rewald on the end-of-July weekend
that his hall of mirrors shattered. Was
his supposed suicide attempt part of
whatever it was that brought him
down. or the cover-up that resulted?
Rewald won't say. In fact, he says
even less now about the events of that
Continued
to,
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
Friday 'and Saturday than he did at the
time.
A hotel employee on a routine room
check found Rewald lying on the
bathroom floor of Room 1632 of the
Sheraton Waikiki Hotel at 4 p.m. on
Saturday. July 30. There was blood
spattered on the floor and fixtures of
the bathroom. The shocked employee,
believing Rewald might be dead,
immediately left the room and
summoned hotel security. When
security officers arrived they found
Rewa)d not only alive but conscious,
his arms held above his head. They
covered him with a blanket and called
for an ambulance and the police. From
a driver's license and two credit cards
found in the room, a security officer
identified Rewald. While waiting for
the police and ambulance, the security
men talked to him. Rewald told them
that he wished he was dead: he said
that a television report the night before
about the state investigation of his
company had ruined him.
When the police arrived, they too
questioned Rewald. After some
prodding, he said that he'd tried to.kill
himself. The investigating officer
noted in his report that aside from the
blood in the bathroom and a large
stain and two blood-soaked towels on
the bed. the hotel room appeared to be
in order. There was no sign of a
struggle. Rewald's business clothes
were draped neatly over two chairs, his
shoes placed side-by-side under one of
them. Next to the license and credit
cards stacked carefully on an adjoining
table were five #20 bills. Rewald's
wristwatch, wedding band and an
envelope addressed to his wife.
The envelope contained two notes
written on hotel stationery in a barely
legible scrawl. The notes asked for
forgiveness. One said that "I started
out working for our country" and
concluded "it never dawned on me that
I would be left alone and unprotected.
The only other item found in the
hotel room that didn't belong there
was a cartridge of Gillette Platinum
Plus razor blades lying next to the
bathroom sink. One of the blades was
partially protruding from the cartridge
and was stained with blood.
Doctor's theory. At Queen's
Hospital in Honolulu, Rewald also
told staff doctors that he had tried to
kill himself. He was put in intensive
care and given eight units of packed
red blood cells to replace the estimated
four pints of blood he had lost. There
were lacerations on each of Rewald's
wrists and a long gash on the inside of
his left forearm. A doctor estimated
that the wounds on the left wrist had
occurred several hours before the
others. He theorized that Rewald had
irflicted the first wounds, wrapped his
arm in towels, lay down on the bed and
lost, consciousness. He then later
awakened and made the other slashes.
The doctor said that before cutting
himself the first time Rewald had
taken about a dozen Tylenol and
codeine tablets, commonly prescribed
for pain relief but not in such quantity.
I
Although Rewald was kept under
close ',.surveillance in the hospital-
common practice in suicide
.attempts-the staff psychiatrists who
attended him reported that from the
beginning Rewald denied any further
suicidal intent. In fact, the patient's
spirits as well as health appeared to
improve rapidly. Though he knew it
woulci mean his immediate arrest,
Rewald chose to be released from the
hospital rather than being admitted to
its psyc=hiatric ward, an alternative that
was offered him.
On August 4, the same day that a
federal t.;ourt declared Bishop,
Baldwin l'ankrupt, the Honolulu
police closed rheir file on the event at
the Sheraton Hotel and declared
Rewald an attempted suicide.
The only evidence besides that
found in the hotel room that was
described in their report was the
registration card for the room. The
name shown on the card was Ron Imn.
of a Milwaukee addres. The room had
been paid for in advance for one night
at the time of check-in on July 29. And
the payment had been ii cash, which
required no identification. A police
handwriting expert wat; asked to
compare the writing on the
registration card with that on the two
notes found in Rewald's room, but he
said that the writing on the card was
insufficient for a comparison. It was
assumed that the "Ron Inip" who
registered was really Ron Rewald
using his wife's maiden name and the
home address of her parents.
Big questions. What happened in
the Waikiki hotel room in the as much
as 24 hours that Rewald occupied it
holds the riddle of his "attempted
suicide" and perhaps much more.
Did Rewald act alone? The evidence
indicates that he did. If he had been the
intended victim of a professional
killer, even one wishing to make his
work appear like a suicide, the assassin
or assassins would surely have been
more thorough. And there was no sign
of a struggle in the room.
Did Rewald intend to kill himself?
For weeks after his discovery he claim-
ed that he did. He said that he was
"crushed" by the seeming personal
attack of the television report
revealing the state investigation of his
company. But such a drastic reaction
to what Rewald also described as a
routine probe seems out of character
for a man who has since then
demonstrated superb self-control.
Unless he was reacting to much more.
Between September 1982, when
Rewald claims he went into semi-
retirement at Bishop, Baldwin, and
last July, there were occasions when
Rewald expressed doubts about his
support from the CIA. He worried
about the agency's slowness to block
the IRS's investigation of his personal
taxes. And he complained that too
many covert assignments were being
given to his company, increasing the
risk of exposure. One of Rewald's
"suicide" notes spoke of being "left
alone and unprotected."
Continued
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
 Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5
Late in 1982, Rewald began to
secretly record conversations between
himself and those whom he felt would
help prove his CIA invovlvement. He
also started collecting a private file of
similarly significant correspondence.
This material now forms a key part of
his defense. Some say that the
material, though authentic enough,
resulted from circumstances that were
staged by Rewald to prove his point
and is therefore misleading.
Their implication is that Rewald
played a far less significant part in the
CIA's use of Bishop, Baldwin than he
now maintains. In short, they argue
that Rewald used the CIA more than it
used him and his company. A
mainstay of the lawst}its by Rewald
and his investors against the CIA is
that the agency at least knew of
Bishop, Baldwin's purloined
investment accounts and is therefore
responsible for them. Some of these
investors are saying that they knew
about hte agency, so it must have
known about them and what was
happening to their money. On proof of
that may hang the investors' case.
Master manipulator. One of Bishop,
Baldwin's unsuspecting consultants,
who now says that he doesn't know
what to make of Rewald, describes his
ex-boss as the most disarming person
he ever met. "Ron was a master of
manipulation," he says. "He had an
uncanny sense of people's feeling, of
saying the right thing at the right
time."
Was Bishop, Baldwin a CIA front
that got out of control? Was it the
agency, and not some more sinister
force, that brought it down? And what
of Rewald's "attempted suicuide"?
Was that the agency's idea, or his? Was
it real, or was it a perilously convincing
ruse? Was Rewald's life-saving
discovery accidental or planned?
Since that late July afternoon,
Rewald has complained bitterly about
the plight of his family, most of whom
now live in Milwaukee. He says that
their abandonment by the CIA is a
major reason for his lawsuit against
the agency. Be says that he counted on
the agency to take care of his family
should anything happen to him. He
had $3 million in life insurance, but
that has lapsed and it's doubtful that it
would have gone to his family anyway
had he died on July 30 because of
Bishop, Baldwin's ensuing
bankruptcy.
Rewald also professes deep concern
about the welfare of Bishop, Baldwin's
former investors and employees.
blames the CIA for letting them down
too. Who did the letting down is, of
course, what the whole sordid tale of
Bishop, Baldwin is about.
One of the few ex-employees who
did avoid being bruised in Bishop,
Baldwin's fall was a man from Seattle
who had just been hired because of
some very special qualifications. On
his resume, which not many saw, he
described himself as a professional
"intelligence officer" who among
many former jobs had once been the
"senior CIA representative in
Moscow." He listed among his honors
the Career Intelligence Medal, which
had been awarded him by the Director
of the Central Intelligence in May 1981
for "exceptional achievement." HI
Sanitized Copy Approved for Release 2011/03/30: CIA-RDP90-00552R000605480122-5