RAMPARTS MAGAZINE MISREPRESENTS ROLE OF CENTRAL INTELLIGENCE AGENCY IN FIGHTING AGAINST IMPORTATION OF DANGEROUS DRUGS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75B00380R000300080002-3
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 150
• Document Creation Date: December 16, 2016
• Document Release Date: May 11, 2005
• Sequence Number: 2
• Publication Date: June 2, 1971
• Content Type: OPEN

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Jun; 1971
The objective of ?
foreign conce,
Act into accoew.
mate' sales to the United ;,te .??.,
The 25 Percent Rule
The Antidumping Act provides that in
normal situations fair value &lien be deter-
mined by comparing tile eX factory home
market price of the merchandise under in-
- vestigation with the ex factory price at which
the merchandise is sold in the United States.
? If tthe price fis the United States is less than
the home market price, then there are "sales
1,1, 1,F,fl then fair value" within the rncaning
he eta to to.
'le Act also steles that in situations where
quantity of merchandise sold in the
1,,alle market is so small in relation to the.
? quantity sold for exportation td countries
? other than the United States as, to form an
'inadequate basis for comparison, then third
? country price should be used as the basis for
.? comparison.
The Antidumping Regulations provide that '
generally for purposes of determining what
constitutes an "inadequate basis of com- ?
parison" for fair value mimeses, home mar- .
?' ket sales will be considered to be inadequate
if less than 25 percent of the.non-U.S, sales
of the merchandise are sold in the home mar-
ket.
The selection of home market or third.
country price for fair value comparison can
easily Ise crucial to the results of antidump?
ing investigations, for frequently home mar-
ket price tends to be higher than third coun-
try price. This is particularly true whore
merchandise is sold in a protected home mar-
ket and, when sold in third countries, is ex-
posed to the vagaries of world competition. ?
It has been Treasury's experience that
cases arise where sales in the home market
are adequate as a basis for fair value corn-,
}Dodson, even though less than 26 percent of
the non-U.S. sales are sold in the home mar-
ket. From a technical standpoint, the exist-
ing regulations provide for this ,situation,
since the 25 percent rule is introduced by
the adverb "Generally." ExaMination of the
precedents, however, revealed that the Treas-
ury has not, in recent years at least, made
nis' exception in applying the 25 percent rule.
'I de left the Treasury with two alterna-
it 'could have ignored the previous in-
? e. elistions of the Antidumping Regula-
lolls which had, in effect, applied the regults-'
dons as if the word "Generally" were not
there, or it coud propose a change in the
Antidumping Regulations to eliminate the
26 percent rule. We chose the latter course.
The proposal was published in the Federal
Register of April 27, and is currently open
for comment by interested persons. Any com-
ments received will be carefully considered
before we take final action on this proposal.
A LOOK INTO THE FUTURE
In my judgment, we have only come to
the end of the beginning of the rejuvenation
process. But, I believe we have made a solid
start. ?
Let me take a final brief moment to touch
upon what I see happening In the future. We
have taken steps to initiate a fresh examina-
tion of the Treasury's antidumping proce-
dures and regulations to see what more can
be done. The regulations were substantially
revised in mid-1068 after a broad review,
with the dual objectives of conforming the
Treasury's procedures to the requirements
of the International Anti-Dumping Code,
and also of having the regulations imple-
ment in clear and precise language the ob-
jectives of the Antidumping Act. With al- '
most three additional years of experience
under the regulations, as then revised, it is
now appropriate to stop and take a now look
to see whether additional changes may be ap-
propriate. A Notice of Proposed Rule Making
Ii' this erect was PUbliSlIed, in the roderal
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COIN.GRESSIONAL REco-:&D ?:.Exteusiolls ,of Rem-arks
? is to Induce
mI; Id
engage in
1.10,
?
Sixty days are being allowed for the sub-
mission of comments. I would assume that
many persons present here today?if you are
not already aware of the Treasury's invita-
tion to submit coraments?may wish to do
so. ?
Let ine emphasize that the Treasury De-
partment continues, as always, to adhere to
its policy of equitable adminietration of the?
Antidumping Act. With the increased per-
sonnel assigned to this field and modernized
procedures and policies, we shall speed up
antidumping investigations, thereby making
administration of the law more effective?all
?
this without sacrificing equity.
Let me also emphasize that the Treasury
Department and the Administration are
strongly opposed to having the Antidumping
Act transformed into an instrument of pro-'
tectionism. On the other hand, we are
equally strongly opposed to allowing foreign
arms to injure U.S. industry by unfair price
discrimination. It is with the latter objec-
tive in mind that the Treasury Department
introduced the changes in the administra-
tion of the Antidumping law, which I have
discussed with you today. To the extent that
we succeed in our objective, the Treasury's
rejuvenation of the Antidumping Act will
become all increasingly important influence
in favor of a freer international trade policy.
In conclusion, I would like DO repeat a
statement made by Secretary Connally on
May 17 before the Subcommittee on Inter-
national Trade of the Senate Committee on
Finance: ?
"The efforts to foster increased comped-,
tiveness -in our economy. must be actively
pursued in the context of fair and liberal
trading arrangements."
RAMPARTS MAGAZINE MISREPRE-
SENTS ROLE OF CENTRAL INTEL-
- LIGENCE AGENCY IN FIGHTING?
' AGAINST IMPORTATION OF. DAN.?
GEROUS DRUGS
C." ? ?
NON. ?CE:ARLES S. CUBSE2.
OF CALIFORNIA .
IN THE HOUSE OF REPRESENTATIVES
Wednesday, June 2, 1071
Mr. GUBSER. Mr. Speaker, recently
Ramparts magazine published an article
which, like so many other articles which
appear in new left publications, attempt-
ed to discredit established agencies of the
Government, including the Central- In-
telligence Agency, Unfortunately, the
Stanford _Daily, the newspaper pub-
lished by students at Stanford Univer-
sity, saw fit to lend credibility to this
article by reprinting it.
A tearsheet from the Stanford Daily
was sent to me by a constituent and I
submitted it to the Bureau of Narcotics
and Dangerous Drugs with a request for
comment. Under date of May 27 I re-
ceived a reply from Mr. John E. Ingersoll,
director of the Bureau of Narcotics and.
Dangerous Drugs. His letter should be
brought to the attention of all responsible
Members of Congress and the press since
it certainly contradicts the implications
contained in the Ramparts magazine
? article. Mr. Ingersoll's response follows:
Hon, CHARLES 5, GUUSER
ELS, /1011.SC Of Representatives
Washington, D.O.
' DEAR CONGRESSMAN CUBSER: This is in
response to your letter of May 21, 107h Which
enclosed a tearsheet from the "Standard
E5305
sity) of the article. entitled;-"T.ie New Opium
War," as reprinted from "Ramparts Mag-
,azine."
Charges made in the article appeal' to he
a part of a continuing effort to discredit
agencies of the U.S. Government, such as the
U.S. Military, the FBI, the CIA, and the De-
partment of State, all of which are, in point
of fact, working .actively with the Bureau of
.Narcotics and Dangerous Drugs (BNDD) in
our worldwide effort to curtaii international
drug traffic,
Actually, CIA has for sometime been this
'Bureau's strongest partner us identifying
foreign sources and routes of illegal trade in
narcotics. Their help has included both direct
support in intelligence concede's, as well as
in intelligence analysis and production. Liai-
son between our two agencies is close and
constant in matters of mutual interest. Much
of the progress we are now making in Wen-
tifyine? overseas narcotics traffic can, in fact,
? be attributed to CIA cooperation.
In Burma. Laos, and Thailand, opium is
produced by tribal peoples, some of Whom
load a marginal existence beyond the polit-
ical reach of their nationas governments.
Since the 1950's, this Southeast Asian area
has become a massive producer of illicit
opium and is the source of 500 to 700 metric
tons annually, which is about half of the
world's illegal supply. Up to now, however,
? less than ten percent of the heroin entering
the United States comes from Far Eastern
production.
? The dimensions of the drm; problem and
the absence of any strong poiitical base for
control purposes has been a dilemma for
United Nations opium control bodies op-
'crating in Southeast Asia for many years.
? Drug traffic, use, and addiction appears to
?.have become accepted as a fact of life in this
area and, on the whole, public attitudes
..are not conducive to change.
The U.S. Government has been concerned
that Southeast Asia could become the major
source of illicit narcotics for U.S. addicts
after the Turkish production is brought
under control. Tile Bureau of Narcotics and ??
? Dangerous Drugs, with the help of CIA,. ,
DOD, and the Department of State, has been
workifig to- define and characterize the prob-
lem so that suitable programs to suppress
the illicit traffic and eliminate illegal opium
production, such as the proposed United
Nations pilot project in Thailand, can be
implemented,
? It is probable that opium production in
Southeast Asia will be brought under effec-
tive control only with further political de-
?velopment in these countries. Nevertheless,
in consideration of U.S. Military personnel
in the area, as well as the possibility that
opium from this area may become a source
for domestic consumption, concerned U.S.
Agencies, including CIA, Bureau of Customs,
DoD, and State, are cooperating with BNDD
to work out programs to meet the immedi-
ate problem as well as provide longer term
solutions. .
? Since, the subject matter of your letter
concerns CIA, I have taken the liberty of.
furnishing .a copy along with my reply to.
Director Richard Helms.
Sincerely, ?
JOHN E. INGERSOLL,.
Director.
As an enclosure to his letter, Mr. In-
gersoll inchideci a paper entitled "Recent
Trends in the Illicit Narcotios Market
In Southeast Asia." This should also be
of interest .to every person who is con-
cerned about this problem and I there-
fore include the text herewith:
RECENT TRENDS IN THE ILLICIT NARCOTICS
MARISET IN SOUTHEAST ASIA
1. The reported increasing incidence of
heroin addiction among U.S. servicemen in
Vietnam and recent intellizeAee Indiestin;
" APvii 13. *proved
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and the United States may also be increas-
ing suggest that Southeast Asia is grow-
ing in importance as a producer of heroin.
While this phenoinenon in part reflects im-
provement in Information available in re-
cent .months to the U.S. Government,. there
Noe' are also good indications that production of
illicit narcotics in Southeast. Asia has in-
deed risen in 1971.
BACXGROUND
2, The Burma, Laos, Thailand border area,
known Also an the "Golden Triangle," is
et/MAW:Teti one of the world's largest oPinne
producing yegione. Tine region normally ac-
counts for about 700 tons of opium annual-
ly or about one-half of the world's total, il-
licit output. A substantial proportion is con-.
slimed within the region. Burma, by far
the largest producer of- opium in this region,
accounts for about 400 tons annually.. ?
a
nunivra .
3. Production in Burma is concentrated
in the Eastern and Northern parts Of Shan
State and in the Southwestern part of Kas
chin State. Poppy fields cover the rugged
slopes in Eastern Shan State around Kong
Tung and in Northern Shan State from
Lashio east and north to the China border.
The latter territory, comprised of the former,
We and Kokang feudal states, is now a cen-
ter of insurgency directed against the Bur-
mese government, with much of the area un-
der insurgent control,
4. The growing season varies with the al-
titude, but the planting season generally
falls during the months of August and Sep-
tember, with the harvest some seven months
later during February and- March. At har-
vest time the women of the hill tribes slit
the poppies and collect the raw. opium by.
hand. The opium plants themselves are
ground into a compound for smoking. In
Northeast Burma, the raw opium is packed
by the growers and traded to Itinerant Chi-
nese merchants who transport it to major
collection, points, particularly around Lashio
and Kong Tung. Agents of the major en-
trepreneurs circulate through the hill coun-
try shortly after harvest time arranging for
payment and pickup. Payment is often ,in
the form of weapons and ammunition, el-
thongh gold and silver rupees are also used,
5. The opium harvested in Shan, Win and
Kokand areas is picked up by caravans that
are put together by the major insurgent
leaders in these areas. The caravans, which
can include up to GOO horses and, donkeys
and 300 to 400 men, take the opium on the
southeasterly journey to the- processing
plants that lie along the Mekong River in
the Tachilek (Burma) -Mae Sat (Thailand).
Ben liouei Sal (Laos) area. Caravans carry-
ing In excess of 16 metric tons have been
reported.
THAILAND
' 6; Opium-growing areas in northern Thai-
land are located in the upland tracts oc-
cupied by various tribal groups. The pro-
vinces of Ching Mai, Chiang Rai, and Nan,
which Ilene the largest concentration of
Angie, produce most Thai opium, Illicit opium
peeteection in Thailand is estimated at 200
7005.
LAOS
7, Another, lest; productive, opium growing
area is along the 2,500 to 4,500 foot high
mountainsides of Northwest Laos. The opium
cultivated by the Meo in this area is- of a
relatively lower grade and thus less Slat..
able for refinement into morphine base or
heroin. In these areas where the tribesmete,
have been encouraged to grow corn, the pop-
pies are planted among the corn, When the
corn is cut, the poppies continue to grow
until they too can be harvested.
6, Major producing areas include Phong
Saly Province in the North, Mutt Phan
(Sanmena) Province in the Northeast, and
the Plaine de Jams area of Xiang Fainting
Province in the Es-tit-central put oX thiP
country. However, largo areae of production
In Phong Spey, Hotta Pisan, and Kiang
Khoang have fallen under the control oY the
Paehet Lao and North Vietnamese.
D. The trade in- Northwest Laos is less well
structured and organized for significant com-
mercial exploitation. There are no advance
purchasing agents or pick-up caravans. The
' harvested opium and the poppy plants which
? are ground op for smoking are transported
to nearby village markets by the growers
themselves. In highland market places the
raw opium and Its by-product are teieci open-
ly as currency. Ethnic Chineee merchants are
ethe traditional purchasers of the opium
products throughout Laos. Tho producte they
collect are transported to population con-
?.ters and also to processing plants ialong- the
Mekong River by travelers, particularly gov-
ernment soldiers, who have the most mobil-
ity and access to air travel in the area, and
? refugees. Opium. produced in the Commu-
nist-controlled areas also find its way into
the regular marketing channels'.
?
DISTRIBUTION AND REI,INERIES
10, The KMT irregular "armies" and the
?
Burmese Self Defense Forces (ICK1r) are the
most important trafficking syndicates in
?Nerthern Southeast Asia: The KMT irregu-.
lars?formerly the remnants of the Chinese
Nationalist forces which retreated across the
Chinese border in I049?now composed
largely of recruits front the local population,
have a combined strength of between 4,000
and 6,000 well-armed men. The largest force,
with an estimated strength of 1,400 to 1,900,
is the Fifth Army. The second largest with
a troop strength of, between 1,200 and 1,700
is the Third Army. The headquarters of both
? armies are located in a remote part of North-
' ern Thailand between Fang and Mae Sae It
Is estimated that these two KMT irregular
forces control more than 80 percent of the
opium traffic from the Shan State.
II. The ICKnir have been major competitors
of the KMT irregulars in the opium trade.
The'leDZY are comprised of former Shan State
insurgents and bandits who have allied
themselves with the Burmese government
against both the nreeT and Chinese Commu-
nist-baeked insurgents. In return the 'gov-
ernment of Burma allowed them to pursue
.their ?Menu trafficking activities.
12. The. Shan States Army, an insurgent.
group, is also heavily involved in the opium
business, It maintains several camps in
Northern Thailand where opium is marketed
for weapons and military supplies.
13. About 140 tons of raw opium is nor-
? mally transported annually out of Northeast
Burma to foreign markets. Most of this
opium is stored or processed in the Mekong
River tri-border area before transiting Thai-
land and Laos. Tachilek, Burma is probably'
the most important transshipment point in
the border area. In 1970, out of a total of 123
tons reportedly shipped out of Northeast
Burma, 45 tons was received in the Tachilek
area. In the first two months of 1971, 58 out
of a total of 67 tons had Tachilek as its desti-
nation. Other important transshipment
points appear to be located in the vicinity
of Ban Reuel Sai, Laos, and Mae' Salong,
Thailand,
' 14. There appear to be at least 21 opium
refineries of various sizes anti capacities lo-
cated in the tri-border area, of which about
7 are believed to be able to process to the
heroin stage. The' most important are located
in the areas around Tachilek, Burma, Ban
Hemel Sai and Nam Keung, Laos, and iSilao
Salong, Thailand, The best known, if not '
largest of these refineries is the one at Zan
Houel Tap, Laos, near Ban Houel Sat which
' is believed capable of processing some 100
kilos of raw opium per day. The 14 refineries
In the Tachilek area apparently process the
largest volume of raw opium- in the region.
,In 1070, about 30 tons was converted by the
Tachilek refineries into refined?opiums mop.
? phine base, and heroin, . .
,
15. The typical refinery is on a small trib-
ntary of the Mekong River in art isolated
' arca with A military defense periineter guard-
ing all ground approaches. Most of these re-
fineries operate under the protection of the
various military organizations in the region,
or are owned or managed by the leaders of
these 'military groups. The KielY units pro-
tect and operate most of the refineries in
Burma; Leaders or these groups also hold
an ownership Interest in many of these fa-
cilities. In Thailand, the refineries appear to
be operated by units of the liesT irregulars,
whereat; in Laos, most of the re aneriee oper-
ate under the protection of ,ilements of elle
Royal Laotian Armed Form While
the management and ownereltip of the Lao-
tian refineries appear to be primarily in the
hands of a consortium of Chinese, some re-
-ports suggest that a senior VAR officer 'my
hold an ownership interest in a few Of these
facilities. ?
16, Most of the narcotics buyers in the tri-
border area are ethnic Chinese. While many
of these buyers pool their purchases, no large
syndicate appears to be invelved. The opium,
morphine base, and heroin purchased in this
area eventually finds its way into Bangkok,
Vientiane, and Lualng Prabang, where addi-
tional processing may take place before tie-
- livery to Saigon, Hong Kong, and other inter-
national Markets.
17. Much of the opium and its derivatives
transisting Thailand from Lurrna moves out
of such Northern Thai towns as Chiang Rai,
Chiang Mai, Lampang, or Tak by various
modes of ground and water transport. These
narcotics, along with those produced in Thai-
land, are smuggled-into Bangkok for further
refinement into morphine or heroin. A con-
siderable quantity of the raw opium and
? morphine base is sent by fis-ting trawler from
Bangkok to Hong Kong during a period from
abput 1 January to 1 May. During this pe-
Vied,, approximately one tithing trawler a
day?carrying one to three tons of opium
and/or quantities of morphine base?leaves
Bangkok for Hong, Kong, eche boats proceed
to the vicinity of the Chinese Communist-
controlled Loma islands-15 miles south of
Hong Kong?where the goods are loaded into
Hong Kong junks.
18. Opium and its derivatives which move
through Laos are transferred from the
Mekong River refineries by river craft and
FAR vehicles to Ban Houei Sal, further
downstreren on the Mekong in Laos, from
where it is transported on Royal Laotian Air
Force (RLAF) aircraft .to Luning Prabang
or Vientiane. Front Vientiane narcotics are
usually sent via RLAP aircraft, as well as
Air Laos, to other cities in Laos such -as
Savannakhet or Pakse or to international
markets. -A considerable portion of the Lao-
tian produced narcotics is smuggled into
Saigon . on military and commercial air
flights, particularly on Royal Air Laos and
Air Vietnam. Although collusion between.
crew members and air line agents on one
hand and. individual narcotics smugglers on
the other has been repotted, poor handling
of commercial cargo and the laxity of Lao
customs control in Vientiane and other sue-
reptitiouS loading of narcotics aboard com-
mercial nights, '
RECENT CHANGES IN VISE AREA
10, There aro tentative indications that
larger quantities of raw- opium may now be
moving into the tri-border area for refining
and that larger quantitlee of this raw opium
are now being refined into morphine base
and heroin In this area, Azi euggestea in para-
graph 13 above, data on-tne first two months'
of 1971 indicate that the Tachilek trans-
,shipment and refining area may be receiving
and processing sizably larger amounts of raw
opium than was the case in 1070. As for
changes in the type of refined narcotics pro-
duced, the processing plants art Mao Haw in '
Thailand and.Houei Tap in Laos now appear
1
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to he converting most or their opium into
No. 4 or 9i1 percent pure white heroin. Pre-
viously, these refineries tended to produce
refined opium, morphine base and No. 3
amoking heroin. An increased demand for
No. 4 heroin also appears to he reflected in
the steady rise in its price. For example, the
mulct-April 1971 price in the Tachilek area for
a kilo of No. 1 heroin -was reported to be
U.S. $1,760 as compared to U.S. $1,240 in
September 1070. Some of this increase may
also reflect a tight supply situation in the
area because of E shortage of chemicals used
In the processing of heroin. Rising prices for
opium and its derivatives can also be seen
Iii other areas of Southeast Asia,
20. The establishment of new refinerieS
since 1909 in the tri-border area, many with
a capability for producing 08 percent pure'
heroin, appears to be due to the sudden
increase in demand by a large and relatively.
affluent market in South Vietnam. A recent
report pertaining to the production of mor-
phine base in the Northern Shan States
would indicate a possible trend toward ver-
tical integrations--produeing areas estab-
lishing their own refineries--in the produc-
tion of narcotics. Such a development would
significantly facilitate itsuspaias ti on and
distribution of refined zinc To /Ai ?yier.
ket places.
?
HOW FAIR THE FARE? ? , .
NON. 13ENAIVI1N S. ROSENTNAL
Or NEW want
? IN THE HOUSE OF REPRESENTATIVES
Wednesday, June 2, 1971
Mr. ROSENTHAL. Mr. Speaker, repro- ?
sentatives of U.S. transatlantic airlines
are going to Montreal later this month
to negotiate air fares?actually the word
should he to "fix" air fares, for the com-
peting carriers meet in private to decide
the rates they all will charge. ? .
The prices are fixed by the Interna-
tional Air Transport Association. Frances
Cerra, Newsday's consumer writer, has
aptly described IATA as "a cartel which
operates without the participatsion of .
consumers and above the laws of the
United States and any international or- '
ganization "
The position of the American carriers
is thrashed out by the airlines and the,
Civil Aeronautics Board in secret ses- '
sions. The people who must pay the fares
will be given no opportunity to 'partici-
pate or express their views; after all,
they have little choice: only one or two
transatlantic airlines land in the United
' States that are not IATA members.
The Aviation Consumer Action Project
has written to CAB Chairman Secor D.
Browne protesting the lack of public par-
ticipation in these proceedings. That let-
ter said, in part:
Such practices on the part of a federal
regulatory agency are hostile' to elementary
notions of due process and deprive citizens
of basic participatory rights assured in the
First Amendment,
I would like at this time to join them
in urging an end to these secret meetings
with the airlines in the course of fare.
negotiations.
So that all my colleagues may be aware -
of this situation, I am inserting in the
RECORD at this point the Aviation Con-
: ? Now' sumer Action Project's letter to CAB
Chairman rowe, and Miss Corrata.very
' fine article on the setting of international ,
an fares:
AVIATION CONSUIVICE ACTION PEOJECT,.
Washington, D.C., May 25,1971.
Hon. Snoort.D. BROWNE,
Civil Aeronautics Board,
Washington, D.C. -
.
Drdia ClIAIEMAN Baowsta: The traffic con-
ference of the International Air Transport
Association (TATA) is scheduled to meet at
Montreal on June 28, 1071, to negotiate trans-
atlantic air fares. The Presidents of the
transatlantic TATA carriers will meet in New
York on May 27, 1071, to discuss the Montreal'.
fares conference. And the Board, in accord-
. anco with its customary practice, will prob-
ably meet with the representatives of the U.S.
carriers and discuss with them the various
views and positions which they will adopt in
the IATA negotiations at Montreal. All these
meetings will, as usual, be held in secret.
,Members of the public and farepayera will
not be given an opportunity to present their
, views and opinions in any of these meetings.
? The ' Aviation Consumer Action Project
(ACA-?), is writing to express its deep re-
sentment and disapproval of the restrictive
price-fixing practices of IATA, and the
Board'a complicity in those practices..
? ACAP is a, non-profit consumer organiza-
tion which has been founded for the purpose
of providing an independent voice for the
? advocacy of consumer and environmental in-
tereSts in matters and proceedings before
? the Board and other regulatory agencies.
. Whatever may be the underlying reasons
?for the Board's approval of U.S. carriers'
? Participation in TATA meetings, ACM' is of
the opinion that there cannot be any justi-
fication for the Board's secret meeting with
airline executives on the eve of the IATA
? conference. The issues raised by such a meet-
ing are rendered all the more serious when
the Board, on the exclusive basis of the air-
.? lines' in camera presentations, formulates
policies and opinions with respect to the ap-
propriate and permissable fare levels for
various international routes and traffic re-
. glom, Such policies and opinions are com-
municated tpJ the carriers by lIsa Board
the form of "directlYes." For all practical
purposes these directives are informal de-
. cisions of the ? Board which tentatively set
forth the fares that the Board considers.
reasonable and legal.
The Federal Aviation Act and the regula-
tory scheme outlined therein do not permit
the Board to make ex parte decisions after
hearing the airlines in closed sessions. Such
practices on the part of a federal regulatory
. agency are hostile to elementary notions of
duo process and deprive citizens of basic par-
ticipatory rights assured in the First Amend-
ment. They aro wholly inconsistent with the
procedural principles embodied in the Ad-.
ministrative Procedure Act.
ACM, urges the Board not to engage in
-secret or private audiences with the airlines
concerning fares or other matters to be nego-
tiated in the TATA conference, except in open
. proceedings of record, in which all interested
and affected parties would have the right
to attend and lawfully participate. We urge
the Board to abstain from convening any
secret meeting with the airlines whether
prior to or in the course of TATA fares nego-
tiations.
- Sincerely.
? ?
?
??,..
line you choose, the flight will co,li you a555
round trip for a 17- to 28-day stay.
The same is true for Rome or Cairo or any
other international destination except Lux-
embourg. (Icelandic, a maverick airline,
filea there.) The prices are fixed by the In-
ternational Air Transport Association, a car-
tel which operates without the participation
of consumers and above the lawa of the U.S.
and any international organization. This year
,the price of international travel increased
from eight to 12 per cent as a result of IATA
agreements. Next month, the process of fix-
ing the 1972 prices will begin, lent a new ele-
ment may be added: A new consumer group
backed by Ralph Nader promises to challenge
the IATA system in the courts.
', Since its formation in 1029, TATA has been
Involved in the complicated maneuvers of
International politics. Many governments in
the world subsidize their own airlines and
therefore want to be protected from true
competition on air fares. These governments
therefore adopt the TATA agreements as law
and threaten to prosecute any foreign airline
which tries to charge lower fares. Great Brit-
ain, which subsidizes BOAC, actually made
such a threat against the U.S. airlines in 1063
when the Civil Aeronautics Board opposed a
five per cent increase in air fares. Faced with
this threat and an international incident, the
CAB backed down.
Foreign governments also enforce the TATA
agreements by another simple measure: They
refuse to allow an airline that is not a mem-
ber of the cartel to land in their countries.
That is why Icelandic Airlines, the only non-
member of IATA, can land only in Luxem-
bourg. No other European country will give s.
it landing rights.
A spokesman for Pan American, whose
president, Najecti E. rialaby, is on the execu-
tive committee of TATA, said lutt he would
not call TATA agreements "price fixing," but
"an area of cooperation."
"If there were not an area of cooperation,"
he said, "many airlines would not be able to
exist. The U.S. airlines in particular would
have a hard time because they are not subsi-
dized by the government, IATA Makes for
fair play, anti Without It there would be
Chaos,"
Herb Aswan, the acting chief of the TATA
rates and fares section of the Civil Aeronau-
tics Board, which sets domestic air fare rates.
echoed Pan American's concern. "With 20
Carriers flying the Atlantic alone," he said,
"to not have IATA would result in chaos be
cause we would have to deal with each in-
dividual foreign government to establish
fares. And because the CAB has no authority
to regulate international fares, we might have-
to accept an uneconomic fares, which would
drive an American carrier out of business."
Dr. It. G. J. Pillai, author of a book on
TATA called "Air Net," and head of the new
Aviation Consumer Action Project, calls such
arguments illogical. "The private airlines are
now at 0. disadvantage in IATA because they
are negotiating as private concerns with gov-
ernment-owned airlines. That is exactly why
we say TATA should net exist. If. there were
competition in air fares I personally don't
think it would "be very destructive because
the efficient airlines would survive. But the
alternative is for the U.S. government to
directly represent the private airlines ill
these conferences."
Pillai said that such negotiations would
? not be unusual for the government which
.
K. G. J. , ' now makes tariff and excise duty agreements
Rtuazar B. ROBERTSON M. on thousands of products like oil and tex-
. ? tiles, and even airmail rates. "T can't under-
aNTERNATIONAL PARES: At Ti-sty SET Varela'? stand why air fares should be different," he
said. Pillai said that if the government was
(By Frances Cerra.) ? involved in fixing the international air fares,
? Unless you really dig leazouki music or the consumer would have a better chance of
care about the color scheme of a plane's-' influencing the negotiations. Right now, he
Interior, it doesn't pay to shop around for charges, the consumer has no chance of in-
the cheapest IliMat to Athens, Whatever airs Auencing TATA,
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, In the end, millions of Americans go with-
out adequate medical care. They cannot af-
ford It, They are afraid it will break ahem.
Or they cannot lind a doctor. Some of them
die, Others are left destitute, And most
of them fall victim to needless pain and need-
lees suffering. They are your parents or
? mine?your children or mine?our friends
and our fellow citizens.
The thsaeter we call medical services makes
most Americans forgotten Americans. It be-
trays each of them and all of us. Our system
of medical care is in fact a system of medi-
cal neglect,. It is in the deepest sense Un-
American. ?
Despite our Power and our strength, de-
. spite our trillion dollar G.N.P., we have let
young people die before their time, and old
people die when there Was some precious
, time left. How will history judge us, a coun-
try which was first in the wealth of its re-
sources, but far from first in the health of
Its people? And more importantly, how will
we judge ourselves in those quiet, inner mo-
ments, when 'we remember that what finally
counts is not how much wo have, but what
wears?
It is time for us to do more until we have
done enough to sustain and enhance the ?
health of our nation.
Countless medical students and some doe- .
tors have already answered the call to n new
kind of service. In the early 1960sa student
,s health organizations from Los Angeles to
J3oston pioneered concepts for comprehen-
sive health care. In the summer of 1907, stu-
dents like you joined together in New York .
City to found the student health project of
the South Pronx, Their historic initiative
WW1 a sign of a new generation's determina-
tion to make medicine work for people.
, But the young and the concerned In the
the medical profession cannot do the whole
, job alone. Your voices have been heard?and
sometimes oven heeded, But your own efforts
will take too long. And the results will be
too uncertain, The only certainty Is that en-
trenched and established forces will oppose -
you every atop of the way. We cannot wait
or gamble on the outcome. Human ille and
human health bang in .the balance.
Four decades after organized medicine al-
most adopted report favoring uniform fi-
nancing for medical services--four decades
and a hundred million illnesses too late?
we must enact a ? medical bill of rights for
all Americans. The Constitution commits our
country to protect political freedom. Now,,
by legislation, the Congress must commit
America to protect the physical health which
alone makes possible the exercise of liberty.
The first medical right of all Americans is
care within their means. Admiesion to a hos-
pital or a doctor's office should depend on
the state of an individual's health, not the,
Mee of his wallet. And we cannot depend on
reform on half-way measures and half-
hearted 'compromise. A right to medical care
which left the burden of cost on the poor
and the near poor would mock its own pur-
pose. The only sure security is federally
funded universal health insurance, That is
our best hope for the future?and a pri-
ority goal in 1971.
We must take the dollar sign out of medi-
cal care. We must destroy the financial bar-
rier between deprived people and essential ,
medical services. We must end the terrible.
choice co many Americans face between los-
ing their health and losing their savings.
The recond medical right of all Americans
is care within their reach. Even if we. guar-
anteed the payment of health costs, millions
of our citizens could not find sufficient moth-
cal services. The system Is not only inequit-
able?it is also undermanned and inefficient.
It is on the verge of collapse. The Nation must .
now respond with Federal financial incen-
tives that wilt Insure real reform. -
There are not enough doe tom put Ihdersi
limo"
1
incentives Can persuade medical schools to
follow Einstein's lead and expand their en-
rollment. New schools can be created and
sustained by Federal loans and grants. And
Federal funds must also be provided to help
medical students, who should have something
better than money to worry about. A pro'-
gram of scholarship aid must include all who
are In need?and it must encourage minority
students who intend to return to the old
neighborhoods.
Yet the number of doctors is not the
whole answer. If we produce 60,000 additional
physicians and plug them into the current
structure, our efforts for reform will certainly
fail. Some of the health manpower higialation
now before the Congress would do just that?
and the result would be too many more doe-1
tors serving too few people at too high a cost.
Here, too, Congress must set up financial
incentives that can move medicine in a new ,
direction. We must encourage a shift from a
system dependent on the individual doctor'
to a system built around the concept of the,
health team, composed of primary care phy-
sicians and I other medical professionals.
Teams would allow us to allocate medical re-
sources with maximum efficiency and to
maximum effect. They would employ para-
professionals to relieve nurses and doctors
from routine, time-coneuming tasks. They ?
would gather together diverse skills?from
internists to pediatricians?and patients
would deal with the team, not just a single
physician. Einstein has experimented with
the health team concept. The Federal Gov-
ernment must make Einstein's experiment
national policy.
And health teams must be sufficient in dis-
tribution as well as in number. Federal
bonuses must make it worthwhile to prac-
tice in the inner city and in rural America.
Medical care cannot reach people unless peo-
ple can reach doctors. And people must have
more than geographic reach. A health team
should also be subject to the reach of local
influence.
Location incentives for health services
must be designed to create responsive, per-
sonal structures. It was never right?and
it is no longer possible--to satisfy Americans
with distant, impersonal medical care. The
system must respect everyone's identity?
and sacrifice no one's dignity. And we must
always remember that it is easier for a
patient to reach a health team that he'
knows?than a shining new medical center
walled off from surrounding rural poverty or
a nearby urban ghetto. ?
The third medical right of all Americans
is care within their needs. The present
health insurance system is heavily biased
toward high-cost hospital treatment and
against preventive health care, That is in-
credibly expensive?and incredibly insensi-
tive to the real needs of people. It has filled
hospitals with patients who should not be
there and would be better off elsewhere. A
new national health program must reverse
the old priorities. It must guarantee a range
of medical services, comprehensive in scope,
preventive in emphasis, and restricted only
by the scope of scientifia knowledge.
America's concern over the quality of
health care has reached a high water mark
in 1971. You are graduating from medical
school at a time when the whole medical
profession may be profoundly altered. You
should welcome change?and work for
change. Only in the context of a medical bill
of rights for every American, can each of you
truly and in the most literal sense profess
your profession?which is nothing more and .
nothing loss than the protection of human
life.
And that requires not just a medical bill
of rights, but a social bill of rights. The real
cure for lead poisoning is not hospital care,
but decent housing. The most effective treat-
mans tor malnutrition is adequate toed.
And the best guarantee of good health is n
physically and emotionally health environ-
ment.
A health professionals, you must commit
yourselves to total health care, And total
-care includes virtually everything that do-
termines whether we are sick or well. You
cannot confine youreelvee to the technical
skills you have learned lae7, You must also
practice the fundamental h amen concern of
a school like Einstein.
You must speak out for a fair and sensible
medical care system.
You must eland up for soelal progress and
for people?whether they are your patients
or migrant workers two thousand miles atee.y.
? You can cure Individuala--and you must
help America build a compaautonute society.
It will take time. There Will be setbacks
, ad frustrations and defeats. But men and
, women who come from Einstein have good
reason to believe that we can finally fashion
. a country that Is great enough to be good.
? You have seen in your own lives whet a dif-
ference one Eehool can make, Now all of you
have a chance to make a real difference in
' the lives of others.
The practice you choose and the practices
you follow may not change our country over-
night. But you can remind -ns by example of
Aristotle's ancient truth: 'Health of mind
and body is so fundamental to the good life
that if we believe men have any personal
rights at all as Ullman beings, they have an
absolute moral right to the measure of good
health that society Is able to give them."
That is our challenge and our chance. Two
thousand years after Aristotle wrote, we must
secure a medical bill of rights for our own
people. We can wait no longer?In health care
or in society. In our individual lives and in
our national life, whatever we can do, and
whatever we dream we can do. we must begin .
now.
THE CIA FIGHTS ILLEGAL DRUG
TRA FFIC
Mr. HANSEN. Mr. President, earlier
this year I had the pleasure of addressing
an ROTC group who was in the audience,
questioned me in regard to certain alle-
gations made in Ramparts magazine that
the Central Intelligence Agency encour-
aged the opium traffickers of Indochina.
I doubt that such allegations have been
given credence by many Americans, but
apparently Mr. Ginsberg either believed
them to be true, or chose to _pretend that
he believed them. But because I do not
take such serious charges against our
Government liabtly, and believe that
none of us should allow unjust criticism
. of our Government to stand unchal-
lenged, I recently asked the Bureau of
Narcotics and Dangerous Drugs to set
the record straLdit on these accusations,
.Bureau Director John Ingersoll replied
this week, and his remarks are timely in
view of the major initiatives President
Nixon is expect3d to announce today to
help deal with the illegal thug Problem.
Mr. President, Mr, Ingersoll has re- .
? ported to me that the CIA is his Bureau's
strongest ally in identifying foreign
sources and routes of illegal trade In
narcotics. I ask unanimous consent that
his letter of June 15 be printed in the
REconn, followed by a report on recent
trends in the illicit narcotics market in
'Southeast Asia, and my telegram of
May 11 which was printed in the final
spring semester edition of the University
of Wyoming student notepaper, the
Branding Iron.
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15. The typical refinery Is on a small trib-
utary of the Mekong River in an isolated area
with a military defense perimeter guarding
all ground approaches. Most of these refin-
eries operate under the protection of the
various military organizations in the region,
? or are owned or managed, by the leaders of
thgee military groups. The KKY units pro-
tect and operate most of the refineries in
Blume. Leaders of these groups also hold an
owneiship interest in many of these facilities.
In Thailand, the refineries appear to be op-
erated by units of the KMT irregniars, where-
as in LAM, most of the refineries operate un-
der the protection of elements of the Royal
Laudon Armed Forces (FAR). While the man-.
agement and ownership of the Laotian re-
fineries appear to be primarily in the hands
of a consortium of Chinese, some reports sug-
gest that a senior PAR officer may hold an
ownership interest in a few of these facil-
ities,
16. Most of the narcotics buyers?in the tie-
border area are ethnic Chinese. While many
of these buyers pool their purchases, no large
syndicate appears to be involved. The opi-
um, morphine base, and heroin purchased
in this area eventually finds tie way into
Bangkok, Vientiane, and Inuting Prabang,
where additional processing may take place
before delivery to Saigon, Hong Kong, and
other international markets.
1'7. Much of the opium and its derivatives
transiting Thailand from Burma moves out
of such Northern Thai towns as Chiang Rai,
Chiang Mai, Lampang, or Tak by various
modes of ground and water transport. These
narcotics, along with those produced in Thai-
land, aro smuggled into Bangkok for fur-
ther refinement into morphine or heroin.
A considerable quantity of the raw opium
and morphine base is sent by fishing trawler
from Bangkok to Hong Kong during a
period from about 1 January to 1 May. Dur-
ing this period, approximately one fishing
trawler a day?carrying one to three tons
of opium and/or quantities of morphine .
base?loeves Bangkok for Hong Kong. The
boats proeeed to the vicinity of the Chinese
Conitntiltiet-controlleti Leiria Ulande--15
Miles nouth of Hong Kong?where the goods
are loaded into Hong Kong junks,
10. Opium anti its derivatives which move
through Laos are transferred from the Me-
kong River refineries by river craft and FAR
vehicles to Dan Hanel SRI, farther down-
stream on the Mekong in Laos, from where
it is transported on Royal Laotian Air Force -
(11,LAIP) aircraft to Luang Pram% or Vien-
tiane. From Vientiane narcotics, are usually
sent via ISLAV aircraft, as well as Air Laos,
to other cities in LAM such as Savannakbet
or Pakse or to international markets. A con-
siderable portion of the Laotian produced
narcotics is smuggled into Saigon on mili-
tary and commercial air flights, particularly
on Royal Air Laos and Air Vietnam. Al-
though collusion between crew members and
air line agents on one hand and individual
narcotics stnuggiers on the other has been
reported, poor handling of commercial cargo,
and. the 'laxity of Lao customs control in
Vientiane and other surreptithme loading
of narcotics aboard commercial flights.
ReCeNT CHANGES IN THE ARCA
10. There are tentative indications that
larger quantities of raw opium may now be
moving into the tri-border area for refining
and that larger quantities of this raw opium
are now being refined into morphine base and
heroin hi this area. As suggested in paragraph
10 above, data on the first two months of
1071 indicate that the Tachilek transship-
ment and refining area may he receiving and
processing sizably larger amounts of raw ?
opium than was the case in .1070. As for -
changes in the type of refined narcotics pro-
duced, the processing plants at Mao Haw in
Thailand and Roue! Tap in Laos now appear
to he converting most of their opium into #4 ?
06 percent pure white heroin. Previously,
these refineries tended to produce refined
)plum, morphine base and #3 smoking
heroin. An increased demand for #4 heroin
also appears to be reflected in the steady rise
In its price. For example the mid-April 1971
price in the Tagthilek area for a kilo of #4
heroin wan reported to he 17.5. $1,700 as com-
pared to U.S. $1,240 in September 1070. Some
of this increase may also reflect 'a tight sup-
ply situation in the area because of a short-
age of chemicals used in the processing of
heroin, Rising prices for opium and its de-
rivatives can also be seen in other areas of
Southeast Asia.
? 20. The establishment of new refineries
since 1060 in the tri-border area, many with
a capability for producing 96 percent pure
heroin, appears to be duo to the sudden in-
crease in demand by a large and relatively
affluent market in South Vietnam. A recent
report pertaining to the production of mor-
phine base in the Northern Shalt States
would indicate a possible trend toward verti-
cal integrations?producing areas establish-
ing their own reilneries---in the production of
narcotics. Such a development would
cantly facilitate transportation and distribu-
tion of refined narcotics to the market
Macau..
MAY 11, 197,1.
Miss VICKI WHIM-WAN,
Editor, 91, The Branding frost, University of
Wyoming, Laramie, Wyo.
DEAA MISS WIIITEITORN: In a letter to the
editor, published in The Branding Iron of
April 231, 1971, Mr. Alien Ginsberg asked my
comments on some allegations contained in
a recent issue of Ramparts Magazine which,
in Mr. Ginsberg's words allege "that our gov-
ernment's Csogstral Intelligence Agency has
been for decades stiZenrogrog-the-erraleropIngh.
traffickers of 83 per cent of the world's ille-
gal supply in Indochina," and "that the CIA
did actually subsidize main opium traffic`infr"
in Indochina as part of our political policy."
I do not take such serious charges against
our government lightly, nor do 1 feel the.
students at, our University can afford to take
such charges lightly, None of us should allow
unjust criticism of our government to go
unchallenged. Therefore, I have sought the
facts and hope you are able to print this in ?
its entirety.
Having thoroughly investigated these al-
legations, I can state categorically that they
Are completely unfounded. AS recently ice.
April 14 of this year, the Director of Central
Intelligence stated in an address to the
American Society of Newspaper Editors:
"There is the arrant nonsense, for example, "
that the Central Intelligence Agency ie, some- ?
how Mire ved-firelleglegingr giFilirrrailic. We
are not. As fathers, we are as concerned about
the lives of mu children and grandchildren
as are all of you. As an agency, in fact, we
are heavily engaged in tracing the foreign
roots of the drug traffic for the Bureau of
Narcotics and Dangerous Drugs. We hope we
are helping with a solution; we know we are
not contributing to the problem."
The Central Intelligence Agency. is directly
accountable to Vrili-Pictird-ent, through the ?
National Security Council which is privy to
all of its activities; it is subject to the .
scrutiny, of the Office of Management and
Budget, which oversees is expenditures; to
the President's Foreign Intelligence Ad-
visory Board, mode up of distinguished pri-
vate citizens; and to four Committees of the
Congress, to whom it reports on all its activi-
ties. To suppose that in, these circumstances
the Agency could conduct the activities al-
leged in the Ramparts article without the
knowledge or approval of any of these s
thorities to which it is responsible, or that
any of these authorities would sanction such
activity, is the ultimate In absurdity.
Turning to some of the more specific alle-
gations In the Ramparts article, It is worth
noting that; .
So far AR opium entering the U.S. is coo
corned, recent etodies indicate that perhaps
, only about 5 per cent of the illegal imports
come from an of Southeast Asia, the re-
mangier originating maloly in the Middle
East;
Roland Paul, a former inirestigator for the
Senate Foreign Bon:atone Committee who
nuide a study of the area lest year, writes in
? the April isette of Foreign Affairs that "in
passing it may be interentlng to note that
because of their long association- with the
American agency (CIA), the hill tribes have
shifted their agricultural,' emphasis from
opium to rice," a conclosiOn which can be
solidly documented from other authoritative
sources.
In fact, efforts of Americam agencies to dis-
courage opium growing among these hill
tribes has produced a North Vietoamese mon-
agenda campaign encouraging and applaud-
ing the raising of opium peoples. This cam-
paign contrasts the Communist-controlled
mean where the population can "make our
living as we wish" by raising opium to the
lot of those under "imperialist domination"
who are restrained from doing so. (In vies,
of his concern, perhaps Mr; Ginsberg would
like to rains the matter with the authoritioto
in Hanoi.)
in summation, I can assure you that the
allegations in question are completely false
and that no U.S. Government agency operat-
ing in Southeast Asia has approved,
ported, or condoned illegal drug production
or traffic. On the contrary, these U.S. Govern-
ment agencies are all cooperating in efforts)
to discourage opium produetion and distribu-
tion and these efforts have had at least some
success.
? Sincerely,
CLIFI'ORD P. 11Alifill1L1
STEP BACKWARD?PSYCHIATRIC
? TRAINING CUTS UNWARRANTED
Mr. mIMPEREY, Mr. President, the
achniniStrat1011.8 proposed eutbflOir in
psychiatri0 training 18 a Cruel and Un-
warranted Step backward hi the field of
mental health.
President Nixon has proposed a $6,7
million cut in funds for the National in-
stitute of Mental Health's training sup-
port for fiscal 1972 and a? planned phase-
out of the entire $34 million program for
- psychiatric residency training.
This cutback would mean the loss of
more than 1,000 hospital residency posi-
tions and severe curtailment of mental
health services to the poor.
For example, the Presbyterian Hospital
in the Bronx, N.Y., treats about 5,000
emotionally disturbed persons a year
from the black and Puerto Rican com-
munities.
If the President's cutbacks go into ef-
fect, the number of psychiatric residents
would drop from 30 to 10 and the number
'of patients served would be reduced by an
estimated 2,000.
. It is important to emphasize that al-
most all of the Patients seen at this facil-
ity are poor people, and there is no other
psychiatric service available to them,
? At a tithe when we are trying to up-
grade health care and do more to help
those with mental problems, we cannot
afford to be cutting back.
Drug use, alcoholism, crime, and delin-
quency are creating severe emotional
problems and increasing the demand for
mental health services. The growing drug
crisis among Vietnam veterans and sol-
diers Ls further compounding. the: situa-,
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2.o50:;'0 ?
irmliov'
. Westside Drug Planning Council
Westside CommUnity Mental Health -
Center, Inc. ?
2201 Sutter Street
San Francisco, California 94115
CLC r,)/-0,340
_ 14 May 1971
Gentlemen:
The Director has sent me his copy of your letter to
Senator Alan Cranston and Senator John V. Tunney concerning
the Ramparts magazine article entitled, "The New Opium War. "
I am glad of this opportunity to.deny. to you officially and cate-
gorically.that the Central intelligence Agency in any way partici-
.-pates in, contributes to, or condones opium traffic in Southeast
H Asia or in any other part of the world.
Particularly in recent years, we have been reporting
information we have obtained on drug traffic to the policy-
makers of our Government and to the enforcement agencies.
We cooperate closely with the Bureau. of Narcotics and Danger-
ous Drugs, Department of Justice, in its efforts Co take action
'against the drug traffic. No proof has been brought to our
..attention that the Agency or any of its personnel are involved
in drug traffic. If such proof were?brought, the individuals '
concerned would be summarily terminated and reported to the .
...proper enforcement authorities.
I hope this letter will encourage you to continue your
drug abuse programs, which I know are difficult and frustrating
,enough without being hampered by vicious and untrue rumors of
united States Government support to any drug traffic.
c; DDP
Asst to DCI-Mr. Goodwin
OLC
CI Staff-
ER
General Counsel w/basic
?
STAT
Sincer.el
STAT
Lawrence R. Houston
General Counsel
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DATE 21 re-f2-22. PAGE
THE WASHINGTON POST
ack Anderson
Thais Continue
Dope RustLin
SOME of Thailand's top
ficials are operating a fleet of
? 11 trawlers which move doz-
ens of tons of opium a year
?i,to Hong Kong for shipment
to American addicts.
The names of the Thal-reg-
istered ships, each capable of
hauling 3.3 tons of opium a
;,..voyage, are known to Ameri-
; can officials in Southeast
''Asia. So are the Thai offi-
?; ? dials' names., .
But despite a joint under-
standing signed in September
,, by Secretary of State Williarri ?
Rogers and . then-Thai For.
Minister Thanat Kho-
Man on ending the narcotics'
, n?traffic, the dope hustling by
;Thai officials goes on.
.11 ? ?
, These are the findings of a
' heretofore secret report
being prepared for the House'/
Foreign Affairs committee by
Rep., Lester Wolff, (D-N.Y.) ?.
Wolff gathered his data.,
from disgruntled 'U.S. narcot-
ics agents, who feel their
? hands are tied for political
,; reasons; ,from customs men;
?from foreign officials, and .
,from State Department offi?
cers themselves.
7
.? The Congressman's report ??
' says that Thai officials in the'"
smuggling racket are so well,, ?
, organized that they have pre- .
pared formal contingency ?
' plans for shifting their ter-
minal point to Manila if
Hong Kong is closed.
. In fact: the Thai officials
have already established ties
with corrupt Philippine au-
( thorities, and have picked un- .,
?loading spots along the is; ?
land's jigsaw shoreline.
, At present, much of the 750
tons of opium produced In. ,
' Laos, Thailand and Burma is
? ;
?trucked down to Bangkok '1-
: under the very, noses of the:
't,:'Thai government. More than
50 tons a year of this raw
opium, plus an unknown ,
amount of processed opium,
-is then loaded aboard
;
The trawlers carry it into
? Red Chinese waters where it
Is loaded intO junks. which, (!;
slip into Hong Kong's numer-.
ous harbors. The raw opium'
; is then processed and smug.
glad as heroin into the.''
United States.
Wolff is drafting 'a letter to
President Nixon urging him
to cut off aid to Thailand un-'
.less the Thais live up to the' '
September agreement. The
Foreign, Affairs committee-
man is also introducing a,:
"sense of the House" resolu,
tion, to request Mr. Nixon
to suspend the aid., "
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STATEMENT BY
NELSON CROSS _
SENIOR ADVISER TO TUE SECRETARY OF STATE
AND COORDINATOR FOR INTERNATIONAL NARCOTICS MATTERS
BEFORE TEE
CONGRESSIONAL INQUIRY REGARDING
INTERNATIONAL NARCOTICS TRAFFIC
JUNE 9, 1972
NEW YORK CITY
I welcome the opportunity of appearing today and
setting the record straight on the progress and the
integrity of the United States Government's anti-
narcotics program in Southeast Asia. I shall address
my statement essentially to the recent allegations
011
regarding that program made by Mr. Alfred:W.. McCoy, a
student .at Yale, and then answer your questions.
With all due respect to Mr. McCoy's obvious interest
in seeing the scourge of drug abuse brought to an end, our
official information reveals that much of what he has
reported is out of date and thus must be labelled mis-
leading and inaccurate. The problem of drug abuse is an
emotionally-charged issue. While it may well make good
copy in the eyes of a book publisher to charge -- as
Mr. McCoy has done in sensational fashion -- that the
Government of the United 'States is aiding and abetting the
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influx of heroin into our nation," nothing could be further
from the truth. Equally sensational and, as far as we can
ascertain, unsubstantiated, is the charge by Mr. McCoy that
high government officials in Thailand, Laos and South Viet-
Nam "are actively engaged in the heroin traffic and are pro-
tecting the region's powerful narcotics syndicates."
Mr. McCoy somehow missed the name of the kingpin of the
heroin traffic in Southeast Asia. The _man is LO Hsing Han
of Burma. His control of the area opium runs the gamut from
opium poppy fields, along the smuggling routes, to his heroin
refineries.
LO has a virtual monopoly on heroin refining in the
section. Many of the refineries driven out of Laos and
Thailand have come under LO's control in Burma.
. We have discussed the urgent problem posed by LO's
operation with the Burmese. But LO operates within insurgent-
controlled territory and is beyond the control of the Burmese
Government.
now turn to the three major allegations made by Mr.
McCoy in his June 2 statement before the Foreign Operations
Subcommittee of the Appropriations Committee, U.S. Senate.
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I. "Much of the heroin entering the United States
now originates in Southeast Asia."
Southeast Asia is not a major source of heroin on our
market. While the "Golden Triangle" area of Burma Laos,
and .Thailand yields an estimated two-thirds of the world's
'illicit opium supply, most of that output is consumed
in traditional Asian markets. The overwhelming
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majority of the heroin coming to the United States
originates in the Middle East and is processed in European
lab6. before being smuggled into our country. We estimate
that probably only five percent, certainly no more than
? ten percent, of the heroin presently flowing to the
United States originates in Southeast Asia. Whatever the
? figure we are obviously concerned. We are further Con-
cerned about the prospect of a swing in international
? traffickers' interest from the Middle East to Southeast
Asia, particularly as the Turkish Government's ban on opium
poppy cultivation results in diminished supplies.
2. "The governments of South Viet-Nam, Laos, and
Thailand are actively engaged in the heroin traffic."
It so happens that Mr. McCoy selected three of the
countries with which we are working very closely. Perhaps
progress has not been as rapid as one would like, but
drugs have been tolerated over many generations in these
countries, and the solution is far from an overnight solu-
tion. Trafficking in drugs in Thailand was legal until
1958, and not until last November did the Lao Government
move to prohibit drug trafficking. At the moment in Laos,
we have two MX) agents with an additional one expected
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to arrive, four permanent Customs agents and five addi-
Clonal ones on TOY, two Public Safety Officers with three
:more 'Scheduled to arrive in the near future, and one AID
official.
In Thailand, we have ten BNDD agents,, two Customs
agents, and one Foreign Service Officer.
And in Viet-Nam, there are ten Public Safety Officers,
two Customs agents, and one BNDD agent.
I should like to provide additional comments on each
of the three countries:
South Viet-Nam -- The U.S. troop withdrawal and
suppression efforts have knocked the bottom out of the
. heroin market in Viet-Nam, causing prices to idummet from
$8,000 per kilo last year to $3,000 or less at present.
All indications are that heroin sellers have had little
success in building an alternative market among the
'Vietnamese to replace their lost C. :c. consumers. In such
a situation, it is logical that suppliers will be tempted
to seek channels to other markets, including the United
States. Fcr this reason, our authorities in Viet-Nam have
.been watching intently for signs of such a development.
Our most recent intelligence indicates that there is no
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organized apparatus smuggling heroin from Viet-Nam to the
U.S. Without exception, those implicated in such activities
have ben low level, individual entrepreneurs who lack an
organized distribution system. With the disappearance of
the C. I. market, many traffickers in the region appear to
be abandoning heroin to return to the traditional opium
trade.
The Government of Viet-Nam with the cooperation of
the U.S. Mission has made considerable progress in reducing
narcotics traffic and drug abuse. The U.S. Mission has
been intensely aware of the heroin traffic in Viet-Nam
since the drug first appared in 3,ate. 1969 and first
became available to U.S. servicemen during the first half
of 1970. In March 1970 the Bureau of Narcotics and
Dangerous Drugs (BNDD) initiated a survey to define the
role of Asia in the world's narcotics traffic which laid
the groundwork for addressing the basic problems in South-
east Asia of production, distribution, suppression, and
rehabilitation. As evidence of the Mission's concern over
increasing drug abuse, MACV carried out a nationwide drug
survey in July 1970 which indicated that heroin was being
introduced in Viet-Nam in 'considerable quantity. As a
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result, a MACV drug abuse task force was formed in August
1970, and a comprehensive drug suppression 'program was
developed and carried into effect. Under the program
Combined Anti-narcotics Enforcement Committees were
established in each military region. A joint American and
Vietnamese Narcotics Investigation Detachment was to gather
drug intelligence and provide a coordinated investigative
capability to eradicate large supply sources of narcotics?.
Another important feature was the establishment of a
joint U.S. Service Customs Group.
On the civil side, the Mission developed a narcotics
control action plan which calls for the involvement of all
elements concerned with the suppression of drug abuse and
trafficking.
As soon as the narcotics problem began to assume
serious proportions, high level coordination and planning
efforts began between theMission and the Government of
Viet-Nam. Prime Minister Khiem initiated a program to
reduce the use of and traffic in drugs throughout the
country. Ambassador Bunker and General Abrams met with
President Thieu to discuss specific measures, and as a
result President Thieu designated a team of experienced
intelligence and police officials to develop and carry
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out an effective action program. He also set up inter-
ministerial drug suppression committees at the national
and pmvincial levels, replaced key personnel in the police
and other areas affecting narcotics activities, and dictated
a nationwide customs crackdown to seal off all airports and
harbors through South Viet-Nam. A tax.-free reward system
was established and a drug education campaign was begun.
Prime Minister Khiem was given direct supervision of the
national campaign and was instructed to use the coordinatin;;
machinery of the pacification program to carry it out.
As a nesult of these combined U.S. Mission/Vietnamese
Government efforts, the number of arrests on narcotics
charges went' from 2,911 in 1969 to 6,464 in 1971. Heroin
seizures throughout Viet-Nam rose from 12 pounds in 1969
to 271 pounds in 1971 and opium seizures increased from
11 pounds in 1969 to 1,071 pounds in 1971. Most important,
the big time traffickers no longer find it profitable or
.safe to operate in the country. Even now, under existing
conditions of martial law and the requirements of national
defense against the North Vietnamese invasion, joint
U.S./South Vietnamese narcotics operations continue.
The arrest last year of two pro-Thieu members of the
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Lower nous? is an indication the Vietnamese Government is
actively engaged against the heroin traffic. One was
dismi,ssed,and the other was sentenced to seven years.
Laos -- The Narcotics _Control Law implemented last
November makes any commercial transaction involving opium
or its derivatives illegal and for the first time gives
the Lao Government a legal basis for interdicting illicit
traffic. Strict controls have also been placed on the
importation and distribution of acetic anhydride, a chemical
required in the.heroin refining process. Last November 7,
'.730 gallons of acetic anhydride -- enough to make three
tons of he..7oin -- were seized. Also several seizures of
opium and heroin have been made. The most recent seizures
were 28 kilos of opium on May 26 and 30 kilos of opium and
9 kilos of #4 heroin on June 7. Inspection procedures on
domestic and international air routes have been tightened up.
In the absence of laws forbidding narcotics trafficking,
Lao law enforcement agencies had not been staffed, trained
.or equipped to interdict the traffic. Therefore, since
passage of the law, the Government has concentrated on
establishing an equivalent of the 1INDD to lead and
cOordinate narcotics control. It is headed by a military .
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officer who reports directly to the Prime Minister and
has jurisdiction over civilian and military enforcement
effor,ts, The Lao national police and customs agency have
also established special narcotics control units.
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The U.S. Mission was most effective in encouraging the
passage of the Lao law. Our narcotics enforcement advisers
from the BNDD, Customs, and USAID's Public Safety Division
are hard at work advising and training their Lao counter-
parts in Vientiane and other key points, including Ban Houei
Sal in the Golden Triangle. Specialized equipment will be
provided to the new narcotics agencies as their personnel are
trained to use it.
The production of opium in Laos, which may have been as
high as 100 tons a year, has been sharply curtailed, and our
intelligence indicates that the flow of opium and heroin
through the country have also decreased considerably.
, In Mr. McCoy's statement of June 2, he indicated that
most of the opium traffic in northeast Laos in controlled by
yang Pao. This statement ignores the fact that most of
northeast Laos is controlled by the North Vietnamese. Opium
production in those areas of northeast Laos still under Lao
Government control could not exceed more than a few tons a
year, and these are consumed by the hill tribesmen. As for
yang Pao, he has taken a strong public position against opium
cultivation and trafficking by the Meo. He considers opium
addiction a serious problem among his people and wishes to
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prevent further addiction and to rehabilate those already
addicted.
As for'Ouan Rathikoun, it may be'that he was involved
in the opium traffic before it was illegal, but we are not
aware of anything more than unsubstantiated allegations con-
cerning his past or present complicity. With regard to his
"control" of the "largest heroin laboratory in Laos," once
again, all we have is allegation. Mt. McCoy was apparently
referring to a refinery at Ban Houie Tap which was abandoned
last summer. EquipMent and chemicals were discovered in the
jungle and seized by a team of Lao narcotics agents. Mr.
McCoy quoted a CIA source in stating that this refinery had
a capacity of 3,000 kilos of heroin per year. Members of
our Mission have examined the site and have estimated that
it could have produced less than 1,000 kilos assuming a
24-hour-a-day operation.
With regard to Mr. McCoy's allegation concerning Air
America I should like to quote the following tatemcnt
released in Washington on June 2 by the Managing Director
of Air America:
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"Mr. Alfred W. McCoy today told the Senate Foreigi,
Operations Committee: 'In Northern Laos, Air America air-
craft and helicopters chartered by the U.S.CIA and USAID
have been transporting opium harvested by the agency's
tribal aorbenaries on a regular basis.:
"This statement is utterly and absolutely false. AA
and USAID have cooperated in a security program which effeer
tively prevents the carriage of drugs on .any of the airline's
equipment. This program is constantly being reviewed to
make sure that drug smugglers cannot misuse the company's
facilities. There is an intensive program of inspection of
both passengers and cargo carried out in close collaboration
with local and U.S. authorities. At up-country sites, in-
spectors inspect all baggage of passengers and crew members
departing from their stations. All cargO placed aboard 'up-
country sites is inspected by members of the inspection '
service. All baggage of persons departing Vientiane on AA,
CAST and Lao nir development are inspected. Where boarding
passengers reEuse to submit to inspection or are found to
have contraband in their possession, they are denied the
right to board the aircraft and their names are turned over
to local Lao authorities. Through these and related measures
attempts by individuals to carry opium on company airplanes
have been detected and prevented. These small time
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smugglers and users are, the greatest threat and the .
security inspection service has constituted an effective
deterrerit..
"Through its many years in the Far East, AA and its
employees have been well aware of the dangers of drug use
and the drug traffic. .It has been the policy of the company
and its many loyal employees to do everything in their power
to oppose any traffic in drugs. To this end there has been
close cooperation between the company and U.S. and local
authorities concerned with the drug problem.
"If Mx. McCoy or any other individual can bring any
proof that any Air America employee has been connected in
???
any Manner- wieli the drugi traffiC appropriate disciplinary
actiowwill be taken and:the. matter referred to the proper
authorities."
Thailand
engaged in a
-- For some years the Thai Government has
major effort to
settle the Moo hill peoples
been
and
to bring them under control. Unfortunately, these RTG efforts
have been a major source of. Meo resentment toward the Thai
and have helped make the Meo receptive to Communist anti-
government propaganda and insurgency. In addition to mil-
itary efforts to put down the Communist rebellion, the Thai
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are trying to improve hill tribe welfare. Particularly
noteworthy is the interest of the King of Thailand in the
-welfare of the hill peoples: he is assisting in the de-
velopment of other cash crops as alternatives to the opium
Poppy.
Enforcement efforts by the Thai Government are hindered
by the impossibility of controlling adequately a long and
mountainous border and the complexities of controlling
passenger and commercial traffic inside Thailand. In its
efforts to control narcotics trafficking, the RTG has ini-
tiated a resettlement program for the Chinese Irregular
Forces (CIF) under which the CIFs would turn over all their
opium stocks to the RTG and cease their involvement with
narcotics in return to land upon which to settle. Twenty-
six tons of CIF opium were burned by the RTG in March 1972.
During the past year, the Thai have increased their
efforts in the drug field with U.S. and UN assistance. A
US/Thai Memorandum og Understanding was signed in September'
1971 providing for increased Thai enforcement capability
through U.S. assistance to Thai police and customs officials.
The Thai also signed an agreement with the UN in December
1971 establishing a program to deal with the long-range
aspects of the drug abuse problem through crop substitution
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and addict rehabilitation.
After the US/Thai Memorandum of Understanding was
signed, a planning group was formud and has been negotiat-
ing specific programs for. implementation of the agreement.
'MN) has assigned agents in Bangkok and Chiang Mai while
U.S. Customs Service personnel are serving in Bangkok. .Thai
police have recently moved to crack down on local traffickers
and several major Thai and American traffickers have been
arrested. A promising start has been made and programs be-
gun which have the potential to bring the drug problem under
increasing control.
Based on all intelligence informvtion the
leaders of the Thai Government are not engaged in the opium
or heroin traffic, nor arc they extending protection to
traffickers. There,have been reports of corruption among
some working Level narcotics officials. Police General
Prasert, head of the Thai National Police and a member of
the ruling National Executive Council has stated publicly
that he would punish any corrupt official.
3. "The U.S. Government is aware of this traffic, but
has not moved to 8Lop it and has consciously concealed
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evidence of the involvement of our Southeast. Asian Allies."
Clearly, the U. S. Government is aware of narcotics
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trafficking. in Southeast Asia, but to say we have done noth
ing to counter it is patently inaccurate. Since the ryes-
ident's meSsage to Congress on June 17, 1971,.we have moved
urgently to commit Customs, LINDD, CIA, AID, and. State Depart-
ment personnel and resources to the fight against inter-
national drug trafficking. Moreover, far from concealing
involvement of persons involved in pushing drugs, our Govern-
ment has been sharing intelligence with friendly governments
in a concentrated effort to uncover the various persons and
systems which are operating in the area.
We feel that the drug problem is a major facet in our
bilateral relations with many countries throughout the world.
We have made that point clear to those countries and we are
asking them tD join with us in the fit,ht. The Governments
of Thailand, Laos, and Vietnam have already joined us in the
fight and, while we have a long way to go, we feel that dur-
ing the past year some real progress has been achieved.
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?FOR RELEASE FRIDAY, JUNE 2, 1972 PM NEWSPAPERS
Testimony to be delivered before Senator Proxmire's
Subcommittee at 2:30 pm, Friday, June 2 in 1224 New
Senate Office Building.
Statement? by Alfred W. McCoy
before the Foreign Operations Subcomittee
of the Appropriations Committee, U.S. Senate
June 2, 1972 '
THE HEROIN TRAFFIC IN SOUTHEAST ASIA
Abstract
1. Much of the heroin entering the U.S. now originates in Southeast Asia.
2. The governments of South Vietnam, Laos, and Thailand are actively
engaged in the heroin traffic.
3. The US. government is aware of this traffic, but has not moved to stop
it and has consciously concealed evidence of the involvement of our
Southeast Asian allies.
Alfred W. McCoy is presently a Ph.D. student in Southeast Asian History
at Yale University. He has spent the last 18 months researching the inter-
national drug traffic and his findings will, be published in a book entitled
The Politics of Heroin in Southeast Asia, Harper & Row, July 1972. Mr. McCoy's
findings 're based on research, documents, and more than 250 personal inter-
views conducted in the U.S., Europe, and Southeast Asia. Sources of information
include U.S. military, intelligence, and Embassy reports on narcotics, as well
as interviews with U.S. Embassy, USAID, military, and CIA personnel. Mr. McCoy
also interviewed the Chief of the Narcotics Bureau of the Vietnamese National
Police, Vietnamese intelligence, military, and customs officials, Gen. Ouane
Rattikone (former Chief of Staff of the Royal Laotian Army), Touby Lyfoung (a
Laotian Meo leader), U Ba Thien (former commander-in-chief of the Shan National
Army in Burma), an officer of the KMT (Nationalist Chinese) irregular army in
Thailand, and other persons in South Vietnam, Laos, Thailand, Hong Kong and
Singapore. Mr. McCoy spent a week livingwith an opium growing Meo tribe in
Laos. He has briefed the U.S. Bureau of Narcotics and Dangerous Drugs on his
findings, and they corroborate much of his evidence. Mr. McCoy can be contacted
at [phone].
For further information contact:
John ? Mark ?
Office of Senator Clifford Case
225-3224
Wes Michaelson
Office of Senator Mark Hatfield
225-8310
Bill Broyderick
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THE HEROIN TRAFFIC IN SOUTHEAST ASIA
Statement by Alfred W. McCoy.
By ignoring, covering up, and failing to counteract the massive crug
traffic from Southeast Asia, our government is aiding and abetting the influx
of heroin into our nation.
Southeast Asia is fast becoming the major supplier of illicit narcotics .
for America's growing population of heroin addicts. Since the late 1960s
international criminal syndicates have responded to mounting law enforcement
efforts in Europe and the Middle East by,shifting their major sources of supply
to Southeast Asia. The opium poppy fields of Southeast Asia's Golden Triangle ?
'Region supply raw materials for clandestine heroin laboratories in Europe,
Hong Kong, and the Tri-border area where Burma, Thailand and Laos converge.
High government officials in Thailand, Laos and South Vietnam are actively
engaged in the heroin traffic and are protecting the region's powerful narcotics
syndicates. Because the corruption in these countries is se systeMatic and
the narcotics traffic so lucrative, our political commitments to these govern-
ments inhibit and prevent any effective action to cut the flow of these
illicit narcotics into the United States.
U.S. diplomatic, military, and intelligence officials have always toler-
ated governmental corruption in Southeast Asia, and narcotics trafficking has
not been treated differently. U.S. officials in Southeast Asia have been impli-
cated in the traffic on three levels: 1) providing political and military support
' for officials and political factions actively engaged in the drug traffic without
pressuring them to deal with the problem; 2) consciously concealing evidence of
involvement in the narcotics traffic by our Southeast Asian allies. Whenever
the U.S. Congress or the media have made accurate allegations about the involve-
ment of our allies, U.S. diplomatic personnel have repeatedly issued categorical,
fallacious denials; 3) active involvement in certain aspects of the region's
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narcotics traffic.
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In 1967-68 American diplomatic initiatives convinced the Turkish government
to drastically reduce its total opium production and expand its enforcement
efforts. .Significantly, the sharp reduction of Turkey's opium production from
1968-72 coincided with a massive increase in the amount of heroin enter-
ing the United States; between 1969 and 1972 America's estimated addict population
practically doubled, increasing from 315,000.to 560,000. As late as 1965 a seizure
of only 15 kilos of pure heroin produced a street panic in New York City; by
1971 seizures totalling almost 400 kilos within a period of several weeks did
not have even a minor impact on the street supply. The question is, of course,
where is all this heroin coming from.
Informed Federal narcotics officials and diplomats are virtually unanimous
in their response--more and more heroin comes from Southeast Asia.
Beginning in 1965 members of the Florida-based Trafficane.family of
' American organized crime began appearing in Southeast Asia. Santo Trafficante,
Jr., heir to the international criminal syndicate established by Lucky Luciano
and Meyer Lansky, traveled to Saigon and Hong Kong himself in 1968. U.S. Embassy
sources state that Trafficante met with prominent members of Saigon's Corsican
syndicates. These syndicates have been regularly supplying the international
narcotics markets since the First Indochina War.
In 1967-68 there was evidence of increased activity on the part of Indochina's
Corsican gangsters. U.S. agents observed Corsican heroin traffickers commuting
:between Saigon and Marseille where the Corsicans control the clandestine heroin
laboratories. A former, high raliking CIA agent in Saigon told me in an interview
that in 1969 there was a summit meeting of Corsican criminals from Marseille,
Vientiane, and Phnom Penh at Saigon's Continental Palace Hotel.
In the wake of these high level meetings, increased quantities of Asian
heroin have begun entering the United States. In 1970 the U.S. Bureau of Narcotics
broke up a Filipino courier ring which had smuggled over 1,000 kilos of pure
Hong Kong heroin into the United States in the preceding .12 months. 1,000
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kilos ofpure heroin is equivalent to 10 to 20% of our estimated total annual
heroin consumption. Since all of Hong Kong's Morphine base comes from Southeast
Asia's Golden Triangle, this case provided ample evidence of the growing import-
ance of Southeast Asia in America's drug crisis. Unfortunately, the U.S. Bureau
of Narcotics has only one agent in Hong Kong and so further seizures have not
been forthcoming. In 1971 French Customs seized 60 kilos of pure Laotian heroin
at Orly Airport in Paris in the suitcases of Prince Sopsaisana, the newly appointed
Laotian Ambassador to France. The U.S. Bureau of Narcotics and diplomatic sources.
.in Vientiane report that the Ambassador's French connection was arranged by Michel
Theodas, manager of theLang Xang Hotel in Vientiane and a high ranking member
of the French-Corsican underworld. Finally, the Director of the U.S. Bureau of
Narcotics reports that his intelligence sources indicate that much of the massive
flow of heroin moving through Latin America on its way to the United States
.is coming from Southeast Asia. Ironically, our Southeast Asian allies are prof-
iting from this heroin bonanza. In a three hour interview with me, Gen. Ouane
Rattikone, forMer chief-of-staff of the Royal Laotian Army, admitted that he
controlled the opium traffic in northwestern Laos since 1962. Gen. Ouane also
controlled the largest heroin laboratory in Laos. This laboratory produced a
high grade of heroin for the GI market in South Vietnam, and, accordiag to the
CIA, was capable of producing over 3,000 kilos of heroin a year. With the with-
drawal. of U.S. troops, the market for such heroin has shifted directly to the
United States. Most of the opium traffic in northeastern Laos is controlled by
yang Pao, the Laotian general who commands the CIA's mercenary army. The Thai
government allows Burmese rebels, Nationalist Chinese irregulars, and mercenary.
armies to move enormous mule caravans loaded with hundreds of tons of Burmese
opium across Thailand's northern border. U.S. narcotics agents working in
Thailand claim that every major narcotics dealer in Thailand has a.high ranking
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"advisor" on the Thai police force. In South Vietnam, the opium and heroin
traffic is divided among the nation's three dominant military factions: Pres.ident
Thieu's political apparatus, PrimeMinister Khiem's political organization,
and General Ky's political apparatus.
An examination of Gen. Ky's political apparatus demonstrates the importance
f official corruption in Southeast Asia's drug traffic and shows how Southeast .
Asia's narcotics move from the poppy fields into the international smuggling
circuits. Located in the Vientiane region of Laos until recently was a large'
heroin laboratory managed by an overseas Chinese racketeer named Huu Tim Heng.
Mr. Hong was the silent partner in Pepsi Cola's Vientiane bottling plant and used
this operation as a cover to import acetic anhydride, a chemical necessary for
the manufacture of heroin. Mr. Hong purchased raw opium and morphine base from
Gen. Guano Rattikone, and then sold the finished product to Gen. Ky's sister,
Mrs. Nguyen Thi Ly. Although a resident of Pakse, Laos from 1962-1967, Mrs. Ly
now lives in Saigon and travels to Vientiane about once a month to arrange for
shipment of the packaged heroin to Pakse or Phnom Penh, Cambodia where it is picked
up by transport aircraft belonging to the Vietnamese Fifth Air Division and flown
to Saigon. The commander of the Fifth Air Division, Col. Phan Phung Tien, has
been publicly attacked by the Director General of Vietnam Customs for his inter-
ference in anti-narcotics efforts and is believed to have extensive contacts with
Saigon's Corsican underworld. Vietnamese military officers have identified Col.
Tien as Gen. Ky's strongest political supporter inside the Air Force, and
one senior U.S. Air Force advisor called him Geri. Ky's "revolutionary plotter."
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There is overwhelming evidence of systematic corruption extending all
the way tO the top of President Thieu's political apparatus. Two of his staunch-
est supporters in the Lower House of the National Assembly have been arrested
trying to smuggle heroin into South Vietnam, and other pro-Thieu deputies,
including one Of the president's legislative advisors have been implicated in
other smuggling cases. Some of Pres. Thieu's closest supporters inside the
Vietnamese Army control the distribution and sale of heroin to American GIs
fighting in Indochina. President Thieu's most important military advisor, Gen.
Dang Van Quang, has been publicly accused by NBC of being the "biggest pusher"
in South Vietnam. It is a 'matter of public record that Gen. Quang was
removed from command of IV Corps for outrageous corruption in 1967-68, and
reliable spurces in the Vietnamese military have confirmed NBC's report.
Finally, U.S. military commanders report that the narcotics traffic in the Mekong
Delta is controlled by colonels and low ranking generals loyal to Gen. Quang.
Another of President Thieu's staunch Army supporters, Gen. Ngo Dzu, II Corps
Commander until several weeks ago when he was removed for military incompetence,
has been identified as one of the major drug traffickers in Central Vietnam
by the USAID'Public Safety Directorate, U.S.Bureau of Narcotics and Dangerous
Drugs, and the U.S. Army Criminal Investigation Division.
American officials serving in Southeast Asia have a great deal of responsi-
bility for the growth of the region's illicit drug traffic. American diplomats
and intelligence agents have allied themselves with corrupt, indigenous groups
without pressuring them to get out of the drug business. Throughout the moun-
tainous Golden Triangle region, the CIA has provided substantial military support
for mercenaries, right-wing rebels, and tribal warlords who are actively engaged
in the narcotics traffic. And in Thailand the CIA has worked closely with
nationalist Chinese paramilitary units which control 8040% of northern Burma's
vast opium exports and manufacture high grade heroin for export to the American
market,
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U'S iblera9.;YsErg?01VMEMI9t5IRRqe? i.90ARE7PER.308cPWW13-91)2L-Re involve
ment of, our local allies in the drug traffic. In 1968 Sen. Gruening came forward
with well-founded allegations about Con. Ky's opium smuggling activities. The
U.S. Embassy in Saigon issued a categorical denial. In July 1971, NBC's senior
Saigon correspondent charged that Gen. Dang Van Quang, Pres. Thieu's chief mili-
tary advisor, was the "biggest pusher" in South Vietnam. Prior to this broad-
cast, I had received independent reports of Gen. Quang's narcotics dealings
from high ranking Vietnamese sources. The U.S. Embassy again issued a vigorous
denial. In July 1971, Congressman Robert Steele claimed to have received clas-
sified documents showing that II Corps Commander, Gen. Ngo Dzu, was trafficking
in herein. The U.S. Embassy deferred to Senior II Corps Advisor John Paul Vann
who denied that such documents existed. I have one Of those documents in my .
possession.
The record of the U.S. Embassy in Laos is even worse.. All U.S. officials -
in Indochina know that the vast majority of the high grade heroin sold to GIs
fighting in South Vietnam is manufactured in Laotian laboratories. Yet in December
1970, the U.S. Ambassador to Laos, G. MCMurtrie Godley, told an American writer,
"I believe the Royal Laotian Government takes its responsibility seriously to
prohibit international opium traffic." Ambassador Godley did his best to prevent
the assignment of U.S. Bureau of Narcotics agents to Laos. It was not until
November 1971--a full two years after Laotian heroin had decimated U.S. troops
in South Vietnam--that the Bureau of Narcotics was allewed to send its agents'
into Laos.
Finally, U.S. agencies have been actually involved in certain aspects of
the region's drug traffic. In northern Laos, Air America aircraft and helicopters
chartered by the U.S. Central Intelligence Agency and USAID have been transporting
opium harvested by the agency's tribal mercenaries on a regular basis.
After spending 18 months researching, travelling and conducting hundreds
of interviews, I have reached one firm conclusion--if we are going to deal seri-
ously wiapqRrNtf8f111M5M4iTs:CYHW741POW9149900089002ribr our pri-
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orities and commitments in Southeast Asia. President Nixon has told us that we
cannot solve the drug problem unless we deal with it at its source and eliminate
illicit opium production. The source is now Southeast Asia, and that'area accounts
for some 70% of the world's illicit opium supply. There is enough opium in
Southeast Asia to fuel our heroin plague for countless generations to come. In
the past and present we have let otir military and political goals in Southeast Asia
dictate our priorities. As a result, our officials have tried to prop up corrupt
regimes there at all costs, including silent acquiesence.to the traffic-in drugs
that is ruining the fabric of our nation. The problem of crime in our streets is
larv^ly a heroin problem which would disappear if the drug traffic were brought
under control. The drugs now flowing from Southeast Asia in effect make all
the funds and effort expended reducing Turkey's opium production totally
irrelevant as a final solution to our problem.
We now have to decide which is more important .to Our country--propping
up corrupt governments in.Southeast.Asia or getting heroin out of our high
schools.
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STAT Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
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C;',71
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\Me
STAT
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EARTI
March 1972
Somc annaznng
coincidences linking
the CIA, the. rvafia,
ir America,
sevezzo
riaero2iu,-;---Tes of
Broth Clizb,
11? .'"I'nelr 7
th2 Kohta
rince. Puchartra
-of Thailane,
anany' banks and
insuarance cm-mannes
? practical:
everyme except
Richard Ninal.
Wasn't he asked?
by Petei.Dale Scott'
'rofessor Samuel Eliot Morison has written how in
1903 Theodore Roosevelt, "in the face of inter-
national law and morality" secretly ordered the
US Navy to support the "revolutionary" secession of
Panama from Colombia. The secession, which led swiftly
to the Canal Zone treaty, is described by him as a plan by
"Panama businessmen, agents of the French company
[which stood to gain 4'40 million in compensation under
the treaty] and United States army officers." He neglecis
to add that the "agents" of the French Panama Canal
Company were New York investment bankers 3. & W.
Seligman and their Washington lobbyist Buneau-Varilla,
who organized and financed the "revolution" out of a
suite in the Waldorf-Astoria.
In some ways, the Panama exercise in "big stick" "
partition is an instructive precedent for the post-war 1-/S ?
involvement in Indochina.' Legally, the picture appears to
be different today; for many of the bankers' activities in
preparing for revolution and war would today be out-
lawed, under sections 956-60 of the US Criminal Code.
In theory, at least, responsibility for this kind of defense
of American "interests" is now a monopoly of the
But in fact, the CIA still maintains close contact with
3. & W. Seligman and similar Wall Street institutions.
These contacts have been powerful; it was pressure
from Wall Street which succeeded in pushing the infant
CIA into its first covert operations. President Truman,
who created the CIA in 1948, has since declared his
unhappiness at the deflection of the CIA from its intelli-
gence function: "I never had any thought. . . when I set
up the CIA that it would be injected into peacetime cloak,
and-dagger operations."' His intentions, however, count-
ed for less than those of Allen Dulles, then a New York
corporation lawyer and President of the Council on
Foreign Relations. The Administration became con-
cerned that the Communists might shortly win the Italian
elections:
Forrestal felt that a secret counteraction was vital, but
his initial assessment was that the Italian operation
would have to be private. The wealthy industriAliscs
in Milan were hesitant to provide the money, fearing
reprisals if the Communists won, and so that hat was
passed at the Brook Club in New York. But Allen
Dulles felt the problem could not be handled cifec-
.? tively in private hands. He urged strongly that the
government establish a covert organization with un-
vouchered funds, the decision wasmade to co it.
? under the National Security Council."
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. 11Se CC:Clary iCit the
should be private, but .a private corporation lawyer de-
termined it should be public-. By this arrangement,
presumably, the men in the Brook Club even got their
money back out of the hat; since then the funds?un-
vouchered ?have come from us, the public taxpayers.
Truman's lack of sympathy for the way the CIA was
being "diverted" into covert operations did not result
in any measures to curb the control of the CIA by Wall
Street Republicans. On the contrary, as the CIA began to
burgeon under Bedell Smith, all seven persons who are
known to have served as Deputy Directors of the CIA
q0-
;
Yr:art..7 C. Trnscasara
under Smith and Truman came from New York legal and
financial circles.' These men used their corporate experi-
ence and connections to set up a number of dummy
')rivate enterprises, as "proprietaries" or wholly-owned
'fronts for the CIA, particularly for Far Eastern operations.
The capital came from government sources, but profits,
if any, are said to have been retained by the "companies"
themselves.
Thus William Ray Peers (an Office of Secret Services
hand from Burma and China, later the Army Chief of
Staff's Special Assistant for Special Warfare Activities)
headed up Western Enterprises, Inc., in Taiwan, a cover
for the launching of Kuomintang?Nationalist Chinese?
n ncc *aids from the Yor nucrnov and Matsu
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China) headed a Bangkok "trading company" called Sea
Supply, Inc., which supplied arms and other supplies to
the Kuomintang troops of General Li Mi in Burma,7 and
later trained the Thai border police under Thai Interior
Minister Phao Sriyanon.8
But by far the largest CIA proprietary in Asia was
Civil Air Transport?CAT Inc.?chartered in 1950 and
known since 1959 as Air America. In 1961, General
Edward Lansdale wrote a memorandum to Maxwell
Taylor on unconventional warfare, published as part of
the Pentagon Papers, confirming Air America's link
with the CIA:
CAT. Civil Air Transport (Chinese Nationalist)
? CAT is a commercial airline engaged in scheduled
and non-scheduled air operations throughout the Far
;East, with headquarters and large maintenance facili-
? ties located in Taiwan. CAT, a CIA proprietary,
provides air logistical support under commercial
cover to most CIA and other US Government agencies'
requirements.... During the past ten years, it has had
some notable achievements, including support of the
Chinese Nationalist withdrawal from the mainland,
, air drop support to the French at Dien Bien Phu,
complete logistical and tactical air support for the
[1958] Indonesian operation, airlifts of refugees from
North Vietnam, more than 200 overflights of Main-
? land China and Tibet, and extensive support in Laos
during the current [1961] crisis.?
General Lansdale erred, however, in failing to distinguish
between the Taiwan commercial airline CAT Co., Ltd.
(alias Civil Air Transport, or CATCL), and the Amer-
ican operating firm CAT, Inc., the CIA proprietary which
supplied CATCL with pilots and other personnel. Sixty
percent of the capital and control of CATCL was Chinese
Nationalist, represented by officers of the former Kin-
cheng Bank in Shanghai, who allegedly fronted for T. V.
Soong, the brother of Madame Chiang Kai-shek.'? Soong
is one of the Most important figures in this history.
CATCL had been set up bY General Chennault in
1946. Chennault's partner in CAT was Whiting Will-
auer, a US "economic intelligence" officer who during
World War II supplied the Flying Tigers as an officer of
China Defense Supplies under T. V. Soong. CAT's
treasurer in the 1940's was James J. Brennan, who after
the war served as T. V. Soong's personal secretary in
China. And the lawyer for CAT, as for the Flying Tigers,
was Tommy Corcoran, who after the wai? was rumored
to be handling T. V. Soong's multi-million dollar invest-
ments in the United States."
In the late 1940's, CAT flew military support missions
for the Kuomintang against the Communists, while
Chennault lobbied openly from a Washington office
against the more cautious China policy of the Truman-
Acheson State Department. In November, 1949, Chen-
nault, after a similar visit by Chiang, flew to Syngman
Rhee in Korea, "to give him a plan for the Korean mili-
tary air force"; even though at this time it was still US
official policy to deny Rhee planes, to discourage him
from invading North Korea." In December, 1949, Time
later claimed, Dean Acheson told one of its correspond-
ents that "What we must do now is shake 1nose from the
CIA-RDP75600380R000300080002-3
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Chinese Nationalists"; while in January, 1949, George
Kerman predicted that "by next year at this time we will
have recognized the Chinese Communists.""
All such thoughts were frustrated by the sudden ouv.'
- break of the Korean 'War in June, 1950?an event still
imperfectly understood, but which may have been an-
ticipated by 'certain Kuomintang speculators; who, be-
cause of the war, ."cleared an estimated profit of about
$30,000,000" in soybeans."
'Shortly after the outbreak of the Korean War, the CIA.
proprietary, CAT Inc., was chartered in Delaware. The
American CAT promptly supplied planes, pilots and US
airlift contracts to the Taiwan's CATCL, which in this
period was the sole flag air carrier of Chiang's new
Republic.'' While Tommy Corcoran continued to repre-
sent Soong, Chennault, and CATCL, the aviation law
firm of Pogue and Neal handled the incorporation of
CAT Inc. During this period of formation, a vice-
president of the National City Bank of New York, Walter
Reid Wolf, was recruited briefly as a CIA Deputy Director
from 1951 to 1953; soon afterwards,' two of Wolf's
fellow-directors in the small Empire City Savings Bank,
Samuel Sloan Walker and Arthur B. Richardson, were
named to the board of CAT, Inc. At the same time,
Desmond Fitzgerald entered the CIA. He was a cousin
of Walker's and a close business associate of Wolf's and,
like them, a member of New York's 400-member Brook
Club, "perhaps clubdom's richest from the point of view
of inherited wealth."" Other Brook Club members in-
chided three directors of CAT, Inc., two directors of Pan
Am, and Chiang Kai-shek's.promoters Walter S. Robert-
son, who for six years was Eisenhower's Assistant Secre-
tary of State for Far Eastern Affairs, and journalist Joe
Als op.
In this pyramid, the CIA's official control over CATCL
was remote and unreliable. While it owned 100 percent
of CAT, Inc., and of CAT's Asian subsidiary, the CIA only
owned 40 percent of CATCL, and thus could hardly be
called to account when (as frequently occurred) CAT
planes flew in support of operations conforming to
Taiwan and Kuomintang foreign policy, but at odds with
the official foreign policy of the United States. Even the
CIA's control over the Airdale/Pacific Corp., which is
said to clear profits in the order of $10 million a year, is
open to question; it is possible that the proprietary rela-
tionship is as useful in supplying an "official" cover for
private profit as it is in supplying a 'private". cover for
the CIA."
Air America itself has a private stake in Southeast
Asia's burgeoning oil economy, for it
? Flies prospectors looking for copper and geologists
searching for oil in Indonesia, and provides pilots for
? commercial airlines such as Air Vietnam and Thai
Airways and for China Airlines [Taiwan's new Chi-
nese-owned flag airline which since 1968 has taken
over CAT's passenger services.1"
Much larger has been the economic stake of the financial
in( crests represented on the boards of Pacific Corp. and
CAT Inc. over the. years (such as Dillon Read, repre-
sented by William A. Read, jr., and the Rockefellers,
represented by Laurance Rockefeller's employee Harper
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Perhaps the most obvious stake has been that of Pan
Am (on whose board sit Robert Lehman of Lehman
Brothers and James Sterling Rockefeller of the National
City Bank). Like the National City Bank itself, and the
larger Bank of America which in the early post-war
period was still allied with it, so also Pan Am was par-
ticularly oriented towards development of a "Pacific rim
community," as opposed to an "Atlantic community." It
has been shown that Pan Am's staggering profits in the
1960's were built on it early monopoly of commercial
air service to Thailand and Indo-China. Pan Am's Indo-
china service was opened, with the assistance of the US
Government "in the national interest," on May. 22nd,
Wa2too CQoaceir laolboirtz.;o:r:
1953, 17 days after CAT, using planes ant'. pilots "loaned'
by the USAF, began. its military airlift to Dien Bien Phu.
The inauguration of CAT's airlift to Laos in September
1959, which has continued with little interruption ever
since, was likewise a godsend to Pan Am and the other
big US airlines, at a time when they were suffering badly.
Laos generated a need for additional military airlift
which, after considerable lobbying and threats of quitting
international service, was awarded by contract to the
commercial carriers." Thanks to its Pacific operations,
Pan Am saw its charter revenues soar almost 300 percent
in four years, and showed a profit in 1961 for the first
time since 1956, even though its Atlantic service con-
Cii441619)780:05%thtit360080002-3
'.;.nueel:
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,a)-(.:?hed China Lobby in Congress in the early 1950's
was to be found the heart of the Pan Am lobby. Senator
Pati"..IcCarran of Nevada, who chaired the Congressional
inquiry into Owen Lattimore and the Institute of Pacific
Relations, had first achieved fame as author of the 1933
Civil Aeronautics Act, and later as an oil lobbyist. In his
heyday as a China 'Lobbyist, McCarron was also known
as "the gamblers' senator"; and is said to have held court
at the Riverside Hotel in Reno, making deals with Syn-
dicate men to obtain casino licenses despite the law!"
Nevertheless, one cannot call lobbying a conspiracy, any
more than one can discern anything illegal in the fact
that Air America's top operating personnel were also
recruited from Pan Am.." But when one looks beyond the
Vaslaington offices of Air America to the Asian field
operations of CAT, with its 60 percent Chinese Nation-
ist control, the possibility of Kuomintang-criminal con-
nections and activity demands to be explored.
The most questionable of CAT's activities was its
sustained supply of arms and other supplies to Kuo-
mintang (KMT) General Li Mi and his successors in
Burma and North Thailand, between 1949 and 1961.
Li Mi is probably the only major opium-dealer in the
world to have been honored with the US Legion of Merit
and Medal of Freedom; his 93rd Division began collect-
ing opium from the Meos of northern Laos as early as
i916:?'.' Faced with a public scandal after Burma corn-.
plained about these foreign. intruders on its soil, the US
hired CAT Inc. to fly them out in 1954. Nevertheless, the
hulk of the troops refused to move, and cATo. Con-
tinued to supply them, possibly using some of the very
.C..kuracz.Cow rJat 11,:cCar:razt
, ? -,
cording to an informed source, "the CIA saw these
troops as a thorn in Mao's side and continued to supply
, them with arms - and money," even though they had
"decided to settle down and become rich by growing
. opium."" ?
The decision to finance ? and supply the remnants of .
Li Mi's troops had grave consequences for the World
opium and heroin traffic, .and also for that part of it
handled by the so-called National Crime Syndicate in the
United States. The new .right-wing Thai Government of ?
Phibum Songgram, having seized power in a 1948 coup
(over the issue of controlling?the local Chinese)," legal-
ized the sale of opium and established an official Thai Gov-
ernment Opium Monopoly, on September 17, 1949. This
happened just as the Chinese Communists were expelling
the last of the KMT-linked warlords who had ?supplied
the Far East and America. with opium before World War
Shortly thereafter, prepared opium in the containers
? of the Thai Government Monopoly was seized in a raid
in Boston, Massachusetts, an event not noted in the US
press. but duly reported by the US Government to the
United Nations Commission on Narcotic Drugs."
Throughout the 1950's, US Government representatives
continued to notice quietly that Thailand was a source for
the opium and heroin imported into the United States,
though this relative candor waned in the 1960's with the
escalation of the war in Vietnam." They also reported
the rapid increase in both opium-trading and opium-
growing in northern Thailand, where the KMT troops
were established; and noted that most of this opium was
exported out of Thailand for illicit traffic abroad."
Up until about 1964, however, the United States also .
complained officially and ostentatiously to the UN
Narcotics Commission about "Yunnan opium," brand
"999" morphine, and heroin from "the Chinese main-
land," as part of Peking's "twenty-year plan to finance
political activities and spread addiction."'? In 1958, for
example, the US reported the smuggling into the United
States of 154 pounds of heroin "from mainland China";
and in 1960 that "the principal sources of the diacetyl-
morphine [heroin] seized in the United States were Hong
Kong, Mexico, and communist China."" But other dele-
gates and the Commission itself would complete this
misleading picture: "Yunnan opium" was opium which
came from anywhere in the "fertile triangle" (the Burma-
Thai-Laos-Yunnan border area). The Hong Kong
authorities "were not aware of a traffic in narcotics from
the mainland of China through Hong Kong"; but
"quantities of narcotics reached Hong Kong via Thai-
land."" The bulk of "Yunnan opium," and the "999"
morphine in particular, were. in fact trafficked under the
protection of the KMT troops in Burma and north Thai-
land supplied by CAT. ,In 1960, the UN Commission
discreetly noted the presence in the Burmese sector of
the "fertile triangle" of "remnants of KMT troops who
were maintaining themselves largely on the profits of the
opium trade. It was reported that they received their
supplies periodically by air.""
. Why did CAT planes 'continue until 1961 to support
the suppliers of heroin which was flooding, via Thailand
and Hong Kong, into the United States? One reason Was
indeed military, to use the KMT troops and raids "as a
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ezrA
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1,'Ia.41.7.7:tolailanc; LCailE.317.01%
thorn in Mao's side," especially during the CIA/CAT-
-supported operation in Tibet from 1956-60, for which
the CIA agent Tony Poe (later stationed in the Laotian
opium. center of Ban Houei Sai) trained Tibetan guer-
rillas in the mountains of Colorado."
But a second reason was political: to maintain contact
with the elaborate fabric of Chinese secret societies or
"'Triads" throughout Southeast Asia. The profits and
relationships of the opium trade, in other words, would
help to preserve the pre-war Nationalist influence among
the Chinese middle class of these countries, and thus
challenge their allegiance to the new Chinese People's
Republic. This question of Chinese allegiance was par-
ticularly acute in the early 1950's in Malaya, where the
farming of the opium franchise among Chinese "Triads"
;lad been resorted to by the British authorities since at
least the 1870's." Organized opium traffic, in other words,
had become a well-established accommodation and
control mechanism; and after World War II the opium
was supplied by the !`fertile triangle.""
Although the British by and large resisted Triad-
IcMT offers to mobilize against the Chinese insurgency
in Malaya, they also found it difficult to crack down on
11, opium and gambling activities of the Wa Kei secret
NOC62(y, "WithOlit diSr111)(ing the fabric" of the Wa Kei
:I (Id ICON ing a vacuum for the Communists to ii11."7Nlean-
arre while the wealthy Chinese owners of tin-mines in the
more exposed countryside found it expedient to sub-
;dize a Wa Kei-Triad private army "with strong KMT
guerrillas. This "Kinta Valley huiie IU is
credit for restoring security to the Malayan tin industry
by 1954."
In Thailand, also, the farming of the opium franchise
has been used by the government for over a century as a
means of controlling the local Chinese population; and
the enormous profits from the opium traffic have been a
traditional source of corruption inside the Siamese Gov-
ernment." In the 1950's, the Thai police Interior Minister
General, after an initial phase of anti-Chinese adminis-
tration, "showed every willingness to co-operate with
Kuomintang Chinese in the campaign against Commu-
nism.""At the same time, his police, and in particular his
border police, collaborated with Li Mi's KMT troops in
Burma by officially "confiscating" their contraband
opium in return for a reward to KMT "informers." (As
early as 1950, a US Government representative noted
cynical reports that it was profitable for the opium-trader
to be seized and to share the reward with police)."
It seems indisputable that some elements in the KMT
used opium as a means to organize and finance KMT
links with and control over the important Chinese com-
munities of Southeast Asia. This is not surprising: the
KMT had relied on the Triads and gan,6-rs involved in the
opium traffic as early as 1927, when Chiang Kai-shek,
encouraged by foreign bankers, used the "Green Gang"
of Tu Yueh-sheng to break the Communist insurrection
in Shanghai."
After the remnants of the Shanghai "Green" and "Red
Gangs" had relocated in Hong Kong, one finds increas-
ing references in UN Reports to the narcotics trafficking
of Triad societies in Hong Kong and indeed throughout
the world. In 1963, for example, the US representative
to the UN Narcotics Commission "observed that the
problem of the Triad organizations (Chinese groups in-
volved in the illicit traffic in the Par East and Europe)
' appeared to be significant in recent trafficking develop-
ments." Other delegates, confirming that "many heroin
traffickers ... had Triad backgrounds," noted the activi-
ties of Hong Kong Triad representatives in Germany,
Spain, and Switzerland."
This world-wide network of Chinese secret societies
in the opium traffic extended both before and after World
War II to the Hip Sings, one of the Chinese tongs in the
United States, and also to the Bing Kong and other
American tongs. In the 1930's, the national president of
the Hip Sings, Yee On Li, was convicted for a Mafia-
linked narcotics operation involving the wife of Lucky
Luciano's partner, Thomas Pennachio; Yee was also
involved with "Hip Sing dope dealers in Chicago, San
Francisco, Pittsburgh, New York, Cleveland, Dallas, and
other important cities."" In January, 1959, a new genera-
tion of Hip Sing officials, including San Francisco
president George W. Yee, were again indicted for nar-
cotics smuggling. A US Government report on the
indictments noted . that the tong's activities possibly
paralleled "the operations of the Triad societies in Hong
Kong."
It has been claimed that profits from narcotics smug-
gling in the United States have been channeled into
Chiang Kai-shek's lobby in the US Congress, thus helping
to keep open the opium supply lines through Laos and
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ICS, wrote that
There is . . considerable evidence that a number of
[Nationalist] Chinese officials engaged in the illegal
smuggling of narcotics into the United States with
the full knowledge and connivance of the Nationalist
Chinese Government. The evidence indicates that
several prominent Americans have participated in and
profited from these transactions. It indicates further
that the narcotics business has been an important
factor in the activities and permutations of the China
Lobby."
Professor Koen expressed the hope that his charges
would lead to a fuller legal investigation; they led, in-
stead, after a denial from Narcotics Commissioner
Anslinger, to his book's being suppressed by the publish-
er. But Anslinger's denial, recently published, does not
touch upon Mr. Koen's charge about the China Lobby:
I can give you an unqualified statement that this is
manufactured out of the whole cloth: that there is no
scintilla of evidence that any Chinese officials have
engaged in illegal smuggling of narcotics into the
United States with the jull knowledge and connivance
of the Chinese Nationalist Government.'"
And, without the italicized qualification, Mr. Anslinger's
refutation is hard to believe. For Chiang's Consul General
to San Francisco at the time of the Hip Sing arrests in the
late 1930's, Huang Chao-chin, himself "narrowly es-
caped conviction . . . on charges of smuggling narcotics
in the US."" Since 1952, Huang has been a member of
the KAIT Central Committee, and today he is Chairman
yew- of the First Commercial Bank of Taiwan.
The XMT's stake in the CAT airlift to its troops in the
"fertile triangle" became obvious in 1961, when Fang
Chih, a member of the KMT Central Supervisory Com-
mittee and Secretary-General of the Free China Relief
Aency (FCRA), admitted responsibility for an unlisted
CAT plane that had just been shot down over Thailand
lw the Burmese Air Force."- The Asian Peoples' Anti-
Communist League (APACL), of which the FCRA at the
same address was a member agency, was itself an organi-
zation through which the KMT maintained overt contact
with right-wing political and financial interests in Europe
and America, as well as with overseas Chinese com-
munities.
The Chairman of the APACL's secret liaison group in
America (in effect the heart of the American China
Lobby) was in 1959 Charles Edison, yet another right-
wing member of the Brook. Club." The APACL also
wrote of its collaboration with psychological-warfare
experts in the Department of Defense, and with the John
Birch Society. The unpublicized visit to Laos of Fang
Chilt, in the weeks immediately preceeding the phony
Laos "invasion" of 1959, suggests that the narcotics
traffic, as well as Path& Lao activity, may have been a
reason why CAT's planes inaugurated their flights in
that year into the opium-growing Meo areas of Sam
Neua province. This, in turn, would explain the extraor-
t? Unary rumors, reported in the Christian Science Monitor,
that the Laotian Air Force's "opium runs are made with
CIA 'protection.' ""
in. .0. otim s ;ee anu toe non-
existent "invasion" of Laos, reported by Brook Club
member Joe Alsop, than with opium? The US Govern-
ment itself, commenting on the nearby rebellion of the
same year in the Shan states of Burma, called it "an
instance of a rebellion precipitated by the opium traffic.""
The KMT-sponsored Shan rebellion followed a crack-
down in the summer of 1959 by the Burmese Govern-
ment, after Pai Clae-j en and some 2,000 KMT troops had
been driven from Sanskyin Mountain in Yunnan into
Burma in 1958.53
By March, 1959, according to Bernard Fall, "Some of
the Nationalist guerrillas operating in the Shan states of
neighboring Burma had crossed into Laotian territory
and were being supplied by an airlift of 'unknown
planes'."" Their old opium routes were being threatened
to the south as well. In July, 1959, the Thai Government,
in response to years of US Government pressure, ended
its opium monopoly and announced it would clamp
down on the narcotics traffic." Shortly after this prohibi-
tion, heroin, in the place of the bulkier opium, "came to
be regarded as the major problem" in Thailand." By
September, 1959, CAT had commenced charter airlift
in Laos at the expense of the American taxpayer.
Meanwhile, in May and June of 1959, Fang Chih of
the Asian Peoples' Anti-Communist League (APACL)
visited KMT camps in Laos, Burma, and Thailand, as he
did again in 1960. On August 18, 1959, five days before
the arrival of the two CAT planes in Vientiane, and 12
days before the alleged "invasion," Ku Cheng-kang, who
was President of the FCRA as well as of the Taiwan
APACL, received in Taiwan the mysterious but influential
Colonel Oudone Sananikone, a member of what was then
the ruling Laotian family and nephew of the Laotian
Premier Phoui Sananikone." On August 26th, 1959, in
Washington, Oudone's father, Ngon Sananikone, signed
the US-Laos emergency aid agreement which would pay
to charter the CAT planes, eight days after their arrival.
This was only a few hours after Eisenhower had left for
Europe on the same day, not having had time to study
the aid request, for Ngon had only submitted it on August
25. On August 27, Col. Oudone Sananikone attended the.
founding in Taiwan of a Sino-Laotian friendship society,
whose trustees included Ku Cheng-kang and Fang Chih."
Oudone Sananikone headed a "Laotian" paramilitary
airline, Veha Akhat, which in those days Serviced the
opium-growing areas north of the Plaine des Jarres with
Chinese Nationalist planes and personnel (CAT had not
yet begun its operations to the Meos in this region, which
offered such profitable opportunities for smuggling as a
sideline for enterprising pilots)" Colonel Oudone
Sananikone also figured prominently in the secret three-
way talks between officers of Laos, South Vietnam, and
Taiwan, which preceded the Laotian coup and resulting
crisis of April 19th, 1964, a coup which was reported
two days in advance by Taiwan Radio."
Another major figure in the 1959 and 2 964 Lao( i;iti
plots was General Outtne Ratitikounc, who flew with ,Joe
Alsop to Sam Neua and showed him the staged evidenet.1
of the 1959 "invasion." General Willie is said to have
admitted in a recent interview that he was "the real boss"
of opium operations in Laos."
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That is extraordinary, and quite possibly- criminal
er US law, is not the involvement in narcotics of the
KMT, nor that of the Taiwan airline CATCL which it
controls, but of Americans exercising the authority of
.41610 the CIA.
The CIA as an agency, it is true, cannot be identified
with the narcotics trade any more than can the whole
of the Kuomintang. In 1955, for example, while the CIA
was running its airlift to the opium trade in Thailand,
- General Lansdale in Vietnam used CIA funds to smash a
pro-french organization, which controlled the dope and.
gambling activities of Saigon and its Chinese suburb,
much as the Triads operated in Malaya." in 1971, Air
America planes are reported to have taken part in the
growing US crackdown on the narcotics traffic.
But while General Lansdale was cracking down on
narcotics in Vietnam, William H. Bird, the CAT repre-
sentative in Bangkok, is said to have co-ordinated CAT
air-drops to Li Mi's troops in the "fertile triangle." In
1960, after CAT began flying in Laos through "the great
Laos fraud," his private engineering firm began the
construction of short airstrips in Meo territory which
were soon used for the collection of Laos opium, some
of it destined to be manufactured into heroin in Mar-
seilles, and forwarded to the National Crime Syndicate
in the United States." Soon Bird and Son had its own
airline of 50 planes flying US contract airlift to the
opium-growing tribesmen, and rumors soon arose that
Approved
these planes, like Air America's in the same area, were
not infrequently used for smuggling."
Willis Bird, William Bird's brother or cousin in
Bangkok, headed the Bangkok office of a "trading com-
pany" called Sea Supply, Inc. As I noted earlier, Sea
Supply first supplied arms to the KMT troops of General
Li Mi, and later trained Phao Sriyanon's Thai border
police who were also implicated in KMT opium-smug-
gling activities. Like William, Willis Bird also branched
into the construction business on his own. In .1959, as
Vice-President of the "Universal Construction Com-
pany," Bird was said by a Congressional committee in-
vestigating corruption in Laos to have bribed an ICA aid
official in Vientiane." In 1962, when President Kennedy
was struggling to bring the CIA hawks in Thailand under
control, his brother the Attorney General belatedly re-
turned an indictment against Willis ?Bird, who has never
returned to this country to stand tria1.66
. What particularly concerns us is of course not the
personal venality of a US construction ofaial or of pilots
dabbling in opium on the side, so much as the sustained
support by CIA proprietaries of narcotics-smuggling ac-
tivities which affected the continental United States. It is
not at all clear that this policy had official sanction:
Eisenhower seems to have, been unaware of the airlift
operations of Air America and Bird and Son in Laos,
which were apparently only authorized by an elaborate
conspiracy of deceit. By all accounts, the Kennedy Ad-
ministration was exerting pressure to remove the "esti-
mated 4,000 Chinese Nationalists" who "were reportedly
operating in western Laos in 1961," having been "flown
from Taiwan into bases in northern Thailand."67 Even
. the Johnson Administration announced in February 1964
that it would withdraw Air America from Laos: this
announcement came to naught after .the organizer of
CAT's American replacement, John Davidson of Sea-
board World Services, was "accidentally" killed in a
dubious and controversial explosion of a CAT plane."
How could the objectives of a US president be at odds
with those of a CIA proprietary? The obvious stake of
KMT interests in CATCL is a ? partial explanation, to
. which one can perhaps add the stake of private American
interests as well. For it is a striking fact that the law firm
of Tommy Corcoran, the Washington lawer for CATCL
and T. V. Soong, has had its own links to the interlocking
worlds of the China Lobby and of organized crime. His
,partner, W. S. Youngman, joined the board of US Life
and other domestic insurance companies, controlled by
C. V. Starr (OSS, China) with the help of Philippine and
other Asian capital. Youngman's fellow-directors of
Starr's companies have included John S. Woodbridge of
Pan Am, Francis F. Randolph of J. & W. Seligman,
W. Palmer Dixon of Loeb Rhoades, Charles Edison of the
post-war China Lobby, and Alfred B. Jones of the Nation-
alist Chinese Government's registered lobby, the Uni-
versal Trading Corporation. The McClellan Committee
heard that in 1950 US Life (with Edison a director) and
a much smaller company (Union Casualty of New York)
were allotted a major Teamsters insurance contract, after
a lower bid from a larger and safer company had been
rejected. Hoffa was accused by a fellow-trustee, testifying
under oath before another committee, of intervening on
behalf of US Life and Union Casualty, whost, azeras were
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The National City Bank itself had once .leased its
- racetrack in Havana (and also, through a subsidiary, the
Hotel Nacion.ale de Cuba's casino) to Meyer Lansky of
the Organized Crime Syndicate." In 1950, Citibank's
largest shareholder, Transamerica Corporation, was rep-
resented through James F. Cavagnaro, in the shadowy
"World Commerce Corporation" organized by several.
OSS veterans. In 1950, the World Commerce Corpora-
tion was involved in dubious soybean operations" while
its subsidiary, Commerce International (China), spon-
sored the unauthorized Pawley-Cooke military assistance
mission to Taiwan," and the illegal smuggling of air-
planes from California to the government of Chiang Kai-
shek." Satins "Sonny" Fassoulis, accused of passing
bribes as the vice-president of Commerce International
(China), was under indictment ten years later when he
surfaced in the Syndicate-linked Guterma scandals."
A director of Air America through the years has been
Robert Guestier Goelet of the City Investing Co., where
his fellow-directors through the years have included
Joseph Binns of the aforementioned US Life (Binns was
involved in Bahamas and other land speculations with
Meyer Lansky's business associate Lou Chesler)," and
John W. :Houser (an intelligence veteran from the Pacific
who 'negotiated .the lease of the Havana Hilton hotel
casino?to Cuban associates of the Syndicate)."
We find the same network linking CIA proprietaries,
war lobbies, and organized crime, when we turn our
attention from CAT to the other identified supporter of
, activities, Sea Supply Inc. Sea Supply Inc. was organized
in Miami, Florida, where its counsel, Paul L. E. Helliwell,
doubled after 1951 as the counsel for C. V. Starr insur-
ance interests,- and also as His Thai Majesty's Consul in
Miami. It would be hard to say whether Helliwell (the
former OSS Chief of Special Intelligence in China) was
more active in representing US or Thai government
interests: in 1955 and 1956, for example, the Thai Con-
sulate in Miami (operating out of Helliwell's office as
secretary for the American Bankers' Insurance Company
of Florida) passed over $30,000 to its registered foreign
lobbyist in Washington, Tommy Corcoran's law partner
James Rowe. Inasmuch as Corcoran and Rowe were two
of the closest personal advisers to Lyndon Baines John-
son, then the rapidly rising Senate Majority Leader,
Helliwell's lobbying activities for the opium-dealing Gov-
ernment of Phibun and Phao Sriyanon may well have
had a more powerful impact on US policy than his legal
activities for the CIA.
Miami, of course, has been frequently identified as "a
point where many of the more important United States
and Canadian and even the French [narcotics] traffickers
congregate,"" American Bankers' Insurance, the com-
pany from whose office Helliwell doubled as Thai Consul
General and counsel for Sea Supply, Inc., appears to have
maintained its own marginal links with the institutions
servicing the world of organized crime and narcotics.'"
The most striking interlock is that of its director, jack L.
King, who in 1964 was also a director of the Miami
National Bank. The Miami National Bank was identified
in 1969 as having served ? between 1963 and 1967 as a
c.o nduit ibrouglApiliii.61i4tacr rgignsfi?ca
;),. .laULLUL:f1.:(1
through the interlocking Exchange and Investment Bank
? in Geneva." Lou Poller, King's fellow-director of the
Miami National Bank and a director also of the Swiss
Exchange and Investment Bank, was investigated by the
McClellan committee about his use of Teamster capital
to acquire the Miami National Bank, and subsequently
indicted for perjury."
It is said that rich Thai and other Asian capitalists,
as well as wealthy Syndicate gangsters such as "Trigger
Mike" Coppola, have invested heavily in Florida's post-
war land boom, through companies such as the General
Development Corporation of Meyer Lansky's business
associate Lou Chesler.8' Such business associations might
help explain why, for example, Prince Puchartra of
Thailand became the only royal representative at the
1966 opening of Caesar's Palace in Las Vegas, a hotel-
casino said to be controlled by Jimmy Hoffa." The same
associations, if they were exposed, might cast light on the
unexplained 1968 business trip to Hong Kong and South-
east Asia of Santo Trafficante, an old Lansky associate
named in narcotics investigations." Trafficante had been
preceded in 1965 by John Pullman, Meyer Lansky's
courier to. the Miami National Bank, In April, 1965,
Pullman visited "the Peninsula Hotel in Hong Kong,
where the syndicate had casinos and obtained much of
its narcotics.""
The apparent involvement of CIA proprietaries with
foreign narcotics operations is paralleled by their ap-
parent interlock with the domestic institutions involved
with organized crime, The need to understand such in-
volvements more fully may well become more urgent in
the future, as the Indochina war is "Vietnamizecl" and
handed over increasingly to CIA proprietaries such as
Air America. For the thrust of this admittedly sketchy
inquiry has been to suggest that, with the maturation of
both capitalism and third-world nationalism, and with
the outlawing of private war operations like those
financed by the Seligmans in 1903, wealthy US interests
(using the secret authorities delegated to the (;IA) have
resorted systematically to organized outlaws to pursue
their operations.
It is true that the embarrassing links between Air
America and .CATCL have been diminished in the last
five years. But the opium-based economy of Laos is still
being protected by a coalition of opium;growing CIA
mercenaries, Air America planes, and Thai troops." The
recent crackdown on Turkish opium production handled
by Corsicans in France can, of course, only increase the
importance of heroin deriving from (and refined in) the
"fertile triangle," which is already estimated to supply
possibly 25 percent of American heroin consumption."
Official US doubletalk about the domestic heroin
problem, and the reluctance since about 1963 to recpg-
nize the "fertile triangle" as a source for it, is only one
further symptom that the public sanctions of law and the
constitution have yielded ground to private in( ercsts and
ihe secret sanctions provided Ity (jA, Mori, ?,j?? ? 11,
ically, the use of illei.cal narcotics ityl worits 10 1,iii cohl-
munism, resorted to by capitalists in Sim ity,Inti 92.7
and in Southeast Asia in the 1950's, stems without our
knowledge to have been sanctioned inside the United
ToOtY661/oeftbati5A137.6-' 38oR0003000s0002-3
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u2pearing On page 45.
e...neel Elio: Morison, The Oxford History of the American
114.lc ,New York: O.U.P., 1965), pp. 825-26. Pointing to the
sucteequent impact on all Latin America, Morison concludes that
*rememe he United States is paying dear today for Roosevelt's impetuos-
ity in 1903."
2. For example the "nation-building" activities in Vietnam of
the immigrant European liberal Joseph Buttinger can be com-
pared to those of the French liberal Buneau-Verilla, "who had.
first caught the attention of the Scligmans through his activities in
the Dreyfus case."
3. Washington Post, De.c. 22, 1963; quoted in Roger Hilsman,
To Move a Nation (Garden City, N.Y.: Doubleday, 1967), p. 63.
4. David Wise and Thomas B. Ross, The Espionage Establish-
ment (New York: Random House, 1967), p. 166.
5. Fre-.k G. Wisner (OSS) came to the government in 1948
from the Wall Street legal firm of Carter, Ledyard and Milbuen,
which represented various Rockefeller, Whitney, and Standard
Oil interests. As Director of the "Office of Policy Co-ordination,"
which became the CIA's Plans Division on Jan. 4, 1951, Wisner
was in charge of the CIA's covert operations.
William Harding Jackson (Republican), Smith's Deputy
Director in 1950-51, had been with Carter, Ledyard and Milburn
from 1934 to 1947, and was now an investment partner of John
Hay Whitney on the board of Bankers' Trust.
Allen Welsh Dulles (OSS, Republican), a war-time director of
3. Henry Schroder Banking Corporation and long-time partner
of Sullivan and Cromwell (linked with various Rockefeller and
Schroder interests), succeeded Jackson as Deputy Director in
August 1951.
Murray McConnel, President of the Manufacturers Capital
Corporation on Wall Street, was the CIA's Deputy Director for
Administration in 1950 and 1951.
Walter Reid Wolf (Republican), a Vice-President Of the Na-
tional City Bank of New York and of its investment affiliate City
Bank Farmers Trust, was a CIA Deputy Director (presumably
McConnel's successor) from 1951 to 1953.
Robert Amory, Jr., son of a New York manufacturer who was
a co-director of at least three Boston firms with directors of
United Fruit, came to the CIA as Deputy Director for Intelligence
from the Harvard Law School in 1952 (according to liYho's Who).
Loftus E. Becker, of the Wall Street law firm Cahiii, Gordon,
Reindel and Ohl (representing the investment firms of Dillon'
Read and Stone arid Webster) went on leave to the C/A In April
1951 and was named Deputy Director "for Intelligence" (accord-
ing to the Martindale-Hubbard Law Directory, 1965, p. 4707) for
a year beginning January 21, 1952..
All of these seven men except Becker were also listed in the
select New York Social Register, and thus were members not only
of New York's financial-legal elite but of its hereditary upper
class. The known links between the CIA and Civil Air Transport-
Air America date from this period, when New York finance en-
joyed a monopoly over the CIA's top civilian appointments.
6. David Wise and Thomas B. Ross, The Invisible Government
(New York: Bantam, 1965), pp. 115-16; New Republic, April 12,
1969, p. 8.
7. Wise and Roes, Invisible Government, p. 140.
8. New York Times, 20 September 1957, p. 7.
9. The Pentagon Papers (New York: Bantam, 1971), p. 137.
10. Arnold Dibble, "The Nine Lives of Cat?II," Saturday
Evening Post, 18 May 1968, p. 50. New York Times, 11 November
1949, p. 14; 5 April 1970, p. 22; Free China Review, November
1963, p. 31. In 1949 the Kincheng Bank ostensibly severed its
connections with CAT, in the vain hope of continuing to operate
on the mainland. But Wang Wen-san, then Manager of the Xin-
cheng Bank, is still Chairman of CATCL's Board, on which the
KMT-Chinese Nationalists have three of the five seats. Air America
pilots still circulate the rumor that "Madam Chiang owns the
'411111w.
PAARPR7413NAIINOMMOCk9273Francisco Chronicle,
2 April 1970, p. 51).
i. john R. Beal, Marshall in China (New York: Doubleday,
1970), 9. 00.
12. US Congress, House, Committee on Un-American Activi-
ties, International Communism: Consultation with Major-General.
Claire Lee Chemuttelt, 85th Cong., 2nd Sess., 23 April 1958, pp.
9-10; US Department of ,State, US Policy in the Korean Crisis
(Washington: G.P.O., 1950), pp. 21-22.
13. Time, 15 October 1951, p. 23.
14. New York Times, 6 July 1951, p. 9; cf. June 9, 1951, p. 6;
I. F. Stone, The Hidden History of the Korean War (New York:
onthly Rebiew Press, 1969), p. xi. The New York Times wrote
that "the soybean is expected to come under any Congressional
inquiry of the China Lobby"; but no such inquiry ever took place.
It may be relevant that Joe McCarthy himself took part in the
profitable soybean speculations, on the advice of a Pepsi-Cola
lobbyist.
15. The build up of US military airlift inside Korea was flown by
CATCL, which soon boasted assets of some $5.5 million, and
income in the order of from $6 to $12 million a year (Colliers,
ii August 1951, p. 35).
16. Cleveland Amory, lrho Killed Society? (New York: Pocket
Books, 1960), p. 202.
17. One indication of this mutual advantage between political
and economic concerns is the later convergence in the board of
one enterprise (Curio Engineering) of former CIA Director
Bedell Smith, of his deputy director Murray McConnel, and of
McConnel's successor Walter Reid Wolf who was involved in
setting up CAT Inc.
18. New York Times, 5 April 1970, pp. 1, 22. Air America
pilots, like Lockheed's U-2 pilots, are mostly recruited from the
USAF, and arc said to have the same rights of return into the
USAF at the end of their "civilian" tour.
19. Transamerica Corp., the Giannini holding corporation,
was in the late 1940's the largest stockholder in both banks, own-
ing about 9 percent of Citibank, and 22 percent of the Bank of
America.
20. New York Times, 8 April 1960, p. 62; US Congress, House,
Committee on Armed Services, Special Subcommittee on National
Airlift, Hearings, 86th Cong. 2nd Sess. (Washington: G.P.O.,
1960), pp. 4616-50, 4730-31. The President of Pan Am testified
that his company would have to release 300 pilots during the next
six months "if trafflc?other than normal civil traffic?doesn't be-
come available." It has been noted that the Congressional com-
promise between the Pentagon and the commercial airlines con-
tained "no recommendation about what to do if the combination
of more strategic airlift and continuing guarantees to the (air-
lines) industry produced too much airlift in nonwar situations"
(Frederick C. Thayer, Air Transport Policy and National Security,
Chapel Hill, N.C.: University of North Carolina Press, 1965,
p. 225). Thanks to the Laotian airlift and war, that problem was
not faced.
21. Angus McDonald and Al McCoy, "Pan Am Makes the
Going Great," Scanlan's (April 1970), p. 53. In 1961 Pan Am's
Atlantic competitor, TWA, lost $38 million. In 1962 Pan Am's
total air cargo load rose 500 percent, thanks in part to the airlift
in that year of US troops to Thailand.
22. Ed Reid, The Grim Reapers (Chicago: Henry Regnery,
1969), p. 219; Wallace Turner, Gamblers' Money: The New Force
in American Life (Cambridge, Mass.: Houghton Mifflin, 1965),
pp. 10, 274.
23. George A. Dole, Chief Executive Officer of Air America,
Amos Hiatt, Treasurer, and Hugh Grundy, President of Air Asia,
all were recruited from Pan Am and ICH foreign rithnitlieries; 'nett
at. William Powley lied witched for Pen Ant's Clilito
I.ile.(;1 left ot ti tem leg De ilyllog leintit s Is, 144 I. (Immo sill,. mow'
"Mows it .imr for Veto" who voltitnitei lel lit respitionii
to the I 9e9 Law, "ieyeellm" were reeiteltell I.y (.111foril I., :ii."441.,
It "major In time Air Force Iteeerve and civilian employee. at Fort
lluachuca, Arizona" (New York Times. 27 September 1959, p. 16).
1,ed
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, Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
Pan Am has a contract at Fort Huachuca to conduct itighly.secret 20 isebruary, 1961, p. 1.
"electronics weapons" research for the USAF.
.$). Gro tab and Outlook (Taipeh: APACL, 1960)?
24. J. 'I'. McAlister, Vietnam: The Origins of a Revolution (New
Christi:pi Science Monitor, 16 June 1970, p. 8; cf. 29 May
York: ICnopf, 1969), is. 228; cited in David Feingold, "Opium
and Politics in Laos," in Nina Adams and Al McCoy (eds.) Laos: )70, p. 14: "Clearly the CIA is cognisant of, if not party to, the
?
vow..ensive movement of opium out of Laos. One charter pilot told
ar and Revoition (New York: Harper, 1970), p. 335.
?le t'tat 'friendly' opium shipments get special CIA clearance and
25. George Thayer, The War Business (New York: Simon and ;.-.onitoring on their !lights southward out of the country. The
Schuster, 1969). p. 158, emphasis added. Even the US Govern- !....me source ailez.;ed two or three flights without this 'protection'
mont Area Book for Thailand (Washington: c.p.o., 1968), ra- ..reshed under mysterious circumstances."
cords of the KMT troops that "Their principal income allegedly
US Note of 29 Aptil 1960 to UN Commission on Narcotic
C)ru,;;A, E/CN.7/394, p. 2.
53. E/CN.7/394, p. 1; Free China and Asia, January 1959, p. 10.
comes from serving as armed escort for the opium caravans
moving southward" (to Bangkok) (p. 454).
26. G. William Skinner, Chinese Society in Thailand: an An-
alytical History (Ithaca, N.Y.: Cornell U.P., 1957), p. 289.
27. UN Document E/CN.7/213 (communicated by the US
Representative), 17 November 1950, p. 9.
28. E.g., statement of Harry J. Anslinger, then US Commis-
sioner of Narcotics, before the Senate Committee on the Judiciary,
Illicit Narcotics Traffic, Hearings, 84th Cong., 2nd Sess. (Wash-
ington: Government Printing Office, 1955). p. 13; U.N. Docu-
ment E/CN.7/394, 29 April 1960, p. 2.
29. US Congress, Senate, Committee on the Judiciary, Narcotic
Control Act of 1956, Hearing, 84th Cong., 2nd Sess., 4 May 1956,
p. 34. Before the Tenth (1955) session of the UN Narcotics
Commission, the US representative noted that from 200 to 400
tons of opium were imported annually south into Thailand across
the Burma-Laos border, of which only 100 tons were consumed
in Thailand itself (UN Document E/CN. 7/303/Rev. 1, p. 34).
30. UN commission on Narcotics Drugs, Report e the Ninth
Session (1954), E/CN.7/283, p. 22.
31. UN Commission on Narcotic Drugs, Report of the Thirteenth
Session (1958), E/CN.7/354, p. 26, cf. p.22; Report of the Fifteenth
Session (1960), E/CN.7/395, p. 19, cf. p. 18.
32. UN Commission on Narcotic Drugs, Report of the Fifteenth
Session (1960), E/CN.7/39S, p. IS.
33. UN Commission on Narcotic Drugs, Report of the Fif-
teenth Session (1960), E/CN.7/395, p. 15.
34. San Francisco Chronicle, 4 September 1970, p. 1. Free China
and Asia, a journal published by the KMT agency responsible for
chartering the CAT flights, gave details of Yunnan military opera-
tions and wrote of "plans to rise up in coordination with the
efforts of the Tibetans against the Communist rule, particularly
those in Yunnan and Sikang" (Free China and Asia, June 1959,
p. 21; cf. January 1959, p. 10).
35. Wilfred Blythe, Impact of Chinese Secret Societies in Malaya
(London: Oxford U.P., 1969), pp. 190, 250.
36. Cf. (e.g.) UN, Committee on Narcotic Drugs, Report of the
Seventeenth Session, E/CN.7/432, p. 15.
37. Blythe, pp. 449, 441.
38. Blythe, pp. 441-42.
39. William Skinner, Chinese Society in Thailand, An Analytic
History (Ithaca, N.Y.: Cornell U.P., 1957), pp. 120-21.
40. Skinner, p. 337.
41. UN Document E/CN.7/210, 3 November 1950, p. 3.
42. H. R. Isaacs, The Tragedy of the Chinese Revolution (Stan-
ford, Cal.: Stanford U.P., 1951), pp. 81, 142-46; Y. C. Wang,
Journal of Asia Studies, May 1967, p. 437; Blythe, pp. 28-29, 21.
43. UN, Commission on Narcotic Drugs, Report of the Eight-
eenth Session, E/CN.7/455, p. 1.0.
44. Will Oursler and Zs. D. Smith, Narcotics: America's Peril
(Garden City, N.Y.: Doubleday, 1952), p. 87.
54. Bernard Fall Anatomy of a Crisis (Garden City. New York:
Doubleday, 1969), p. 99.
5. The Thai police favoritism shown the KMT during 1952-
195.1 had been disavowed in 1956; and Prime Minister Phibun
stated at a public press conference, "The Kuomintang causes too
much trouble: they trade in opium and cause Thailand to be blamed
in the United Nations" (Skinner, p. 343). The next year Phao was
ousted from power by the present military rulers of Thailand,
amid reports that Phao, "a sort of local Beria ... ran the gold
exchange and opium trade" (New York Times, 6 November 1957,
p.
S. UN Commission on Narcotic Drugs: Report of the Seventeenth
Session (1962), ii/CN. 7/432, p. 11.
57. APACL, Free China and Asia (October, 1959), p. 14.
5s. Free China and Asia, October 1959, p. 31.
59. In fact Vella Akhat was little more than a front for the Nation-.
Chinese airlines from which it chartered six planes and
On 19 February 1961, four days after the CAT/FCRA
plane was shot down by the Burmese, a Veha Akhat C-47 leased
from a Taiwan company was shot down over Laos; four of the six
personnel aboard were said to be Nationalist Chinese ollicers.
(Bangkok Post, 22 February 1961, p. 1; Singapore Straits Times, ?
22 February 1961, p. 3). The same year Taiwan's second airline,
Foshing, reported a decrease in its air fleet from three C-47's to .
two. Foshing Airlines was headed by Moon Chin, a former.
Assistant Operating Manager of Pan Ant's China subsidiary,
CNAC, under William Pawley.
60. Bangkok Post, 18 April 1964.
61. San Francisco Chronicle, 16 August 1971, p. 12.
62. It is striking that in 1961, when the CIA inaugurated covert
air operations from Saigon against North Vietnam, it spurned
the available planes and facilities of CAT at Saigon's Tan Son Nhut
airport and set up a new unrelated "prop..letary," "Aviation
Investors, Inc.," d/b/a/ Vietnam Air Trans:tort. Vietnam Air
Transport is said to have hired Nguyen Cao Ky, then fired him
after learning that he used his "Operation liaylift" flights as a
cover for opium-smuggling from Laos to Saigon.
63. Stanley Karnow once named a "debonairc, pencil-moustached
Corsican by the name of Bonavencure Frandsci" as one of the
top opium-runners in Laos ("The Opium Must Go: Through,"
Life, 30 August 1963, p. 12). The Francisci family has been linked
to the Spirito-Venturi arm of the Corsican enafia in Marseilles,
which in turn reaches to America through Syndicate associate
Vincent Cotroni of Montreal (US Congress, Senate, Committee
on Government' Operations, Organized Crime and Illicit Traffic
in Narcotics, Hearings, 88th Cong., 2nd Sess., Washington, G.p.0,?.
1964, pp. 956, 961; cited hereafter as Narcotics Hearings.) This
45. E/CN.7/394, 29 April 1960, p. 8.
46, Ross Y. 1Coen, The China toblylv rimeritan (I Iv
'York: Itgaip,11, In,
Woo 0,111ild Labe fiI,io (I Hon bob., I I. ,
At liosoma I woo, II, 1,1111
Arldsoi:1 hiroglii, "4:1 11.111114i4 NOW
October 1954, p. 13.
49, New York 'I'lmes, 16 Febriiary I 96 , p. 9; Sioolpore Sredito?
Approved For Release 2005/05/20 : CIA-RDP751300380R0003000800024i;
Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
? Pan Am has a contract at Fort Huachuca to c- onduct highly Secret
"electronics weapons" research for the USAF.
24. 3. T. McAlister, Vietnam: The Origins of a Repot:aims (New
York: Knopf, 1969), p. 228; cited in David Feingold, "Opium
and Politics in Laos," in Nina Adams and Al McCoy (eds.) Laos:
War and Revolgtion (New York: Harper, 1970), p. 335.
25. George Thayer, The War Business (New York: Simon and
Schuster, 1969), p. 158, emphasis added. Even the US Govern.
latent Area Book for Thailand (Washington; G.P.O., 1968), re-
cords of the KMT troops that "Their principal income allegedly
comes from serving as armed escort for the opium caravans
moving southward" (to Bangkok) (p. 454).
26. G. William Skinner, Chinese Society in Thailand: an An-
alytical History (Ithaca, N.Y.: Cornell ZIP., 1957), p. 289.
27. UN Document E/CN.7/213 (communicated by the US
Representative), 17 November 1950, p. 9.
28. E.g., statement of Harry J. Anslinger, then US Commis-
sioner of Narcotics, before the Senate Committee on the Judiciary,
Illicit Narcotics Traffic, Hearings, 84th Cong., 2nd Seas. (Wash-
ington: Government Printing Office, 1955), p. 13; U.N. Docu-
ment E/CN.7/394, 29 April 1960, p. 2.
29. US Congress, Senate, Committee on the Judiciary, Narcotic
Control Act of 7936, Hearing, 84th Cong., 2nd Sess., 4 May 1956.
p. 34. Before the Tenth (1955) session of the UN Narcotics
Commission, the US representative noted that from 200 to 400
tons of opium were imported annually south into Thailand across
the BurmaZaos border, of which only 100 tons were consumed
in Thailand itself (UN Document E/CN. 7/303/Rev. 1, p. 34).
30. UN commission on Narcotics Drugs, Report of the Ninth
Session (1954), E/CN.7/283, p. 22.
31. UN Commission on Narcotic Drugs, Report of the Thirteenth
Session (1958), E/CN.7/354, p. 26, cf. p. 22; Report of the Fifteenth
Session (1960), E/CN.7/395, p. 19, cf. p. 18.
32. UN Commission on Narcotic Drugs, Report of the Fifteenth
Session (1960), E/CN.7/39S, p. 18.
33. UN Commission on Narcotic Drugs, Report of the Fif-
?tuaao teenth Session (1960), E/CN.7/395, p. 15.
34. San Francisco Chronicle, 4 September 1970, p. 1. Free China
? and Asia, a journal published by the KMT agency responsible for
chartering the CAT flights, gave details of Yunnan military opera-
tions and wrote of "plans to rise up in coordination with the
efforts of the Tibetans against the Communist rule, particularly
those in Yunnan and Sikang" (Free China and Asia, June 1959,
p. 21; cf. January 1959, p. 10).
35. Wilfred Blythe, Impact of ?Chitiese Secret Societies in Malaya
(London: Oxford U.P., 1969), pp. 190, 250.
36. Cf. (e.g.) UN, Committee on Narcotic Drugs, Report of the
Seventeenth Session, E/CN.7/432, p. 15.
37. Blythe, pp. 449, 441.
38. Blythe, pp. 441-42.
39. William Skinner, Chinese Society in Thailand, An Analytic
History (Ithaca, N.Y.: Cornell U.P., 1957), pp. 120-21.
40. Skinner, p. 337.
41. UN Document E/CN.7/210, 3 November 1950, p. 3.
? 42. H. R. Isaacs, The Tragedy of the Chinese Revolution (Stan-
ford, Cal.: Stanford U.P., 1951), pp. 81, 142-46; Y. C. Wang,
Journal of Asia Studies, May 1967, p. 437; Blythe, pp. 28-29, 21.
43. UN, Commission on Narcotic Drugs, Report of the Eight-
? eenth Session, E/CN.7/455, p. 10.
44. Will Oursler and L,D. Smith, Narcotics: America's Peril
(Garden City, N.Y.: Doubleday, 1952), p. 87.
45; E/CN.7/394, 29 April 1960, p. 8.
46. Boss Y. leoen, The Chloe 1,obbyht rInind fan NMI, It I..
Miorionlbin, Is
rl'h Jo l'? 0+,1090 Thr, floind ',oldie Manii 11.'4 Pin 11?110 , i, I
Al "AI" I101004 110(1(1)t f01?14.0,
thi, liot.I "Corrnoilon anti (Analog P.A./41111h," NOW
RePiiblle, u OCI(thee o. 12,
49, New York Thaes, I 6 Vehruary 1061, p. 9; Sions/pao. V/A/PP?
Moe,
Shale
..wes, 20 'ebruary, 1961, p. 1.
./. WACL?1,'s Growth and Outlook (Taipch: APACL, 1960).
r.,./Jaistian Science Monitor, 16 June 1970, p. 8; cf. 29 May
, 9%, p. 14: "Clearly the CIA is cognisant of, if not party to, the
..-.ensive movement of opium out of Laos. One charter pilot told
that 'friendly' opium shipments get special CIA clearance and
...onitoring on their flights southward out of the country. The
:..ime source aileed two or three flights without this 'protection'
er.:si-,ed under mysterious circumstances."
US Note of 29 April 1960 to UN Commission on Narcotic
E/CN.7/394, p. 2.
53. E/CN.7/394, p. 1; Free China and Asia, January 1959, p. 10.
54. Bernard Fall, Anatomy of a Crisis (Garden City, New York:
)oubleday., 1969), p. 99.
,5. The Thai police favoritism shown the KMT during 1952-
-.954 had been disavowed in 1956; and Prime Minister Phibun
.,tated at a public press conference, "The Kuomintang causes too
much trouble: they trade in opium and cause Thailand to be blamed
in the United Nations" (Skinner, p. 343). The next year Phao was
ousted from power by the present military rulers of Thailand,
amid reports that Phao, "a sort of local Beria ... ran the gold
exchange and opium trade" (New York Times, 6 November 1957,
p.
3.0.
_56. UN Commission on Narcotic Drugs: Report of the Seventeenth
Session (1962), EycN. 7/432, p. 11.
57. APACL, Free China and Asia (October, 1959), p. 14.
56. Free China and Asia, October 1959, p. 31.
59. In fact Veha Akhat was little more than a front for the Nation-.
..list Chinese airlines front which it chartered six planes and
On 19 February 1961, four days after the CAT/FCRA
plane was shot down by the Burmese, a Veha Akhat C-47 leased
from a Taiwan company was shot down over Laos; four of the six
personnel aboard were said to be Nationalist Chinese officers.
(Bangkok Post, 22 February 1961, p. 1; Singapore Straits Times,
22 February 1961, p. 3). The same year Taiwaa's second airline,
Positing, reported a decrease in its air fleet from three C-47's to
two. Foshing Airlines was headed by Moor. Chin, a former
Assistant Operating Manager of Pan Ant's China subsidiary,
CNAC, under William Pawley. .
60. Bangkok Post, 18 April 1964:
61. San Francisco Chronicle, 16 August 1971, p. 12.
62. It is striking that in 1961, when the CIA inaugurated covert
air operations front Saigon against North Vietnam, it spurned
the available planes and facilities of CAT at Saigon's Tan Son Nit ut
airport and set up a new, unrelated "proprietary," "Aviation
Investors, Inc.," d/b/a/ Vietnam Air Transport. Vietnam Air
Transport is said to have hired Nguyen Cao Ky, then fired hint .
a:fter learning that he used his "Operation Haylift" flights as a
cover for opium-smuggling from Laos to Saigon.
63. Stanley Karnow once named a "debonaire, pencil-moustached
Corsican by the name of Bonaventure Francisci" as one of the
top opium-runners in ,Laos ("The Opium Must Go' Through,"
Life, 30 August 1963, p. 12). The Prancisci family has been linked
to the Spirito-Venturi arm of the Corsican malia in Marseilles,
which in turn reaches to America through Syndicate associate
Vincent Cotroni of Montreal (US Congress, Senate, Committee
on Government Operations, Organized Crime and Illicit Traffic
in Narcotics, Hearings, 88th Cong., 2nd Sess., Washington, G.P.O.,
1964, pp. 956, 961; cited hereafter as Narcotics Hearings.) This
1...t.Tie dates back at least to the 19505, according to
Pera, a senior Narcotics Bureau official: "When French
imloch;r... existed, there were quantities of opium that were
shipped to the Labs ... around Marseilles, France, to the Corsican
rw,,rid there, and then transshipped to the United States"
(US CocigresN, Senate, Select Committee on Improper Activities
in tile i.t,or or Management Field, Hearings, $5to Cong., 2nd
Sess. (Washington: G.P.O., 1959), p. 12225 (cite,: hereafter as
,11..-0/.14/1/ Ilearings).
rq1-r.
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11
? 64.. An 1965 Bird's air heArRsVsVid o?E.BK2?AP..63P9d1Oc'IR
? newly created subsidiary of Continental Air Lines ,headed by
Robert Rousselot, a CAT and Air America veteran. The sale price
was said to have been over $1 million (Wall Street Journal, 23
August 1965, p. 20; Continental Airlines, Annual Report, 1965,
p. 13; New York Times, 27 August 1964, p. 6).
vaset55. US Congress, House, Committee on Government Operations,
US Aid Operations in Laos, House Report No. 546, 86th Cong.,
1st Sess. (Washington: Government Printing Office, p. 1959).
'p. 2; Hearings, p. 327; Neu, York Times, 24 March 1959, p. 19.
66. New York Times, 2 February 1962, p. 8.
67. Stanley Karnow, Washington Post, 16 March 1970, A10.
Theodore Sorenson records that "Chiang was . . . vexed with
Kennedy ... over our quiet pressure for the removal of his forag-
ing force from Burma" (Kennedy, New York: Harper, 1965, p.
661.) The KMT lobbied publicly for these troops to be given
the job of stopping communism as a "volunteer force" in Laos
. (Free China and Asia, December 1960, pp. 5-6); and were sup-
ported in the USA by elements in the Pentagon and American
Security Council (including Admiral Felix Stump, Air America's
Board Chairman). Western Laos was the area of the celebrated
"opium battle" of July 1967, between 800 KMT troops and the
forces of the opium-smuggling Laotian general Ouane Rathi-
kotine, who also figures prominently in the Laotian invasion fraud
of September 1959; San Francisco Chronicle, 16 August 1971, p.:
12; Feingold, in Adams and McCoy, Conflict in Laos, p. 323; Frank
Browning and Banning Garrett, "The New Opium War," Ram-
parts, May 1971, p. 34.
68. New Yoik Times, 19 March 1964, p. 4; Bangkok Post, 20
March 1964; New York Times, 27 August 1964, p. 6; South China
Morning Post, 22 June 1964, p. 1; Saturday Review, 11 May 1968,
p.44.
69. McClellan Hearings, pp. 15262-72.
:7c.iikkaGRALMO,31SPRQPAPPA499.?&.3
80. New York Times, 14 August 1959, p. 11; MeNsick, Lansky, p.
268. Allan Dorfman, whose friendship with Hoffa hclpcd win
Teamsters insurance contract for US Life in 1950, has recently
been indicted for accepting kickbacks on Teamster loan to the
Neisco Corp. (San Francisco Chronicle, 15 July 1971, p. 5).
Neisco's Chairman G. A. Horvath was Board Chairman and prin-
cipal. owner of the Miami National Bank in 1964.
81. The Thai King's general counsel in New York from 1945 to
1950, Carl 0. Hoffmann of OSS, is today Board Chairman of the
First Florida Resource Corp.
82. Reid, Grim Reapers, pp. 225-26.
83. Reid, Grim Reapers, p. 296.
84. Messick, Lansky, p. 241.
85. In March 1970, for example, Air America flew in tta
hundred Thal 'pontiff In lIore'llt1 1110, ?IlVit MI to lt,i1111t110
ill I
I ?'WSW, (Neill 1./Ilb 'PAM' PI/11111i f
Its Niel 0,011
SM. Ill1111 lolf 11101 S' I." if'
.11 41111 AI jiily 1911, p, .1.11 411,?,11 lI,ITTil/1.r,14
opium route im likely to do IUD 111(11V liii drivu the ionlmtry
further CAM."
70. Hank Messick, Lansky (New York: G. P. Putnam's, 1971),
p. 89. In 1968 Citibank refused to produce a $200,000 certificate
of deposit which had been subpoenaed in an investigation of
stock fraud. (New York Times, 1 December 1969, p. 42).
?
'40.1 71. New York Times, 13 May 1950, P. 34.
72. Pawley, on the advice of President Roosevelt and Tommy
Corcoran, sat up the Flying Tigers under a secret presidential
executive order, exempting him from the neutrality provisions of
the US code (Anna Chan Chennault, Chennault and the Flying
Tigers, New York, P. S. Eriksson, 1963, pp. 76-83). In 1949
Pawley petitioned the State Department to secure similar authori-
zation for the Commerce International (China) mission, but was
turned down (US Congress, Senate, Committee on Judiciary,
:Communist Threat to the United States through the Caribbean, Hear-
ings, 86th Cong., 2nd Sess., testimony of William D. Pawley,
2 September 1960, P. 729). Admiral Charles Cooke, later a
member of the American Security Council, proceeded anyway.
73. Washington Post, 9 September 1951, Al, AS; reprinted in
Congressional Record, Senate, 10 September 1951, p. 11066-67;
Reporter, 29 April 1952, pp. 10-11; Koen, p. 50.
74. T. A. Wise, "The World of Alexander Guterma," Fortune,
December 1959, p. 160. Also figuring in the Guterma scandals
were Matthew Fox, a former registered lobbyist for Indonesia
with possible CIA connections (Chester Cooper, The Lost Cru-
sade, New York, Dodd Mead, 1970, p. 52)' and William lirann, a
former intelligence agent. Guterma himself came from Shanghai
and the Philippines, and used Philippine capital to launch himself
into Florida land development.
75. Through Chesler's Seven Arts Productions, Ltd.; of Messick,
Lansky, p.,228; Ed Reid, The Grim Reapers, p. 107.
76. Messick, Lansky, P. 211.
77. McClellan Hearings, p. 12246.
78. The company's president was an officer for the realty invest-
ment interests of Lindsey Hopkins, Jr., himself an officer of CIA
proprietaries in Miami (e.g. Zenith Enterprises and Melmar, Inc.'
law' in the 19(0's). As a director of Sperry Corp. and its subsidiaries,
Hopkins nad been linked to William ?Pawley's establishment of
the Flying Tigers in 1941 (through a Sperry subsidiary, Inter-
continent Corp.). Through the Carl G. Fisher Corporation, Hop-
kins inherited a fortune in Miami Beach hotels, and took part in
the post-war land IxfizivniabihsriBrbitnad nitomear.
pd. CIA-RDP75600380R000300080002-3
associates, the former sCr11;er D
in a Las Vegas casino.
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TAB
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Next 12 Page(s) In Document Exempt
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Approved For RligneFgagniA2A:99K-.M.R:MoRoo0300080002-3
92d Congress 1
1st Session f
COMMITTEE PRINT
THE WORLD HEROIN PROBLEM
REPORT OF SPECIAL STUDY MISSION
COMPOSED OF
MORGAN F. MURPHY, Illinois, Chairman
ROBERT H. STEELE, Connecticut
PURSUANT TO
H. Res. 109
AUTHORIZING THE COMMITTEE ON FOREIGN AF-
FAIRS TO CONDUCT THOROUGH STUDIES AND INVES-
TIGATIONS OF ALL MATTERS COMING WITHIN THE
JURISDICTION OF THE COMMITTEE
MAY 27, 1971
U.S. GOVERNMENT PRINTING OFFICE
60-176 0 WASHINGTON : 1971
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Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
ERRATITM SHEET
TO
COMMITTEE PRINT
ENTITLED
"THE WORLD HEROIN PROBLEM"
On page 4, in the last line of the third paragraph
under the heading "Heroin addiction and crime in the
United States", the amount "$2,737,500" should be
"$2,737,500,000".
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Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
FOREWORD
HOUSE OF REPRESENTATIVES,
COMMITTEE ON FOREIGN AFFAIRS,
TV ashington, D.0 May 07, 1971.
This report has been submitted to the Committee on Foreign Affairs
by a special study mission conducted between April 3 and 23, 1971.
The findings in this report are those of the special study mission and
do not necessarily reflect the views of the membership of the full
Committee on Foreign Affairs.
TIO/VIAS E. MORGAN, Chairman.
(m)
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Approved For Release 2005/05/20: CIA-RDP75600380R000300080002-3
LETTER OF TRANSMITTAL
HOUSE OF REPRESENTATIVES,
COMMITTEE ON FOREIGN AFFAIRS,
Washington, D.0 ., May 27, 1971.
Hon. THOMAS E. MORGAN,
Chairman, Committee on Foreign Affairs,
House of Representatives,W ashington, 1.0 .
DEAR MR. CHAIRMAN: There is transmitted herewith a report of a
special study mission conducted between April 3 and April 23, 1971, by
the undersigned, both members of the Committee on Foreign Affairs.
We were accompanied by Dr. John J. Brady, Jr., staff consultant,
Committee on Foreign Affairs. Mr. Fred Flott-, Department of State,
acted as escort officer.
The purpose of the study mission was to gather information per-
taining to the illegal international traffic in heroin.
During the course of the trip, which took us around the world, we
met with United States diplomatic and military officials, parliamen-
tarians' foreign law enforcement officials responsible for narcotics
control and other foreign governmental leaders responsible for nar-
cotics matters in Switzerland, France, Italy, Turkey, Iran, Thailand,
South Vietnam, Hong Kong, and Japan. Prior to our departure we
met with officials from the Departments of State, Defense, Justice, and
Treasury, concerning various aspects of this problem.
We would like to express our thanks and appreciation for the assist-
ance, cooperation and hospitality extended to the members of the study
mission by Departments of State and Defense personnel in the coun-
tries visited.
In particular, we would like to thank the agents of the Bureau of
Narcotics and Dangerous Drugs, U.S. Department of Justice, with
whom we met in the several countries. It was largely through their
efforts that we were able to learn as much as we did concerning the
illegal production of, and traffic in, heroin around the world.
It is hoped that the information contained in this report will be help-
ful to the members of the Foreign Affairs Committee and the Congress
in their deliberations on the legislation pending on this subject.
MORGAN F. MURPHY, Chairman,
ROBERT H. STEELE,
Special Study Mission on
the World Heroin Problem.
(v)
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Approved For Release 2005/05/20 : CIA-RDP75600380R000300080002-3
CONTENTS
Foreword
Letter of transmittal
Introduction 1
The heroin problem in the United States 3
Heroin addiction in the United States 3
Consumption of heroin in the United States 4
Heroin addiction and crime in the United States 4
The source of illicit heroin 4
Illustration showing major illicit opium sources and flow through-
out the world Facing p. 6
Profits from the production, procssing and sale of illegal opium 5
The situation in France and Italy 7
France 7
Heroin production in France '7
The Marseilles heroin operation 7
French mechanism for control 8
Difficulties in controlling illegal heroin production in France____ 9
Italy 10
Italian efforts to control the illegal traffic in narcotics 10
Italian cooperation with the United States 11
The role of Turkey 12
Background 12
Attempts to control opium production 12
Economic factors involved in Turkish poppy growing 14
What Turkey has not done 14
United States-Turkish cooperation 16
The problem in Southeast Asia 18
Heroin addiction in the military services in South Vietnam 18
U.S. deaths from heroin abuse 18
Ready availability of heroin in South Vietnam_ 19
Heroin production in Southeast Asia 19
Major flow of illegal traffic 20
Smuggling into South Vietnam 21
The problem of corruption 22
What the governments of Southeast Asia are doing:
South Vietnam 23
Thailand 24
Burma 25
Laos 25
What the United States is doing to attack the heroin problem in
Southeast Asia 26
Iran and Japan 30
International cooperation to control illegal heroin traffic 32
International Criminal Police Organization 34
Other international organizations 35
Conclusions 36
Recommendations 37
Journal (schedule of meetings, interviews, and discussions) 40
Appendix: Note of presentation (transmittal sheet to Lao National
Assembly) concerning the draft law on the prohibition of the grow-
ing of the poppy, of the manufacture, consumption, sale, purchase,
and possession of opium 45
Page
zit
(VII)
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THE WORLD HEROIN PROBLEM
INTRODUCTION
Drug abuse around the world is increasing. Of particular concern is
the alarming rise in the use of opium-based drugs, particularly heroin,
in the United States, and the rapid increase in heroin addiction within
the United States military forces in South Vietnam, where the best
estimates are that as many as 10 to 15 percent of our servicemen are
addicted to heroin in one form or another.
To combat this growing menace around the world and at home the
United States must use every resource available. It must work through
international organizations; it must exert pressure on its friends and
allies to convince them of the need to take strong action either to con-
trol or eliminate the growing of opium poppies or to increase their
efforts to stop the illegal traffic in narcotics. Our Nation must provide
the leadership to make international cooperation to control the illegal
traffic in narcotics and other dangerous drugs more effective.
The battle to stem the alarming increase in heroin addiction will not
be easy, nor will victory come quickly. But the war against heroin must
be sharply accelerated?now. Given the increasing use of heroin among
our youth, immediate action is crucial. Unfortunately, time is not on
our side, and as this report is being written more young Americans are
becoming addicted to heroin.
Equally distressing is the fact that the United States alone cannot
bring an end to the waste and devastation that drug abuse, particularly
the use of opium and its derivatives, is causing among the youth of
the Nation. We must have the cooperation of the entire world.
For example, only a small percentage of the illegal heroin that
reaches the United States is confiscated by the authorities. There are
simply too many ways of hiding heroin, from small containers secreted
in various body orifices to hollow ski poles and food containers. There
are literally thousands of places to hide illegal heroin on board ships
entering U.S. ports. International air travel has complicated the
problem even further for it enables the courier or trafficker to
move quickly from continent to continent, arranging pickups and
payoffs personally, in addition to providing places to secrete illegal
shipments.
Once the poppy pod is cut and the opium gum extracted and sold on
the illegal market, the battle to prevent the end product, heroin, from
reaching the addict is lost. The problem must be attacked at the
source?in the poppy fields of the Near and Far East, principally in
Turkey, Thailand, Burma, and Laos.
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We must be willing to devote more resources, human and material,
to fight the illegal international traffic in heroin, including the exercise
of economic and political pressures where necessary. If that means the
imposition of economic sanctions or the exercise of political initiatives,
we must be willing to follow that course of action. We are fighting to
save generations of young Americans from the scourge of heroin. As in
any war, we must bring all of the weapons available to the point of
decision.
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THE HEROIN PROBLEM IN THE UNITED STATES
The problem of heroin addiction in the United States
The National Institute of Mental Health estimates that there are
250,000 heroin addicts in the United States. One-half of these are
located in the New York City area.
In 1970, 1,154 persons died as a result of drug addiction in the Na-
tion's largest city. One half of these deaths occurred among young
people 23 years of age, or less.
In a 1970 survey in the District of Columbia, heroin addiction was
estimated at 10,400 persons. In 1971, this estimate had risen to 16,880,
an increase of more than 60 percent.
There are approximately 9,000 heroin addicts in Chicago, according
to the Narcotics Squad of that city.
Heroin addiction among U.S. military forces has reached alarming
proportions. Reliable authorities estimate that as many as 10 to 15 per-
cent of the troops in Vietnam are using heroin in one form or another.
Some smoke it, some sniff or "snort," and approximately 5 to 10 per-
cent inject.
Five years ago the heroin problem was restricted to the ghetto areas
of our major cities. Now it is spreading to the suburbs and is found
among the children of the wealthy and well-to-do as well as among the
poor.
The heroin problem is also affecting U.S. industry. The Wall Street
Journal, quoting from a study conducted by the New York Chamber
of Commerce, reported last summer that "drug abuse in business?a
problem which was rare indeed, two years ago has overnight become?
in qualitative terms?almost as serious as that of alcoholism."
"The increase in drug abuse on company premises stems partly from
the spread of illegal drugs through high schools and college campuses
and U.S. troops in Vietnam," the report concluded.
And the number of addicts is increasing rapidly. In a statement
to the United Nations Commission on Narcotics at Geneva in Sep-
tember 1970, John E. Ingersoll, Director of the Bureau of Narcotics
and Dangerous Drugs (BNDD) said that "the list of addicts is grow-
ing by several thousand each year and, in 1969, the number of new
addicts doubled from the preceding year. Every time one addict is
cured, more take his place because of the ever-increasing amounts of
heroin available. Among the other debilitating consequences of the
addiction problem is that in New York City alone, persons are dying
of drug related causes at the rate of three per day."
Even these statistics, alarming as they are, may not tell the whole
story. Unfortunately, the extent of the addiction problem is difficult
to measure. There is no central agency in the United States which col-
lects all of the intelligence on the number of drug users and the figures
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provided by BNDD are minimal estimates since they are based only
on reporting from law enforcement agencies.
The statistics that are available, therefore, are only educated guesses
and the number of addicts may be greatly in excess of the estimated
250,000.
onsumption, of heroin in the United States
Based on the estimates that there are at least 250,000 heroin addicts
in the United States, it would take between 4 and 5 tons of heroin to
support the addict population.
Estimates of the cost of the heroin that the average addict requires
daily varies, however, from $30 to $100 per day.
Heroin addiction and crime in the United States
The habit of the narcotics addict is not only a danger to himself,
but to society as a whole. Narcotics have been cited as a primary cause
of the enormous increase in crimes committed over the past few years.
Whatever the price, the cost in property stolen by the addict to
support the habit is tremendous.
The estimated amount of money spent by heroin addicts in the
United States is $7.5 million per day. This figure is based on the fact
that there are 250,000 addicts, with an average habit (minimum) of
$30 daily. For this year, the estimated figure would be approximately
$2,737,500.
To support the habit, reliable authorities estimate that the addict
would have to steal goods worth at least 4 or 5 times the cost of his
habit per year.
If 75 percent of those addicted resorted to crime, using the above
figures, then, the cost in crime committed to sustain the habit would
be in excess of $8 billion per year at a minimum.
The source of illicit heroin
Most world poppy cultivation takes place within a zone extending
from the Plains of Anatolia in Turkey to Yunnan Province in China.
The international illegal traffic in opium has two major production
areas. The first area of importance for the United States is in the
Near East where opium produced in Turkey for legitimate medical
requirements is diverted to illegal channels. The opium is smuggled
to Syria and Lebanon where it is processed into morphine base. (A
certain amount of morphine base and heroin is also produced in Tur-
key.) The morphine base is then smuggled to the Marseilles area of
France where it is refined into heroin in clandestine laboratories. The
bulk of the heroin entering the United States is grown in Turkey and
processed in Marseilles.
The second important area is in the Far East, particularly in Laos,
Burma, and Thailand, and to a lesser degree, Yunnan Province in
China.
At least 1,000 tons of raw opium are Produced in the Shan states
of Burma, the border area of Yunnan Province in China, northern
Thailand, and northwestern Laos. This production is illicit and is
grown in areas where there is little or no governmental control by
either Burma, Laos, or Thailand.
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The central collecting point for the majority of this opium is at
a point where the borders of Thailand, Laos, and Burma meet. A
large proportion of the opium is designated for Southeast Asian opium
addicts. The remainder is either exported outside of Southeast Asia
or is refined into morphine base, the basic ingredient of heroin, or
heroin itself in laboratories located in the Burmese-Laotian-Thailand
border area, in Vientiane, Laos, in Bangkok, Thailand, and at other
points along. the Mekong. The heroin labs manufacture both No. 3
purple smoking heroin, which is used by Asian addicts, and No. 4
white heroin, which is produced primarily for the U.S. market and
for -U.S. troops in South Vietnam.
The main flow of No. 4 heroin to U.S. troops in South Vietnam
is through Laos and Thailand. In addition, large quantities of opium
and morphine base are smuggled into Hong Kong, where it is both
consumed locally and refined into No. 4 heroin for the U.S. market.1
U.S. narcotics experts regard Hong Kong of increasing importance
as a source of the heroin being smuggled to the United States from the
Far East. Current estimates are that at least 10 percent of the heroin
entering the United States comes from the Far East and that the per-
centage is growing. There is also evidence that some of the No. 4 heroin
appearing in Saigon also has its source in Hong Kong.
A Chinese traveler from Hong Kong was arrested at Ton Son Nhut
in April carrying 3.5 kilos of heroin. This could be the beginning of
a trend. When the heroin dealers in Hong Kong realize that a lucra-
tive market. exists among the Americans in South Vietnam, they will
undoubtedly attempt to get into the market.
There has recently been an increase in the amount of No. 4
heroin smuggled directly from Thailand to the United States.
Narcotics experts attribute the increase primarily to the expanding
activity of a number of ex-servicemen and U.S. nationals who have
served in Southeast Asia and have set up smuggling operations in
Thailand.
A certain amount of heroin is also produced from opium poppies
grown in Mexico. It is estimated that Mexico accounts for about 15 per
cent of the heroin which is smuggled into the United States. There is
no evidence available to suggest that the Chinese Communists are ac-
tively engaged in the illegal international traffic in opium or its
derivatives.
The major sources and flow of illicit opium is shown in figure 1.
Profits from the production, processing, and sale of illegal opium
One of the fundamental facts mitigating against solution of the
heroin problem iii both the T7-nited States and abroad is the tremen-
dous profit involved. From the prices paid to the poppy grower to the
Opium and morphine base are smuggled into Hong Kong primarily in Thai fishing
boats. It is processed into heroin in four or five clandestine laboratories. The authorities
in IIong Kong have a difficult time intercepting shipments from Thailand. The Thai fishing
boats dump the opium into Chinese Communist waters where it is picked up by one of the
11,000 junks that ply the waters around Hong Kong. The job of policing and seizing is
almost impossible. As in the case of Turkey, once the poppy is cut and the opium intro-
duced into illegal channels, the battle to prevent the end product from falling into the
hands of the addict is lost.
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retail price for pure heroin sold in New York, there is a $219,975
dollar mark-up as shown in the following table:
DEVELOPMENT OF RETAIL PRICE OF HEROIN IN THE UNITED STATES, 1969
United States
U.S. dollars per
U.S. dollars per kilogram of raw
kilogram opium equivalent
Price to farmer for opium (in Turkey)
$25
Wholesale price for heroin I (Marseilles)
5,000
$500
Border price for heroin (New York)
10,000
1,000
Wholesale price for heroin (New York)
22, 000
2,200
Retail price for heroin (New York)
220, 000
22, 000
I When raw opium is converted to morphine and heroin the volume is reduced by a ratio of 10 to 1.
Because of the tremendous profits that are realized as a result of
the illegal traffic in narcotics, there is always the possibility that
governmental authorities and police at all levels "can be bought."
Above all, some way must be found to take the profit out of heroin
smuggling.
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THE SITUATION IN FRANCE AND ITALY
FRANCE
Heroin production in France
Heroin is produced in illegal laboratories primarily in the Mar-
seilles area although some may also be produced in Paris and Le
Havre. The principal area is Marseilles because of the port facilities
and the large criminal element located there. Marseilles is also closer
to the source of supply, Turkey, than either Paris or Le Harve,
although there is evidence that increasing amounts of morphine base
are being smuggled into West Germany by Turkish nationals em-
ployed in that country. If this trend continues, other areas of Europe
could be used to produce heroin. This will be particularly true if cur-
rent efforts to close down the illicit laboratories in Marseilles prove
successful.
It has been estimated that 80 percent of the heroin entering the
United States originates in Turkish poppy fields and is processed
in France. French authorities question this estimate. From the dis-
cussion which the study group has had with authorities in France,
Turkey and the United States, this estimate is undoubtedly high. It
is fair to say, however, that the bulk of the heroin entering the United
States does originate in Turkish poppy fields and is processed in
France. According to the experts, French heroin is among the best
grade made due to the expertise of the French chemists who process
the morphine into heroin. By the time it reaches the addict in the
United States, it has been reduced to 4 to 6 percent purity.
The Marseilles heroin operation
Most of the illegal heroin producing laboratories are located on the
southern coast of France, between Nice and Marseilles, and possibly in
Corsica.
These laboratories are not large and a number are believed to be
mobile. They do not operate continuously as it does not take long to
process a shipment of morphine base into heroin. According to the best
estimates, there are probably only 5 to 10 laboratories operating at
any one time.
The poppy is grown in Turkey and the opium smuggled to Mar-
seilles by sea, air, and overland. Once it arrives in Marseilles it is
picked up by the purchaser and turned over to a chemist for
processing.
The chemist usually operates his own laboratory, frequently on a
free-lance basis. There is no one central organization commanding the
entire operation although cooperation among groups is not unusual. If
a shipment to one group is seized by the police, another group will help
by loaning it some morphine base to tide the losing group over until
it can arrange for another shipment from Turkey.
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It is estimated that there are five, and possibly ten, groups operating
at any one time with up to 100 individuals employed. Each group
appears to have its own courier and trafficking and purchasing opera-
tions. Over the past 10 years every narcotics case in Marseilles has
involved one or more of four Corsican families: the Venturi brothers
(Jean and Dominic), Marcel Francisci, Antoine Guerini and Joseph
Orsini. (Orsini himself served a prison term in the United States and
was deported in 1958.) There are offshoots of these four families and
ad hoc groups may appear from time to time, but these four families
are the heart of illegal heroin production in Marseilles. The problem
is that in France, as well as in the United States, the police must have
evidence upon which to base a case. The police cannot put the finger
on the families or people involved. French authorities are hampered
by the secret Swiss bank accounts as much as are U.S. authorities.
French mechanism, for control
Though France does not suffer to the same extent from heroin
abuse as the United States, there is a problem developing in that coun-
try. This has been a major factor in prompting French authorities to
increase their efforts to combat the availability of heroin in France.
An indispensable element in this endeavor has been a growing willing-
ness to cooperate with the United States in its efforts to fight heroin
abuse.
A French-American agreement setting up close cooperation between
the agencies specializing in the fight against the illegal traffic in drugs
in France and the United States was signed on February 26, 1971, by
Raymond Marcellin, French Minister of the Interior, and U.S. Attor-
ney General John M. Mitchell. Under the terms of the agreement both
governments have agreed to exchange narcotics agents in order to fa-
cilitate cooperation. Very considerable credit belongs to Mr. Marcellin
for assigning high priority to the anti-heroin effort.
The fight against drug abuse in France is centralized in the Office
of the Chief of National Narcotics and Dangerous Drugs Bureau.
There are three groups which deal with narcotics matters: the Cen-
tral Office, the Marseilles Service, and the Narcotics Service in Paris.
In 1969 there were 40 agents assigned to narcotics duties; today
there are 120 with the probability that this number will be increased
shortly.
In addition, between 6,000 and 7,000 police and gendarmerie and
others have been given training in narcotics control practices.
It was pointed out that under the centralized French system, num-
bers were not as important as emphasis.
If any information becomes available to any French authority, it
will be transmitted to the Central Office, although at the present time
French authorities are working largely from information provided
by the United States.
The French authorities believe that the effort against drug traffick-
ers must be secret. In their opinion the nature of the problem is such
that the less known about police methods and tactics, the better the
chances are for successful results. As a result, police throughout the
country sometimes work on narcotics cases without being completely
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aware of all the facts surrounding the case. This approach also serves
to prevent police corruption.
French police do very little undercover work. Under French law
even police officials are not permitted to get involved in narcotics
traffic. If they do, they are liable to criminal prosecution. In addition,
if it could be shown that the evidence was provoked by police activity
the case would be thrown out of court. As a consequence, the French
police depend upon U.S. personnel for their information.
Difficulties in controlling illegal heroin production in France
The French police have been able to locate and close only 13
laboratories over the past 20 years. Two were closed in 1969; one in
1964. One of those closed in 1969 was located in a villa approximately
25 kilometers outside of Marseilles. Finding this one was a result of
fine police work by both the French police and United States BNDD
agents working closely with the police. A man suspected of being im-
plicated in the narcotics racket was released from arrest. He went
directly to the villa and was followed by the authorities. When the
police raided the villa, the laboratory was in full operation.
The study mission inspected another building in the suburbs of
Marseilles which had housed the illicit laboratory that was closed in
1964. It was an innocent looking building, and if the authorities had
not been told by an informer that a laboratory was located in that par-
ticular building it would not have been discovered.
As a result of visiting these two locations, it became evident to us
that looking for an illegal heroin-producing laboratory is like looking
for a needle in a haystack. They can be set up anywhere in a short
period of time and they can be moved just as quickly.
At present, the only practical method by which they can be located
is through the use of informers. This takes time and money. Money
must also be available to pay the informer as well as for making a
purchase of the heroin from illegal sources in order to develop leads.
Both French and American authorities voiced confidence that their
efforts were progressing satisfactorily and that the Marseilles Service
and the Central Office were developing a force capable of effective
action in discovering and closing the illegal laboratories. There is a
steadily increasing spirit of aggressiveness on the part of the French
authorities in their efforts to stop the illegal production of heroin in
France.
The French authorities were also hopeful that scientific and tech-
nological developments would greatly assist them in their investiga-
tions. For example, now in the process of development is a sensory
device which, when perfected, will "smell" illegal laboratories in
operation. These devices will be mounted in helicopters which will
be used by the police to patrol the area. Unfortunately, the device
must be in an area when a laboratory is in operation if it is to be
useful to the police.
Helicopter-borne patrols are of considerable assistance to the police
and should be used. If nothing else, they can increase the sense of
police pressure that the narcotics manufacturer is beginning to feel
in France. The authorities were emphatic in their belief that, because
of French narcotics laws and police pressure, the laboratory oper-
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ators are beginning to "panic." Police pressure should, therefore, be
increased.
Consideration- should be given to making helicopters and trained
pilots available to the French until they develop their own capa-
bilities. If arrangements can be made with French governmental
officials it might be possible to place U.S. helicopter units assigned
to U.S. Forces in Europe on temporary duty in the Marseilles area.
While this would be only an interim solution to the problem, it would
be useful and it would enable the authorities to utilize one more
weapon in the struggle to stamp out illicit heroin production during
the period when the French are developing their own airborne patrol
capability.
ITALY
Italy is a transshipment point. It is estimated that 30 to 40 percent
of the raw material used to produce heroin either passes through
Italy or is hidden in vessels destined for France which stop at
Italian ports.
There is also the probability that some of the heroin produced in
France and elsewhere returns to Italy where it is then smuggled to the
United States. There are no firm estimates on the amount involved,
but it is considered to be substantial by knowledgeable experts. The
number of known heroin traffickers seen in Italy, plus the deep involve-
ment of a number of known Mafiosa in the United States form the basis
for this judgment.
There is also the possibility that heroin is being produced in
Sicily and Sardinia.
Italian efforts to control the illegal traffic in narcotics
Efforts by the Italian Government to control the illegal traffic in
narcotics have not been successful. For example, it is estimated that
the Italian authorities seize only about one-tenth of 1 percent of the
narcotics which reach that country.
There appear to be a number of reasons for this.
First, the Italian police agencies are fragmented and cooperation
depends upon personalities rather than institutional procedures. There
are three distinct national police agencies: The Finance Police, the
Public Security Forces, and the Carabinieri. Each is jealous of its
prerogatives.
In addition, a Central Narcotics Office (CNO) has been set up in
the Ministry of the Interior. Charged with the responsibility for coor-
dinating efforts to control narcotics traffic, the CNO does not always
get the cooperation of the police agencies or high-ranking government
officials.
Second, the Mafia is deeply involved in the narcotics traffic, and
high-ranking Italian Government officials aid that organization
throughout Europe. A commission has been appointed to determine
the extent of Mafia infiltration of the Italian Government. It will take
some time, however, before the results of this study are known.
Third, the Italians do not recognize the seriousness of this problem.
According to police authorities throughout Italy, there is no Italian
heroin problem. Consequently, there is no feeling of urgency to take
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immediate and effective action to coordinate their efforts to combat
this problem.
Fourth, the Italians will not take action to improve international
cooperation to stop the illegal traffic of heroin. They do not coordinate
their activities with the International Criminal Police Organization
(Interpol) in spite of the fact that that organization maintains com-
plete files on all known international criminals. Nor will they pass
information to Interpol. They have also refused to put any pressure
on Turkey to do anything about this problem. Another indication of
Italian attitudes is their refusal to participate in the Special Drug
Abuse Control Fund established by the United Nations until at least
three-fourths of the members have contributed.
Italian cooperation with the United States
There are BNDD agents in Italy working with the Italian author-
ities in an effort to interdict morphine passing through Italy and to
stop heroin from returning. These efforts are hampered by the need
to coordinate activities within the, several Italian police agencies.
Nevertheless, BNDD is helping and encouraging the Italians to im-
prove their capability to halt the drug traffic while waiting for the
Italian Government to centralize its operations in this area. Right
now, there is little or no cooperation between the Central Narcotics
Office and the several police agencies, including the local police. As a
matter of fact, the only successful seizures and arrests made in Italy
since 1962 have been made with BNDD assistance.
Ambassador Graham Martin has met with Italian Government
officials on at least three occasions requesting more cooperation from
the Italian Government, to no avail.
These efforts must be intensified. The United States must keep
the pressure on the Government, of Italy to take effective action and
should be prepared, if necessary, to supply aircraft, helicopters,
vehicles, communication and other equipment to help increase
Italian capabilities to deal effectively with the illegal traffic in
narcotics.
If there were no opium production in Turkey, however the illegal
laboratories in Marseilles could not exist. Nor could the illegal traf-
ficker profit in Italy. Solution to the problem has to be found in Tur-
key. If efforts to close the illegal laboratories in Marseilles, or to stop
the Italian trafficker are successful, the operation will move some place
else. Without morphine base it is impossible to produce heroin. The
Middle East-European aspect of the illegal international traffic in
narcotics can only be stopped at the source?in the poppy fields of
Turkey.
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THE ROLE OF TURKEY
Bacleg'round
Poppy cultivation is a tradition in the Anatolian region of Turkey
dating back to about 1900 B.C. During the 19th century, as world
trade greatly expanded, the demand for opium increased and between
1850 and 1900 cultivation spread and expanded throughout the entire
country as a cash crop and an important export. In addition to opium
gum, other important by-products include seeds for flavorino, and oil,
both of which have become a standard part of the Turkish farmer's
diet.
Although by 1900 the addiction and abuse of opium and its deriva-
tives had become a serious world health problem and the need for con-
trols was recognized, the political, cultural, social and economic differ-
ences between nations made achievement possible only through a
progression of treaties, culminating finally in their codification in a
Single Convention in 1961. The Single Narcotics Convention which
came into force in 1964 was ratified by Turkey in December 1966 and
by the United States in 1967. Under this agreement Turkey is recog-
nized as an opium exporter to the legal market.
Attempts to control opium production
Since 1967 Turkey has reduced the number of provinces legally per-
mitted to cultivate poppies from 21 to 7 for the 1971 harvest. It has
announced a further reduction to four provinces for 1972. During this
same period the legal production of opium gum has been reduced from
368 tons to an estimated 100 tons in 1970. It is estimated by reliable au-
thorities, however, that illegal production could be at least as much
and possibly twice that amount?more than enough to satisfy the
4 to 5 tons of heroin required by the addict population in the United
States.
Turkey has also tightened procedures for surveillance of poppy
fields, purchase from farmers, and curbing of illegal traffic, and in-
stituted efforts to encourage crop substitutions.
Under current practice, worldwide opium trade requirements are
determined by the United Nations Control Board. Based upon this,
the Turkish Government estimates how much opium Turkey should
produce in the following year. The Ministry of Agriculture then de-
termines how much acreage should be planted and in which provinces.
The Cabinet then passes an approving decree. The Ministry does not
tell the farmer how much land he can plant. Instead, the farmer de-
clares to the village headman how much he intends to farm and the
expected yield. These estimates are then passed to the Ministry of
Agriculture. The farmer is expected to abide by his declaration, but
under present law he is not required to obtain a license.
Control teams will be organized in each of the four provinces to
monitor the growing of poppies. These teams will inspect the fields
continually from the time of planting through the harvest. The con-
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trol team will also be responsible for inspecting those areas where
poppy cultivation is not permitted. To insure that the provincial con-
trol teams are managing the program properly other inspection teams
will be periodically sent from Ankara. To facilitate the inspection
process the United States will probably loan an airplane to the Turk-
ish Marketing Organization (TMO) to help in the surveillance. The
control teams will also educate the farmer on the reasons for and the
need to eradicate poppy growing in Turkey.
The Government of Turkey has also increased its efforts to purchase
the total opium crop being produced this year. Special instructions
have been given to the TM() wldcli is the agency responsible for all
purchases and sales of opium. In addition, the governors of the prov-
inces currently harvesting opium have been instructed to assure the
closest cooperation between TMO, Ministry of Agriculture, and law
enforcement agencies in their provinces.
The basic problem in any collection system is to get an accurate
measure of how much is actually planted and how much opium gum
is produced. If the above system is effective, the illegal production of
opium should be reduced. These procedures are not, however, a sub-
stitute for a licensing law. Under this procedure the only penalty is
to deny the farmer the authorization to grow poppies. These steps,
however, do represent an effort to bring poppy cultivation under
control.
Hopefully, once poppy cultivation is brought under control, the
next step should be a decision to stop growing poppies entirely. To
do this, the farmer must be taught. to grow other crops. This should
not be an insurmountable problem. Poppy cultivation represents only
a minor portion of the crop land. The poppy grower seldom devotes
more than one hectare to poppies. The poppy takes so much out of
the soil that there is a need to rotate crops. If modern farming meth-
ods could be introduced and crops that are easier on the soil developed,
the incentive to grow poppies might be removed.
To encourage crop substitution, the, Ministry of Agriculture has i
appointed at least one extension agent to each county n the poppy
cultivation area. Depending upon soil and climatic conditions, farm-
ers are being encouraged and assisted to switch to other cash crops,
including fruits and vegetables, safflower, sunflower, alfalfa, vetch
and wheat. A new high yielding winter wheat seed has been intro-
duced on the Anatolia Plateau which includes some of the poppy
growing provinces.
The matter of crop substitution is a long-term problem. The Gov-
ernment of Turkey has yet to develop any particular crop that would
pay the farmer the same amount of income as that derived from the
legal and illegal production of opium. While there are crops that
would pay the farmer the same amount. of money that he now derives
from the legal cultivation of poppies, there is no other crop which
would equal the total income from both legal and illegal production.
In an effort to induce the Turkish farmer to grow other crops, con-
sideration should be given to discontinuing poppies as a cash crop.
It is one of two crops grown in Turkey for which payment by the
Government is immediate. The other is sugar beets.
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If the Government were to increase the payments for sugar beets
and encourage the substitution of wheat or some other crop for the
poppy as a cash crop, the results might be encouraging. If necessary,
the Lmted States should help in this effort by vigorously pressing the
Turkish Government to consider this alternative and by furnishing
financial and technical assistance to implement such a program.
Consideration should also be given to the feasibility of increasing
the price that the Government pays the farmer for opium gum. This
action, combined with a strict licensing laws and other measures which
would make possession of, and trafficking in, illegal opium or its
derivatives a crime punishable by death, as in Iran, could produce
positive results.
.Economic factors involved in Turkish poppy growing
:If Turkey stopped growing poppies completely there would be
slight impact upon the Turkish economy. According to official Turkish
Government statistics, Turkey's total export earnings in 1969 were
4.8 billion Turkish lira (TL) or approximately $534 million, at the rate
of 9 lira to the dollar. Legal exports of opium products?opium gum
and poppy straw?in that year were valued at only TL 23.6 million or
$2,622,196.
Illegal sales of opium do not show up in these figures. If illegal
opium sales netted the Turkish farmer even three times that amount
or $7,866,588 this is an insignificant item in a total export earning of
approximately $534 million.
There are now approximately 80,000 farmers engaged in growing
poppies for opium production. In the late 1960's the average annual
earnings per farm was between $700 and $800. Ten percent of this
was derived from the sale, legal and illegal, of opium gum. This
represents approximately one-half of the total annual cash income
of the Turkish farmer. The Government pays between $10 and $15
per kilogram for legal opium. On the other hand, the farmer can sell
opium on the illegal market for at least $25 per kilogram. Thus, the
incentive is to sell to the illegal purchaser.
There is another problem. At present the farmer takes the opium
gum to the Government collector in his area who is supposed to weigh
the gum and pay the farmer on the spot.
In practice, the farmer is very often cheated: The TMO repre-
sentative responsible for the purchase of the opium gum: from the
farmer frequently waits 6 weeks before he weighs the opium gum.
During this time moisture in the gum has evaporated and the weight
reduced. As a consequence, the farmer gets less money and he feels
cheated. Under the circumstances it is no wonder that the farmer is
more interested in selling on the black market.
What Turkey has not done
In 1966 Turkey ratified the Single Convention on Narcotic Drugs.
Article 23 of the Convention requires that all parties enact licensing
laws to control the growing of poppies. To date, Turkey has not
passed a licensing law.
The principal reasons given are that domestic political realities
(approximately 80,000 farmers grow poppies) do not permit passage,
and that passage as a result of U.S. pressure would give the impression!
that the Government of Turkey is a "puppet of the United States.'
This is the basic document controlling the legal production of opium around the world.
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The Committee on Foreign Affairs has been studying this problem
since July 1970. At that time passage of the licensing laws was thought
imminent, before the Turkish Parliament adjourned during the first
week in August. No action was taken.
At the Geneva meeting of the United Nations Commission on Nar-
cotics in September 1970 the Turkish representatives pledged pas-
sage of a licensing law shortly after Parliament convened early in
November.
It is now May 1971 and no positive action has yet been taken by the
Turkish Parliament. In response to questions by members of the study
mission, a high-ranking Turkish official expressed strong belief that
a licensing law would be passed this year.
The Demirel Cabinet fell in March 1971 and a new Cabinet has
been installed under the leadership of Prime Minister Nihat Erim.
This government is a non-Party government and is more broadly
based than was the Demirel government. If it had the will to do so it
could pass quickly a law licensing the growing of poppies.
And while there are indications that the Prime Minister intends to
take action to control the growing of poppies, the study mission is of
the opinion that there, is no sense of immediacy on the part of the
Turkish Government.
An extract from the Erim government's program fully illustrates
this. "Our Government is of the opinion that opium smuggling, which
has become a destructive disaster of the youth of the world, is hurting
above all our humane feelings; therefore, due importance shall b
attached to this problem. Opium producers shall be provided with a
better field of occupation in farming."
Certain Turkish legislators questioned the inclusion in the pro-
gram of remarks on opium. The full response of Prime Minister Erim
is not available; however, observers present report that he took a
strong position in favor of opium production controls and then ex-
plained that opium production would not be discontinued com-
pletely until the farmers engaged in poppy farming and opium
production were provided with means of attaining a higher level of
subsistence.
While it is reassuring to learn that, the Government of Turkey is
aware of the problem, it is well to remember that actions speak louder
than words.
?If the United States is to solve the problem of heroin addiction at
home, it must have the active and effective, cooperation of the Turkish
Government, for only the Turks have the power and the authority to
control the growing of poppies. And while the United States can't
tell the Turks what to do in this matter, it must employ every avail-
able leverage to persuade the, Turkish Government to take whatever
steps are necessary to control and eventually discontinue the growing
of poppies.
As a measure of Turkish sincerity in acting on this problem, it is
essential that legislation controlling the growing of poppies be enacted
as a meaningful first step. While passage of a licensing law will not
solve the problem, it is required if the Government of Turkey is to
inhibit the flow of opium to the illegal market. Passage of this legisla-
tion would also demonstrate Turkey's desire to fulfill her treaty com-
mitments under the provisions of the Single Convention?commit-
ments that were made in December 1966.
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16
United States-Turkish cooperation
In September 1966 the United States began discussions with the
Government of Turkey to find ways to better control the production
of opium in Turkey. At that time poppy cultivation was permitted
in 21 provinces. Although production was prohibited throughout the
rest .of Turkey, enforcement agencies were poorly equipped and
relatively untrained for this type of control, resulting in an estimated
200 tons available for the illegal market.
By 1967, as a result of U.S. efforts and decreasing world opium
requirements, the Government of Turkey concluded that opium pro-
duction would not be an economic crop in the future and that steps
should be taken to reduce production. At the same time, the Govern-
ment decided that it needed to upgrade its enforcement capabilities
as well as to provide assistance to farmers to switch to other crops.
To assist in this effort, in 1968 the United States made $3 million
available from AID funds. Approximately $1.5 million of the loan
is being used to finance vehicles and equipment for enforcement
agencies and the remainder to finance research to develop alternative
crops and vehicles and equipment required by the Ministry of Agri-
culture to assist the farmer in switching to other crops.
All of the commodities programed under this loan have not been
received in Turkey. Bureaucracy and redtape have held up the clear-
ing of the commodities through Turkish customs, with the result
that much of the equipment sits around on the dock for substantial
periods of time. Steps are now being taken to insure that equipment
and commodities shipped for the use of the National Police and
gendarmerie will not be subjected to customs clearance.
In connection with this loan, the Government of Turkey has re-
organized the Turkish National Police and the gendarmerie in order
to develop a 750-man narcotic law enforcement groun. The head-
quarters of this group is located in Ankara and when fully developed,
it is expected that there will be 51 regional offices. At. the present time
it is estimated that half of the 750-man group has been trained and
deployed in the field.
Cooperation between the U.S. Bureau of Narcotics and Dangerous
Drugs and Turkish enforcement agencies has been excellent. BNDD
agents are now in Turkey working with their counterparts on narcotics
control. U.S. agents have reported little evidence of illicit production
in provinces where poppy cultivation has been prohibited, and such
crops, when found, have been immediately destroyed.
There have been suggestions that the United States make money
available to Turkey to buy up the entire poppy crop. They have been
rejected on the grounds that it would result in every farmer increasing
the land that he devotes to poppy cultivation.
The suggestion has also been rejected by the Turkish Government
on the grounds that the domestic political situation in Turkey made it
impossible. If this obstacle could be overcome, it is estimated that it
would cost about $5 million to buy up the entire crop.
Another proposal worthy of consideration has been made that the
U.S, attempt to purchase the entire illegal crop through the use of
undercover agents. This would have the effect of drying up the source
of morphine for the laboratories in Marseilles and if entirely success-
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ful would dry up the heroin supply to the U.S. market, at least tem-
porarily. Consideration might be given to this expedient as a stop gap
measure while other programs, such as crop substitution, are being
developed.
It was also suggested to the study mission by a leading Turkish
parliamentarian that a parliamentary group be established between
the Congress of the United States and the Turkish Parliament for the
purpose of discussing mutual problems in the field of narcotics control.
In the opinion of the study mission such a group would be beneficial
and would provide a useful forum for a meaningful exchange of views
on the subject. It should not, however, become merely a discussion
panel.
It has been argued that if the supply of opium from Turkey is shut
off completely, those engaged in the illegal production of heroin
would transfer their operations someplace else, possibly to Afghan-
istan, India, Iran, Thailand, etc.
There are valid arguments against this line of reasoning. In the
first place, the heroin obtained from poppies grown in Afghanistan is
low quality and cannot be produced in the quantities needed by the in-
ternational heroin dealer. Secondly, most of the opium grown in
Afghanistan is consumed either in Afghanistan or in Iran.
Iran has strict licensing laws and efficient collection procedures, and
most of what she produces is also consumed domestically.
India also has strict licensing laws and efficient collection procedures.
There is little evidence of a leakage of opium gum to the illicit market
from India.
Thailand, Burma, and Laos do present a problem. But it is a prob-
lem that will have to be faced under any circumstances, regardless of
whether Turkey produces opium gum or not. If the source of illegal
opium can be compressed, more resources can be applied to a smaller
area. This would enable the United States and the international com-
munity to concentrate its effort in Southeast Asia.
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THE PROBLEM IN SOUTHEAST ASIA
Heroin addiction in the military services in South Vietnam
Heroin addiction in the military forces of the United States is in-
creasing rapidly, particularly in South Vietnam where the best esti-
mates available are that 10 to 15 percent of all U.S. troops currently
in South Vietnam .are addicted to heroin in one form or another. It
is estimated that in some units heroin addiction might be as high
as 25 percent. Some smoke it; some sniff or "snort." From 5 to 10
percent of these inject. In the eloquent words of one concerned young
American currently serving in Vietnam: "It is ironic indeed that in
the last two years of the war our biggest casualty figures will come
from heroin addiction, not from combat."
Contributing to this epidemic use of heroin is its ready availability,
the frustrations and boredom growing out of the war, and the fact that
the drug culture in the Armed Forces reflects American society as a
whole. It is realistic to assume that many young Americans have
used heroin prior to induction into the military services.
However, most of the addicts in South Vietnam become addicted
in that country?usually within the first 30 days after entry.
Because of the quality of the heroin available in South Vietnam, it
is possible to become addicted through smoking or sniffing. The "high"
does not develop as quickly as when injected, but smoking or sniffing
does develop a physical need for heroin. Unfortunately, most of those
who smoke or sniff are under the dangerous illusion that heroin taken
in this manner is not addictive,. Nothing could be further from the
truth.
There is also a widespread belief among many American servicemen
in Vietnam that this heroin is actually cocaine, a non-addictive drug.
This, again, is not true.
Of the heroin users among the U.S. military in South Vietnam, it
is estimated that 40 to 45 percent sniff, 50 percent smoke, and between 5
and 10 percent inject. Because of the purity of the heroin all are addic-
tive, although according to medical authorities those who inject become
physically dependent. sooner than do those who sniff or smoke.
Those who have become addicted to the high quality heroin available
in South Vietnam will have no choice but to inject the much more
diluted heroin that is available in the United States. The military
services should, therefore, make every effort to detect and rehabilitate
addicts before returning them to civilian society.
U.S. deaths from heroin abuse
The rate of deaths resulting from drug abuse in South Vietnam is
increasing. Between August and December 1970, there were 90 deaths
which were suspected to have been drug related. Autopsy confirmed
that 59 of these had died from an overdose of heroin.
In January 1971 there were 17 deaths which were suspected to have
been drug related. In February there were 19 such deaths. Figures for
March and April are not yet available, but if this trend continues over
200 young Americans will die of heroin addiction in 1971.
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Ready availability of heroin in South Vietnam
Heroin is readily available to American servicemen in South Viet-
nam, particularly in Saigon. And it is cheap.
One quarter gram sells for as little as $2.50 and as much as $10,
while an eighth of a gram will sell for as little as $1.50 and as much as
$5. Most is purchased, but a large amount is obtained by military per-
sonnel who barter cigarettes and other post exchange items for the
drugs.
Contributing to the availability of heroin in Saigon is the large
number of U.S. military deserters who are engaged in every form of
criminal activity, including the selling of heroin.
According to figures provided by United States Army Vietnam
(USARV) there are 875 such deserters, although the figure varies.
Between 400 and 500 of these live in an area of Saigon which is
called Soul Alley. This area is "off limits" to U.S. personnel and one
enters at his own risk. Military police and others who have entered
the area have been assaulted, robbed, stripped of their clothing and
weapons and otherwise mistreated.
United States military efforts to conduct raids into Soul Alley have
failed.
The intelligence gathering capability of the inhabitants of Soul
Alley is excellent, and they are usually "tipped off" when a raid is
being planned.
Nevertheless -U.S. authorities in South Vietnam should surround
and raid Soul Alley and apprehend all U.S. deserters. While this would
not solve the heroin problem in Vietnam, certainly it would help.
Heroin production in Southeast Asia
Virtually all of the heroin being used by United States military
personnel in South Vietnam, and an increasing amount of the heroin
entering the United States, is produced from poppies grown in the
remote mountain areas of Burma, Laos, Thailand, and parts of
Yunnan Province in Communist China.
Unfortunately, no government exercises effective administrative or
political control over these areas.
Poppies are grown in areas occupied by hill tribesmen who have
been growing poppies for centuries. Some of the areas of Laos and
Thailand are infested with Communist guerrillas, if not actually con-
trolled by them, while rebel bands and remnants of the Koumintang
inhabit the poppy-producing areas in Burma and Thailand.
Burma, Laos, and Thailand produce an estimated 1,000 tons of
raw opium, or more than one-half of the world illicit output. Most of
this is consumed in the Far East and Southeast Asia. Practically all
observers are agreed that the largest group of users and addicts con-
sists of overseas Chinese. Burma, Laos, and Thailand may together
account for three-quarters of a million users and addicts, with Burma
having the largest share. Hong Kong may account for another 150,000.
Two different types of heroin are produced from the poppies grown
in this area?white and purple. There is little or no indigenous re-
quirement for white heroin in Southeast Asia?purple heroin is
smoked there.
The production of white heroin in quantity is a comparatively re-
cent development. There are no reliable statistics available to indicate
what proportion of opium production is processed into heroin, but it
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must be concluded that production is increasing in direct proportion
to the growing demand among Americans in South Vietnam.
The major flow of illegal traffic
The major flow of the traffic from the producing areas of Burma,
Laos, and Thailand is directed through the Mekong River Valley in
the latter two countries. Major cities in these two countries, such as
Luang Prabang, Vientiane, and Bangkok, serve as final markets, her-
oin processing- centers, and transshipment points, principally to South
Vietnam and Hong Kong.
The first major collections of the raw opium in Burma are made by
Koumintang irregulars and guerrilla armies of the Shan tribal
insurgents who themselves convoy the product southward for delivery
to wholesale operators in the cities. The latter arrange for conversion
to heroin and for the domestic and export distribution of both opium
and heroin. Often these wholesalers are prominent local businessmen.
In Laos, Government armed forces are major wholesalers of opium
and heroin and have been directly involved in large-scale smuggling
activities.
The major conduit, however, is Thailand.
From the American viewpoint, Thailand is as important to the
control of the illegal international traffic in narcotics as Turkey,
While all of the opium produced in Southeast Asia is not grown m
Thailand, most of it is smuggled through that country. Some of this
is processed into heroin which is smuggled to the United States by
couriers on commercial or military aircraft. Some is mailed to the
United States by U.S. military personnel using both commercial and
military postal services. Most, however, is smuggled into South
Vietnam through both Laos and Thailand.
Recently American citizens, mostly ex-military, have moved to
Thailand and have entered the business of smuggling heroin to the
United States.
According ? to -U.S. narcotics agents, the Bangkok operation is led
by an ex-U.S. serviceman, William Henry Jackson. Jackson operates
a place called the Five Star Bar in Bangkok, which is patronized
chiefly by black U.S. servicemen. According to the narcotics agents,
Jackson is assisted by other ex-military men, some of whom have moved
from Europe to Bangkok. According to the agents, the Jackson group
recruits patrons of the, Five Star Bar as heroin couriers to the United
States and utilizes other active duty military personnel to ship heroin
to the -United States through the Army and Air Force Postal System.'
Jackson is now wanted in the United States in connection with a
heroin seizure case, and American authorities are working with the
Thai Government to have him deported.
BNDD agents in Bangkok are of the opinion that Jackson is prob-
ably paying a Thai legislator for protection.
Bangkok is also the source of heroin for another major system en-
gaged in smuggling heroin into the United States?the. Okinawa sys-
1 The Bureau of Customs announced on May 9, that it made 248 seizures of narcotics
through Army and Air Force post offices from the beginning of March through April 24.
1971. It also announced that it had seized 17 pounds of heroin in a piece of military mail
from, Bangkok, Thailand, on April 5. The package, seized at Fort Monmouth, N.J., con-
tained heroin valued at an estimated $1.75 million on the street.
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tern. This system is composed of U.S. military and ex-military per-
sonnel allied with a few Okinawans. Efforts to contain this system are
hampered by the inability of authorities on Okinawa to initiate ade-
quate customs procedures at the cvilian airports. Most U.S. authorities
are convinced that this will change once Okinawa reverts to Japan and
Japanese law enforcement officials assume customs responsibility for
Okinawa.
These Americans who are engaged in this most despicable crime of
modern times carry U.S. passports with all of the privileges attend-
ant. They are enemies of the American people who do not deserve the
rights accorded to law-abiding citizens, and serious consideration
should be given to withdrawing the passports of these international
criminals.
Above all, the United States Government should inform the Thai
Government that a refusal to deport known U.S. heroin traffickers
could prejudice Thai-American relations.
Smuggling into South Vietnam
Heroin is smuggled into South Vietnam in a variety of ways. Some
is carried in commercial aircraft, some is air landed or air dropped.
Some is probably carried overland by North Vietnamese or Vietcong
using trail areas used for transporting supplies, and some is carried
in South Vietnamese vehicles and aircraft.
It is believed that the Laotian and South Vietnamese Air Forces are
deeply involved in this activity. Heroin has also been smuggled in Air
America aircraft although there is no evidence that any official of a
U.S. agency has ever been involved in the smuggling of heroin into
South Vietnam.
It is also possible to rent private aircraft in Southeast Asia and
the use of private aircraft for smuggling purposes is increasing.
It is assumed by the U.S. military that this activity reaches high
levels of command, to include the politicians, both in Laos and in
South Vietnam. We were told that there is information available that
high-ranking Vietnamese officials, including military, are mixed up in
drug operations.
Heroin is smuggled into South Vietnam from Bangkok by Thai
soldiers either returning from leave or those beginning a tour of
duty in South Vietnam. Many of these soldiers travel in U.S. mili-
tary aircraft. Unfortunately, there are no adequate customs pro-
cedures in effect and the That soldier enters South Vietnam unchecked.
Some is also carried in Thai aircraft, both military and commercial,
and some is thought to be mailed by Thai military personnel through
the postal system which the United States operates for the Thai
military serving in Vietnam. As one American official told us, "This
is an ideal situation for shipping heroin to Vietnam." Finally, some
heroin is thought to be carried in by American military personnel re-
turning from R. and R. Recent evidence indicates that Hong Kong
may be a limited source of the heroin reaching U.S. troops in South
Vietnam.
Once the heroin reaches South Vietnam from these various sources,
it becomes readily available in the streets of Saigon. The street peddler
i
who sells heroin s the low man on the totem pole. The structure of
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the illegal heroin market can be illustrated as a pyramid consisting
of four tiers:
Financiers and Backers
Producers, Smugglers and Importers
Drug Distributors
Street Peddler
If the financiers and backers who finance the narcotics business can
be uncovered and prosecuted, severe damage could be inflicted on the
entire operation, especially if strong measures are taken to deal with
the bottom three tiers of the pyramid simultaneously.
The problem of corruption
Official corruption plays an important part in the worldwide traffic
in heroin. The extent of corruption in Southeast Asia is difficult to
assess. Reliable sources report that at least two high-ranking Laotian
officials, military and governmental, including the chief of the Laotian
general -staff, are deeply involved in the heroin business.
In Thailand, a former diplomat and member of one of the most re-
spected Thai families is reputed to be one of the key figures in the
opium, morphine base, and heroin operations in that country and
throughout Southeast Asia.
Recently, a member of the South Vietnamese legislature, and friend
of high-ranking governmental officials, was arrested smuggling heroin
into Vietnam. The U.S. Military Command has supplied Ambassador
Bunker with the names of high-ranking Vietnamese officials it suspects
of involvement in the heroin trade, and believes that the corruption
has reached the point where only forceful intervention by President
Thieu can succeed in checking the traffic.
There have also been reports that Vice President Ky is implicated
in the current heroin traffic. The study mission was unable to find any
evidence to support this allegation.
In general the wholesale organizations trading in opium and opiates
seek to involve government officials in their activities by corruption.
Essentially, the wholesalers want both legal protection for themselves
and insurance for the dependability of their business operations. .In
order to provide deliveries of contraband in large volumes and with
regularity, the wholesalers seek to corrupt officialdom at fairly high
levels if possible. At the same time, officialdom itself may be vulner-
able to corruption because of the relatively large compensation it can
get for collaborating with the major traders. For this reason, some
officials are undoubtedly involved in illegal narcotics traffic.
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The involvement in the traffic of individual officials and military
officers in some other countries has also been reliably reported, as has
the use of diplomatic pouches for smuggling opium and heroin. In
no country, however, is there likely to be a flourishing illicit trade in
opium or heroin without the complicity of at least a few key civil
servants or police officers.
What the governments of Southeast Asia are doing
SOUTH VIETNAM
Most of the heroin in Southeast Asia is produced for Americans.
Until recently this led many governments to look upon heroin usage
as strictly an American problem and little was done to help stop the
illegal traffic. Addiction, however, is being discovered among the in-
digenous population, and the various governments are responding to
-U.S. initiatives in order to begin to get some control over this
problem.
This is particularly true in the South Vietnamese military forces.
We were told that during the South Vietnamese invasion of Laos, that
some South Vietnamese troops who had been transferred from other
areas of Vietnam on short notice had to be treated for withdrawal
symptoms. Some U.S. personnel supporting the operation were also
treated for withdrawal pains. The theory is that these troops were
moved so rapidly and on such short notice that it was not possible to
obtain sufficient heroin to satisfy their needs. As a result, one high-
ranking South Vietnamese official told the study mission that whereas
he had formerly looked upon the drug problem as an American prob-
lem, he now realized that it was becoming a Vietnamese problem.
Proper enforcement of South Vietnamese law would put a stop to
a large part of the illegal traffic in heroin in that country. Particular
emphasis must be placed on ending corruption in the customs service,
which has been responsible for large quantities of heroin entering
South Vietnam.
The possession of and the sale of heroin in South Vietnam is illegal.
Yet sales on the streets of Saigon are so blatant that several attempts
were made to sell heroin to members of the study mission as they
walked the streets of Saigon, accompanied by a uniformed member of
the United States Army.
As a result of American pressure the national police are becoming
more aware of the need to do something about this problem. The na-
tional police commander has promised to take action.
In this context, combined narcotics suppression committees have been
established in each military region. The membership consists of two
U.S. officers and two inspectors from the national police. The com-
mittee collects and evaluates information on narcotics smuggling and
informs the national police agencies of the need to take action to
arrest and prosecute offenders.
It is too early to measure the effectiveness of these committees. In
spite of the fact that heroin addiction has been a growing problem for
over a year, the committees were not established until February 1971.
The study mission was assured by U.S. Ambassador Ellsworth
Bunker that both President Thieu and Vice President Ky were con-
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cerned with the problem and are interested in stopping the illegal
traffic in heroin.
Promises and interest are not enough, however. Strong action must
be taken to stop the heroin traffic in South Vietnam. We are not opti-
mistic that the Government is either willing or able to take such
action.
One of the major reasons for pessimism is the internal political situa-
tion in South Vietnam, where differences between President Thieu and
Vice President Ky inhibits effective action being taken.
Vice President Ky was especially critical of the efforts being taken
by the Government of South Vietnam to solve the problem of heroin,
and stated that if he were given the responsibility of cleaning up
"the drug mess" in South Vietnam, he would produce concrete results
within 2 or 3 months.
The implication of this statement is that the Government is not
doing all that it can, or should. Some way must be found to convince
the South Vietnamese of the urgency of this problem and the absolute
necessity to solve it.
In the final analysis, neither South Vietnam nor the United States
can solve this problem alone. Both need the cooperation of the produc-
ing countries: Burma, Laos, and Thailand. Of the three, Thailand is
the most important, and the most able to take action.
TITAILAND
According to United States officials in Bangkok, the Thai Govern-
ment is taking some action to stem illicit heroin production.
Since producing opium is illegal in Thailand, there are projects
aimed at encouraging the hill tribesmen to grow other crops. These
programs consist of education and training in new farming tech-
niques and improved enforcement of Thai law.
The study mission visited a tribal research center which is situated
on the grounds of Chiang Mai University in Northern Thailand.
The research center is the research branch of the Hill Tribe Division,
Department of Public Welfare. Ministry of the Interior. One of the
problems which led to the creation of the research center was the
illegal cultivation of poppies in Northern Thailand. The Government
was desirous of eliminating the growing of poppies, yet the economy
of some of the hill societies is based upon the income derived from
opium sales. Prohibition, without the promotion of alternative cash
crops would have caused considerable hardships. In addition, the in-
ability of the Government to exert effective administrative control
over these areas would have doomed the project to failure.
In 1967 and again in 1970. the Thai Government requested the
United Nations to help by conducting a study on the economic and
social needs of the opium producing areas in Thailand.
There have also been efforts to resettle the hill tribes to other areas,
but this program has not been overly successful.
The Thai Government has initiated efforts to destroy the poppy
crops, but without great success. The areas are too remote and en-
forcement almost impossible because of the Communist inspired in-
surgency in the area.
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In 1962, the Thai invited U.S. BNDD agents into Thailand to
assist them in their efforts. Relations between BNDD agents and the
Thai police are improving. The Thai now permit BNDD agents to
operate undercover and to appear in court in narcotics cases.
BNDD efforts, at least until 1969, were hampered because funds
needed to do an effective job were not available. This situation has also
changed and sufficient funds are now being made available.
Much more cooperation on the part of the Thai government is re-
quired, however. The Thai must devote more resources to improve-
ment of their capability to intercept illegal shipments of opium, mor-
phine, and heroin.
The Thai Government must also institute adequate and effective
customs inspection, especially in the case of Thai troops and aircraft
going to and from South Vietnam.
The study mission was also of the opinion that the United States
Mission in Thailand should be more forceful in convincing the Thai
Government that the United States not only needs, but expects, rapidly
increasing action to stop the illegal traffic in opium and its derivatives.
Strong and effective measures by the Thai Government, however,
would not completely solve the problem. Poppies are also grown in
Burma and Laos.
BURMA
Poppies are grown in Burma under uncontrolled conditions. Due to
economic, social, and political factors, the Government is not able to
apply control measures required to implement their policies or in-
tentions of prohibiting, or to supervise and control the growing of
poppies and the production of opium. While much of the opium
produced in Burma is consumed locally, a considerable amount ap-
pears in the illicit traffic. It is bartered for goods or sold for cash.
Opium is very often the principal cash crop.
Burma has few economic, political, or cultural contacts with the
outside world as a result of the Government's acute sensitivity to
foreign influence. Because of this, U.S. relations with Burma are not
close, although they are "correct and friendly."
Any reduction in the amount of opium produced in Burma will
take time. The Government must be strengthened and some way found
to convince the opium producers to grow other crops.
There is little that the United States can do unilaterally to bring
this about. It can, and must, however, urge the United Nations to
help.
LAOS
The Laotians are deeply involved in the growing of poppies and in
the production of heroin. Opium is the principal source of income of
the ethnic minorities in Laos.
The possession of opium in Laos is not illegal at the present time.
There is a law being considered which would make such possession
illegal. Even if the law passes, enforcement will be next to impos-
sible because of the inability of the Laotian Government to exercise
effective political control over most of Laos. A copy of the proposed
legislation, including the note of presentation, is included in the
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26
appendix. This proposal, which was first drafted in 1963, will be pre-
sented to the National Assembly, hopefully in May 1971.
There are other steps that the Laotians can take to assert some
control over the illegal traffic in opium and its derivatives. From the
evidence available, there is no doubt that the Laotian military is
deeply involved in the international traffic in -heroin. Heroin is proc-
essed in laboratories located in Laos, and what is not smuggled
through Thailand is smuggled through Laos, primarily by air in
Laotian Air Force planes. While there is little likelihood that the
Laotian Government will gain control over its territory in the near
future, it can, and must, take action to reform its air force and elim-
inate the corruption which permits the drug traffic to flourish.
It should also be pointed out that tribesmen who grow poppies in
the non-Communist part of Laos are some of the most effective re-
sistance fighters against the North Vietnamese and the Pathet Lao.
They depend for their livelihood upon opium production. The United
States should consider the feasibility of buying up the opium crop
each year, while encouraging and assisting the tribesmen to grow
other crops. Such a program would probably cost at the most $10
million annually. In 5 years however, it would not equal the amount.
of military assistance that the United States gives to Laos annually to
enable it to remain non-Communist. If it is in the national security in-
terests of the United States to save 3 million Laotians from communism,
it certainly is in the national security interest of the United States to
spend whatever is necessary to save generations of young Americans
from heroin addiction.
In summary, the heroin problem in Southeast Asia is a regional
problem. It transcends national boundaries and the operations in one
country are dependent upon the operations in the other. Efforts to
combat it must, therefore, be regional in scope. And the United States
must push the fight against heroin as vigorously as it has conducted the
fight against Communist aggression in Southeast Asia.
For years the United States has been encouraging regional economic
development in Southeast Asia. It is discouraging that the most success-
ful regional commercial development has been the illicit production
and sale of heroin.
What the United States is doing to attack the heroin problem in
South Vietnam
Steps are being taken by the United States Government in South
Vietnam at both the diplomatic level and the military level to combat
the growing heroin problem.
The study mission learned that the United States has made a strong
appeal to the Government of South Vietnam to take action in this
area. In a strongly worded memorandum, the U.S. Ambassador pointed
out that "continuation of illegal traffic in drugs, particularly heroin,
will have a serious impact on American support of the national effort."
Because there has been criticism of U.S. diplomats for not pressing
the narcotics issue forcefully enough with host governments, it is only
fair to say that the study mission wholeheartedly supports the efforts
of the Embassy in South Vietnam. Following is an extract from the
paper:
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DRUG ABUSE
GOALS
Accordingly it is suggested that the following goals be established:
1. Recognition by all Vietnamese offidals and citizens of the magnitude of the
drug problem and the serious impact that a continuation of illicit traffic in drugs,
particularly heroin, will have on the American support of the national effort.
2. Development of a national will to eradicate trafficking in drugs.
RECOMMENDATIONS
To achieve these goals it is specifically recommended that the President of
Vietnam:
1. Issue a circular in the immediate future, through both civilian and military
components of the government, indicating your concern over the accelerating
drug problem and the apparent involvement of large numbers of Vietnamese in
drug trafficking. This circular should specifically mention the trafficking of heroin
and the danger this highly addictive narcntic currently poses to the physical well-
being of Americans as well as the future danger it poses to Vietnamese citizens.
This circular should be followed by a decree which specifically legislates against
trafficking in heroin and which imposes severe penalties for doing so.
2. Appoint a Presidential Task Force of highly qualified, dedicated and honest
investigators to ferret out, investigate and prosecute the financiers and backers
who comprise the powers behind drug trafficking. These men are responsible for
manipulating, fostering, protecting and promoting the illicit traffic in drugs. They
include influential political figures, government officials and moneyed ethnic
Chinese members of the criminal syndicate now flourishing in the Cholon sector
of Saigon.
3. Initiate action to establish a comprehensive drug training program for all
law enforcement elements within the Republic of Vietnam, to include prose-
cutors. Such training would be directed primarily at heroin, its characteristics
and the danger it poses to the physical well being of users.
4. Initiate immediate action to arrest all importers, distributors and street
peddlers involved in the distribution and sale of drugs, especially heroin. Further,
that stringent penalties be levied against these people to preclude their return
to these activities.
5. Initiate action to form a specialized narcotics section within the Customs
Fraud Repression Service. Such a section would devote its energy to combat
the smuggling of drugs, especially heroin.
6. Take immediate action to have existing customs regulations enforced.
Specific actions that must be taken are:
(a) Unauthorized personnel must not be allowed to handle any items of
cargo or baggage until such items have been properly cleared by customs
officin is.
( b) Existing customs regulations pertaining to the actual processing and
searching of individuals and all classes of cargo/personnel must be adhered
to rigidly.
7. Initiate action to enforce existing health and welfare laws as they pertain
to the sale of pharmaceutical products (dangerous drugs) throughout Vietnam.
No such products should be sold to American servicemen without the required
prescription.
U.S. military authorities in South Vietnam are also aware that the
problem of heroin addiction has reached epidemic proportions and
must be solved. To do this, a four-point program has been developed,
consisting of education, amnesty, rehabilitation, and suppression.
Education programs have been expanded at all levels of command
where the consequences of drug abuse are stressed. There are also
programs aimed at educating noncommissioned and commissioned offi-
cers in the detection and control of drug abuse in their units.
An education program to be effective must stress the dangers inher-
ent in the illegal use of drugs and the dangers it poses to the health and
future of the user. It must be current, accurate, and hardhitting.
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There has been criticism that material provided for use in Vietnam
does not fit these requirements. According to one recognized author-
ity, more use should be made of films which "tell it like it is." These
films should be kept up to date and they should focus on the problem
in South Vietnam.
Amnesty programs have been instituted. Basically, amnesty is a
promise of freedom from punishment in exchange for accepting medi-
cal treatment and rehabilitation. Under this program when an addict
requests rehabilitation treatment and medical assistance, he is admitted
to a rehabilitation center where he undergoes treatment for his addic-
tion. To prevent the amnesty program from being used as a vehicle to
escape from combat and to discourage resumption of the habit, an in-
dividual is permitted to request amnesty only one time.
While there has been no success in curing those who inject, there
have been some successes in curing those who sniff or smoke. There
are very few statistics available concerning rehabilitation programs.
They must, therefore, be used with caution.
For example, during the first quarter of 1971, 3,458 heroin users
participated in the rehabilitation program. Of this number, there
were at least 703 known unsuccessful participants. There are no
figures available which estimate the rate of cure of those participat-
ing. From statistics that are available, the rate of cure is not en-
couraging. For instance, of 532 addicts treated at Pioneer House, an
amnesty and rehabilitation center located in Long Binh, between Octo-
ber 1970 and March 1971, there were reported 149 successful cures, 94
failures, and 249 in the unsure category.
An important part. of the rehabilitation program is the counseling
received during the treatment period. Even here, the program is vul-
nerable. For instance, the week before the study mission visited Long
Binh, two counsellors at Pioneer House were arrested, one for using
LSD; the other for using heroin.
Another problem emanates from the requirement that the amnesty
and rehabilitation program is entirely voluntary. The individual is
free to leave the center at any time. In the past, people have walked
out of the rehabilitation center before they were cured. They will prob-
ably do the same in the future.
But perhaps the most serious shortcoming of the drug rehabilitation
program is that there is not a coordinated Vietnam-wide effort to
establish rehabilitation centers. Responsibility is delegated to major
commanders. Some commands support the effort fully. Some distrust
the concept and take little or no interest in the program.
Several steps have also been taken to suppress the use of drugs, par-
ticularly heroin, in South Vietnam. Drug-abuse councils have been
formed in every unit down to battalion/squadron level to provide
analysis, evaluation, and monitoring of a.11 aspects of narcotics and
drug suppression. A combined antinarcotics enforcement committee,
composed of Vietnamese and American forces, has also been estab-
lished in each military region to eliminate the illicit traffic in narcotics
within the civilian community of the Republic of Vietnam.
In addition, a Joint United States/Republic of Vietnam Narcotics
Investigative Detachment will concentrate its efforts on the illegal
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drug supply and trafficking problem to interdict and eradicate drug
sources before the heroin reaches military personnel. This detachment
is made up of representatives from the several U.S. military investi-
gative organizations, the Vietnamese Military Police, and the Viet-
namese National Police.
Simultaneously, a Joint U.S. Customs Group has been established
to assume responsibility for all military customs operations in Viet-
nam to include postal, household goods, unaccompanied baggage, and
the processing of accompanied baggage and personnel arriving or
departing South Vietnam. This unit is responsible for all customs
enforcement, including narcotics.
Hopefully, these steps will help reduce the availability and use of
heroin by U.S. personnel in South Vietnam.
There is one other aspect of the problem which is of concern to
military authorities in South Vietnam?they have no adequate and
reliable procedures for detecting the heroin addict. As part of the
drug-suppression program, new and more complete surveying tech-
niques are to be employed and statistical data will be collected and
compiled on a commandwide basis.
Measures must be taken to improve the reliability of addict detec-
tion procedures. If possible, the development of a simplified urinalysis
test should become a matter of first priority for medical authorities. If
this is not feasible, adequate laboratory facilities should be furnished
down to battalion and squadron level. Every soldier should be required
to undergo periodic urinalysis, especially before his return to the
United States and absolutely before his separation from the military
service. If the serviceman who has become addicted using 94- to 97-
percent pure heroin in South Vietnam enters the drug scene in the
United States where the heroin available is 4 to 6 percent pure, the
ominous implications are obvious for himself, his family, and for
American society. In the absence of the heroin available in South
Vietnam, the only alternative for one who has become addicted through
sniffing and snorting will be to inject.
Implementation of the above program must receive the highest
priority at every level of command, and it must be pushed with a
greater sense of urgency than has been the case. In spite of the fact
that drug abuse has been a growing problem in South Vietnam for
over 1 year, the directive setting out the program to combat it was not
issued until December 1970.
While U.S. military and diplomatic personnel in Southeast Asia are
concerned about the problem, the study mission is of the opinion that
a greater sense of urgency is needed.
For example, when we arrived in Bangkok, we were told that there
was a regional conference being held to discuss the problem of drug
addiction among U.S. military personnel in Southeast Asia. All U.S.
agencies responsible for the drug problem were represented at the
meeting. This included military, Bureau of Customs, the Bureau of
Narcotics and Dangerous Drugs, and U.S. diplomatic personnel.
While it was encouraging to note that this conference was finally
held, such action should have been taken much sooner to mobilize the
resources available to take strong coordinated action to stop the illegal
traffic in heroin.
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IRAN AND JAPAN
The study mission also traveled to Iran and Japan in an effort to
determine what impact, if any, those countries had upon the heroin
problem in the United States. We are happy to report that there is no
evidence to suggest that either contributes in any way to the illegal
production and smuggling of heroin into the United States.
What was of particular interest to us was the approach that the two
countries have taken, and are taking, to control heroin addiction.
In both, these procedures are aimed at suppression of the illegal
traffic, rehabilitation of the addicts when found. and strict justice for
those convicted for illegal possession of, or trafficking in, heroin.
IRAN
Iran has one of the largest heroin using populations in the world?
approximately 50,000. Unlike the United States, 90 percent of the
heroin used in Iran is produced illegally in that country. The remaining
10 percent required by the Iranian heroin addict population originates
in the poppy fields of Turkey.
In 1955, because opium addiction was undermining the health of the
nation, Iran banned the growing of poppies.
By 1969, discouraged by the lack of movement on the part of Turkey
and Afghanistan, and alarmed by the gold drain which covered the
cost of illicitly imported opium, Iran authorized limited poppy culti-
vation under strictly controlled conditions.
Iran has strict opium collection procedures and the poppy crop is
closely monitored from planting until the harvest of the opium gum.
And whereas the Government of Turkey pays the farmer $10 to $15
for opium gum, the Government of Iran pays $90. This, of course, ex-
plains in part why there is little or no leakage of opium gum from the
licit to the illicit market in Iran.
There are other reasons. If the farmer in Iran violates the law, he
forfeits his license to grow poppies. And if an individual in Iran is
convicted of possession or trafficking in heroin, he is executed. (Since
1969, 86 people have been shot for offenses involving heroin.)
In the past, Turkish smugglers moved raw opium into Iran. As a
result of strict enforcement of Iranian narcotics legislation and efforts
by both Turkish and Iranian Governments to combat smuggling, the
amount of opium introduced from Turkey has been reduced dramati-
cally. Now, however, instead of smuggling raw opium, the Turks are
smuggling morphine base and heroin. This is a new development.
It is easier to deal in morphine gum or heroin which has one-tenth
the bulk of opium gum. In addition, opium gum has a distinctive odor
and in hot weather is extremely difficult to conceal while morphine
base or heroin is almost odorless.
This poses a potential problem of severe dimensions for the entire
international effort to control the illegal traffic in narcotics.
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The evidence suggests that the drug traffickers in the Marseilles area
of France are becoming concerned at the increasing pressure being
applied by the French authorities in cooperation with U.S. Bureau
of Narcotics and Dangerous Drug agents. It is thought that they may
be looking for other areas in which to operate their illicit lab-
oratories. If heroin is produced in Turkey, at the source of the
opium gum, it will remove the necessity to smuggle opium gum or mor-
phine base to France. The long, circuitous route from Turkey to Mar-
seilles provides an opportunity for law enforcement agencies to
intercept the shipment at any step along the way and particularly in
Marseilles where it is halted long enough to be turned into heroin.
If, on the other hand, heroin production takes place in Turkey on a
scale large enough to provide the illegal heroin formerly produced in
Marseilles, interception will become much more difficult.
It is obvious that Turkey must introduce effective opium production
controls and work toward a complete abolition of opium production.
The heroin problem in Iran and the United States is fueled by the
opium that originates in Turkey, and it is that country that can do the
most toward helping to solve the heroin addiction problem.
JAPAN
The Japanese have been able to control heroin addiction. Since 1964
they have succeeded in reducing their heroin addict population from
approximately 50,000 to only several thousand.
The success of Japanese efforts to control addiction is due to effec-
tive Japanese police work and to strict penalties dealing with the nar-
cotics pusher.
The maximum penalty is 10 years in prison for smuggling or selling
heroin.
If a man is arrested for heroin pushing, there is no bail permitted.
He must be charged within 48 hours, however. The police can hold the
suspect for 10 days during which preindictment investigations are
conducted. At the end of 10 days, he is turned over to the prosecutor
who has an additional 10 days to bring the accused to trial. If neces-
sary, the prosecutor can request an additional 10 days before com-
mencing trial. Therefore, an individual arrested for possession of
heroin can be held for 30 days without bail.
It is the opinion of the study mission that law enforcement officials
and legislators in the United States should study the methods used
by Japan to deal with this problem.
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INTERNATIONAL COOPERATION TO CONTROL
ILLEGAL HEROIN TRAFFIC
It is obvious that if the illegal traffic in heroin is to be brought
under control international cooperation is needed. The most imme-
diate problem is to control the cultivation of poppies and the produc-
tion of opium.
The production of legal opium ,is regulated by the International
Narcotics Control Board (INCB) 'through the provisions of the Sin-
gle Convention of 1961 which became internationally effective Decem-
ber 13, 1964.
The Board is entrusted with enforcing the provisions of the Single
Convention. The Board asks both parties and non-parties to the Con-
vention for estimates of drug requirements and existing stocks and
statistics of production, consumption and seizures each year, and by
article 12(3), if estimates are not forthcoming, the Board can fix
them. Among the weapons which the Board has are requests for in-
formation and explanations, public declarations that a country has
violated its obligations, and under article 14(2), a recommendation
to parties that they impose embargoes on imports and exports against
an offending country.
Member states are also required to license the growing of poppies
and to control trade by granting export licenses only when the im-
porter produces an import certificate from the importing country. A
third country is not to allow drugs to pass through its territory with-
out a copy of the export authorization.
The provisions of the Single Convention, however, apply only to
the control of legal production of opium. They provide essentially vol-
untary restraints on parties with respect to cultivation of the opium
poppy, production of opium, manufacture of opium-derived drugs and
import and export of these substances. The United States has pro-
posed amendments which, if adopted, would provide the INCB with
authority to control production and illegal traffic in narcotic drugs.
It is hoped that a conference to consider the proposed amendments
would meet early in 1972.
While the study mission fully supports U.S. efforts to strengthen
the ability of the international community to restrict narcotics activity
to legitimate medical and scientific purposes, it is of :the opinion that
such a conference should be convened as soon as possible and not wait
until early in 1972. Time is essential and the United States should
impress this fact on the international community at every opportunity.
The problem, however, is not the control of legal production, but
to find ways to stop leakage of opium to the illegal market. Some
countries such as India, Iran, the Soviet Union, and Yugoslavia have
been relatively successful in accomplishing this. Others such as Turkey
have not.
(n)
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Complicating the problem are those areas of Afghanistan, Pakistan,
Burma, Laos, and Thailand were opium poppies are grown illegally
and under uncontrolled conditions.
Because of the amount and quality of heroin produced from the
poppies grown in Burma, Laos Thailand, and Turkey, international
efforts to control the illegal traffic in heroin must be concentrated on
those four countries.
Experience has demonstrated that the only way to control this prob-
lem is to control it at the source?in the poppy fields.
The United States can, and should, exercise what bilateral diplo-
matic and economic pressures it can to encourage its friends and allies
to take action to stop opium production. It is also necessary to obtain
the cooperation of the United Nations.
Acting upon the initiative of the United States the United Nations
did agree to establish a Special Fund for Drug Abuse Controls, to
be made up of voluntary contributions and used to develop short-
term and long-term plans and programs to bring the problem of drug
addiction under control.
The United States pledged $2 million and on April 1, 1971, the Per-
manent U.S. Representative to the United Nations made the first $1
million payment. Unfortunately, the United States is the only coun-
try to have pledged any money, although one other, West Germany,
has announced unofficially that it will pay approximately $350,000
into the fund.
This is disappointing. With addiction increasing around the world,
particularly in the United States, there is an immediate need for effec-
tive action and cooperation.
According to the Secretary General, the purpose of the drug abuse
fund will be to develop short-term and long-term plans and programs
and to provide assistance in the execution of those plans and programs.
During the initial stages of the Fund, pending the completion and
submission of a proposed long-term policy and plan of action which
would deal with all aspects of the problems related to drug abuse con-
trol, the voluntary contributions to the Fund will be used for specific
projects to be included in a short-term program without prejudice to
on-going projects. The short-term program will consist of projects
to expand the research and information facilities of United Nations
drug control bodies; to plan and implement programs of technical
assistance in pilot projects for crop substitution purposes, the es-
tablishment and improvement of national drug control administra-
tions and enforcement machinery, and training of personnel, and in
setting up or expanding research and training centers which could
serve national or regional needs; to enlarge the capabilities and ex-
tend the operations of United Nations drug control bodies and their
secretariats; to promote facilities for the treatment, rehabilitation and
social reintegration of drug addicts; and to develop educational mate-
rial and programs suitable for use on high-risk populations.
While this is a commendable program and should be encouraged
it does not go to the heart of the problem?how to stop the illegal
traffic in heroin now or how to get Turkey to honor her international
treaty obligations by passing a law licensing the growing of poppies;
or what is to be done to control the growing of poppies and the pro-
duction and smuggling of heroin in the Far East.
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These are the basic problems and, if necessary, the United States
should be willing to make funds available to the United Nations,
or to the individual countries, so that they might begin to deal with
them.
The United States also must convince the world community of the
urgency of this problem.
International Criminal Police Organization (Interpol)
Essentially, the purpose of Interpol is to enable police forces
in the different countries to coordinate their work effectively in the
double aim of law enforcement and crime prevention.
Interpol is not an enforcement body, nor is it an investigating body.
It collects, collates, stores and disseminates information on known
international criminals.
It has a staff of 107, of which 12 devote full time to narcotics
matters.
Interpol is hampered in its efforts to assist in the control of nar-
cotics by?
(1) Bad communications between police units in the member
countries;
(2) Corruption in the police units or on a higher national
level; and
(3) Poor administrative and police control over large parts
of the country such as in Thailand, Laos and Burma.
Another problem is that Interpol does not receive a great amount
of intelligence from member countries concerning the smuggling
of narcotics. If a foreign national is arrested for a narcotics offense,
the national police are required to provide Interpol with all of the
information surrounding the case. This is not always done. Until
January 1971 one of the greatest offenders was the United States.
?The United States is also currently behind in its dues to Interpol.
The dues were increased in 1969 from $28,500 per year to $48,780.
The United States needed legislative authority to pay the difference?
authority which has not yet been granted.
There have been a number of suggestions made that Interpol could
increase its effectiveness by improving its communications facilities
and by computerizing its operations. The Study mission discussed this
with Interpol officials at some length. Although it was the considered
opinion of those experts that such improvements would make Interpol
operations more efficient, they pointed out that there were no funds
available for this: Interpol operates on an annual budget of less than
$1 million and any additional equipment would require an increase in
the annual dues.
It has been suggested that the United States should make money
available to Interpol to introduce these modernization programs. This
could be done but it should be done with caution and in such a way as
to preclude the assumption that the United States is trying to "take
over" Interpol.
The United States should consider ways to improve the communi-
cations capabilities of Interpol and the member countries, either on a
bilateral basis or through the Interpol apparatus.
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Other international organizatian,8
In addition to action in the United Nations and increased coopera-
tion with Interpol, the United States should also consider putting pres-
sure on our allies in the North Atlantic Treaty Organization (NATO)
and the Southeast Asia Treaty Organization (SEATO). Both are
mutual security treaties and both pledge action against a common foe.
Heroin addiction is an enemy of mankind and all the world's resources
should be mobilized against it.
The United States furnishes approximately $100 million military
assistance to Turkey annually to enable that country to fulfill her
commitment to the North Atlantic Treaty Organization (NATO).
NATO was organized to protect the security of the North Atlantic
area, including the United States. During the 22 years that NATO has
been in existence, the United States has contributed well over $20 bil-
lion to insure its survival. Money is no object when it comes to the de-
fense of the free world. The U.S. defense budget in 1971 will be
approximately $79 billion, plus another $2 billion for military
assistance.
But how well will we have defended America, if we lose a genera-
tion of young Americans to heroin addiction in the process?
Europe depends upon the United States for its security. It should be
willing to do what is necessary to help solve this problem, including
putting pressure on Turkey to take effective action to first control and
then to stop the growing of poppies.
The same situation applies in Southeast Asia. Thailand is a SEATO
partner and Laos and South Vietnam fall under the U.S. security
blanket. They must all be persuaded to join in the battle against heroin
now.
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CONCLUSIONS
1. As of May, 1971, there are an estimated 250,000 heroin addicts
in the United States and an additional 30,000-40,000 addicts among
U.S. troops in Southeast Asia.
2. The problem is how to stop heroin from reaching American
addicts in the United States and in Southeast Asia. Once the
poppy is cut and introduced into illegal channels, the battle to
prevent the end product, heroin, from reaching the addict is
virtually lost.
3. Heroin addiction is essentially an American problem and most
countries view it as such. As a result, there is a great deal of talk
about cooperation with the United States but there is very little
action.
4. There is no sense of urgency on the part of most governments
that action must be taken immediately to stop the illegal produc-
tion of, and traffic in, heroin. U.S. diplomatic personnel must
assign top priority to gaining the full cooperation of host gov-
ernments in attempting to solve the heroin problem.
5. Turkey must stop growing opium poppies if this problem is to
be brought under control. Most of the heroin entering the United
States originates in the poppy fields of Turkey.
6. Prospects for stopping poppy cultivation and the production
of heroin in Southeast Asia in the near future are dim. Ef-
forts must be directed toward stopping the illegal flow of heroin
into South Vietnam. If these efforts fail, the only solution is to
withdraw American servicemen from Southeast Asia. Above
all the U.S. diplomatic community in the several countries must
be aware that their job is to represent United States interests
rather than to appease the host government.
7. The United States can and should exert pressures on the
Governments in Southeast Asia in order to gain their coopera-
tion in the fight against heroin. The survival of Laos and South
Vietnam depend upon continued military and economic assistance
from the United States and the ability of Thailand to defend itself
would be seriously weakened if the United States were to discon-
tinue military assistance to that country. While the effectiveness
of threats to cut off military and economic assistance are debata-
ble, there can be no disagreement that because of this assistance
the United States has a right to expect full cooperation from
these countries in efforts to stop illegal traffic in heroin.
8. Corruption plays an important role in the illegal heroin traf-
fic, particularly in Southeast Asia. Governmental and military of-
ficials at all levels are implicated. If graft and corruption are to
be eliminated, some way must be found to take the profit out of
the production and sale of heroin.
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RECOMMENDATIONS
1. That the President take personal command of the struggle to
eliminate the illegal international traffic in narcotics, particularly
heroin, and commit the full resources of the country to that battle.
2. That every U.S. department and agency engaged in the con-
duct of foreign policy be instructed to participate in a broad-
based diplomatic offensive to gain the full cooperation of foreign
gvernments in eliminating the illegal traffic in opium and its
derivatives. These instructions should require each U.S. country
team to draw up a comprehensive and specific plan for gaining
greater cooperation from the host government. Such plans should
entail the escalating use of all available political and economic
leverages and each foreign government should be put on notice
that failure to cooperate would prejudice bilateral relations. To
buttress the efforts made abroad, the Department of State should
undertake a concerted campaign to impress on foreign ambassa-
dors in Washington and at the United Nations the seriousness of
the U.S. Government's concern.
3. That the U.S. Government immediately and forcefully
exercise the special leverages it has with the South Vietnamese
and Royal Laotian Governments by virtue of our enormous mili-
tary, economic, and political support of those governments to
gain their cooperation in cracking down on the illegal heroin trade
in their countries and the official corruption that contributes to it.
4. That the U.S. Government underwrite an accelerated research
program to find a nonaddictive substitute for opium, which con-
tinues to have important medicinal applications.
5. That the United States negotiate with other countries to
better control and, where feasible, stop the cultivation of opium
poppies. To help accomplish this, the United States must be pre-
pared to undertake a multimillion-dollar bilateral program to
assist those countries to develop substitute economic activities for
their opium farmers.
6. That the permanent U.S. Representative to the United Na-
tions continue his initiatives to gain greater U.N. participation in
the fight against illicit narcotics and dangerous drugs, emphasiz-
ing efforts to:
(a) gain the strong support of the Secretary General in this
struggle;
(b) push vigorously to insure adoption of amendments to
the Single Convention which have been proposed by the United
States;
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(c) gain participation by all nations in the U.N. Special
Fund for Drug Abuse Control; and
(d) initiate proposals designed to upgrade the capabilities
of the United Nations Division on Narcotic Drugs and the
International Narcotics Control Board in terms of personnel
and funding. Special emphasis should be placed on the devel-
opment of programs by the U.N. Division on Narcotic Drugs
to provide alternate economic activities for opium farmers.
7. That U.S. military authorities in Southeast Asia undertake
all appropriate policing measures to reduce the flow of heroin to
U.S. troops in South Vietnam, including increasing the surveil-
lance of mail entering South Vietnam through APO channels.
Custans proeedures must also be expanded to include inspection
of Thai soldiers entering South Vietnam aboard U.S. military'
aircraft.
8. That the Department of Defense improve its -capability to
identify military heroin addicts by instituting an extensive pro-
gram of urinalysis; that it provide acute care and detoxification
for all military addicts; and that it provide basic rehabilitation
services for those addicts. That in cases where military rehabilita-
tion efforts prove unsuccessful, the unrehabilitated addict's com-
manding officer should be permitted and required, prior to the
addict's discharge from the military, to civilly commit the addict
to the Administrator of the Veterans' Administration for a period
of 3 years for treatment and rehabilitation. That the Veterans'
Administration in turn contract with civilian multimodality treat-
ment centers at the community level with the purposes of utilizing
the centers' expertise within the VA hospitals and ultimately turn-
ing the patient over to such centers for reintegration into society.
9. That the United States substantially speed up the withdrawal
of military draftees from South Vietnam. The draftees have
proven far more susceptible to heroin addiction than nondraftees
and are estimated to have an addiction rate of over 15 percent.
10. That the Congress consider legislation which would provide
for preventive detention, in the form of a nonbailable offense, for
those arrested for the illegal possession of, or trafficking in, heroin,
who are not addicted themselves. This legislation should also
consist of a mandatory jail sentence of not less than 20 years upon
conviction with no possibility of parole.
11. That the Congress consider legislation which would ban the
manufacture, distribution, sale, or possession with intent to use,
drug materials for illegal purposes.
12. That the United States consider canceling the passport of
any American known to be engaged in the illegal traffic in heroin.
13. That U.S. customs authorities increase the surveillance of
mail entering the United States through APO channels.
14. That the United States utilize its worldwide intelligence col-
lection apparatus, including the use of satellite photography, to
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gather information on all aspects of the illegal production of and
traffic in heroin.
15. That substantial new funds be made available to the Bureau
of Narcotics and Dangerous Drugs for discretionary expenditure.
16. That the United States consider making additional funds
available to Interpol to improve its operations.
17. That the United States seek greater cooperation from the
Government of Switzerland to identify individuals who utilize
secret Swiss bank accounts to finance the traffic in heroin.
18. That Congress extend an invitation to the Parliament of
Turkey to join in the creation of an interparliamentary group to
consider ways and means of attacking the illegal production and
sale of opium and its derivatives.
19. That the Committee on Foreign Affairs conduct an in-depth
series of hearings to consider the several legislative proposals that
have been made to deal with the illegal international traffic in
narcotics.
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JOURNAL.
SCHEDULE OF MEETINGS, INTERVIEWS AND DISCUSSIONS
Trashington, D.C.?March 30 and 31:
Mr. Frank A. Bartimo, Assistant General Counsel Manpower, Re-
serve Affairs, Health and Environment, Department of Defense.
Mr. Kenneth Giannoules, Interpol Bureau, Department of the
Treasury.
Mr. Fred T. Dick, Chief, Saigon Office, Bureau of Narcotics and
Dangerous Druo.s.
Mr. Andrew '"C. Tartaglino, Assistant Director for Enforcement,
Bureau of Narcotics and Dangerous -I hugs.
Genera., Switzerland?April 4-5:
United Nations
Dr. Dale C. Cameron, Chief, Drug Dependence Unit, World Health
Organization.i
Mr. S. P. Sotiroff, Officer in Charge, U.N. Division of Narcotic
Drugs.
Mr. Leon Steinig, U.S. Member, International Narcotics Control
Board.
- Mr. S. Stepczynski, Deputy Secretary, International Narcotics Con-
trol Board.
Dr. Braenden, Director of U.N. Narcotics Laboratory.
Dr. J. M. Chilov, Chemist from U.S.S.R., U.N. Narcotics Labora-
tory.
Dr. Carl Blood, "World Health Organization.
U.S. Mission to the European Office of the United Nations:
Hon. Idar Rimestad (AEP) , U.S. Representative.
Mr. Edward J. Gaumond, Counselor for Administration.
Mr. Edward G. Misey, Legal Officer, Control Officer.
Paris, France?April 6.
Mr. Jean Nepote, General Secretary, International Criminal Police
Organization (Interpol) and staff.
- Hon. Arthur K. "Watson, U.S. Ambassador to France.
Hon. David K. E. Bruce, (AEP) , Representative, Paris Peace
Talks.
Mr. John Cusack, Chief, U.S. Bureau of Narcotics and Dangerous
Drugs, Europe, and staff.
Mr. Marcell Carrere, Chief, French National Narcotics Squad, and
staff.
Mr. Louis F. Janowski, Control Officer, Consular Officer, U.S.
Embassy.
Marseilles, France?April 7-9:
Mr. Philip H. Chadbourn, Jr., Consul General.
Mr. Albert Habib, Chief, Bureau of Narcotics and Dangerous
Drugs, Marseilles.
1 Congressman Steele only.
(40)
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Mr. Anthony J. Morelli, Special Agent, Bureau of Narcotics and
Dangerous Drugs.
Mr. Stephen M. Swanson, Special Agent, Bureau of Narcotics and
Dangerous Drugs.
Arr. Robert Mattel, Chief, Narcotics Division, Marseilles.
Mr. Francois Goujon ; Asst. Chief, Commission Principal.
Mr. Antoine Comiti, Chief of Narcotics, Marseilles Regional
Services.
M. Henri Arnaud, Member, French Chamber of Deputies.
M. Hubert Louis, Commission Division, Ministry of the Interior.
Mr. Herbert Moza, Dir. of American Studies, University of Aix,
Aix, France, and selected students.
M. Jean Laporte, Regional Super. Prefect, Marseilles.
Rome, Italy?April 9-10:
Mr. Michael A. Antonelli, Chief, Bureau of Narcotics and Danger-
ous Drugs, Italy.
Mr. Wells Stabler, Deputy Chief of Mission,1 U.S. Embassy.
Col. David Brown, Defense Attache Office, Control Officer, U.S.
Embassy.
Bishop Paul C. Mareinkus, Vatican Diplomatic, Corps.2
Mr. Mario Cozzi, U.S. Customs Liaison Representative, Rome.
Ankara, Turkey?April 1042
Hon. William J. Handley, TT.S. Ambassador to Turkey.
Mr. Henry P. Schardt, Political Officers, U.S. Embassy.
Mr. Joseph S. Toner, Dir., U.S. Agency for International Develop-
ment, Turkey.
Dr. Harry R. Varney, Agricultural Attache (visit to poppyfield in
Afyon).
Mr. Morris Draper, Political Officer' Control Officer.
Mr. Leonard H. Otto, Agricultural Adviser, U.S. AID Mission.
Mr. James W. Spain, Principal Officer, Istanbul.
Mr. John Warner, Special Assistant to the Director, U.S. Bureau of
Narcotics and Dangerous Drugs.
Mr. Bernard J. iotklein, Mutual Security Affairs Officer, Control
Officer.
Maj. General Dudley Faver, USAF, Commander, Turkish-U.S. Lo-
gistics Command (TUSLOG).
Mr. Robert A. Lincoln, Public Affairs Officer, USIA.
Hon. Kasim Gulek, Presidential Quota Senator.
Hon. Mahmut Vural, Justice Party Senator from Ankara.
Hon. Mustafa Ustundag, Republican Peoples Party Deputy from
Konya.
Hon. Mukadder Oztekin, Republican Peoples Party Deputy from
Adana.
Hon. Ali Ihsan Baum, Justice Party Deputy from Isparta.
Hon. Osman Meric, Uder Secretary, Ministry of Interior.
Hon. Oral Karaosmanoglu, Justice Party Senator from Manisa.
Congressman Steele only.
Congressman Murphy only.
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Mr. Altemur Kilic, Press and Publications Director General, Prime
Ministry.
Mr. Ekren Gunay, Assistant General Director, Ministry of
Agriculture.
Orhan Eralp, Secretary General of the Foreign Ministry.
Tehran, Iran?April 1-13:
Hon. Douglas MacArthur, U.S. Ambassador to Iran.
Mr. Douglas L. Heck, Dep. Chief of Mission.
Mr. Donald R. Toussaint, Political Officer.
Col. Warren Boyce Chief of Mission to the Iranian Gendarmerie.
Mr. Arnold L. laphel, Political Officer (Narcotics Reporting
Officer), Control Officer.
CWO Danny Boyd, Genmish Narcotics Adviser.
Mr. James P. Cavanaugh, Regular Administraton Specialist, Se-
curity Officer, 'U.S. Embassy.
Major James J. McGowan, Jr., U.S. Army Judge Advocate Gen-
eral's Office.
General Roohollali Amini, Chief, Narcotics Division, Iranian Gen-
darmerie.
Dr. Amini-Rad, Director General, Narcotics Control Administra-
tion.
Col. Naser Glioli Shirani, Chief, Narcotics Division, National Police.
Dr. Jahanshah Saleh, Iranian Senate.
Mr. Mohammad Saidi, Iranian Senate.
Mr. Hill, Community School, Tehran.
Mrs. Ertehfat, International School, Tehran.
Dr. Morrone, Tehran, American School.
Th,ailand?April 14-17:
Hon. Leonard Unger, U.S. Ambassador.
Mr. George S. Newman, Deputy Chief of Mission.
Mr. Rey M. Hill, Director, United States Operations Mission,
Agency for International Development.
Mr. William Wanzeck, Chief of Bureau of Narcotics and Dangerous
Drugs.
Mr. Keith S. Shostrom, Chief, Bureau of Narcotics and Dangerous
Drugs, Hong Kong.
Maj. Gen. Louis T. Seith, USAF, Commander, Military Assistance
Command.
Mr. Joseph Jenkins, Agent in Charge, United States Customs
Bureau, Southeast Asia.
Mr. Laurence G. Pickering, Political Officer.
Mr. Michael A. Burns, Political Officer, Control Officer.
Brig Gen. John W. Vessey, Jr., USA, Commanding General, Sup-
port Command, Thailand.
Mr. Louis J. Lapham, Political Counselor.
Weyer G-im, Consul General, Chiang Mai.
Mr. James Pettit, Bur. of Narcotics and Dangerous Drugs, Chiang
Mai.
Hon. Rajawonffse Thongthang Thongtaem, Director General, Cus-
toms Department'''.
H. S. H. Prince Bhisatej Rajani, His Majesty's Hilltribe Project.
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Mr. Chit Posayanonda, former Director General, now Counselor,
to the Bureau of Narcotics.
Police Maj. Gen. Surapol Chul abrahm, Police Department (Border
Patrol Police).
Police Maj. Gen. (M. R.) Nilya Bhanumas, Secretary General, Thai-
land Central Bureau of Narcotics.
Mr. M. R. Chiravadee Kasemsri, Chief, U.N. Division Department
Technical and Economic Cooperation (participated in U.N. Narcotics
Survey).
Mr. Sayom Ratanawichit, Chief, Social Studies & Planning Divi-
sion, Dept. of Public Welfare.
Mr. Nikom Khamnuanmasok, Social Development Branch, Chief,
Social Projects Div., National Economic Development Board.
Visit to Hilltribe Research Center, Chiang Mai University.
Visit to Border Patrol Police Hilltribe Handicraft Center.
Flyover Mae Kona Soon poppy-growing area.
Also participated in a Staff Conference on Control of Drug Abuse
and Traffic with representatives from U.S. Mission in Southeast Asia.
Saigon?April 17-19:
Hon. Ellsworth Bunker U.S. Ambassador, South Vietnam.
Mr. Samuel D. Berger, Deputy Ambassador.
Mr. John E. McGowan, Special Assistant.
Mr. Terrence G. Grant, Political/Military Affairs Officer, Control
Officer.
Mr. Stephen Winship, Political/Military Affairs Officer.
Lt. Gen. William J. McCaffrey, Dep. Commanding General, U.S.
Army, Vietnam.
Lt. Gen. Michael Davison, Commanding General, II Field Forces,
Vietnam (II FFV).
Col. George Webb, Deputy Chief of Staff II FFV.
Col. James H. Hyndman, Provost Marshal General II FFV.
Lt. Col. Frank H. Chamberlin, Surgeon General, II FFV.
Specialist John Backoven, Coordinator Pioneer House.
Sgt. Tim Jaqua, Coordinator, Pioneer House.
Lt. Col. Alfred R. Jefferson, Deputy Provost Marshal, MACV.
Lt. Col. James M. Parrack, Commanding Officer, Joint Narcotics
Investigation Detachment, 8th MP Group (CI), 18th MP Brigade.
Ma James J. Reilley, Control Officer, Drug Abuse Suppression
Division, Provost Marshal Office, MACV.
Maj. Robert Schwartz, Joint Customs Section, Security and Inves-
tigations Division, Provost Marshal Office, MACV.
Hong Kong?April 19-20
Mr. David L. Osborn, prinicipal officer, U.S. consulate.
Mr. David Dean, International Relations Officer General.
Mr. J. Donald Blevins, Consular Officer, Control Officer.
Mr. Keith S. Shostrom, Chief, Bur. of Narcotics and Dangerous
Drugs, Hong Kong.
Cdr. R. L. Vomies, Liaison Officer, 7th Fleet, Hong Kong.
Cdr. R. L. Stanford, Officer in Charge, Commander, U.S. Naval
Forces Phil. Det. Hong Kong.
Mr. Wayne Crawford, Resident Agent, Naval Investigative Serv-
ices.
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Mr. Vincent E. Durant, U.S. Customs, Foreign Liaison Officer,
Hong Kong (TD.Y).
Tokyo?April 21-22:
Hon. Armin H. Meyer, U.S. Ambassador, Japan.
Mr. Lester E. Edmond, Economic/Commercial Officer.
Mr. Ronald A. Gaiduk, Consular Officer, Control Officer.
Mr. Rustam Aruslan, Bureau of Narcotics and Dangerous Drugs,
Tokyo.
Mr. William J. Cunningham, Political Officer.
Mr. Thomas C. Stave, Economic/Commercial Officer.
Mr. Segoro Usukura, Police Superintendent and Chief of Second
Vice Section,' Tokyo Metropolitan Police Dept.
Mr. Hiromasa Sato, Chief of Narcotics, Second Section, Ministry of
HeaMil and Welfare; Briefing by Office of Special Investigations,
US 1 Air Force, Naval Investigation Serviee Office, and Criminal In-
vestigation Detachment, US Army, Japan.
'Congressman Steele only.
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APPENDIX
NOTE OF PRESENTATION (TRANSMITTAL SHEET TO LAO NATIONAL ASSEM-
BLY) CONCERNING THE DRAFT LAW ON THE PROHIBITION OF THE
GROWING OF THE POPPY, OF THE MANUFACTURE, CONSUMPTION, SALE,
PURCHASE, AND POSSESSION OF OPIUM
Importance of the opium problem is manifest equally from the domestic and
the international point of view. On the domestic side, the economic aspect of the
problem is tied to its political aspect by the fact that the culture of the opium
poppy constitutes the principle source of revenue of our ethnic minorities.
However, it would be useless in the present state of affairs to think that we
would be able to avoid international control of drugs. The idea of considering
opium as an important source of revenue is best rejected.
Traffic in drugs in Laos was formerly an administrative offense governed by
the Decree of Haussaire High Commissioner] No. 247/3101 of 3 September 1948
which is no longer in effect.
The Royal Government, by letter No. 2595/PC/AG of December 10, 1958
addressed to the Ministry of Finance gave its agreement to the principle of the
complete revision of their legislation concerning drugs to replace the Decree of
3 September 1948 of the High Commissioner of France in Indochina, regarding
the establishment of the opium regulation.
Such is the draft text prepared by our experts and followed by an explanation
of the rationale attached to this note.
In view of the events which continuously preoccupy us it would be appropriate
to develop a clear policy concerning the campaign against illicit traffic in drugs. It
is recalled that in 1963 the Royal Government decided to withdraw the member-
ship of Laos in the Single Convention of 1961 regarding drugs.
DRAFT OF PROPOSED LEGISLATION CONCERNING THE PROHIBITION OF THE CULTI-
VATION OF THE POPPY, OF THE MANUFACTURE AND CONSUMPTION, SALE AND
PURCHASE OF OPIUM
Article 1.?For a period of five years following the publication of this law
the mountain dwelling population who traditionally devote themselves to the
cultivation of the opium poppy may only continue to consume the opium which
they produce.
Authorization to grow and consume may be granted by provincial governors
only to men over thirty years of age.
The area of land to be cultivated will be determined in relation to the needs
of the person requesting it by a provincial consultative commission chaired by
the provincial governor and including a representative of the Ministry of National
Education. This area will be reduced each year so that at the expiration of the
five year period indicated above no authorization to cultivate the poppy and to
consume the opium which may be drawn from it will be granted.
Article 2.?With the exception of the specific cases covered by the preceding
Article, the culture of the opium poppy, the manufacture, possession, consumption
and the vending of opium are forbidden throughout the territory of the Kingdom.
The sale and purchase of opium are forbidden to all persons including those
exceptionally authorized to cultivate the opium poppy and who may consume
only the product of their cultivation.
Article 3.?With the exception of medicinal products containing opium or such
products intended for the manufacture of medicines which remain subject to
regulations regarding the sale. conditions and use of poisonous substances, im-
portation, even with the intention of reexportation, transit, storage and trans-
shipment of opium are prohibited.
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Article .4.?Any person who shall cultivate the poppy or shall consume opium
without the authorization specified in Article 1 or who shall not respect the limits
of such authorization as he shall have reeeived, shall be punished by a line from
5,000 to 200,000 kip and by imprisonment of three months to three years, or by
one of these two penalties only.
In case of repetition of the offense, the maximum fine shall be applied.
Article 5.?Any person will be punished by a tine from 5,00() to 10,000 kip and
by imprisonment from six months to five years or one of these two penalties only,
who shall have :
1. Manufactured opium outside of the special rases covered in Article 1;
2. Transported or possessed or given opium either freely or payment, or
who will have bought or received free;
3. Forged, false authorization to cultivate or to consume or who will have
falsified authorization granted by provincial governors by the substitution of
names, of photographs, or by false notification or false declarations of civil
status ;
4. Participate in the preparation and the introduction into circulation of false
authorization or falsified authorization ;
5. Sale of an authorization or who will have given such authorization free ;
(3. Bought an auth oriza (lou (Jr will have received it free ;
7. Who will have obtained or tried to obtain more than one authorization ;
M. Who will have imported opium, stocked it, had it transshipped, or had it
transited in Laos territory.
Further in the cases covered by sections 5, 6 find 7, the authorization will be
withdrawn.
In case of repetition of the offense, the maximum fine will be applied.
rticle (L?Any keeper of an opium smoking den will be punished by a fine
from 10,000 to 1 million kip and be imprisoned from six months to five years or
by one of these two penalties only.
In case of repetition of the offense the maximum fine will be applied.
Article 7.?infractions covered by this law will be prosecuted by the Depart-
ment of the Public Prosecutor.
In every case opium seized will be confiscated and destroyed. Means of trans-
portation will be seized and sold on behalf of the state if it is established that
their owners are the perpetrators of the infraction, prosecutors or accomplices
of such perpetrators.
Materiels, furniture and special objects such as beds, sofas, lamps, pipes,
etc. . . found in the possession of keepers of opium dens will be seized, con-
fiscated and destroyed.
Opium found abandoned in Lao territory will he seized and destroyed on de-
mand of the Public Prosecutor.
Article 8.?All previous dispositions contrary to the present law are annulled.
Certified that the present text is adopted by the National Assembly at its meet-
ing of
THE PRESIDENT OF THE NATIONAL ASSEMBLY.
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TliE NEW YORK TIMES DATE PAGE
C. I. I. A. Identifies ,21 A sian Opium Refineries
By FELIX BELAIR Jr.
sr,,tha I The New York Times
I WASHINGTON, June 5?
ed States intelligence
oarnts have identified at least
121 opium refineries in the bor-
der area of Burma, Laos, and
'Thailand that provide a con-
:stout flow of heroin to Ameri-
can troops in South Vietnam.
Operated and protected in
Burma and Thailand by insur-
gent armies and ? their lealers
and in Laos by elements of the
royal Laotian armed forces, the
refining and distributing have
grown until white heroin rated
PG per cent mire is turning up
in Pacific coast cities of the
United States as well as in
Saigon,
The Burma -Laos-Thailand
border area, known as the
"Golden Triangle," normally
accounts for about 700 tons of
opium annually, or about half
the world's illicit production..
Burma is the iargest producer .
in the region, accounting for
alamt 400 tons.
But a recent analysis by the
Central Intelligence Agency
suggests that production is ex-
panding in the area, and there!
are indications that this year's.
output may reach 1,000 tons.
More High-Grade Heroin
The C.I.A. analysis made
these major points about re-
cent trends in the illicit nar-
notics business in Southeast
Asia:
(l Refineries in Laos and
Thailand that used to produce
only refined opium, morphine
base and No. 3, heroin for
smoking are now -converting
most of their opium supplies to
No. 4, or 96 per cent
pure white heroin. The change
"appears to be due to the sud-
den increase in demand by a (
large and relatively affluent
market in South Vietnam."
',Most of the narcotics buy-
ers in tub tri-border area are
ethnic Chinese who pool their
purchases, but no large syndi-
cate appears to be involved. The
opium, morphine base and
heroin purchased in this area
eventually finds its way to
Bangkok, Vientiane and Luang
"'raking, where additional pro-
cessing may take place before
d-iwery to Saigon, Hong Kong
and other international mar-
kets."
A "considerable quantity" of
raw opium and morphine base
from northeast Burma and
Thailand was sintia,gled into
Bangkok and sent trona there
to Hong Kong in fishing trawl-
ers from Jan. 1 to May 1. Car-
rying one to three tons of opium
and quantities of morphine
base, "one trawler a day moves
to the vicinity of the Chinese
Communist-controlled Lema Is-
lands-15 miles from Hong
Kong?where the goods are
loaded into Hong Kong junks."
flOpium and derivatives move
through Laos and are trans-
ferred from the Mekong River
refineries by river craft and
vehicles to Ban Houei Sai,
further downstream on the
Mekong in Laos, and are trans-
ported from there to Luang
Prabang or Vientiane. A con-
siderable portion of the Laotian-
produced narcotics is smug-
gled into Saigon."
(11"An increased demand for
No. 4 heroin also appears to
be reflected in the steady rise
in the price. For example, in
mid-April, 1971, the price in the
Tachilek [Burma! area for a
kilo of No. 4 heroin was re-
ported to be $1,780, as com-
pared with $1,240 in Septem-
ber, 1970." A kilogram is 2.2
pounds.
41"The reported increasing in-
cidence of heroin addiction
among U.S. servicemen in Viet-
nam and recent intelligence in7
dicating that heroin traffic be-
tween Southeast Asia and the
United States may also be in-
creasing suggest that Southeast
Asia is growing in importance
as a producer of heroin."
U.S. Policy Criticized
This growth has been aided,
according to one Congressional
authority, by the lack?until re-
! cently?of a firm United States
policy on heroin in Southeast
I Asia. The United States?which
! provides billions of dollars in
military and economic foreign
aid to Laos, Thailand and Cam-
bodia?has directed its efforts
I intercepting the traffic at the
Saigon end of the line, rather
than to stamping out produc-
tion at the source, Representa-
tive Robert If. Steele. Republi-
can of Connecticut, said today.
Mr. Steele is the principal
author of a recent report esti-1
mating the numbers of heroin
addicts among American serv-
icemen in South Vietnam at
23,000 to 30,000.
"Vietnam unquestionably
proves that the availability of
narcotics breeds users," he said.
"Until we dry up the sources,
we haven't got a prayer of com-
batting the problem."
While much of the opium
producing and refining takes
place in areas of Burma, Laos
and Thailand now controlled by
insurgents, narcotics enforce-
ment officials say that a con-
tinuous flow of the drugs
through government-controlled
areas cannot be sustained with-
out the involvement of corrupt
officials.
The same view was ex-
pressed earlier in the week by
John E. Ingersoll, director of
the Bureau of Narcotics and
Dangerous Drugs, in testimony
before the House Select Com-
mittee on Crime..
Ile said that middle-level
government officials and mili-
tary men throughout Southeast
Asia were deeply involved in
the traffic in opium, the prod-
uct from which morphine and
heroin is refined.
Routes and Refineries Named
The analysis by the Central
Intelligence Agency pinpointed
major areas of cultivation, re-
fineries and routes used in the
traffic.
Northeast Burma was iden-
tified as the largest producer
and processor of raw opium in
the border area. The study said
that Burma's 14 refineries, lo-
cated in the Tachilek area, last
year converted 30 tons of raw
opium into refined opium, mor-
phine base and heroin.
"The opium harvested in
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Shan, Wa and Kokang area is
picked by caravans that are put
together by the major insurgent
leaders in these areas," the
C.I.A. study said. "The cara-
vans, which can include up to
600 horses and donkeys and
300 to 400 men, take the opium
on the southeasterly journey to
the processing plants that lie
along the Mekong River in the
Tachilek-Mae Sai, Thailand-Ban
Houci Sai, Laos area."
The analysis said that car-
avans carrying more than 16
metric tons had been reported.
A metric ton is about 2,200
P17)51300380R000300080 02-3
7 In-piirtant Refineries
Of the 21 refineries identifed
in he thr e countries, seven
welt! deacrioed in the report as
capable of processing raw
opium to the heroin stage. "The
most important are located in
the areis around Techilek,
Burma; an Houei Sai and Nam
Keung in Laos, and Mae Salong
in Thailand." it said.
"The hes( known, if not larg-
est of these refineries is the
one at Ban Houei Tap, Laos,
near Batt Iionet Sai, which is
believed aaaable of procesina
some 10e kilos of raw opium
per day," the report said.
The oltvin' and derivatives
crossing Thailand from Burma
enroute to Bangkok was traced,
in the paaer as moving out of
such Northam Thai towns as
Chiang R !e, Chiang Mai, Lam-
pang an ! Tak "by various
modes o -;round. and water
transport."
"The omoni is packed by the
growers aia? traded to itinerant
Chinese merchants who trans-
port it to major collection,
points, particularly aroundLa-
shio and a:en Tung," the study
said.
?
. CHINA
BURMA
Moe Sal'
Ch.nynit
Rai
Chiang
*Mai THAILAND
4:enionng
Iry E.rtuk,,,k
LAOS
1Bnnli-,ue,
Luang
Probang
Vitntjane
CHINA
VIT,./YeAftl ,Z,Zt
FAA,
VIE; TriAM
pri
?7--7C7i,`1,0f,1
The Ntlw lurk Times June 6, 1971
Opium products from the
surrounding area, known
as the 'Golden Triangle,'
are said to be shipped
through Ban loud Sai.
ARCA OP LAOS
Pf
THAILAND:\
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King ,), )171 tif :La
ANTI-,NARCOTIC3 LAW
Law
?:1
No, .71/5 dated August 70, 1971, pert-Ainir.g to prolli!lition
? tiori,; nmoking or ta,:iing? purch:Lse? saln .=-.111d 1-tiAirg, ix. Posses-
s/or:, of opium or Opium compound or opium tailing, inctuding niorphine
and hrio. in the Kingdom of Laos.
1
The Nationa! AssTmbly has deliberated on and adr.,ptcd a draft law per-
taining to; the prohibition from cultivation, davor ?Icing or taking,
purchase, sate and 1-1..:,Ping in. possession of opium or opium ersmpound or
opium tadrg n luding morphine and heroin, in the Kingdom .of Laos, the
provisions of wilich are the following:
I
Artic! 1. Absolute prohibition is imposed on the cultivation opium
poppy throughout th Kingdom of Laos,
On a temporary basis, however, members of thz- tribes whose.. native
villages ae located in the mountains and jungles where for generations
heretofore, opium poppy has been cultivated, and those whohe been
authorized to grow opium poppy may carry on this cultivation 9; smoke'
the opium grown and produced by themselves.
Authorization to grow opium poppy or to smoke opium thus produced shall
be issued by the Chao Khoueng to individuals whose age is .Dver 40 years,
effectinie 1?4.pon the promulgation of this Law,
1
The Provincial Advisory Committee, under the chairmanship otthe Chao
Khouereg? and the representatives of the Ministries oZ: Public utii..t lt h of
National clucation and of Finance shall fix the amount of and iv the
cultivation of opium poppy in favor of the applicant as appropriAte?
11
I
Article 2: Flavoring, possession, taking or smoking of opium and trans-
.
portation of opium or opium compound or opium tailing, inc luctlng morphine
and heroin, in the Kingdom of Laos are absolutely prohibited.
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?=::?? El': i.^.?C.11) (A..-:(1'YM".., :1' C11,10
?
? 4..1 /
?sto3..aja 8 an(1
?cc.;!701.1.0(7 6;:?"7.,..,,r.:k
II
? r.t?.1.)...!ai 02 r:Fi.?rAY=.
? 4 I
?
opiurri pop)!*
r p5i cc c:f.i-,f-;ot-ncl 0j o;Ji_i:in tailin or opivtiy; c.xt)
g
? r r? o_f vozin.:., n, w iiout
in .2...riiO1.2 I, or
.1
4:fie e c.-Jrtificateautt:oiizin 'r
ppr
64111,, 'co c?-h:_li1 73e liable to a
'1.1.?I?sVi0i17,-,:e.i:t i-r.-toritlis to tl-lree or
N
1.(;?'S,:.3 ?
6:: red9-7!:ezc3 o r.e violation, the fine sl)..3.1i ic to
t
? mum oi: trile s-zq forth lactret..1-10v..?
.1.-ticle 5:
fine. 1O, 000 air. to 500. 000 kip and an ir-lprisorano.?1.:-..r.cor-t six
II I
(:ttlii to fvy5.:are, or eit37.er,of the 3bov 1i he cn any,
plkr3oas in i:67,16?,61.:1g cases:
41
1./reparation of certificate or pe:f7ri-d".:
? opin poppy or c_or -11-..c smoking of opiam, o.r E.1iicioi idva.
toi,A.ready is svt3ii by Chao Tt':iolieng tv..7
or photograph or by giving li.;lse information in the
,r
.2) Acting as accomplice in tile fa1sificz1Lion borink-
tion as stated above;
.3) irsua.nce of the certifiCate or permit fr;:e 0,1* or sale c
the 2;,'il certificzte or permit;
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1 i
) e a a cv c icri ccetrtliCikte Co? 1dt or purchase
???--.5) to .-;.or, or??. ?
1"
/
In cz:-.z..3of o:,-(se zsti:1-)7?11 tee. n .ten-zs 1, 2, a, 4 .,.1Ar.1 the
--,-.7th0riv-,Lt1on must be cotaZisoteci br Court of
for
of :i.-sr.,..1.;:.renze cf the viola-tion, ,the fine sh-111 e incre.;,.).,-.ei; to the
rilaximuni of d pera. ltise...t forth hereabrive?
43) A fine ivzit to aye times the price of th2 co;.-t-isc!ttej itutttris, the
,F,E13e,,s-ertzetc. tiaereof being in coniorinity wi_th tho p7,..ivisions of the
Royal Decl-ers estid..f4Ii5hel in i i regard, and an ',.-,.17).priontr.:,-eit iJa harr3
labor frors- rive ye.-Irs to 20 years sh1l he irr,3:-.3e.:,71. on:
.1) perc:ins who produce opitnii or oi-Yinin co.c.Tfoun,-1lo!I* opium
tailing of irrv-..i.hatsoever or corripouad Trade ofopi 'in or
fl,.i.vo-red. with ?LA:47n including morphine arizi e:,:ceryt the
cases 3ti1t ia e provisions of Article 1 he.reabov;
g
1
-74 .4rty per,...o-as who tirrat to others free of chri?im a.il,-?,,ith payment,
t.risport or f.:0Stio.sc or leave or purchase or accettopiL or or...ittm cortipound
or opium il i o r.,/ type. whntsoevev or coolrou.r.f.1 of 02-. nu tailing
C;J: fln.voved optaiii tailing, including morp.' LT1Jand in 1-nin;
1 t
...3.i. ,'-1,ny- per:ions y..ho bring opium or OPitirf, compound o.:- ocriuin
:
t FLO. i..ne: Of :3.17 tYPe whzItscover or coinpound rnade. of opii1.71..., 4.-;_rilin'.--- or ilavorer.1
viltrl oplu-u, ng, including morphine and heroin, ioto S.,':,(-::-, o-il store it in
. . .
,
pl*".ce or ro.rivo it or transport it in transit in Y..,z...oc.
t
Phe Cour': cit Suetioe is prohibited frotri granting a -,:eduction tiC.epenzth e.
The penalty i:o a ine shall be in conformity wiii. he provisio:Ls nil forth in
IN 6
a
:
ctise of recurrene of the violation, the Court of Justicn.,: ir 1:,-tiiiiihited from
1;1.7f:clang P. resell-Le:tit= of the penalty to an imprisaninent
sElltrnce tite:oiora shall conform to the provisionc fc T.',":11ros ???bY
. .
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Li of to .i.he
rntir c' nai ii
herea.bove.
1e 7: its. penalties therefcre fined in this
the sui-jc-i: a.cticsr.. in the Gault of .711stice by the :).11:1:h-! Pret.4ecutor.
In all cases lc. 41.3.1 the opir:n-1 or opium derivztives or opium resiclue of any
type or oriurn cornpounc; made of or flavored with opiuru r idue including
mOrphirie ;r4 ;.1t9 no e confiscated and destroyed. Likewise, the
transportAtion r.leans zad contsdners used in this connection hil be
c::_scated and nut on auction sa.ie, and the proceeas ohLind ;:rorn ouch
aia.11he noiol in the Igaticral Treasury, provicaed it comes to
1i tTht the owner of si.3. -nsporta.tion means or crilitAiliers himself
onder or c-cts ai an o.coo.zn,Igice of the -ofiender.
'1
Opi.1.2.m, opium deT.:Ivatives, opiartz residue of any type or oiiri compound
made of or with opium residue, including loorpLine ,k).-,ir-1 heroin,
ii found, r"ball Ile confiscated and destroyed upon request of the
And other itorns accescory? to opium consumption fcund in the
house of the ow-71er of 0.ie opitun or in the opium den, ouch us: 1...ted, /stnp,
optuat pipe and others, shall be 000fticatecl and de strafed.
Artic,le 8:
abrogated.
L: is hereby
the general
'al laws ;1.nsl regulations contrary to the present 1.7-_?.7 are hereby
I I
cerdfied that this Law has bitsri dolihora.,1.3d andr"_.dopted dazing
rneei,thig ihe Natixtzgat 41,esernbly Au.i;ust 12, 1971.
Vieuttane, Anguet 120 1971
Preeicient of the 1440:iow1.ksatornb1y
/0/ Phagria Rouakisoug
(Phoni Sawalttorte)
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4
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1`?
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Cfficial Crder
Ministry of pef6r?;e
RLAM HQ.
Commander of Trnsportaticn
No 1041
SUBJECT : To subdUe narcotic
REFER TC1075/Law,2 dtd. 27 Cct. 1971 of Ministry of Interrior.
In order to observe the law No 71/5 dtd. 10 Aug. 1V1 coneernim,
banning to 'plant opium, smoking, selling or buying.
According to the condition mentioned in the' law ir
the National Army Force is to takinp in part of greatly responsible to
policy of the government and World Orp,:nination to subdue narcotic uhih .3 bo.inc
pressed to control narcotic which is.preatly clangorous. So, the Natirn't1 Araly Vor
has set up the following conditions :
'1. The search of Passengers on domestic and interuAional fltJ
be submitted. Especially, for the first step,. of passengers cn bc:Ayd of AAM.
2. In order to show- of unbiased, the search will oc
according to the universal-rule, there will be no any exception at all. Cnly in case
of absolutely special (The advise will be commended). 0
3. At the Traffic Terminal, there will be one autilorized
tary police and one AAM officer searching passengers.
? .
General Boonpol MAKTHEPARAK.
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rcIuc t to OA
. I 6 errtificat (Ja t 61 Proi!rIm
?Sls
rart?f.;(.:c!-urity ar
riOlug - ccurity jrA 1,,Ai rice
Lea ec.aky r fi,arrity Air VI ca
T. 1,!"..)rr:311i EinD - Att.:Li NIC
M. Irc,I19.n rablic Saf;3t
U. Jo La0Iair - V. B. Ow;t1 Advigo,2.
06001c Mnrcotic Law
1000 D'rn Identiftoation 4- Test Nit
1030-1233 Information,. Repogting of,
1330
g.e.port;ix% of Violfttion3
Action of 3P3 rronni
qui3(;tiou, and .1cr? Feried
Wit0t)'1,Nir
T. NorvalLi
-
Identifi.(!ntion of drur: cavrier
ftithods
Posnialc Rout0S
Banage Examioation
LuClair
Evidence_ of contraband
Places of coac,Ittlo(Nat
Per6onAl searchan frirAzing LeClair
14dlop. hulndbogg
:eptiona to secwch
Aiert
observto.nt
D/C ttJt0111/3 :11,31..scela ir dfa:1/ r
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Rep. Robert H. Steele (R-'
Conn.). said on. July 7, 1071,
before the House Foreign Af-,
fairs CoipmIttee that U.S.
military authorities have pro-
vided Ambassador Bunker
0 with hard intelligence that one
of he chief traffickers" tof
heroin is Dzu. Steele and
Rep. Morgan . F. Murphy (D.
Ill.) in April, 1971, conducted
a special study on heroin
trafficking for the House
Foreign Affairs Committee.
One of their recciflimenda.
George C. Wilson tions to stem the heroin trill-
'
ficking in Asia was to "force-
, Washington Post etaft Writer fully exercise" the "special
:Secret U.S. government re- lug in heroin with Mr. Chanh,lleverages" it has with the
ports. linking South Vietnam's an ethnic Chinese from Cho- South Vietnamese and Lao-
Gen. Ngo D7,11 to trafficking Ion. . .. (Gen. Dzu was recent- tian governments through
In heroin are slated to be ex- ly relieved as commander of 'our enormous military, eco-
amined today at a public hear. MR-2 after battlefield reverses ;nomic and political support
;
jug of the Senate Foreign Op. there.) . 1. .
erations Subcommittee. "General Dzu's father lives; Rep. Lester L. Wolff (D-
in.Quinhon, Mr. Chanh makes':) has 84 co-sponsors on
regular trips to Quinhon from his pending resolution to cut
Saigon, usually via Air Viet-
nam but sometimes by Gen.
Dzu's private aircraft. . . .
The documentary evidence
? 'could stiffen congressional re-
sistance to voting aid money
this year to Asian nations
which do not crack down on
the illegal drug trade?a rc.
sistance which manifested it-
self in narcotics control
amendments in the Foreign
Assistance Act of 1971. Simi-
lar amendments are in the
works for this year's aid bill
as well.
A confidential memo from
the U.S. military command in
Vietnam and reports from the
Army's Criminal Investigation
Division raise fresh challenges
to previous US, government
denials about drug trafficking
? by Thieu government officials.
"The national police in
Quinhon, especially those po-
lice assigned to the airport,
er amendment along this
are reportedly aware of the
, same line for this year's for-
activity between Genera' eign aid bill.
D711'S father and Mr. Chanh,
off economic and military aid
to Thailand if the President
determines that nation has
not taken "adequate steps"
to control narcotics, traffick-
ing. Wolff is drafting a strong-
but are afraid to either report
or investigate these alleged
violhtions fearing that they
will only be made the scape-
goats should they act. ..." ;
Vann, both in response to
Steele's charges last summer
and again in a letter to The
Washington Post on Oct. 9,
1971, said, "There is no evi-
dence available to me or to
The memo was signed by Gen. Abrams that would tend
Michael G. McCann, director to substantiate Congressman
of CORD's public safety di- Steele's charges.". ? .,4
rectorate.
These are quotes from the
John Paul Vann, director of U.S. Army's Criminal Investi-
pacification activities in Mill- ; gation Division reports, with
tary Region 2, which includes ;the third one contributed by
Kontum, has repeatedly denied 'U.S. customs officials.
that there is any liard evidence ; * Jan. 6, 1971 ? "Source
implicating Dzu in heroin ;reported to CID that Gen.
trafficking.:Dzu and his father were in,
Alfred W.' McCoy, author of volved in narcotics traffick-
a book entitled, "The Politics lug. This source said that
of Heroin in Southeast Asia," is with ' a number of other in
.slated to make the documents dividuals, including the ARVN
public today when ho testifies (Army of the Republic of
at a hearing of Sen. William Vietnam) provost marshal in
Proxmire':; (D.-Wis.) Foreign Quinhon, certain South Viet-
Operations Subcommittee of the narnese navy officers and an
Senate Appropriations Commit- officer in a South Korean di-,
4..e. vision . . ."
?? :The Washington Post has ob- ? May 12, 1911? " . . . .
tamed copies of the.documents. According to this source, Gen.
? The It it he r to unpublished Dzu's father is working with
memo from the military cam- a former special assistant to.
mand's assistant chief ot staff President Thieu."
for Civil Operations and Rural ? July 10, 1971 ? "Source'
? Development is dated June 10, alleged that Gen. Dzu con-
1071, and states:. trolled a sizeable heroin ring
"A confidential source has through a number of assoei-
advised this directorate that ates, including his mistress,
the father of General Dzu, Mrs. Tran Thi Khahn."
MR 2 (Military Region 2) corn-
'flanging .general,, is traffick. . ? .
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LACX
(3.001(
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FOR RELEASE FRIDAY, JUNE 2, 19/2 PM
Testimony to be delivered before Senator Proxmire's
Subcommittee at 2:30 pm, Friday, June 2 in 1224 New
Senate Office Building.
Statement by Alfred W. McCoy
before the Foreign Operations Subcomittee
of the Appropriations Committee, U.S. Senate
June 2, 1972
THE HEROIN TRAFFIC IN SOUTHEAST ASIA
Abstract
1. Much of the heroin entering the U.S. now originates in Southeast Asia.
2. The governments of South Vietnam, Laos, and Thailand are actively
engaged in the heroin traffic.
3. The U.S. government is aware of this traffic, but has not moved to stop
it and has consciously concealed evidence of the involvement of our
Southeast Asian allies.
Alfred W. McCoy is presently a Ph.D. student in Southeast Asian History
at Yale University. He has spent the last 18 months researching the inter-
national drug traffic and his findings will be published in a book entitled
The Politics of Heroin in Southeast Asia, Harper Row, July 1972. Mr. McCoy's
findings 're based on research, documents, and more than 250 person:11 inter-
views conducted in the U.S., Europe, and Southeast Asia. Sources of information
include U.S. military, intelligence, and Embassy reports on narcotics, as well
as interviews with U.S. Embassy, USAID, military, and CIA personnel. Mr. McCoy
also interviewed the Chief of the Narcotics Bureau of the Vietnamese National
Police, Vietnamese intelligence, military, and customs officials, Gen. Ouane
Rattikone (former Chief of Staff of the Royal Laotian Army), Touby Lyfoung (a
Laotian Meo leader), U Ba Thien (former commander-in-chief of the Shan National
Army in Burma), an officer of the KMT (Nationalist Chinese) irregular army in
Thailand, and other persons in South Vietnam, Laos, Thailand, Hong Kong and
Singapore. Mr. McCoy spent a week livingwith an opium growing Meo tribe in
Laos. He has briefed the U.S. Bureau of Narcotics and Dangerous Drugs on his
findings, and they corroborate much of his evidence. Mr. McCoy can be contacted
at [phone].
For further information contact:
John Marx
Office of Senator Clifford Case
225-3224
Wes Michaelson
Office of Senator Mark Hatfield
225-8310
Bill Broyderick
Office of Cong. Les Aspin
225-3031
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THE HEROIN TRAFFIC IN SOUTHEAST ASIA
Statement by Alfred W. McCoy'
By ignoring, covering up, and failing to counteract the massive drug
traffic from Southeast Asia, our goveinment is aiding and abetting the influx
of heroin into our nation.
Southeast Asia is fast becoming the major supplier of illicit narcotics
for America's growing population of heroin addicts. Since the late 1960s
international criminal syndicates have responded to mounting law enforcement
efforts in Europe and the Middle East by shifting their major source:; of supply
to Southeast Asia. The opium poppy fields of Southeast Asia's Golden Triangle
,Region supply raw materials for clandestine heroin laboratories in Europe,
Hong Kong, and the Tri-border area where Burma, Thailand and Laos converge.
High government officials in Thailand, Laos and South Vietnam are actively
engaged in the heroin traffic and are protecting the region's powerful narcotics
syndicates. Because the corruption in these countries is so systematic and
the narcotics traffic so lucrative, our political commitments to these govern-
ments inhibit and prevent any effective action to cut the flow of these
illicit narcotics into the United States.
U.S. diplomatic, military, and intelligence officials have always toler-
ated governmental corruption in Southeast Asia, and narcotics trafficking has
not been treated differently. U.S. officials in Southeast Asia have been impli-
cated in the traffic on three levels: 1) providing political and military support
for officials and political factions actively engaged in the drug traffic without
pressuring them to deal with the problem; 2) consciously concealing evidence of
involvement in the narcotics traffic by our Southeast Asian allies. Whenever
the U.S. Congress or the media have made accurate allegations about the involve-
ment of our allies, U.S. diplomatic personnel have repeatedly issued categorical,
fallacious denials; 3) active involvement in certain aspects of the region's
narcotics traffic.
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In 1967-68 American diplomatic initiatives convinced the Turkish government
to drastically reduce its total opium production .and expand its enforcement
efforts. . Significantly, the sharp reduction of Turkey's opium production from
1963-72 coincided with a massive increase in the amount of heroin enter-
ing the United States; between 1969 and 1972 America's estimated addict population
practically doubled, increasing from 315,000 to 560,000. As late as 1965 a seizure
of only 15 kilos of pure heroin produced a street panic in New York City; by
1971 seizures totalling almost 400 kilos within a period of several weeks did
not have even a minor impact on the street supply. The question is, oF course,
where is all this heroin coming from.
Informed Federal narcotics offieals and diplomats are virtually unanimous
in their response--more and more heroin comes from Southeast Asia.
Beginning in 1965 members of the Florida-based Trafficantc family of
American organized crime began appearing in Southeast Asia. Santo Trafficante,
Jr., heir to the international criminal syndicate established by Lucky kuciano
and Meyer Lansky, traveled to Saigon and Hong Kong himself in 1968. U.S. Embassy
sources state that Trafficante met with prominent members of Saigon's Corsican
syndicates. These syndicates have been regularly supplying the international
narcotics markets since the First Indochina War.
In 1967-68 there was evidence of increased activity on the part of Indochina's
Corsican gangsters. U.S. agents observed Corsican heroin traffickers commuting
between Saigon and Marseille where the Corsicans control the clandestine heroin
laboratories. A former, high raliking CIA agent in Saigon told me in an interview
that in 1969 there was a summit meeting of Corsican criminals from Marseille,
Vientiane, and Phnom Penh at Saigon's Continental Palace Hotel.
In the wake of these high level meetings, increased quantities of Asian
heroin have begun entering the United States. In 1970 the U.S. Bureau of Narcotics
broke up a Filipino courier ring which had smuggled over 1,000 kilos of pure
Hong Kong heroin into the United States in the preceding 12 months. 1,000
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kilos of pure heroin is equivalent to 10 to 20% of our estimated tot.W., annual
heroin consumption. Since all of Hong Kong's morphine base comes froli Southeast
Asia's Golden Triangle, this case provided ample evidence of the growing import-
ance of Southeast Asia in America's druK crisis. Unfortunately, the U.S. Bureau
of Narcotics has only one agent in Hong Kong and so further seizures have not
been forthcoming. In 1971 French Customs seized 60 kilos of pure Laotian heroin
at Orly Airport in Paris in the suitcases of Prince Sopsaisana, the newly appointed
Laotian Ambassador to France. The U.S. Bureau of Narcotics and diplomatic sources
in Vientiane report that the Ambassador's French connection was arraned by Michel
Theodas, manager of the Lang Xang Hotel in Vientiane and a high ranking member
of the French-Corsican underworld. Piaally, the Director of the U.S. Bureau of
Narcotics reports that his intelligence sources indicate that much of the massive
flow of heroin moving through Latin America on its way to the United :Aates
is coming from Southeast Asia. Ironically, our Southeast Asian allies are prof-
iting from this heroin bonanza. In a three hour interview with me, Gen. Ouane
Rattikone, former chief-of-staff of the Royal Laotian Army, admitted that he
controlled the opium traffic in northwestern Laos since 1962. Gen. ()aerie also
controlled the largest heroin laboratory in Laos. This laboratory produced a
high grade of heroin for the GI market in South Vietnam, and, according to the
CIA, was capable of producing over 3,000 kilos of heroin a year. With the with-
drawal. of U.S. troops, the market for such heroin has shifted directly to the
United States. Most of the opium traffic in northeastern Laos is controlled by
yang Pao, the Laotian general who commands the CIA's mercenary aimy. The Thai
government allows Burmese rebels, Nationalist Chinese irregulars, and mercenary .
Armies to move enolmous mule caravans loaded with hundreds of tons of Burmese
opium across Thailand's northern border. U.S. narcotics agents working in
Thailand claim that every major narcotics dealer in Thailand hasa high ranking
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"advisor" on the Thai police force. In South Vietnam, the opium and heroin
...traffic is, divided among the nation's three dominant military factions: President
Thieu's political apparatus, PrimeMinister Khiem's political organization,
and General Ky's political apparatus.
An examination of Gen. Ky's political apparatus demonstrates the importance
of official corruption in Southeast Asia's drug traffic and shows how Southeast
.Asia's narcotics move from the poppy fields into the international smuggling
circuits. Located in the Vientiane region of Laos. until recently was a large'
heroin laboratory managed by an overseas Chinese racketeer named Huu Tim Heng.
Mr. Hong was the silent partner in Pepsi Cola's Vientiane bottling plant and used
this operation as a cover to import acetic anhydride, a chemical necessary for
the manufacture of heroin. Mr. Heng purchased raw opium and morphine base from
Gen. Guano. Rattikone, and then sold the finished product to Gen. Ky's sister,
Mrs. Nguyen Thi Ly. Although a resident of Pakse, Laos from 1962-1967, Mrs. Ly
now lives in Saigon and travels to Vientiane about once a month to arrange for
shipment of the packaged heroin to Pakse or Phnom Penh, Cambodia where it is picked
up by transport aircraft belonging to the Vietnamese Fifth Air Division and flown
to Saigon. The commander of the Fifth Air Division, Col. Phan Phung Tien, has
been publicly attacked by the Director General of Vietnam Customs for his inter-
ference in anti-narcotics efforts and is believed to have extensive contacts with
Saigon's Corsican underworld. Vietnamese military officers have identified Col.
Tien as Gen. Ky's strongest political supporter inside the Air Force, and
one senior U.S. Air Force advisor called him Gen. Ky's "revolutionary plotter."
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ThAPTPAWKMITTPTaRTfltrisWaT8PMMUMITM
ing all
the way to the top of President Thieu's political apparatus. Two of hj_s staunch-
est supporters in the Lower House of the National Assembly have been arrested
trying to smuggle heroin into South Vietnam, and other pro-Thieu deputies,
including one of the president's legislative advisors have been implicated in
other smuggling cases. Some of Pres. Thieu's closest supporters inside the
Vietnamese Almy control the distribution and sale of heroin to American GIs
fighting in Indochina. President Thieu's most important military advisor, Gen.
Dang Van Quang, has been publicly accused by NBC of being the "biggest pusher"
in South Vietnam. It is a matter of public record that Gen. Quang was
removed from command of IV Corps for outrageous corruption in 1967-68, and
reliable sources in the Vietnamese military have confirmed NBC's report
Finally, U.S. military commanders report that the narcotics traffic in the Mekong
Delta is controlled by colonels and low ranking generals loyal to Gen. Quang.
Another of President Thieu's staunch Army supporters, Gen. Ngo Dzu, Il COrps
Commander until several weeks ago when he was removed for military incompetence,
has been identified as one of the major drug traffickers in Central Vietnam
by the USAID Public Safety Directorate, U.S. Bureau ofNarcotics and Dangerous
Drugs, and the U.S. Army Criminal Investigation Division.
American officials serving in Southeast Asia have a great deal of responsi-
bility for the growth of the region's illicit drug traffic. American diplomats
and intelligence agents have allied themselves with corrupt, indigenols groups
without pressuring them to get out of the drug business. Throughout the moun-
tainous Golden Triangle region, the CIA has provided substantial military support
for mercenaries, right-wing rebels, aad tribal warlords who are actively engaged
in the narcotics traffic. And in Thailand the CIA has worked closely with
nationalist Chinese paramilitary units which control 80-90% of northern Burma's
vast opium exports and manufacture hiah grade heroin for export to the American
market.
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U. SApgarinadfew Relettate200KINUId git3FRRIRWOMg130i$93MeclOg3-3th-.! involve
-
merit of our local
with woll-founded
allies in the drug traffic. In 1968 Sen. Cruening came forward
allegations about Gen. Ky's opium smuggling activites. The
U.S. Embassy in Saigon issued a categorical denial. In July 1971, NBC's senior
Saigon correspondent charged that Gen. Dang Van Quang, Pres. Thieu's chief mili-
tary advisor, was the "biggest pusher" in South Vietnam. Prior to this broad-
cast, I had received independent reports of Gen. Quang's narcotics dealings
from high ranking Vietnamese sources. The U.S. Embassy again issued a vigorous
denial. In July 1971, Congressman Robert Steele claimed to have received clas-
sified documents showing that II Corps Commander, Gen. Ngo Dzu, was trafficking
in heroin. The U.S. Embassy deferred to Senior II Corps Advisor John Paul Vann
who denied that such documents existed. I have one Of those documents in my
possession.
The record of the U.S. Embassy in Laos is even worse. All U.S. officials
in Indochina know that the vast majority of the high grade heroin sold to GIs
fighting in South Vietnam is manufactured in Laotian laboratories. Yet in December
1970, the U.S..Ambassador to Laos, G. McMurtrie Godley, told an American writer,
"I believe the Royal Laotian Government takes its responsibility seriously to
;
prohibit international opiumtraffic." Ambassador Godley did his best to prevent
the assignment of U.S. Bureau of Narcotics agents to Laos. It was not until
November 1971--a full two years after Laotian heroin had decimated U.S. troops
in South Vietnam--that the Bureau of Narcotics was allewed to send its agents
into Laos.
Finally, U.S. agencies have been actually involved in certain w;pects of
the region's drug traffic. In northern Laos, Air America aircraft and helicopters
chartered by the U.S. Central Intelligence Agency and USAID have been transporting
opium harvested by the agency's tribal mercenaries on a regular basis.
After spending 18 months researching, travelling and conducting hundreds
of interviews, I have reached one fiLm conclusion--if we are going to deal seri-
ously with the heroin problem in this country we will have to reordec our pri-
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G.
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?Titles and commitments in Southeast Asia. President i\ixon nas told us that we
cannot solve the drug problem unless we deal with it at its source and eliminate
illicit opium production. The source is now Southeast Asia, and that area accounts
for some 70% of the world's illicit opium supply. There is enough opium in
Southeast Asia to fuel our heroin plague for countless generations to come. In
the past and present we have let our military and political goals in Southeast Asia
dictate our priorities. As a result, our officials have tried to prop up corrupt
regimes there at all costs, including silent acquiesence to the traffic in drugs
that is ruining the fabric of our nation. The problem of crime in our streets is
larci^ly a heroin problem which would disappear if the drug traffic were brought
under control. The drugs now flowing from Southeast Asia. in effect mike all
the funds and effort expended reducing Turkey's opium production totAly
irrelevant as a final solution to our problem.
We now have to decide which is more important to Our country--propping
up corrupt governments in Southeast Asia or getting heroin out of ou high
schools.
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