C.I.A. IS REPORTED TRYING TO SELL INTEREST IN AIRLINE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP75B00380R000400050058-4
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 19, 2016
• Document Release Date: January 3, 2006
• Sequence Number: 58
• Publication Date: August 30, 1973
• Content Type: NSPR

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C.I.A. Is Reported Trying
To Sell Interest in Airline
WASHINGTON, Aug. 28
-The Central Intelligence
Agency is secretly trying to
sell its controlling interest in
a charter airline, Southern Air
Transport, knowledgeable of-
ficials said today.
A member of the Miami-
based company, which operates
three Lockheed Hercules trans-
ports, said in a telephone in-
terviewthat SouthernAir Trans-
port had done contract work
for the United States Military
Assistance Command in
Vietnam. He asked not to be
identified.
There is also some evidence
that the charter airline per-,
formed some clandestine mis-
sions for the intelligenceagency
in the Caribbean area, specifi-
cally to Haiti.
The sale of the 26-year-old
airline to Stanley G. Williams
is currently before the Civil
AeronauticsBoard's administra-
tive law judge, Milton Sha-
piro.
Mr. Williams, a former Navy
man, joined the airline in 1949
and became its secretary-trea-
surer. Now, as president and
direction, he is seeking 100 per
cent ownership for $5.1-million.
Nominal Sellers
The nominal sellers are al
Washington businessman, Per-
kins McGuire, and Percival
Flack Brundage, also of Wash-
ington. Mr. McGuire was an as-
sistant Secretary of Defense and
Mr. Bundage a director of the
Bureau of the Budget under
After six days of secret'
hearings before Judge Shapiro
last June, representatives of
four charter airlines competi-
tive with Southern alleged that
Mr. McGuire and Mr. Brundage
were merely acting for the Cen-
tral Intelligence Agency. Nei-
ther marr could he reached for
comment this evening.
Officials familiar with the
charter airline business said
the four companies contesting
the sale of Southern to Mr.
Williams resented what they,
regard an unfair competition
from Government interests.
They noted that Southern
was awarded a choice route
across the Pacific Ocean in 1966
.wen though its presentation
was, in the words of a former
C.A.B. official, "substantially
different" and less well docu?
mooted than those of many
other airlines bidding for the
route.'
Southern Air Transport, a Miami-Based
Charter Company, Had Done Work
for the U.S. Military in Vietnam
By DAVID BINDER
Special to The New York Times
Air America Operation
The award to Southern was
evidently made as a require-
ment of national security. The
President of the United States
has the ultimate authority to
award foreign airline routes on
this basis, it was noted.
It appears that the Central
Intelligence Agency decided to
pick up Southern Air Transport
in 19601-in part as an adjunct
to its operation known as Air
America, which carried out
numerous clandestine opera-
tions in Indochina, particularly
in Laos, during the nineteen-
sixties.
Southern's attorney in the
case pending before the C.A.B.
i's James H. Bastian, who is also
on the board of directors of
Air America.
The 1972-73 District of Co-
lumbia telephone book lists both
Air America and Southern Air
Transport offices as beiing at
1725 K Street N.W. but a caller
was told that Southern had re-
cently closed its, Washington
quarters and could now be
reached at the Miami Interna-
tional Airport.
Mr. Bastian said on the tele.
phone that he had requested
secret sessions in the Southern
transaction before the C.A.B.
on the ground of "national in-
terest."
But an official of the au-
thority said that all parties at-
access to all of the informa-
tion" in the case. He indicated
that the representatives of com-
peting companies had broken
oaths of secrecy in disclosing
the intelligence agency's in-
volvement
Among the companies con-
testing the sale is Overseas
National Airways of New York.
Asked for comment on an
article in today's Wall Street
Journal dealing with the South
ern Transport Case, a repre-
sentative of the intelligence
agency said, "Nobody here
feels it is appropriate to dis-
cuss it."
Mr. Williams, 52 years old,
the president of Southern, was
described by company associ-
ates as being out of town and
unavailable for comment.
However, a man familiar
with Southern operations said
he was aware the 120-member
charter company did fly mis-
sions to "certain areas" of In-
dochina from the Philippines
in the past.
Federal Contracts
He added that Southern had
also been given contracts by
the Agency for International
Development to carry relief
supplies to Bangledesh last
year, and in recent months to
the drought-stricken inhabi-
tants-of the western Sahara re-
gion in Africa.
Southern Air Transport's con-
nection with Air America ap-
pears to have involved money
as well as personnel, judging
from the C.A.B. hearings.
Air America is said to have'
lent Southern $1.7-million in
1960 to buy two Douglas DC-6
aircraft from it. That was
about the time Mr. McGuire
and Mr. Brundage appeared in
the ownership of Southern. In
1966 Air America lent $5.7-mil-
lion to Southern.
Southern has also received
money from a company called
Actus Technology, which is
said to be owned and managed
by Mr. Williams, Mr. Brundage
and Mr. McGuire.
"They are all part of the
C.I.A. old boys' club," a char-
ter airlines official said.
The auditing firm for both
Air America and Southern is
Coopers & Lybrand, the same
New York-based international
accounting firm that analyzed
President Nixon's purchase of
his property at San Clemente,
Calif.
Approved. For Release 2006/0.2LQ2,:_DIARDP_.75BQ038QROOQ4Q005D058-4~