The Last Supper (16 page)

Brenneke’s allegations may appear wild and, like many witnesses in this story, he has severe credibility problems – partly because of a propensity to modify his account as he goes along – but his claims about the drug operations at Mena airport have been backed up by the independent testimony of an investigator from the Internal Revenue Service (IRS). Testifying on the same day as Brenneke to Congressman Alexander and a representative of the Arkansas attorney general’s office, Treasury Department criminal investigator William C. Duncan described how his money laundering inquiry had been frustrated by colleagues in the IRS and the US Attorney’s Office. ‘What Mr Brenneke has related concerning the Mena operation would be consistent with testimony from a variety of individuals and additional information that we received concerning the method of operation at Rich Mountain Aviation [one of the companies operating at the airport],’ Duncan said. The allegations of collusion between the CIA and the mafia were perhaps not so far-fetched after all. Not long before, the US government agency was looking to Cosa Nostra for assistance with the assassination of Fidel Castro, and there is no more discreet form of off-the-books money – always a valuable commodity in an intelligence agency – than that generated by drug-dealing.

Richard Brenneke was ideally suited to his role as a CIA money launderer. A conservative Roman Catholic who studied at Jesuit high school in Portland, he read philosophy and
mathematics at university, gaining an MA in mathematical theory from the University of Toronto in 1966. He went on to teach mathematics at the Jesuit-run St John’s College in New York. While there he had his first contact with the Central Intelligence Agency, applying for a job with the agency in 1968. ‘I had a very intense feeling of patriotism, and a very, very strong feeling that American ideals, the American Dream, had a right to be shared with other people,’ Brenneke told the left-wing newspaper the
Village Voice
years later. He was offered a job as a computer analyst at CIA headquarters in Langley, Virginia, but decided to turn it down.

The
Village Voice
summed up his character: ‘A true believer, Brenneke placed the same kind of faith and trust in his government that his Jesuit instructors had taught him to have for the Catholic church. The church’s fervent anti-communist teachings seemed to rhyme with cold war idealism: being a soldier for Freedom was not unlike being a soldier for the pope.’ And his role: ‘Brenneke, a low-level covert jack-of-all-trades, did his bit in the 1980s while Americans and their allies created a multinational covert warfare network of arms dealers, money launderers, drug smugglers, cut-throat mercenaries, and professional spooks that stretched from Portland to Pakistan to Paris to Panama.’
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Brenneke claims to have worked for the Israeli government in a number of sensitive capacities during the 1970s and 1980s, from installing and upgrading computer systems in Guatemala and Costa Rica to flying Jewish refugees out of Iran after the fall of the Shah. Israel was selling a lot of weapons in Central and South America, he explained to Portland’s
Willamette Week
, sometimes as a proxy for the CIA to the Contras, or to the government of Guatemala, sometimes to the other side, to the Marxist rebels of Shining Path in Peru, for example. ‘Every country has an army and a revolutionary opposition,’ he told the local magazine. ‘It’s a very profitable place to do that kind of business.’
³

Brenneke’s illegal activities, if true, place him in the same sphere of activity as Sindona and Calvi, if the word of the ‘repentant’
mafiosi
implicating them in money laundering is to be believed. But the story he told in an interview broadcast on Italy’s principal state-run television channel on 2 July 1990 moves him even closer to the world of Roberto Calvi. It concerns the P2 masonic lodge and paints a portrait of the organization that is far removed from the reassuring old boys’ club described by the CIA’s Duane Clarridge in
Chapter 5
. The lodge had been involved in fomenting terrorism and smuggling drugs and had been generously funded for those purposes by the CIA, Brenneke alleged. He had been in contact with P2 from 1969 and had been personally responsible for making some of the payments, which amounted, on occasion, to more than $10 million a month.

‘The CIA’s money went to P2 for a variety of purposes, one of which was terrorism,’ Brenneke told the RAI Uno interviewer, Ennio Remondino. ‘Another aim was to obtain its help, at the beginning of the 1970s, in smuggling drugs into the United States from a number of different countries. They were people who had influence within the government, important people. We made use of these people to help get money and drugs into and out of the United States and to get money and drugs in and out of Italy. We used them to create a situation that would favour the outbreak of terrorism in Italy and other European countries at the beginning of the 1970s. These were very important activities, since certain governments fell as a result of them.’

Brenneke said both he and Licio Gelli had worked for the CIA as contract agents and that P2 and the American mafia had collaborated on the import of drugs into the United States. He had met Gelli on a number of occasions, once in Colorado when Gelli was on the run from Italian justice, and once in Argentina at around the time of the Falklands war in 1982 when the two men had discussed P2’s funding and ‘the supply
of armaments to various people’. Gelli was not the real head of P2, but he was ‘the man we dealt with’, Brenneke said. Gelli had also been present at a meeting in Paris in autumn 1980 to head off a premature release of the 52 US embassy hostages in Teheran during the final stages of the US presidential election. Such a pre-election welcome surprise might have led to the re-election of Jimmy Carter as Democratic president. Brenneke claimed he had been present himself at this ‘October Surprise’ gathering and had spotted William Casey, Ronald Reagan’s campaign manager and the future director of the Central Intelligence Agency, and Donald Gregg, a CIA officer who would later be appointed ambassador to South Korea, a key observation post from which to monitor the United States’ cold war foes in North Korea and China.

Brenneke’s interview caused uproar in Italy, its impact augmented by the fact that it had been broadcast on the normally cautious Christian Democrat-controlled RAI Uno. Gelli himself responded with an indignant denial, announcing that he would be seeking ‘purely symbolic’ damages of 10 billion lire (£5 million). He followed this up with a somewhat contorted statement to the news magazine
L’Europeo.
‘This Mr Brenneke, of whose existence I was unaware until now, must be a sleepwalker or a dreamer,’ he said. ‘If he really had been a CIA agent he should know that certain revelations are forbidden. And if they were false, it would be forbidden even to think them.’
⁴
Even the CIA was moved to issue a formal denial that Brenneke ‘was ever an agent of the CIA or associated in any way with the CIA’. Agency spokesman Peter Earnest added: ‘We repeat this public denial because of the outrageous nature of his claims. Allegations attributed to him regarding agency involvement in terrorist activities in Italy... are absolute nonsense.’
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Brenneke is best known in the United States for his ‘October Surprise’ allegations, a continuing source of unresolved controversy. When he was put on trial for perjury, though, a Portland
court found they believed him rather than his federal accusers. In May 1990 the court acquitted Brenneke on five counts of lying under oath to a federal court. The 12-member jury voted unanimously in his favour on every count. The court may also have been influenced by the final outcome of the hostage standoff in Iran: the 52 Americans were set free only minutes after Ronald Reagan was sworn in as president on 20 January 1981, a full three months after the alleged Paris meetings.

To bolster his credibility with RAI’s interviewer, Brenneke handed over a series of documents detailing his alleged financial activities on behalf of the CIA and P2. They make for an illuminating read and support his contention that P2 was part of a wider international conspiracy. One of the instruments for channelling funds from the CIA to the P2 lodge, he indicated, was a company called the Amitalia Fund SA, incorporated in the Grand Duchy of Luxembourg on 12 March 1970. Brenneke’s documents describe the company as ‘an open-ended, diversified investment company offering its shares for sale primarily in Italy’.

Brenneke’s documents specify the custodian of the Amitalia Fund as the Banque du Benelux–La Luxembourgeoise of 10 Rue Aldringen, Luxembourg. Significantly, a subcustodian is Michele Sindona’s Banca Privata Finanziaria, of 7 Via G. Verdi, Milan. Among the bank accounts allegedly used for CIA/P2 transactions was one at the Bank of Credit and Commerce International branch at 33 Boulevard Princesse Charlotte, Monte Carlo. The BCCI is another potentially significant partner; dubbed the ‘Bank of Crooks and Criminals International’ by senior CIA official Robert Gates, the bank was extensively used both for espionage and for the funding of cold war operations by western secret services before going bust with debts of more than $1.7 billion in 1991.

The breadth of Brenneke’s interests is illustrated by other documents provided to the RAI interviewer and subsequently handed over to Italian investigators in Rome. Among them is a
contract for the purchase of 20 Dassault-Breguet Mirage 2000 fighter jets at a cost of $440 million from a company in Hong Kong. The operation bears the codename ‘Molasses’ and the correspondence from the Hong Kong company is signed by the arms dealer Eugene Bartholomew.

Where Brenneke appears to be on the firmest ground is in his knowledge of secret arms sales to Iran, the subject that first brought him to the attention of the media in the United States. His contact with the arms business goes back a long way. According to his own account, the Brenneke family used to manufacture high-quality shotguns in Germany until the 1920s. Hunting down those rare collectors’ items brought him into contact with dealers in East Germany and Czechoslovakia, facilitating the contacts that would subsequently enable him to buy Eastern Bloc weapons for the CIA, particularly from sources in Yugoslavia and Czechoslovakia. Such eastern-origin weapons are particularly useful if one wants to arm guerrilla organizations, such as the mujahedin in Afghanistan, without leaving telltale western fingerprints on the operation.

If Brenneke participated, as he claims, in the airlift that led to the exchange of arms for Iranian Jews in 1980, an operation allegedly brokered by French, US and Israeli secret services, it would seem that he was in at the very conception of what would become the Iran–Contra scandal in 1986. The scheme would morph through the ‘October Surprise’ phase, when Brenneke claims to have helped launder some $40 million needed to grease palms in the Iranian mullahs’ regime and ensure the delayed release of the US embassy hostages, into what became the fully fledged Iran–Contra operation: the overcharging on the sale of weapons to one enemy, Iran, to fund a clandestine war against another, the left-wing government of Nicaragua. It was his involvement in this operation that made Brenneke aware of the drugs for arms exchange. He says he had particular moral qualms about the drug trafficking because the life of his teenage son had been ruined
by drug addiction. ‘Typically, the drugs were run through Panama and into the United States,’ he told the
Willamette Week.
‘If the shipments were extremely sensitive, you’d see Israeli pilots and aircraft.’
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Later in the 1980s Brenneke claims he approached Vice-President George Bush with details of an Iranian offer to begin normalization of relations with the US and to provide the Americans with samples of their Russian weapons systems and intelligence in exchange for US weapons systems, but was rebuffed.

Secrecy, and secret services, exist for just such circumstances as these. Ronald Reagan had vowed not to negotiate with terrorists or hostage-takers, so he couldn’t afford to be seen negotiating with Teheran; Iran had been placed on the US government’s official list of terrorist states on 18 January 1984 and William Casey, the director of the CIA, routinely referred to the country in speeches as ‘the most dangerous state sponsor of terrorism in the world’. The United States had vowed to remain neutral in the Iran–Iraq war of 1980–88; it did so by arming both sides, and the West watched while its arms industries grew rich and two enemies of Israel poured their blood and treasure copiously into the desert. The eight-year conflict, which resulted in more than a million deaths, produced a kind of oil crisis in reverse: the two oil-producing belligerents were forced to pump extra crude to pay for the war, thus bringing down energy costs and boosting the dollar economy.

Israel’s role in arming Iran has been detailed by Ari Ben-Menashe, an Israeli military intelligence officer who claims to have personally participated in some of the secret deals. In 1983 the Iranian-born Ben-Menashe negotiated the sale of 4,000 TOW anti-tank missiles to Teheran, he says. The missiles were part of an old stock and their power supply
was due to run out in two years’ time. That consignment was followed by two more of a similar quantity, the first batch drawn from NATO stock in Europe and the second directly from the United States, but shipped via Guatemala and Australia. A total of 12,000 TOWs were sent to Iran between 1983 and 1987, he claims. ‘These, we believed, eventually changed the face of the war,’ he wrote in his controversial memoir,
Profits of War.

Ben-Menashe claimed Israel used a slush fund, fed from the arms-trading profits, to buy the goodwill and silence of politicians in the US, Britain and Australia. Democrats on the Iran–Contra panel also received payments, intended to blunt their curiosity, some of them channelled through the American Israel Public Affairs Committee, he claimed. The friendship with Conservative politicians in the UK, which had been similarly lubricated, came to an end in 1988, ‘when Margaret Thatcher supported the sale of military equipment for unconventional warfare to Iraq,’
⁷
he alleged.