EX-AGENT CITES CIA DRUG SCHEME

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00494R001100700192-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: July 5, 2011
• Sequence Number: 192
• Publication Date: December 26, 1984
• Content Type: OPEN SOURCE

......... Sanitized Copy Approved for Release 2011/07/05: CIA-RDP90-00494RO01100700192-7
THE NEW YORK TIMES
DATE 6 D ~C.
PAGE Eir
JJACKANULKbUR
Ex-Agent Cites CIA Drug Scheme
A former C14--agent, who is under indictment
for fraud and perjury, claims that a superior
asked him.to take part in a CIA-sponsored
drug-smuggling operation. The ex-agent, Ronald
Ray Rewald, told confidants that when he declined,
the CIA dropped the matter.
Rewaki's charge is the latest in a spate of reports
dating back to the 1970s that the CIA has been
involved in international drug trafficking. It also
raises new questions about an Australian bank
scandal four years ago that cost investors millions.
The Australian bank, Nugan Hand Ltd., was run
by former CIA and U.S. military officers. It served
as a "laundry" for illicit heroin and arms syndicates,
which it also helped to finance. The bank collapsed
after the-apparent suicide of its co-founder,
entrepreneur Frank Nugan, in January 1980.
. Rewald's accusation of CIA drug trafficking
turned up during an investigation by my associates
Dale Van Atta and Indy Badhwar into the Hawaiian
investment firm that Rewald headed-Bishop,
Baldwin, Rewald, Dillingham A Wong.
Rewald insists that the CIA bankrolled his
company and'catfsed its collapse, which, like the
bank, cost investors millions: The CIA has
acknowledged only low-level involvement with
BBRD&W and categorically denies any involvement
in the drug trade. i.
A business card of a-former CIA director was in
Nugan's pocket when his body was found. His
partner, Michael Hand, and several members bf the
bank's board had ties to the CIA. Yet. the agency
vehemently denied any connection with the bank.
The parallels between Nugan Hand Ltd. and
BBRD&W are striking. For example, Nugan Hand,
with 22 offices around the world, offered investors
at least a 15 percent return on their money-high
for the 1970s. BBRD&W had 16 offices in various
countries and-reflecting the higher interest rate
of more recent years-offered investors a
generous 20 percent return.
Like Nugan Hand, Rewald's investment firm was
hip-deep in active or retired CIA employes. My
staff has identified at least 17 BBRD&W employes
who were CIA agents.
In fact, several sources close to the Rewald case
have suggested that his Honolulu investment
company was being specifically groomed to take.
over Nugan Hand's role in CIA operations
throughout the Pacific basin.
It was in 1982, to the best of Rewald's
recollection, that be was approached by a senior
CIA official and asked if he would help in a CIA
drug-smuggling operation. +i
When Rewald told the CIA official, that he had no
one in his firm with experience in drug operations,.
the CIA man contradicted him and named a, :,
BBRD&W employe who had been a longtime CIA'
contract agent active in Southeast Asia. Rewald
still declined the drug assignment.
Before the CIA's ambitious expansion hopes for"
BBRD&W could be implemented, a Hawaiian
television station ran a financial expose of Rewald
and his company. Staying in a Honolulu hotel room
under a false name, Rewald watched the show, then
slashed his wrists. Unlike Frank Nugan three years
earlier, Rewald lived. He faces trial on 100 counts
of fraud, perjury and tax evasion.
Sanitized Copy Approved for Release 2011/07/05: CIA-RDP90-00494RO01100700192-7