CIA SHIPPED ARMS FROM BRAZIL, INDIA WASHINGTON POST - 17 OCTOBER 1986

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP91-00561R000100160017-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 4
• Document Creation Date: December 22, 2016
• Document Release Date: February 23, 2012
• Sequence Number: 17
• Publication Date: October 17, 1986
• Content Type: MEMO

Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
Iq
Next 1 Page(s) In Document Denied
Declassified in Part - Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
 Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
THE WASHINGTON POST
FRIDAY, OCTOBER 17, 1986 E5
JACK ANDERSON and DALE VAN ATTA
CIA Shipped Arms From Brazil, India
For more than 10 years the Central
Intelligence Agency has used a Maryland bank
for secret arms shipments to "clients" around
the world. Purchase records obtained by our
associates Corky Johnson and Donald Goldberg
detail arms transactions totaling $21 million
through the First National Bank of Maryland in
Baltimore. Two shipments worth a total of $5
million involved the purchase and delivery of about
100,000 rifles in a complex transaction apparently
winked at by the bank management.
The rifle shipments originated in Brazil and
India, according to the documents, but the
destinations listed are suspect. Several ports were
crossed out on the original shipping papers and new
destinations written in.
The arms deals were initiated by a CIA front
called Associated Traders, and handled by
Sherwood International Export Corp., a large arms
broker licensed with the State Department.
Sherwood has offices in Los Angeles, Miami,
London and Washington, D.C.
The bills of lading indicate that Associated
bought 60,000 rifles from the Indian Defense
Ministry for $3.6 million in September 1983. The
original destination was given as Portugal, but a
corrected listing showed the destination as "Any
U[nited] Kingdom] Port." Sources told us the rifles
undoubtedly were delivered to Mujaheddin
guerrillas fighting Soviet occupation forces in
Afghanistan. .
A year earlier, Associated bought $1.8 million in
.rifles from Brazil. There was an additional $1
million purchase of "merchandise" from Brazil that
listed Baltimore as the destination. Shipping
Brazilian guns to Maryland makes little sense;
observers in Nicaragua say the CIA-backed rebels
known as contras there have been known to use
Brazilian weapons in their fight against the
Sandinista regime.
The Brazilian and Indian arms transactions were
handled through Sherwood, which, records show,
was the purchase and transfer agent for Associated
on several major arms deals. In the past, Sherwood
president Michael Kokin has denied that his
company worked with the CIA. He did not return
our calls for comment on this story.
Associated also used Shimon Ltd., a Cayman
Islands firm, for weapons shipments. One of these
was a $9.4 million shipment of "technical
goods"-industry jargon for military
hardware-sent to Lagos, Nigeria. Lagos would be
a convenient way station for weapons going to the
CIA-backed Angolan rebel leader, Jonas Savimbi.
Little is known about the Shimon firm because of
strict Cayman Islands secrecy laws. But it does
share the same registration agent on the islands as
a Sherwood subsidiary, Cromwell Ltd.
John Keating, a Bethesda attorney and director
of Associated Traders, said he could not comment
on any CIA connection with the company. He said
he has "very secretive clients."
First National Bank officials also declined to
comment. But as we have disclosed, a former bank
officer, Robert Maxwell, resigned when he was
unable to get written authorization from his
superiors to handle the CIA front's transactions.
Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
 Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
THE WASHINGTON POST
THURSDAY, OCTOBER 16, 1986 D.C. 11
JACK ANDERSON and JOSEPH SPEAR ~
Md. Bank Tied to CIA Arms Deals
T he crash last week of a "mystery plane"
carrying guns for the Nicaraguan
counterrevolutionaries, or contras, shed some
unwelcome light on the shady reality of
international arms smuggling. The Central
Intelligence Agency stoutly denied any hand in the
incident, but the denial was greeted with
widespread skepticism.
It is rare indeed that CIA involvement in the
murky world of arms trading can be pinpointed
beyond a reasonable doubt. But bills of lading,
purchase orders, bank records and other
documents obtained by our associates Corky
Johnson and Donald Goldberg show conclusively
that a respected Maryland bank was caught up in
the web of clandestine CIA arms deals.
The documents show that for more than 10
years the First National Bank of Maryland in
Baltimore has been the transfer point for millions of
CIA dollars used to buy and ship military hardware
around the world. Two transactions in 1982 and
1983 involved the shipping of about 100,000 rifles,
worth $5 million, to ports indicating that the
weapons may have been delivered to
CIA-supported rebel groups in Nicaragua, Angola
and Afghanistan.
The two companies that carried out the
transactions were Associated Traders Corp. of
Baltimore and the Washington, D.C., office of
Sherwood International Corp., a Los Angeles-based
licensed arms exporter. Associated Traders used
First National Bank to make payments to Sherwood
for handling the arms shipments.
Associated Traders is a CIA "front," our sources
have confirmed. It was incorporated in 1969 as a
Baltimore firm, but now operates in Vienna, Va.,
not far from CIA headquarters, in a building that
houses classified federal government operations.
Robert Maxwell, a former First National senior
executive, acknowledged that the bank handled the
Associated Traders account with the clear
understanding that the company was really the CIA.
Maxwell told us he was instructed by his bosses
to do "whatever Associated Traders requested."
The requests included hidden financial transfers of
dubious legality. Associated transferred huge sums
to offshore banks in the Cayman Islands, then to
banks in Panama and finally to Switzerland, to make
arms purchases difficult to trace.
Maxwell said the money laundering sidestepped
normal banking procedures and may have violated
federal laws, including the Bank Secrecy Act.
In a memo to his superiors in February 1985,
Maxwell said an Associated employe "expressed
concern at having the comptroller of the currency
or any type of federal investigation learning about
Associated Traders" and added: "I question if our
bank should be involved."
Maxwell also complained about Associated
Traders' practice of transferring large amounts
without identifying itself in the authorization.
For his own protection, Maxwell demanded
written authorization from his superiors to handle
Associated's "requests." When he failed to get the
written authorization, Maxwell resigned.
Footnote: CIA, Associated Traders, Sherwood
International and First National Bank officials
refused comment.
Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
 Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6
Declassified in Part -Sanitized Copy Approved for Release 2012/02/23: CIA-RDP91-00561 R000100160017-6