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Conspiracy Nation -- Vol. 8 Num. 05

("Quid coniuratio est?")


(From the May 1996 Conspiracy Nation Newsletter)


Hillary Rodham Clinton -- wife of Bill Clinton, her office at the Rose Law Firm is right next to "WEBB" HUBBELL's office.

Roger Clinton -- brother of Bill Clinton. Roger works for DAN LASATER.

Webster ("Webb") Hubbell -- a close friend of then-Governor Bill Clinton. "Webb" Hubbell works at the Rose Law Firm.

Dan Lasater -- Arkansas "Bond Daddy" and close friend of Bill Clinton. His firm, Lasater & Co., was handling more than $300 million per year in preferred state bond activity.

Barry Seal -- a skilled pilot, from his plane he drops duffel bags filled with cash onto the Triple S Ranch near Hot Springs, Arkansas.

Finis Shellnut -- son-in-law of SETH WARD. Finis lives at the Triple S Ranch and is the go-for who retrieves the bundles of cash being dropped by BARRY SEAL. Finis works for DAN LASATER as a "bondsman".

Seth Ward -- owner of the Triple S Ranch. His daughter, Suzy, is married to WEBSTER ("WEBB") HUBBELL.

John Cummings is a former prize-winning investigative reporter at New York Newsday. He has co-authored the Heist (1987), Goombata: The Improbable Rise of John Gotti and His Gang (1990) and Death Do Us Part (1993). His latest book, Compromised: Clinton, Bush and the CIA (Clandestine Publishing, ISBN: 1-883955-02-5), co-authored with Terry Reed, has been a bestseller. For over thirty years, since the Bay of Pigs, Cummings has studied the confluence of intelligence gathering, money laundering and drug-trafficking.

I spoke with Mr. Cummings on March 25, 1996.

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CONSPIRACY NATION: I heard you and Terry Reed, I think it was on Radio Free America with Tom Valentine. And as I recall, you were investigating some kind of corruption in Florida that led you to, when you first became aware of Terry Reed and his situation...

JOHN CUMMINGS: It began around the time of the Bay of Pigs. And I came to know a lot of the guys who were involved in that. And it worked out that I began to look into this question of covert operations. And the more I looked into it (prior to that, I'd been working on organized crime), the more I found organized crime and drug trafficking. They always seemed to go hand-inhand. And that led to my looking, some years later, at Barry Seal. And from Barry Seal, I was led to Arkansas by some friends in the Louisiana State Police who believed that Seal was doing more than what most people thought he was really doing. This one particular cop came to believe that Seal had some kind of government protection and that he was probably engaged in some kind of covert activity. And he said that he left Louisiana and he went up to Arkansas. And then I started to look up there. And the more I looked up there, the more suspicious I got, the more it smelled of an intelligence operation. (Which I had seen a lot of in Florida.) And that led me, eventually, to Terry Reed.

CONSPIRACY NATION: How did you first get in contact with Reed?

JOHN CUMMINGS: I heard about Terry Reed from a friend who is a private investigator in Washington. (He's a retired CID man. [IRS Criminal Investigation Division]) And he told me about Terry's case. Terry at the time was under indictment for mail fraud. And so I called his lawyer (and in the interim, I'd done a big piece on Barry Seal for Penthouse, and she had read it.) And she sent me some of the pleadings from the case. And here I see Terry was at Mena. So I began to pursue Terry.

CONSPIRACY NATION: What exactly was Mena about?

JOHN CUMMINGS: Terry came in contact with a man who was introduced to him as "John Cathey." And John Cathey was, in reality, Oliver North. And he came into contact as the result of the Toshiba investigation. And you know what that was, right?

CONSPIRACY NATION: That was something with submarines, wasn't it?

JOHN CUMMINGS: The Toshiba Machine Tools was secretly selling propeller technology to the Soviet Union. This equipment would allow the Soviets to make propellers that would elude American detection. There was a big scandal about it. At one point, Congress wanted to totally stop trading with Toshiba and not allow them in the country. There was a tremendous tumult about this.

Well North, or "Cathey," asked Terry to make... Terry, at the time, was working for Toshiba. And they wanted him to try to find out what was going through the Toshiba warehouse.

Anyway, that's how he came to meet North. (Although he didn't know his name was Oliver North. He only knew that he had been in Vietnam like Terry had been.) And they were very simpatico.

So at some point, Terry decides to go into business for himself and he's gonna move to Arkansas. And North tells him, "Well. If you're moving to Arkansas, there's a guy there who's running some stuff for us that you ought to meet." And he says, "You can probably make some money out of this."

So anyway, North gives him the name of Barry Seal and says that Seal will contact him. And Terry moves to Little Rock, and not too long thereafter, Seal comes to see Terry at his place of business. And he has with him, when he comes that day, a guy name of Dan Lasater. And working for Lasater, as a chauffeur, was [Bill] Clinton's brother, Roger.

Well he meets Seal, and they hit it off. And Seal tells him that he needs someone who can train Contra pilots to drop supplies into areas of Nicaragua at night; you know, teach them how to do air drops.

CONSPIRACY NATION: And they trained those pilots so that the CIA would have plausible deniability.

JOHN CUMMINGS: Right. The CIA would appear to have no "hands-on" knowledge. This [would appear to be] simply a free-lance operation.

At the same time, Terry (whose background is in machine tooling)... Seal needed help with producing untraceable weapons that they could give the Contras.

Anyway, that's how it came about. That's how he met Barry Seal.

CONSPIRACY NATION: And then, what wound up happening was that the guns were being flown down there, but either (I'm not clear on this) it was, say, "individual entrepreneurship" that caused some pilots to decide to fly back with drugs? Or were the drugs...

JOHN CUMMINGS: Well Terry did not know about the drugs. All he would do was go to Mena, teach these guys, in various places, [about flying]. And they were kept at a place out in the woods. This area is very remote. And they built a makeshift base out in the woods near Mena, Arkansas. And all Terry would do was take 'em up and try to teach 'em. And although these guys had had pilot training, they were very rough. They could fly, but barely.

So Terry's job was trying to teach them how to drop this stuff at night, in the jungle, to supply their own troops. Because they didn't want (what later happened), they did not want a plane shot down with an American crew on board. (And of course, that did happen.)

And one of the people working with Terry, working with Seal at that time, was William Cooper -- who was a pilot of the C-123 that was shot down.

CONSPIRACY NATION: And Cooper died in that crash, right?

JOHN CUMMINGS: He died. Only [Eugene] Hasenfus survived.

CONSPIRACY NATION: But in general, these planes were not flying back to the U.S. empty.

JOHN CUMMINGS: Well, separate and apart from this. See, my suspicion was, as they were flying weapons in, since the cargo... You know, the planes were empty. They weren't gonna come back empty. I mean, Seal's (how shall I say?) "cover" was that of a drug trafficker. In other words, he had gotten into that game early. And for all the world, all the time they were chasing Seal around Mena, they were looking for drugs. But what they were really doing was running a supply operation.

Now if Seal was running stuff back, it was not something Terry was involved in. Terry didn't find out about the drugs until much later, when he was in Mexico.

CONSPIRACY NATION: And that was what caused him to break off from the operation.

JOHN CUMMINGS: Yeah. He broke off from that. And right after he did, he started having legal problems.

CONSPIRACY NATION: So he found out, while he was in Mexico, that drugs were involved. And he didn't want to have anything to do with the drugs.

JOHN CUMMINGS: He was down there supposedly to run a machine tool company. And he had acquired a big warehouse for putting machine tools. He'd been told that what they were gonna do with this proprietary company was run guns from the U.S. to Central America. But when he went to his warehouse one day, he opened one of these big, huge containers, and it was full of cocaine. And at which time he then confronted his then boss, a man named Felix Rodriguez (although he was going under a pseudonym too.)


JOHN CUMMINGS: Max Gomez. Yeah.

And he [Terry Reed] bargained his way out of there. He thought he was home free. He says, "I just want out. I'm gonna go home. I'm not gonna say anything to anybody. I just want out of this."

And then suddenly, it turns out that a plane that had been stolen from [Reed] years earlier turns up in a hangar he had rented in Little Rock.

CONSPIRACY NATION: Wasn't Buddy Young, then working as Clinton's chief of security, involved?

JOHN CUMMINGS: Buddy Young is one of the people he's sueing.

CONSPIRACY NATION: And what happened was, Reed thought everything was okay, and he heads north. And Buddy Young puts out a "profile" on him, through the computers.

JOHN CUMMINGS: He put out a phony profile on him! Saying that he was a known drug trafficker and that he had been dealing in drugs in Central America. He put that into the government computers.

CONSPIRACY NATION: So then, Reed figured they must be out to get him. He figured that they'll probably, since they've got this false profile on him, that he's this "dangerous drug trafficker", he'll be lucky if he gets captured alive.

JOHN CUMMINGS: Yes, well that was the idea. They had listed, on this alert, "Armed and dangerous" -- which is a tip-off to every cop: shoot first and ask questions later. But, you see, he had enough knowledge that he could have implicated both Bill Clinton and George Bush in this.

CONSPIRACY NATION: So Reed went "underground" for what, 18 months or so?

JOHN CUMMINGS: Well, a little less than a year. He and his wife took off with their children and drove across the country, trying to stay out of sight, figuring that he had been marked for a hit like [Barry] Seal had been! He was convinced they would do the same thing to him that they did to Seal.

CONSPIRACY NATION: Barry Seal had taken that secret videotape of [the Sandinistas] loading that plane with narcotics. And who leaked that tape? Was it Reagan or North?

JOHN CUMMINGS: It was photos, not videotape.

CONSPIRACY NATION: But wasn't it North, or Reagan, that made the photos public?

JOHN CUMMINGS: Reagan put 'em on the air.

CONSPIRACY NATION: Yeah. Because Reagan was under political pressure.

JOHN CUMMINGS: He wanted to get aid to the Contras through Congress. And they wanted to show, "Look. These guys [Sandinistas] are all drug dealers." And by doing that, they made it known who was informing on them.

CONSPIRACY NATION: And then Seal was a marked man. And by the government putting him in a position where he was easily found, it was the same as setting him up.

JOHN CUMMINGS: Yeah, that's a well-documented story.

CONSPIRACY NATION: So after about a year underground, Reed decides that he's gonna turn himself in.

JOHN CUMMINGS: No, he learns that he's been indicted. So having been indicted, he decided that he'd better surrender before they tried to come and find him. And he did. He arranged to surrender. And he went with an attorney and surrendered. And his wife was also indicted. And she had done absolutely nothing.

CONSPIRACY NATION: Yeah. She says in the video ["The Mena Connection"] that the judge at one point said, "Mrs. Reed, I don't even understand why you're here in court."

JOHN CUMMINGS: What he said was, "Why is she here?" And Terry's attorney said, "I guess because she's married to him." The judge asked, several times, "Why is she here?"

CONSPIRACY NATION: So then Reed was exonerated, and found not guilty.

JOHN CUMMINGS: He was acquitted, yeah. He was acquitted by the judge. It was an order of acquittal, from a judge (which you hardly ever see.) There was no jury trial.

CONSPIRACY NATION: So he was so obviously innocent that...

JOHN CUMMINGS: He was acquitted on the law. Not on the facts. Because the jury decides the facts. But the judge said that the government had no case! (This was after two-and-a-half years.) And when I spoke to the judge about it, he told me that he thought the case "had a high odor to it."

CONSPIRACY NATION: And after he was acquitted, he had gone through a lot of hardship because of all this and had to spend a lot of money, I assume, with legal fees and everything.

And at what point did you meet up with him?

JOHN CUMMINGS: I met up with him while he was still under indictment. I met him for the first time, personally, the Summer of 1990. The judge's acquittal came in the following November.

CONSPIRACY NATION: One of the reasons he decided to work with you on a book was because he figured if he got his story out, he and his family would be safer.

JOHN CUMMINGS: I told him that. If he got his story out, it wouldn't be a suit of armor, but it would raise more suspicion if something happened to him. Otherwise, if they were to shoot him dead, I mean, who knew about this guy?

CONSPIRACY NATION: So after he was acquitted, he wanted redress of his grievances and he also wanted to get the truth out.

JOHN CUMMINGS: He was very angry because of what they had done to his wife. He was very angry that they had put her through this. And they had three small children. And it's very obvious that she had done absolutely nothing. In fact, I read the grand jury minutes: there was virtually no case going on there at all. But you know, there's a saying: "A prosecutor can indict a ham sandwich."

And that's what really pissed him off. So the two of them decided... They were still wary of me, at that point. They decided that they were going to go back into court and seek justice. (Not really realizing that that is a relative term, and seeking justice sometimes can be a very burdensome thing.)

But anyway, they decided to do this. And then I went to visit him in early 1991. And that was the first time, in our conversations, that he brought in Bill Clinton, and ADFA [Arkansas Development Finance Authority], and money-laundering, and all the rest of it.

CONSPIRACY NATION: The book Compromised was kind of a landmark book, or a ground- breaking book, in that it outlined what was going on; it provided a road map for what had been going on in Arkansas.

JOHN CUMMINGS: What it was, it was a kind of diary of a foot soldier in that war [i.e. Contras]. This is something that he really believed in. He believed in the Contras and he felt that they should be helped. (You know, he and I had many arguments about that.) And he said that he, at the time, thought that Oliver North was (although he didn't know, at the time, he was Oliver North), he thought he was a great guy. And he was as pissed off as Terry was about what had happened in Vietnam.

CONSPIRACY NATION: And so Reed brought suit against the government?

JOHN CUMMINGS: No, it wasn't a suit against the government. It was a suit against the two men who testified against him. There was a third man, who was an Arkansas state trooper, who works for the DEA.

CONSPIRACY NATION: He brought suit against these 3 people. Do you know the names of the people?

JOHN CUMMINGS: Buddy Young. Tommy Baker. And Sanders -- he's an Arkansas cop who was working with the DEA.

Sanders was brought in because of the contacts... I tell you what: to really understand the court case you have to read the chapter, "Department of Injustice." Because these guys lied so many times, in their testimony. They kept getting caught: they would say one thing, and then the facts would show something else.

See, the reason he brought suit against those guys, it was very clear that they were lying in their testimony. And they didn't even really make any attempt to hide the fact they were lying.

CONSPIRACY NATION: And by bringing suit, this allows what they call the discovery process, right? That he (at least theoretically) should have access to documents that aren't normally available?

JOHN CUMMINGS: He got documents from the FBI and from the DEA Intelligence Headquarters in El Paso which showed that Young had planted the profile about him being a drug trafficker, and that they claimed when they found the airplane that they took the VIN number through NCIC [National Crime Information Center] -- but not when they said they did!

CONSPIRACY NATION: And so this lawsuit was proceeding well. And in the video, "The Mena Connection," it ends with a request that people try to help with the legal expenses.

JOHN CUMMINGS: If they can. Yes.

CONSPIRACY NATION: Did he get much help with the legal expenses, from people?

JOHN CUMMINGS: Yeah, there was help that came in. Basically, Terry is taking what income, his share of what income there has been from the book, to plough into this case.

CONSPIRACY NATION: So he's in a situation that happens to a lot of people: the government has got unlimited funds, but an individual citizen, if they're gonna pursue something like this, they've got to spend their own money.

JOHN CUMMINGS: That's right. There's no way you can really out-spend the government.

CONSPIRACY NATION: And so, this case was proceeding well, up until recently, right?

JOHN CUMMINGS: There was a motion, from the other side, to limit the amount of evidence that Terry could bring in. And that copy of the court order I sent you [See CN 7.56] just about wipes away any reference to Mena or... In other words, he can try his civil rights case, but you can't go into why they would have wanted to frame him.

CONSPIRACY NATION: So the judge is like a gatekeeper, right? He decides what gets allowed in.

JOHN CUMMINGS: The judge is, of course, a product of Arkansas politics.

CONSPIRACY NATION: What's the judge's name?

JOHN CUMMINGS: George Howard.

He's the one that's trying the case now against Jim Guy Tucker.

CONSPIRACY NATION: So that would indicate that the case against Tucker is also likely to be biased.

JOHN CUMMINGS: I'm not familiar with that case. There's a lot of people running interference for Bill Clinton.

And I think the thing that you might want to keep in mind: every attempt to pull back the rock on Mena has been thwarted.

CONSPIRACY NATION: I don't know if you know this fellow named Sherman Skolnick, out of Chicago...

JOHN CUMMINGS: I know who he is. I don't know much about him.

CONSPIRACY NATION: Well he's been looking into this whole thing, with Whitewater and Mena, and his end of this is, he represents somebody named Joseph Andreuccetti which, it's a complicated case, but there was supposed to have been a transfer of an RTC [Resolution Trust Corporation] contingency fund -- an illegal transfer -- that this money went down to Arkansas to cover up an embezzlement of a savings and loan down there.

But just generally, I'm familiar that the state just reeks of corruption.

JOHN CUMMINGS: Arkansas? Oh geez. We have a chapter in there which we refer to as "America's Banana Republic." Which is what it is.

CONSPIRACY NATION: So at this point you're being stymied.

JOHN CUMMINGS: Terry has run into a big road-block with this judge. Yeah.

CONSPIRACY NATION: And what's the prognosis at this point?

JOHN CUMMINGS: Well, I think that (I'm giving you my speculation now), if Terry appeals this, if he can't appeal it now, it would keep the case out of court until after the election -- which is what I think they're after.

CONSPIRACY NATION: In your book, there's two occasions where Reed actually meets with Clinton...

JOHN CUMMINGS: There were three meetings. Reed only talks about two.

CONSPIRACY NATION: And the third is kept quiet, for now.

I talked with Sarah McClendon, the veteran White House correspondent. And she thinks that Clinton is just, basically, innocent. How involved was Clinton?

JOHN CUMMINGS: Up to his ears. Here was a guy, what he was doing was playing ball with the Administration in Washington, and for a lot of reasons. There was a lot of money flowing into the state. You have to really understand the amount of money that was flowing into Arkansas. And the net effect of this was, the money went to finance firms run by Clinton's friends, who could then make very nice campaign contributions to him. I mean, Clinton never got any of that money directly.

CONSPIRACY NATION: When I talked with Sarah McClendon, she said that there were several "Menas", so-called; that this was not an isolated operation.

JOHN CUMMINGS: There was at least one other that I know of, out in Texas. [Barry] Seal was involved.

CONSPIRACY NATION: The Arkansas Development Finance Authority [ADFA], the way that worked: drug money goes into ADFA and then it gets loaned out to people...

JOHN CUMMINGS: [Barry Seal] was dropping $9 million a month into Arkansas. And the money ended up going to Dan Lasater. Where it went from there, who knows? ADFA... Nobody knows where ADFA's money came from. We know that they lent out a lot of money to Bill Clinton's friends -- people who didn't need it! ADFA was supposedly set up to help companies that couldn't get regular financing.

CONSPIRACY NATION: You've looked into the drug corruption. What's your opinion on the "War on Drugs"?

JOHN CUMMINGS: The "War on Drugs" is a joke.

CONSPIRACY NATION: Orlin Grabbe, a former finance professor at the Wharton Business College, has theorized that what this "War on Drugs" is about is inflating the cost of these drugs; that the United States sells arms to the Third World and the Third World has no way to pay, except with their drugs. And the way it works is, the "War on Drugs" artificially boosts the cost of these drugs.

JOHN CUMMINGS: I'm somewhat aware of his theory. And I have no serious argument with it, although I have no personal knowledge of that.

I'll put it to you this way: the guy who originally put me on to Barry Seal was a narcotics investigator. And he said to me (referring to Seal), "I thought I was chasing the biggest drug trafficker in the country, only to learn that the biggest drug trafficker in the country was the country." (And I think that really tells it all.) He suddenly realized that he'd spent his life on a fool's errand.

The "War on Drugs" is a tremendous farce. But it's easy to sell this country on anything.

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