Chapter V: Ronald Lister

Ronald Lister is a convicted drug dealer who has alleged that he had a relationship to the CIA. At various times during the investigation of Blandon and since, questions have arisen as to whether Lister in fact had any such connection. It is to these issues that we now turn. Our exposition here is somewhat episodic. We simply look at the contexts in which a relationship between Lister and the CIA has been suggested, and then evaluate that evidence. There are many loose ends. But one bottom-line conclusion emerges with some force: we have found no credible evidence that Lister ever had a relationship with the CIA. The evidence does indicate, however, that Lister frequently told people that he had an association with the CIA in order to impress them and to hide his illegal activities.

A. Background of Lister

When interviewed by the OIG, Ronald Lister said that he was in law enforcement for approximately 13 years: first with the Los Angeles Sheriff's Department in 1967, then with the City of Maywood, California, Police Department from 1969 to 1973, and finally with the City of Laguna Beach Department in California, from 1973 to 1980. In 1980, Lister left the Laguna Beach Police Department to "go into the security business full-time."(45) He became the owner of Terman International Security Consultants, which later became Mundy's Security Group. The business was based in Newport Beach, California. Lister told the OIG that the company was "involved in physical security applications, both overseas and here in the U.S., commercial, institutional, maybe governmental, residential."

In researching DOJ files, the OIG found five FBI files on Lister. In September 1983, Lister's company, Pyramid International Security Consultants, was listed as the subject in a neutrality violation investigation involving the sale of weapons to El Salvador and the loan of money from Saudi Arabia to the Salvadoran government. Lister was also alleged to be attempting to sell arms to several other countries. No further information was ever developed in this matter.

In 1984, the FBI became aware of an attempt by Lister to offer his services to a foreign government. Lister reported that he was investigated by the FBI because he sold an FBI "scrambler system" to someone overseas, but the FBI later learned that the equipment was not classified and was available on the open market. However, a review of FBI files reveals that the FBI terminated its investigation of Lister, not because it found his actions to be legal, but rather because Lister could not actually supply the equipment he was attempting to sell to the foreign nationals. The FBI concluded that Lister was "an ordinary con man" and that, while Lister clearly had intentions of violating U.S. export laws, he did not appear to have the ability to do so. The FBI closed the case.

During the FBI's 1984 investigation of Lister, he claimed to have extensive CIA contacts and provided a number of names, including David Scott Weekly. The FBI noted that Lister was duplicitous throughout the interview and only made admissions when confronted with evidence. The San Francisco FBI office labeled Lister the "quintessential con man." The FBI interviewed Weekly and two others and determined that they did not have any information supporting Lister's claims of CIA ties. Lister later told the FBI that he only believed that these individuals had CIA contacts and mentioned them to his foreign "contact" to establish a "credibility base."

FBI records also indicate that, in approximately 1985, the Boston office of the Bureau of Alcohol, Tobacco and Firearms (ATF) investigated attempts by Lister to sell illegal firearms to an informant. The inquiry was closed when Lister, who was in California, insisted that an informant pay his way to Boston in order to complete the arms transaction. When the informant did not pay, Lister said he was no longer interested, and the deal was never completed.

In July 1986, a file was opened on Lister and Aparicio Moreno for alleged contacts with foreign authorities in the United States. No further evidence was developed and the file was put in inactive status in July 1987 after the initiating office became aware of the pending drug investigation in Los Angeles.

In August 1986, Ronald "Lester" became the subject of investigation by the Savannah, Georgia, FBI office when "Lester" discussed selling illegal counter-surveillance devices to an undercover agent. The investigation was terminated when Lister moved to Laguna Beach, California, and no further evidence was developed against him.

According to the CIA OIG, the CIA has no record of Ronald Lister except for the inquiry made by FBI SA Aukland in 1986 as to whether Lister was an asset, as a result of statements Lister had made at the time of the LASD search of his home. The CIA informed the FBI that he was not an asset.

B. Lister's Dealings with Blandon, Meneses, and the Contras

Although the focus of the OIG's inquiry was on allegations of impropriety involving the Department of Justice, our investigation shed considerable light on the relationship between Lister, Meneses, and Blandon, and particularly on the claim that Lister aided Blandon and Meneses in support of the Contras. As with the other allegations that do not involve DOJ in this report, we will describe the information gathered, give our assessment of the reliability of the witnesses, but not reach any definitive conclusions.

Lister told the OIG that he had met Blandon at the end of 1981 through a connection in Beverly Hills. According to Lister, the intermediary was interested in having Lister meet Blandon "for the purpose of providing security and possibly doing some work in Central America." Lister stated that he had several proposals for providing security to the government of El Salvador, where he had maintained an office for several years. Lister soon met Meneses through Blandon because, according to Lister, Blandon and Meneses were "working closely in those days." A partnership soon developed involving Lister, Meneses, and Blandon. Lister explained that "Blandon and Meneses were the ones that opened the doors down there [referring to El Salvador], and . . . they were considered part of the company. They were going to share in the profits." Lister noted that Blandon and Meneses had many connections in El Salvador, connections that he later learned were from their drug trafficking business. Lister soon became aware, based on the fact that they always paid him and everyone in cash, that Blandon and Meneses were dealing in drugs. When he approached them about obtaining cocaine, they agreed. Lister obtained the cocaine from Blandon and gave it to an associate to distribute. Lister ultimately began purchasing cocaine in multi-kilo quantities for resale.

When interviewed by the OIG, Lister noted that many of the Nicaraguans with whom he dealt supported the Contras. But he dismissed the claim that they were giving their money to the Contras -- according to Lister, they were just drug dealers. He stated: "We were just a bunch of people making money and maybe psychologically feeling better about what we were doing because we said we were helping somebody." Both Blandon and Meneses told Lister at different times that they wanted to help the Contras, but Lister stated that he knew that they were not doing it to any substantial extent "because the money just went back in our pockets." He recalled that Blandon gave some money to Pastora, but said these were small amounts given in friendship.

Lister told the OIG that, between 1982 and 1984, he and an associate obtained 15-20 "KG-9's" (also known as "Tech-9's") and some handguns from "Crasney's Gun Shop," a legitimate gun dealer, and sold them to Blandon. Lister denied dealing in any fully automatic weapons. He claimed that he provided Blandon with the weapons for the Contras and that that is how Lister "felt [he] was doing [his] part to help him." Blandon told Lister that he had sent the weapons to the Contras, but Lister had no personal knowledge of that fact. He explained: "Anything I gave him was for the purpose of the Contras. What he did with it, I can't say." Lister stated that he was not aware of Blandon's selling weapons to Ricky Ross, but opined that Blandon might have given him a few as gifts in order to maintain their business relationship.

Lister told the DEA in 1990 that he became involved in drug dealing when he met Norwin Meneses and Danilo Blandon in early 1981. Lister began obtaining kilograms of cocaine from Blandon and selling it with the aid of his friend Bill Downing. Lister also said that he transported money and drugs for Blandon. Lister told the DEA that in April and June 1984, Blandon paid him $60,000 to deliver two customized vans with cash that Blandon had secreted in the door panels to Blandon in Miami. Blandon told Lister that the first van held $1 million in cash. Lister reported that he later heard that the second van held $5 million in cash.

Lister told the OIG that he helped Blandon deliver cocaine to Ricky Ross on only one occasion, sometime in 1985. They delivered 100 kilos of cocaine and picked up $2.5 million in cash. Lister stated that Blandon paid him $50,000 for his work.

The account Blandon gave the OIG of the transactions described by Lister was somewhat different. He said that he had first met Lister when he came to an FDN meeting to show them some weapons. Eventually, Lister, Meneses, and Blandon entered into an informal partnership for the purpose of selling arms abroad. Efforts to sell to the Contras were unsuccessful, however, because the Contras already had their own weapons suppliers. Meneses, Blandon, and Lister then went to El Salvador to market weapons to the Salvadorans. According to Blandon, the plan was for Blandon and Meneses to get their share of the profits in weapons, which they would then give to the Contras.(46) Blandon stated that the project failed because on their second trip to El Salvador, Meneses sent his girlfriend a book containing cocaine and it was intercepted in San Salvador. Meneses was not charged but according to Blandon, his contacts dried up. Blandon stated that Lister was broke so he started asking Blandon to get him involved in the drug business.

Blandon recalled hearing Lister say that he was involved with the CIA and that he knew someone high up in the CIA who was getting him some licenses so he could sell weapons to Iran. Blandon said that he had never believed Lister because he lied too much. For example, to pay off a $14,000 debt to Blandon, Lister had given Blandon a little piece of land Lister said he owned. When Blandon went to register his title to the land, he found that Lister had already sold the land six months before to someone else.

The OIG also interviewed the FBI informant, known here as "LA CI-1," who had provided information about Blandon, Meneses and Lister in 1986 (see Chapter II). LA CI-1 shed light on the El Salvador deal described by Lister and Blandon above. LA CI-1 recalled that Meneses returned to Miami from El Salvador in 1982 and spoke of plans to sell night scope devices obtained from Ronald Lister to the Salvadoran government. Meneses was planning to use the proceeds from the night scopes to aid the Contras. Meneses was concerned whether Lister was "legitimate." Meneses later learned that Lister's proposals had no chance of success, and that Lister was not honest. Because Meneses had already invested money in the project, Meneses had a "damage assessment" conducted which revealed that Lister's contacts were inadequate and the equipment he was trying to sell was basically useless.

C. Reports of Lister's CIA Affiliation in Connection with the 1986 LASD Search Warrants

As discussed extensively in the chapter on Blandon, Lister's apparent foreknowledge of the 1986 search of his home by Los Angeles Sheriff's Department Deputies, comments he made in the course of the search, and certain materials seized at the time, all have provided grist for the suggestion that he indeed had some relationship with the CIA and/or the Contras. Closer examination of this evidence, however, shows it to simply corroborate the accounts of Blandon, LA CI-1, and even Lister himself, about the abortive attempt to sell weapons to the Contras, or to others on their behalf, in 1982.

1. Lister's Alleged Foreknowledge of the LASD Warrants

When interviewed by the OIG, Lister said he had not been "tipped off" in advance that the LASD was about to execute search warrants. A former neighbor had called to tell him that there were two men on the hillside of the house where he had previously lived with "walkie-talkies or something." Because he had been a policeman and because of his time in the "coke business," he knew "this has gotta be a precursor to a search warrant." Lister recalled that this was either several weeks or days before the raid. He had called Blandon and "laid it all out on him." However, as described in Chapter II, above, Blandon told a different story to the OIG about how he found out that he was under investigation. We have found no evidence indicating that Lister had any other sources of information about the raid.

2. Lister's Claims of a CIA Connection

As discussed in the chapter on Blandon, LASD deputies alleged that Lister made statements about his CIA contacts when they searched his house in 1986. LASD deputies recall that Lister stated that if he made a phone call, the law enforcement agents would be forced to go away. When interviewed by the OIG, Lister denied making any such comment or ever claiming affiliation with the CIA. But, as discussed below, when Lister was confronted with several letters written by his attorney, Lynn Ball, that included several references to Lister's contact with "intelligence agencies," Lister admitted having claimed contacts in the CIA on several occasions in order to get different law enforcement agents to "back off." He also stated that his claim of CIA affiliation was just a "ruse" and that it "sounded like a good thing to say" at the time.

Lister stated that the documents taken from his house and logged in by the Sheriffs as "CIA documents" were in reality his personal business papers and journal. After no charges were filed against Lister, his attorney retrieved them and returned them to Lister. We now turn to a discussion of these documents.

D. Documents Seized by the LASD

The documents seized from Lister's home during the 1986 LASD search warrants became the subject of litigation in the "Big Spender" trial, when the LASD deputies who were being charged with corruption attempted to use the documents to support a claim of outrageous government misconduct. In a motion filed in that case, the defense alleged that deputies executing the warrant at Lister's home had discovered films of military operations in Central America, military hardware and communications manuals and information, and "numerous documents indicating that drug money was being used to purchase military equipment for Central America." Neither the documents nor the defense was relevant to the case and the introduction of the documents was not allowed by the trial court.

The San Jose Mercury News alleged that the defense motion filed in the Big Spender trial indicated "that the drug ring of former Nicaraguan government official Danilo Blandon -- which helped fuel the crack explosion in black America -- was connected to the Central Intelligence Agency and efforts to launder drug money to finance [the Contras.]"

In an article entitled "Sealed Records May Unlock Truth," the Mercury News stated that copies of a ten-page document were submitted to the court under seal and that the document may "hold the key" to unlocking the truth behind the relationship of the CIA and the Contras to the emergence of crack cocaine in black neighborhoods.(47)

The OIG has reviewed the documents seized during the searches from Lister's home that the defendants alleged to be probative of a relationship between Lister, the CIA, and the Contras. The OIG found them to offer no credible evidence of any such relationship. To be sure, in evaluating these materials we have, to some extent, considered Lister's own explanations of their significance and meaning. However, although Lister is hardly the most credible of witnesses, we generally found that his explanations on these points rang true or were consistent with other evidence.

Lister told the OIG that the ten-page document was part of a business journal he maintained over a period of three or four years, that, in part, detailed his efforts to sell a scrambler to some Eastern Europeans. Lister noted that the journal was particularly helpful in keeping track of his business deals at a time when he was regularly using drugs. Lister also stated that the document was prepared to help in an FBI grand jury investigation of him and that the journal was helpful when he was the subject of a grand jury investigation in 1985, relating to his dealings with Eastern bloc agents (see above).

As we discussed in Chapter II, the OIG located the ten-page document referred to in the defense motion in IRS files. The first page lists various weapons and mentions "Korea." When interviewed by the LASD, Lister stated that he was licensed at the time to sell these weapons. The second page is a jumbled list of numbers and names. The only notation recognizable to the OIG lists a telephone number and the notation "Angie/Apareco, FDN," an apparent reference to Aparicio Moreno, a supplier of cocaine to Blandon's organization. Lister told the LASD that the name was supposed to be Aparicio and that he had been asked by Blandon to represent him at Aparicio Moreno's wedding. Blandon had noted that Moreno was affiliated with the FDN, as were many other Nicaraguans living in the United States. Next to the name is the notation "wedding reception," which supports Lister's assertion. Also on the second page was the notation "Khadijeh Amin - our girl in I." Lister explained that Khadijeh was a woman in Iran who had helped him establish a business relationship with a man in London who was a key food supplier in Iran. Lister stated that this was simply a business contact.

The third page and half of the fourth appear to be notes about an effort by Lister to sell a scrambler and night vision equipment to an unidentified client. The second half of the fourth page has notes about the FBI's interviewing Lister about whom he knew in Eastern Bloc countries. Then comes a list of names, including: Bill Nelson, Ron Brown, Steve Kissler, Tabor Suppan, Scott Weekly, Roberto Abuson [sic], and Ray Prendes. Lister later stated that he wrote these names because he had given them to the FBI when they interviewed him. He said that Bill Nelson was an "A.S.I.S. member" (American Society for Industrial Security) who was the security director for the Fluor Corporation -- for which Lister claimed to have done some work. Lister said that Ron Brown was a retired Navy Captain; he could not recall who Steve Kissler was, and Tebor Suppan was his businessman "buddy in Europe." Lister told the OIG that he believed that Scott Weekly was associated with the Defense Intelligence Agency and that he worked with Weekly on several projects, including a weapons demonstration in El Salvador. Lister stated that "Abuson" was the head of the ARENA political party in El Salvador, the opposition party there in the 1980s, and that Prendes was the General Secretary of the Christian Democrats, the party in power. Roberto D'Aubison was indeed a leader of the ARENA party in El Salvador during the early 1980s (and later the Prime Minister of El Salvador), and this document may well reflect efforts by Lister to supply military equipment to one or more factions involved in the civil war that was raging in El Salvador during this period.

The next pages appear to document efforts on Lister's part to sell security plans and materials to a representative of a foreign government in San Francisco, and several other individuals. The journal states:

In the meantime I had regular meeting with DIA Subcontractor Scott Weekly. Scott had worked in El Salvador for us. Meeting concern my relationship [with] the contra group in Cent. Am. At that time I asked him about scramblers syst. I might buy to sell. He suggested one which he was familiar with that was commercially available. Not classified and told me who was currently using it. N.C. State Police, FBI & other domestic group, Public & Private. Said he could get one for me to sell if I had a customer. Want $10,000 for it. As he had to share cost [with] someone in DIA. . . .

Lister told LASD investigators that he could not recall what "DIA" stood for, but that it was not the Defense Intelligence Agency. He later told them that it stood for "deals in arms" and that he used the abbreviation because he "thought it was cute. " Lister told the OIG, however, that DIA stood for Defense Intelligence Agency, and that he had referred to Weekly as a DIA subcontractor because an individual named Tim LaFrance had told him that Weekly worked for the DIA. Lister said he merely assumed that Weekly did, but never discussed it with Weekly. Lister added that there were no "CIA operatives" listed on the sheet. Lister told the OIG that he was aware that Bill Nelson had previously worked for the CIA, but that he was retired and had his own security company. The CIA OIG confirmed that an individual named William Nelson was at one time the Deputy Director for operations at the CIA.

When the OIG asked Lister why the Contras had been mentioned in the meeting he documented with Weekly, Lister explained that he had told Weekly about his past contact with Contras in an effort to make himself "look big" and to make it seem as if he had clients that he could provide equipment to. He said his references to the "Contra group" were to Blandon and Meneses and that this was a short-hand way to refer to them.

On the final page of the document is a flow chart suggesting the flow of money. Lister stated that this chart represented the legal way to sell munitions to other countries under the law as it existed in 1983. LASD investigators asked U.S. Customs Service Special Agent James P. McShane, Office of the Defense Trade Controls, to review the document, and he reported that the chart could represent a legitimate transaction that would occur if a State Department license had been obtained. He further stated that the notation "% EUC" might indicate that an "end use certificate" was being purchased and that the transaction would therefore be illegal. In a legitimate transaction, an EUC is provided without cost. He also stated that the fact that the funds were to flow through Hong Kong to "X Country" indicated an attempt to disguise the true destination of the export and therefore might be an illegal diversion of arms to someone that might not be able to get licenses for exported munition. Whatever the legality of the transactions depicted in the flow chart, nothing indicates that it shows the sale of arms to the Contras, and certainly nothing suggests that it depicts the use of drug money in any of the deals.

It is difficult to assess Lister's explanations of his writings in this document. The OIG did not find Lister to be a credible witness and he gave LASD investigators different explanations about it than he gave us. What is clear, however, is that the document does not constitute proof of either a Contra or CIA connection to Lister's drug trafficking endeavors.

The LASD deputies also seized during the 1986 search of Lister's residence various financial records, including both personal and Pyramid International bank statements. None of these accounts contained any significant amounts of money -- the largest reflecting several thousand dollars, and the smallest containing $10. There were also a number of notices of overdue bills to Lister and records of two civil suits filed against him by Citibank for failure to pay his credit card bill and by a former employee for failure to pay his salary. The records also included Lister's telephone records, showing calls mainly to California and Florida, and Lister's airline ticket receipts and boarding passes for trips to Miami; San Jose, California; Bogota, Colombia in May 1986; and Puerta Vallarta, Mexico with his family in December 1985.

The OIG found four potentially significant documents in this group. The first two contained lists of arms coded with pastry names and a long list of weaponry and other equipment. When interviewed by the OIG, Lister said he would give the equipment list to potential clients to show what he had or could obtain and that the "pastry list" was a list of code words for various guns and ammunition that he had obtained somewhere. He said that he, Blandon, and people associated with Blandon, had used the code words when they had discussed weaponry over the telephone. Lister stated that Blandon had been looking for a source of supply of weapons and other equipment to sell to the Salvadoran government and also to provide to the Contras. Lister noted that none of the weapons requested by Blandon was on the pastry list nor did Lister have a source of supply to provide Blandon with what he was looking for. Lister said that he never provided any weapons on the list to Blandon.

Lister's 1985 monthly calendar was also among the documents seized. It reflects appointments with the notation "Contra," or "D-Contra." On February 25, 1985, the notation "1 pm - Scott DIA, Ref/Contra Group" appears. Lister told the OIG that he had probably asked Weekly for information about equipment in response to Blandon's frequent inquiries about what equipment was commercially available to support the Contras. Lister particularly recalled Blandon's asking him about fire resistant paint and night vision equipment. Lister noted that, as a general matter, the frequent references to Contras in his calendar were really just meetings with Blandon to discuss drug trafficking. Lister said that the notation "SF Contras" on March 7, 1985 was a reference to a meeting with Blandon in San Francisco on a drug transaction, and the notation "LA Contras" on September 18, 1985 referred to meeting Blandon in Los Angeles on that date.

Another document was a handwritten note with the heading "ARDE," which then listed the names "Dr. Felix Saborio," "Carol Prado, ass[istant] to Pastora," "Popo Chamarro," "Martine -- account banker," and "Marianno -- helio pilot." Lister told the OIG that he wrote the list after he had attended a party at Dr. Saborio's house in Hialeah, Florida with Blandon in 1982 or 1983 at which the five people listed were present. Blandon had asked Lister to come to the party to talk to Dr. Saborio and see if he could help him with supplying equipment to the Contras. Dr. Saborio was closely connected to the ARDE and knew Blandon from Nicaragua. Lister said he never conducted any drug transactions with the people listed, other than Blandon, and never ended up providing them with any equipment or any significant information on weaponry. The names on the list correspond with a meeting described to the OIG by Blandon. In discussing his contacts with Pastora, Blandon stated that he met with Pastora once in Miami with Ron Lister, Dr. Saborio, Popo Chamarro, and another lieutenant in the house of "Mariano."

In the end, when stripped of their quirky embellishments, the documents seized from Lister in 1986 largely corroborate his account of his relationship with Blandon and the Contras. Lister would have liked to sell military and security weaponry and equipment to the Contras and to factions in El Salvador but we found no evidence showing that he did. And apart from the fact that his link to the potential Contra market, Blandon, was also his source of supply in his drug trafficking, Lister's trafficking activities appear to have had at best a slender relationship to his efforts in the weapons and equipment market.

E. Lister's Claims of CIA Affiliation Gathered by the FBI in 1986-1987

Lister's suggestion of a CIA connection during the 1986 LASD raid was hardly the only time that he attempted to use his purported intelligence agency ties to get out of a difficult situation. Nor was it the only time that law enforcement agents were not deterred by his efforts.

On December 11, 1986, in the course of the FBI's investigation into Blandon's trafficking activities (discussed above in Chapter II), FBI agents interviewed a realtor in Mission Viejo about Blandon's association with Lister. The realtor reported that Lister -- who was known in Mission Viejo social circles as a "fundraiser organizer" -- had contacted the realtor about purchasing a residence in Mission Viejo for $374,000 in cash. Lister stated that he was self-employed in selling security systems to third world countries and that his business was "CIA approved." At the closing, Lister had claimed that his cash was tied up in purchasing a jet in Florida and that additional funds would be coming from European accounts. Lister gave the sellers $18,000 in cash to extend escrow by 15 days. When Lister was unable to provide the cash after the 15-day extension, escrow was extended a second time. Thereafter, Lister and his wife provided the sellers with $20,000 in cash and were allowed to move into the residence on condition that they both make the mortgage payments and also pay $2200 a month rent to the sellers. About a month later, Lister told the realtor's associate that he had about $200,000 in cash in his garage in an athletic bag, and asked that the realtor retrieve the bag, and put the money in escrow. The realtor went to the house and found the bag, which contained $224,000, much of it in small denominations. Instead of wiring the remaining funds as arranged, Lister had the realtor fly to San Jose, California, where Lister gave him a paper bag containing money. When the realtor asked Lister where the funds had come from, Lister responded that he was involved in fund raising for the Contras or the Sandinistas -- the realtor could not recall but believed it was the Contras -- and that the activity was "CIA approved." On returning to Orange County, the realtor found that the bag contained $71,000. After he contacted Lister's wife and told her that a balance of $51,000 or $52,000 remained, Lister called and told him that he must have gotten the "wrong bag." A few days later, Lister provided the remaining funds and escrow closed.

On December 12, 1986, the Los Angeles FBI Office forwarded a teletype with this information to FBI Headquarters for review by agents handling an investigation entitled "Front Door," which involved allegations of neutrality act violations by United States government officials in the covert sale of arms to Iran. This FBI investigation was later taken over by the Independent Counsel in the Iran-Contra Investigation. The teletype concluded that the Los Angeles office did not believe there was a connection between Lister and Operation Front Door. In response, FBI Headquarters requested that Los Angeles interview Lister about his contacts with Richard Secord, Albert Hakim or Stanford Technology. It does not appear that the FBI had any reason to believe there were any such contacts, and that it was a routine inquiry to determine whether there was any connection to the budding Iran-Contra investigation. On December 22, 1986, the FBI interviewed Lister and asked if he had any knowledge of or contact with Richard Secord, Albert Hakim, or Stanford Technology, the lead targets of the "Front Door" investigation. Lister stated that he had none, and denied any knowledge of arms sales to the Contras. When asked if he was involved in training of Contras he requested that an unidentified representative from another agency be present before he would answer and scheduled another interview for January 5, 1987.

On December 23, 1986, FBI Headquarters advised all offices to suspend all inquiries relating to the "Front Door investigation" to allow the newly appointed Special Counsel, Lawrence Walsh, to decide in which manner he wished the matter pursued. On January 21, 1987, the Independent Counsel issued a directive that the Department of Justice should continue investigations that did not conflict with Front Door. Because the FBI determined that Lister had no real connection to the CIA or any national security agencies or agents which would conflict in any way with "Front Door," the FBI continued its investigation of Lister.

On February 3, 1987, the Los Angeles FBI received information from an informant that Lister had told an unidentified neighbor over drinks that he worked for Oliver North and Secord and had sent arms shipments to the Contras. The Los Angeles office reported this information to FBI Headquarters and noted in its teletype that Assistant U.S. Attorney Crossan Andersen had reported the information to Public Integrity Section Attorney William Hendricks, III and that Hendricks had advised that investigation of the drug matter could continue "as long as its direction does not conflict with [Front Door]" and cited the Independent Counsel's Directive. The teletype also stated that Assistant U.S. Attorney Andersen had requested that Lister and the neighbor not be interviewed at that time, as it would have a negative impact on the ongoing drug investigation.

45. According to the Costa Mesa police, Lister fraudulently used his police credentials after he left the Laguna Beach police department and they were not recovered until he was arrested on drug charges in 1988.

46. It should be noted that a report dated June 17, 1991, written by the Customs agent assigned to the OCDETF investigation of Blandon stated that a DEA source had provided information about a project in El Salvador to "provide assistance to the Contras." The source appears to be Lister.

47. In October 1996, Braun moved to have the ten-page document unsealed at the request of counsel for Ricky Ross. United States District Judge Edward Rafeedie instructed his staff to conduct an exhaustive search of the files and exhibits in the case, and they located only a five-page document which was unsealed. This document was entitled "Background & Operation Plan" and appears to be the LASD plan for the execution of the search warrants at the various locations related to the Blandon organization. Braun told the LASD investigators that this five-page document was not the document he filed with the court. A transcript of the hearing at which Braun attempted to file the document reveals that the court instructed Braun to "lodge" the documents, "not file them." Lodging a document means that it will be reviewed by the court, but will not automatically become part of the court record. It is therefore likely that the ten-page document was later determined not to be relevant and was discarded.