C. Castillo's Allegation Concerning Ilopango Airport

Castillo claims that the CIA, the U.S. Ambassador to El Salvador, and the DEA colluded to prevent him from pursuing certain investigations that linked the Contras and the CIA to drug trafficking. These claims relate primarily to Walter Grasheim and Carlos Amador, two pilots who, according to Castillo, allegedly smuggled drugs from the Ilopango Airport for the Contras with the complicity of the CIA.

1. Investigation of Walter Grasheim

a. DEA Reports on Grasheim

The earliest reference to Grasheim we found in DEA files was a cable from a DEA agent in Panama, sent on March 10, 1986, to DEA Headquarters and various DEA offices in Central America and the United States. The cable reported that on March 7, 1986, Panamanian authorities informed the DEA there that Grasheim and an Israeli national had flown a private aircraft into Panama from El Salvador and, when initially questioned about their business, claimed to be DEA agents. When further questioned, they claimed that they were in Panama to meet with the Defense Attache at the American Embassy, but that office said they did not know Grasheim or the Israeli. The cable also reported that Grasheim was the subject of an investigation by the U.S. Customs Service in New York for arms smuggling from the United States to Latin America.

The next reference to Grasheim in DEA files was contained in a debriefing report written by Castillo on June 23, 1986. In this report, Castillo discussed what a confidential informant, STG6, said about various alleged cocaine traffickers in El Salvador. The informant identified Grasheim as "head of smuggling operations at the Illopango [sic] Military International Airport." Grasheim allegedly identified himself with FBI credentials and a U.S. pilot's license and claimed to be a military advisor to the Salvadoran military. According to the informant's report:

Grasheim owns and operates Hangar #4 at said airport. Said hangar is utilized by international cocaine and arms traffickers. Hangar #4 is also utilized by the Contra Movement in El Salvador.

Castillo's report went on to describe other alleged drug traffickers in El Salvador, including pilot Carlos Amador, and companies and aircraft that were allegedly used in the trafficking activities. This report was filed in a general "Air Intelligence" DEA file.

On October 27, 1986, Castillo opened a DEA case on Grasheim. Castillo's case opening report stated that based upon the information provided by two informants, STG6 and STG13, an investigation was being initiated involving air smuggling of cocaine by subjects who were believed to be associated with the Contra movement. The report stated that for the previous few months, the DEA's Guatemala office, in coordination with the narcotics unit of the Salvadoran police, was investigating drug trafficking at hangars four and five at the Ilopango airbase. According to Castillo's report, the Salvadoran armed forces Chief of Staff, General Adolfo O. Blandon,(74) had limited the Salvadoran investigation "for security reasons." Castillo's report stated that, despite the General's directive, STG6, who worked at Ilopango Airport, nevertheless kept Castillo informed of smuggling operations there.

Castillo's report said that hangars four and five were operated by the Contra rebel movement, Felix Rodriguez (aka "Max Gomez"), and Walter Grasheim. Grasheim allegedly abused the use of hangars four and five, which had been provided to him by the CIA, by running an international narcotics smuggling operation out of them. Grasheim used United States government credentials to bypass local authorities at the airport. Grasheim was also reported to have ties to mercenaries and the Contra movement in Nicaragua.

The report supplied the names of thirteen other "documented narcotics traffickers" who also used hangars four and five at Ilopango, as well as the names of nine individuals who allegedly traveled with Grasheim abroad. According to the report, Salvadoran authorities would let some of the traffickers stop on the taxiway upon landing their planes at Ilopango. A passenger would then exit the aircraft with a suitcase and run to the military side of the airfield. The aircraft would then continue to Salvadoran Customs and Immigration without declarations of either passenger or cargo. Castillo's report did not supply any details about when this happened or who was involved.

Also, according to Castillo's report, on May 3, 1986, Grasheim had crash landed his airplane six miles northwest of the Tamiami, Florida, airport while trying to fly from Ilopango to Florida. At the accident scene, Grasheim had identified himself as a "secret agent" with the United States government, and according to Castillo's report, had turned a suitcase over to the police that he said contained highly classified documents. Castillo's report stated that the suitcase weighed approximately 60 pounds and was reported to have contained cocaine, and that Grasheim had failed to clear Customs following the accident.

The report added that on March 7, 1986, Grasheim allegedly flew a plane into Panama and identified himself as a DEA agent to Panamanian authorities. According to Castillo's report, the DEA denied knowing Grasheim.

Castillo's report stated that on August 28, 1986, he had advised the U.S. Ambassador in El Salvador, Edwin Corr, of Grasheim's illegal activities. Corr said that Grasheim was at one time employed by the United States Embassy Military Group (Milgroup) in El Salvador.

According to the report, on September 1, 1986, based on surveillances and informant information that Grasheim was in possession of drugs and weapons, the Salvadoran police searched his residence in El Salvador and seized a small amount of marijuana, plastic explosives, cases of grenades, sniper equipment, silencers, anti-tank rockets, machine guns, pistols, night vision equipment, military radios, and an undetermined amount of ammunition for a variety of weapons. Three vehicles were also seized, one of which had a license plate registered to the U.S. Embassy. The Embassy denied the license plate belonged to it.

The report said that the Salvadoran armed forces and the U.S. Embassy were advised of the results of the search. Both the Salvadorans and the U.S. Embassy Milgroup denied giving Grasheim any of the equipment seized from his house, according to Castillo's report. Castillo wrote that it was believed that the equipment might be stolen property. The report also stated that the Salvadoran government issued arrest warrants for Grasheim for possession of illegal weapons and explosives.

According to Castillo's report, on September 19, 1986, Grasheim submitted a sworn statement to the Salvadoran authorities about the items found in the search of his residence. His statement alleged that the Salvadoran armed forces had named him as a military advisor and had given him all the weapons, explosives, and ammunition found during the search. The Salvadoran armed forces denied Grasheim's claim that they had given him the seized items and the Salvadorans added that there were no provisions under Salvadoran law for civilian advisors.

In addition to this case opening report, on October 31, 1986, Castillo filled out a DEA personal history report on Grasheim, giving Grasheim's identifying information as well as a short description of the case in the remarks section. Castillo stated that Grasheim was the "head of a cocaine organization that export [sic] cocaine out of the Illopango [sic] Military Airport in San Salvador, El Salvador. He is a member of the Contra moverment [sic] freedom fighter based out of El Salvador." Castillo then described the previous reports on Grasheim, the search of his house, and the weapons found there.

On November 5, 1986, Castillo wrote a case status report. Castillo reported that Grasheim recently returned to El Salvador on October 29 and had contacted several individuals in the U.S. Embassy and the Salvadoran Government. As a result, Ambassador Corr had asked Castillo and U.S. Customs Service agent Richard Rivera, who was investigating Grasheim for arms smuggling, for a status report on their cases.

According to Castillo's November 5 report, on October 30, Castillo and Rivera briefed Corr. Castillo told Corr that the Salvadorans had issued arrest warrants for Grasheim for possession of narcotics and weapons, but that the warrants had not been executed because of some outstanding business deals the Salvadoran government had with Grasheim. Rivera advised Corr that the U.S. Customs Service had been investigating Grasheim for the previous few years for illegal exportation of "hi-tech" equipment and weapons to Central America without a license. According to Castillo's report, Ambassador Corr "stated that he welcomed any investigation on Grasheim but that the only thing he asked was that the investigation be conducted in a very discreet manner." As we describe below, Corr told us that he was concerned that such an investigation without an adequate factual basis could imperil relationships that had been developed with Salvadoran officials.

Castillo's report stated that he and Rivera next interviewed General Adolfo Blandon, who had recently been contacted by Grasheim. Grasheim had asked General Blandon to certify that Grasheim's possession of the weapons found at his residence was legal. Blandon had declined to do so.

Castillo also reported that he had interviewed an unidentified source of information at the U.S. Embassy in El Salvador. This source said that Grasheim had contacted a member of the U.S. Milgroup at the Embassy and had threatened that if he "was arrested, then everybody else was going to go down with him." According to the source, Grasheim said that he had telephone recordings of conversations with other members of the Milgroup.

The report added that Grasheim had left El Salvador, but that the U.S. Customs Service expected to issue an arrest warrant for Grasheim in a few weeks for illegally exporting weapons and hi-tech equipment.

The next, and final report, that we found in DEA files on Castillo's case against Grasheim was a case closing report, written by the Guatemala DEA Country Attache, Robert Stia, on November 21, 1986. Stia referred to the previous reports about Grasheim in DEA files and the search of his house by the Salvadoran narcotics unit. Stia reported that the search had "precipitated an investigation into the clandestine illegal operations of Grasheim, and his relationship with the U.S. Embassy and the Salvadoran government officials." The report noted that Grasheim had made veiled threats to Embassy Milgroup officials about "illegal activities by [United States government personnel] in his dealings with them," and that Grasheim had questioned "DEA's right and authority to conduct an investigation into his activities."

The report said that, as a result, Ambassador Corr had requested that a "full scale, but very discreet investigation be conducted on the activities of Grasheim." Without describing what the DEA's investigation entailed, the report then said that "DEA has no further interest in Grasheim at this time and it is unlikely to develop further drug information about Grasheim directly." Stia wrote that Ambassador Corr was advised of the case closing and that all information developed by the DEA was turned over the U.S. Customs and the Internal Revenue Service (IRS), who were conducting an active investigation into Grasheim's activity, past and present, regarding illegal possession and exportation of military supplies. The report noted that U.S. Customs Service and the IRS would keep Ambassador Corr advised, and that Grasheim had left El Salvador and his whereabouts were unknown. The report stated that "[t]he drug aspect of this portion of the investigation is concluded and therefore this particular file is closed."

b. OIG Interviews related to the Grasheim case

The OIG interviewed a number of individuals about the Grasheim case, including Grasheim himself. The following describes the results of those interviews.

(1) Felix Rodriguez

Felix Rodriguez worked for the CIA, beginning in the 1960s, throughout South and Central America. In 1976, he retired from the CIA on a total disability due to job related injuries. Since then he has been a consultant to various government agencies.

Rodriguez told us that, in March 1985, he went to El Salvador, with the approval of the U.S. government, to oversee a counterinsurgency program run by the government of El Salvador and financed by private United States funds. The program was based at the Ilopango Airport, which Rodriguez described as a medium to small facility with separate military and civilian sides. Both sides shared a runway, although the military side was off-limits to civilians. The military side was controlled by the Salvadoran armed forces. There was a fence surrounding the entire military side, with approximately three entrances, each manned by Salvadoran security. Anyone who wanted access to the military side needed a pass. Passes could be obtained through the U.S. Embassy. With a pass, the person could move around the military side of the facility freely. Hangars four and five lay within the military side. Hangar four was used by the Salvadoran military to store equipment and helicopters, which Rodriguez used during his various missions. According to Rodriguez, the CIA controlled hangar five, where it kept a helicopter for operational purposes. Generally, the sliding doors on hangars four and five remained open.

Rodriguez said that in 1985, at the request of Oliver North, Rodriguez made arrangements for the Ilopango airfield to be used to unload equipment and supplies destined for the Contras. Over the next year, four or five 707-type planes landed at Ilopango to unload these supplies. Rodriguez added that throughout the time he spent in El Salvador, he witnessed many planes unloading equipment at Ilopango, but he said he never saw or had reason to believe that drugs were being transported by the pilots.

Rodriguez recalled that, in 1986, a man named Carson had come to Ilopango to work as a mechanic. Carson told Rodriguez that he had fixed planes for drug traffickers in Colombia and elsewhere, and Carson told another employee that he had heard the operation in Ilopango was "a money making project." Believing that Carson was referring to drug trafficking, Rodriguez sent Carson back to the United States within three days, and then called North to complain about Carson and ask that North not send people with backgrounds like Carson's. Rodriguez said that this was the only incident to his knowledge in which a valid concern about drug trafficking arose. He said that, although some people associated with the Contra resupply operation took advantage of the Salvadoran government by grossly over-charging for equipment, he had no knowledge of drug activity by anyone, either Salvadoran or American. He recalled that General Bustillo, who ran the airport, was very "hard nosed" and one of the most honest people he has ever met. When Bustillo heard of DEA allegations concerning drug activity by Contra pilots using Ilopango, Bustillo had asked Ambassador Corr to place drug-sniffing dogs at the airfield. Although, to Rodriguez' knowledge, Corr never did so, Rodriguez thought that it would have been extremely difficult to smuggle drugs in and out of the air base undetected.

Rodriguez said he has never met Castillo but knew who he was. Rodriguez said he heard about Castillo's allegations through media reports but said he does not believe them. Rodriguez said that he knew a lot of people in El Salvador and, just as he found out about Carson's drug-related activity, he believes he would have found out about other drug information related to Ilopango if it had occurred.

(2) Edwin Corr

The OIG also interviewed former U.S. Ambassador to El Salvador Edwin Corr, who was the Ambassador in El Salvador from 1985 to 1988. Corr recalled that Robert Stia, the DEA's Country Attache in Guatemala, had brought Castillo to meet Corr in 1986, soon after Castillo had arrived in Guatemala. Shortly after the meeting, Castillo had developed information from confidential informants that Grasheim was allegedly involved in smuggling large quantities of cocaine through El Salvador and ultimately into the United States. Corr said that Castillo briefed him on a regular basis concerning the Grasheim investigation and other drug matters that could have affected the relationship between the U.S. and El Salvador. Castillo reported to Corr that the Grasheim investigation involved air smuggling of cocaine by subjects believed to be associated with the Contra movement, and that Grasheim was a major trafficker who had befriended several Salvadoran officials at the Ilopango Airport.

Corr told us he thought Castillo was very professional and a good agent, so he had no reason to question Castillo's investigation concerning Grasheim. Although Corr had been told by U.S. Embassy personnel that drugs were not a major issue in El Salvador, he said that his prior service in Peru and Bolivia had sensitized him to the drug problem, and he had requested an analysis on whether there had been an increase in the number of Colombians traveling into El Salvador. Because the analysis showed such an increase, Corr believed that a higher priority needed to be given to combating drug trafficking in El Salvador. He said he was therefore very supportive when Castillo told him about the Grasheim investigation.

Corr stated that, despite Castillo's efforts, the drug case against Grasheim was never proven. Corr had not known Grasheim personally, but was told by a member of his security staff that, several weeks after Grasheim's house had been searched by the Salvadoran authorities, Grasheim came to the U.S. Embassy and demanded to see Corr. Corr said his security staff turned Grasheim away. Corr said that, because of the weaponry found at Grasheim's house, Corr had canceled United States government contracts with Grasheim for night vision equipment that the United States was supplying to the Salvadorans, thinking it would be best to sever all ties with Grasheim.

Corr said that after the search, Castillo continued to make allegations concerning Grasheim's possible involvement with Salvadoran officials and Contra rebels in drug trafficking. Corr said that at some point, General Bustillo heard about claims of trafficking at Ilopango and asked Corr to put drug-sniffing dogs there. Corr said that before doing so he had wanted to be sure that the allegations concerning the Ilopango Airport were serious enough to warrant the use of such resources. He also noted that he had not wanted to validate a false allegation that could destroy relationships with Salvadoran officials that had taken so long to build.

Corr therefore sent a "back channel" cable -- a secret cable for limited viewing -- to State Department Headquarters requesting that the DEA be asked to review Castillo's allegations. Corr did not remember when that cable was sent. According to Corr, DEA Headquarters responded that, as a result of the search warrant served on Grasheim's residence and the lack of any additional evidence concerning Grasheim's drug involvement, the case on Grasheim would be closed by the DEA.

The OIG was unable to locate in DEA files any cable or DEA response referred to by Ambassador Corr. The OIG asked the Department of State to search for Corr's back channel cable or any response to him, but the State Department could not find any such cable.

Corr said that after his back channel cable, Castillo had been told by his supervisors to close his investigation on Grasheim and move on to something else. But Corr said that Castillo continued "to snoop around the airport and make allegations." Corr said he informed Castillo that, if Castillo had additional evidence on trafficking by Grasheim or anyone else at Ilopango, he would support Castillo's investigative efforts, but if Castillo had no such evidence he would have to stop the "witch hunt." Corr warned that they were dealing with a very sensitive matter, and Castillo would have to take care not to make false allegations. Corr noted that, after this conversation, Castillo did not attempt to pursue the Grasheim matter any further.

Corr told the OIG that, although there was a large contingent of U.S. military personnel and advisors in El Salvador at that time, the Ilopango Airport was controlled by the Salvadoran military. He said that there may have been some independent pilots flying in and out of the Ilopango Airport transporting drugs, but that no evidence had ever been presented to him corroborating that suspicion. Corr said he had a good working relationship with the CIA, and that the CIA kept him informed about its activities, including its supplying the Contras with intelligence information and basic equipment. Corr added that the CIA was upset with Oliver North because he was performing rogue operations with the Contras and not keeping the CIA informed. Corr said that he had no knowledge that North was flying arms into El Salvador and that North seemed conscientious in keeping away from drug dealers. Corr said that one of the mechanics from the crew of planes used by North for the supply of the Contras who was suspected of having some involvement with drug trafficking was terminated immediately.

Corr said that he did not recall the CIA ever asking him to pressure the DEA to back away from an investigation. Corr said that with the exception of some unknown problem between Castillo and the CIA Chief of Station, the CIA and the DEA appeared to get along fairly well and share information regularly. He said that Castillo never suggested to him that the CIA was conspiring with the Contras to traffick drugs.

(3) Abraham Azzam

Retired DEA SA Abraham Azzam told the OIG that in the mid-1980s he had worked in DEA's Office of International Operations, which supervised the DEA's operations internationally. In that capacity, Azzam interacted with Castillo. Azzam opined that Castillo had seemed to be somewhat "insufficient" as an agent, particularly in his ability to control informants. Azzam said that until Castillo came forward with allegations in the fall of 1996, he had never heard allegations that the Contras as a group or the CIA were involved in illicit drug activity.

Azzam said that in the course of his work, he found that the CIA seemed to be very careful about whether any of its operatives had a drug history. CIA Central American Task Force Chief Alan Fiers would regularly ask Azzam to check whether a potential operative had a drug history. Azzam said that most of the names he was asked to check were not in the DEA database. Azzam stated that the DEA has an impressive international intelligence capability and that he had never heard any allegation through intelligence information or otherwise that the CIA or Contras as a group were involved in drug activity. He said that although many people could have been opportunistic and sold drugs for personal reasons, it was not likely that the CIA or the Contras as an organization had supported any illicit drug operation.

Azzam vaguely recalled Corr's sending a "back channel" cable asking the State Department to inquire whether the DEA had a valid case against anyone at the Ilopango Airport, because Castillo had been making allegations concerning individuals (Salvadoran and U. S. military people) there. After researching the allegations, the DEA Intelligence unit had not been able to locate any information to substantiate the charges, and the DEA reported back to Corr that it did not have a valid investigation concerning anyone at Ilopango Airport. Azzam could not recall any particulars of the Corr cable or whom the correspondence went through at the DEA.

(4) Robert Stia

Robert Stia, now retired, was the DEA Country Attache in Guatemala from 1985 until 1991, and supervised Castillo when Castillo was assigned there.(75) Stia described his working relationship with Castillo as "normal." He recalled that Castillo needed a lot of guidance, because Castillo was aggressive, but poorly focused, and unable to distinguish between promising lines of inquiry and allegations that seemed without substance. According to Stia, Castillo was quick to make judgments before conducting an adequate investigation, and Stia did not find those judgements to be trustworthy.

Stia told us that he was vaguely familiar with the Grasheim investigation conducted by Castillo. Stia thought that the investigation had been initiated based on information received from the U.S. Embassy in El Salvador that Grasheim might have been involved in smuggling drugs into the United States. Stia said the case was closed shortly after a search of Grasheim's residence turned up only a small amount of marijuana. Stia noted that Castillo had never given the impression that he wanted the case to remain open, and that it was customary to close cases when all leads had been exhausted.

Stia recalled that intelligence information indicated that some Salvadoran military pilots were using the Ilopango Airport to transport drugs, and Castillo had made similar allegations. But neither Castillo nor anyone else had been able to substantiate the allegations. Stia said he did not recall, before the recent media coverage, hearing an allegation that the CIA and the Contra resupply operation at Ilopango Airport were running drugs into the United States to raise money for the Contras. Stia said that his office had worked closely with the CIA and frequently shared information -- a relationship that was instrumental in the Guatemala DEA office's success in drug seizures between 1987 and 1989. He said that he believed the CIA was open and honest with the DEA in most instances.

(5) Richard Rivera

Richard Rivera has worked for the U.S. Customs Service since 1975. From 1985 until 1990, he was assigned to the U.S. Customs Service Mexico City office, handling cases there and throughout Central America. Rivera first met Celerino Castillo in Guatemala in 1986.

Rivera said that he did not get involved in the Grasheim case until after the Salvadoran police served the search warrant on Grasheim's residence. Rivera said that a lot of weapons and military equipment were found at the residence, and that the U.S. Customs Service entered the case because of the possible violations of law relating to the exportation of weapons. But Rivera said that the U.S. Customs Service never developed enough evidence on Grasheim for an indictment and eventually closed the case.

Rivera did not recall hearing from Castillo or anyone else that the CIA or the Contras were involved in drug activity. Rivera also said that neither Castillo nor anyone else ever told him that hangars 4 and 5 at the Ilopango Airport were used to facilitate drug activity by the CIA or the Contras. The Salvadoran military commander gave Rivera a tour of Ilopango Airport and informed him that the military side of the base, including hangars 4 and 5, was a restricted area. Rivera said that he never had a reason to attempt to gain entrance into those hangars, and that he never heard from Castillo that Castillo was denied entrance into those hangars.

Rivera said that he thought that Grasheim had an association with the Milgroup and the CIA, but he did not remember that Grasheim had any association with the Contras. Rivera added that if Castillo had an investigation concerning the CIA and the Contras, Castillo never shared that information with him. Rivera also stated that he debriefed many of Castillo's confidential informants and they never told him about any CIA or Contra drug activity.

(6) Walter Grasheim

We also interviewed Walter Grasheim, now a businessman in Miami. He told us that in the mid-1980s he owned Metro/Egida Limited, a protection and defense support business specializing in night vision equipment. At the request of General Paul Gorman, the head of the United States Southern Military Command, he had gone to El Salvador to help the Salvadoran military with its counterinsurgency efforts and with night combat in particular. Grasheim trained the Salvadorans in night vision combat for several weeks before receiving a contract from the U.S. government for the sale of night vision equipment. Grasheim said he immediately established a rapport with the Salvadoran military and the U.S. Milgroup personnel there, and was allowed to participate in Salvadoran field operations.

Grasheim said he frequently flew his plane in and out of El Salvador. He said that he was never involved in smuggling drugs or weapons. In 1986, one of the secretaries in the U.S. Embassy in El Salvador told him that he was suspected of being a drug trafficker, but Grasheim said he was unconcerned about the allegation because he said it was untrue. Sometime later, the secretary identified Castillo as the DEA agent investigating him. In September 1986, while in the United States on personal business, Grasheim heard that his house in El Salvador had been searched by the Salvadoran police. The police seized equipment and personal documents. When Grasheim returned from his trip, he heard that Castillo had told the U.S. Milgroup that he was a drug dealer and a fugitive. But Grasheim said he was never charged with a crime or given a formal explanation for the search.

Grasheim said that, although he had an office at his residence in El Salvador, he spent a great deal of time at the Ilopango Airport. General Bustillo personally allowed Grasheim's personnel to use hangar three to install night combat equipment into the Salvadoran military helicopters. Grasheim was familiar with hangars four and five, but said he never went inside. He said those hangars were controlled by the CIA, which flew "classified" flights from them. Grasheim said the Contras allegedly had two planes at Ilopango, but they were not in hangars four or five. He said that he had never worked for the CIA, and had never heard the allegation that the CIA conspired with the Contras in distributing drugs. (In response to our request for information, the CIA OIG reported that there are no records indicating that Grasheim ever worked with the CIA.)

Grasheim said he was not aware of drugs being smuggled through the Ilopango Airport. He said that General Bustillo ran the Salvadoran Air Force with an "iron fist" and if drugs were being transported through the airport, Bustillo would have known.

Grasheim recalled that, on one of his trips to Miami in 1987, a clog in his fuel line had forced him to make an emergency landing outside of the Tamiami airport. Grasheim had immediately contacted United States Customs, requesting guidance, and was instructed to proceed to the airport. After an emergency landing at the Tamiami airport, he left everything in his plane except a large suitcase that contained business records and flight plans. At the airport, United States Customs informed him that a "lookout" had been placed on his airplane. Grasheim said that to his knowledge no one ever searched his person, his bags, or his plane.

Grasheim said he was not sure why the DEA targeted him for investigation, but he theorized three possibilities. First, he agreed that some of his activities were suspicious -- like the "crash landing" of his private plane in Miami and his frequent flights to and from the United States for business and personal reasons. Second, Grasheim theorized that the DEA may have been "led by the nose through the investigation by someone else" who wanted to divert attention from himself. Third, Grasheim said that the investigation might have been a result of his "high profile" in El Salvador.

c. Closing of the Grasheim case

As noted above, on November 21, 1986, DEA Country Attache Stia wrote a report closing the Grasheim case and stating that the DEA would turn its information over to the U.S. Customs Service, for its review for possible criminal charges involving the weapons found at Grasheim's residence. We found no further report about this case in DEA files, from Castillo or anyone else.

Customs SA Richard Rivera told the OIG that the U.S. Customs Service never developed enough evidence to charge Grasheim with any offense, and its case on him was subsequently closed. The OIG obtained the Customs file on Grasheim. It did not contain any information on either the CIA or the Contras.

2. Investigation of Carlos Amador

Castillo's allegations about Ilopango also referred to a pilot named Carlos Amador, who also allegedly used Ilopango Airport for drug trafficking activities. Amador, who reportedly was born in Nicaragua but is a naturalized U.S. citizen, was allegedly involved in flying supplies for the Contras for several years. The following describes the DEA's information on Amador, as well as the CIA's involvement in this matter.

a. CIA information

The first references that we found to Amador were contained in CIA files. A CIA cable in November 1984 states that Amador was a pilot for the Contra group ARDE, and he provided information to the CIA about another ARDE pilot who was fired for suspected involvement in "contraband smuggling."

According to a 1985 CIA cable, on February 2, 1985, another pilot arrived in Tegucigalpa, Honduras, to begin working with the FDN. On his way to Tegucigalpa, the other pilot stopped in El Salvador to provide information to the CIA Station on arms smuggling and drug-related flights. According to the CIA cable, the other pilot knew of the Station's interest in arms smuggling because he had overheard a conversation between Amador and the Station. The CIA cable stated that the other pilot and Amador had been very cooperative in El Salvador.

CIA records also reflect that the CIA had some information which suggested that Amador was involved in drug trafficking. In July and August 1985, the CIA Costa Rica Station reported in a cable to other CIA offices that the other pilot had suggested that Amador was a possible trafficker. According to a CIA cable, the other pilot's information was reportedly passed to the local Costa Rica DEA office, but we found no record of this in DEA's files.

b. DEA Information

On August 27, 1985, DEA SA Sandalio Gonzalez, in the Costa Rica DEA Country Office, reported the receipt of intelligence from an informant that Amador was planning to fly two aircraft from Miami to Colombia for use in a drug smuggling operation. We asked Gonzalez about this report, but he did not recall anything about the report or Amador. He said that because the report was in a general file called air intelligence, this indicated to him that there was not enough specific information to begin an investigation on Amador.

On March 20, 1986, the DEA Costa Rica office reported that a source said that Amador was intending to fly an aircraft from Costa Rica through El Salvador to Miami with cocaine. The source reported that Amador was possibly picking up the cocaine at "Hangar No. 4" in San Salvador and that Amador had Salvadoran government identification that allowed him to operate freely in that country. The DEA in Costa Rica sent the cable to the DEA in Guatemala requesting that it:

ask Salvadoran police to investigate Amador, and any person(s) and/or companies associated with Hangar No. 4 in San Salvador Intl Airport.[sic]

We located no specific written response from the DEA's Guatemala office to this cable. But it apparently generated some reaction by the CIA. On April 23, 1986, the Costa Rica CIA Station sent a cable to the El Salvador CIA Station describing Amador and the recent intelligence regarding his alleged trafficking activities, and noting the request that DEA planned to make of the San Salvador police.

On April 25, 1986 the El Salvador CIA Station responded by noting that Amador had stopped flying with the Contras in early 1985, had worked with the FDN in Honduras for a short period, and then had gone into private business. This cable went on to explain that Hangar 4 at Ilopango was the location of Contra operations, and that the El Salvador Station could assure that the only thing Amador and the other pilot had transported during their flights there was military supplies. The cable also noted that sources had reported that Amador was at times flying light aircraft from the United States and that the sources suspected that Amador was involved in narcotics. The cable also made the following request:

Based on that information, [El Salvador] Station would appreciate [Costa Rica] Station advising [DEA] not to make any inquiries to anyone re: hangar no. 4 at Ilopango since only legitimate [CIA] supported operations were conducted from this facility. FYI,. . .Station air operations moved from hangar no. 4 into hangar no. 5 which Station still occupies.

On June 10, 1986, the CIA's El Salvador Station wrote in a cable to the Costa Rica Station that an embassy officer in El Salvador, who was the local point of contact for the regional DEA officer, had recently requested any information that the CIA had on Amador. The El Salvador Embassy officer had said that the regional DEA official, who was not identified in the cable, had reported that Amador was suspected of being heavily involved in narcotics smuggling. According to this cable:

The Embassy officer said that if Amador is connected to [the CIA], [the DEA] will leave him alone, but if not they [the DEA] intend to go after him.

The El Salvador Station requested traces on Amador and guidance from CIA Headquarters in the event Amador was associated with the CIA.

Although the Station did not identify the "DEA regional official" in question, it likely was Stia, the DEA's Country Attache in Guatemala, the office which covered El Salvador, or Castillo, the DEA agent responsible for El Salvador. Castillo would not agree to be interviewed by the OIG, and Stia refused to be interviewed a second time, when we wanted to question him about these and other issues.

On June 11, 1986, the Costa Rica CIA Station wrote another cable noting that in November 1984 Amador had been a pilot for the ARDE, and that he was thereafter suspected of working as a pilot in a drug smuggling operation from Colombia to Miami.

On June 17, 1986, CIA Headquarters responded to the El Salvador Station with a cable stating that its records showed no CIA "association" with Amador.

Shortly thereafter, on June 23, 1986, Castillo reported in a debriefing report of a confidential informant in El Salvador, STG6, information about various alleged drug traffickers in El Salvador, including Amador. The informant had reported that Amador had identified himself to the informant as a "Contra Freedom Fighter" based in Miami. According to the informant, Amador allegedly used a Salvadoran military credential that allowed him to land at Ilopango without being searched by Customs. Amador was also reported to smuggle arms to Nicaragua and cocaine from El Salvador to Miami. The informant provided the tail numbers of aircraft flown by Amador and specific flights that had been flown by Amador in the previous several months. In his cable, Castillo requested NADDIS checks of the alleged drug traffickers and the aircraft listed in his report.

As noted in section C, on October 27, 1987, Castillo opened a case on Grasheim which described the information about his alleged drug trafficking activities at Ilopango Airport. In that case opening report, Castillo also referred to Amador and the March 20, 1986 request from the DEA office in Costa Rica to investigate intelligence information that Amador and others were using hangar four at Ilopango for the transportation of cocaine. Castillo stated in his report that he had spoken with the CIA's Assistant Chief of Station in El Salvador, who had denied that Amador had anything to do with the Station.(76) Castillo's report also stated that this Station official said that Amador was a known drug trafficker and had "obtained a U.S. visa with the help of an agency of the U.S. government in Salvador."(77) Castillo included Amador in the index to his report, stating that Amador was an alleged drug trafficker believed to be associated with the Contras. However, as we described above, Castillo's investigation was closed on November 21, 1986.

We located no further information concerning Amador in DEA files or FBI files. According to the DEA's NADDIS database, no case was ever initiated against Amador, and the DEA did not receive further information about him.

74. To our knowledge, General Blandon is not related to Oscar Danilo Blandon.

75. Stia agreed to be interviewed by the OIG, but after this interview, when we attempted to contact him again to clarify various issues that had arisen in interviews of other people, Stia did not make himself available for a second interview.

76. According to the CIA OIG, the person at the Station in El Salvador who was likely the person Castillo referred to as the "Assistant Chief of Station" -- not actually a title used by the CIA -- had no recollection of meeting with Castillo.

77. In a later memorandum, written in 1988, Castillo stated that it was revealed by the Consul General at the U.S. Embassy in El Salvador that an employee of the CIA had previously requested a U.S. visa for Amador a few years back.