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The book is: “The Crimes of Patriots A true tale of Dope, Dirty Money, and the CIA” by Jonathan Kwitny and it is attached below.Prepare a visual (PowerPoint) presentation. No more than 7 slides: Title slide with title of book and your name Claim 2 specific examples from the book to support your claim — if you quote, you will need to provide a works cited slide Conclusion to support claim Be sure that you consider the objectives of the course and your classmates as the intended audience. Then your argument should show how your recommended book is a good or poor supplement.The Crimes of Patriots will reveal how an obscure Australian bank, Nugan Hand Ltd.,
came to occupy the central position in a vast network of drug transactions, fraud, secret
arms deals, and covert intelligence operations.
“The Crimes of Patriots is a masterpiece, pulling together previously unavailable
documentation in a most creative way and—through Kwitny’s original research—
addressing the crucial questions to the most mysterious collection of intelligence hands
ever caught in a single scandal. The answers Kwitny gathers and the new questions he
raises are a roadmap for a major Congressional investigation yet to come.”
—Scott Armstrong
“As this book so clearly demonstrates, Jonathan Kwitny is a peerless investigative
reporter.”
—Peter Maas
“There is a secret government in America. It operates with the explicit and implied
authority of the highest officials, and in the name of America’s interests it has inflicted
great damage on the unsuspecting peoples of other countries and on our
own fundamental principles… I wish everyone would read The Crimes of Patriots.
Perhaps then the current hearings on the Iran-Contra affair—for Ronald Reagan is the
latest to wield this secret weapon and to perish by it—will be the last. An informed
people might become an outraged people and finally put a stop to our own self-destruction.
If so, we will owe much to Jonathan Kwitny’s reporting.”
—Bill Moyers
“It is unusual to commend a book of investigative journalism that leaves some questions
unanswered, but Jonathan Kwitny’s account of the Nugan Hand affair transcends
ordinary journalism. The Crimes of Patriots is the story of a reporter at work trying to
balance issues of criminality and national security, and Kwitny left me with the sense
that no one could have done it better.”
—Seymour Hersh
“This is a superbly researched and exceptionally well-told story.”
—John Kenneth Galbraith
“Jonathan Kwitny is the John Le Carre of nonfiction crime. Sometimes when I was
wallowing in The Crimes of Patriots I burst out laughing (perversely) because the kings of
this complicated idyl are such shameless rogues. Is there no limit to their white-collar
mischief? Kwitny has raised the question again, as only he can.”
—Robert Sherrill
The Crimes of Patriots is the story behind the story revealed in the Iran-contra investigation. It is a chilling glimpse into the workings of the secret government that has
operated ruthlessly in this country and around the world for the last forty years,
unchecked, answerable only to itself. It is a masterpiece of investigative journalism that
reveals the sordid truths shrouded within the “national security interest.”
A rifle blast blows off the head of an Australian banker in his Mercedes—and a tale of the
whole Cold War begins to unravel. The death of Frank Nugan exposes the massive fraud
at the heart of his empire, the Nugan Hand Bank; but it also exposes the real power of the
bank—a network of U.S. generals, admirals, and CIA men, including a former director of
that organization. As the colorful story of the Nugan Hand Bank unfolds, we learn that
there have been many similar operations. Patterns and eerie resonances emerge, and the
names of those who later masterminded the Iran-contra fiasco lurk in the shadows cast by
Nugan Hand: Clines, Shackley, Secord. We are slowly brought to a greater truth.
In his last book, Endless Enemies, Jonathan Kwitny showed how our anti-communist
based foreign policy undermines American security. Here he exposes at last the crimes
committed against American citizens in pursuit of that policy. He shows how some of the
biggest names in American defense and intelligence were involved in an operation that
promoted the dope trade, tax evasion, and gun running, and swindled American citizens,
and citizens of allied countries, out of millions of dollars. Kwitny lays out a mystery filled
with questions whose answers—so far—have stayed locked in the U.S. government’s
vault of secrets.
JONATHAN KWITNY, a Wall Street
Journal reporter for sixteen years, is
one of America’s foremost journalists
and holds the honor medal for career
achievement from the University of
Missouri School of Journalism. His
reporting exposed former Reagan
adviser Richard Allen’s conflicts of
interest, and forced the resignation of
Lynn Helms, Reagan’s Federal
Aviation administrator. This is
Jonathan Kwitny’s sixth book. His
fifth, Endless Enemies: The Making
of an Unfriendly World, was runnerup for the Pulitzer Prize in general
nonfiction in 1985. Mr. Kwitny has
lived or traveled in more than ninety countries. A native of Indianapolis, he works from
the Journal’s New York bureau.
Author’s Note for The Crimes of Patriots
For five years prior to the publication of this book, the author tried repeatedly and
fruitlessly to interview and obtain comment from Richard Secord, Theodore Shackley,
and Thomas Clines, former high federal officials connected to Edwin Wilson, the traitor
and convicted death merchant. Some of these efforts are described in the book. At the
eleventh hour, as books were sitting on the warehouse loading docks waiting to be
shipped to bookstores, Clines, Shackley, and Secord’s lawyer, Thomas Green, contacted
the publisher, stating that they had obtained a proof copy of the book and alleged that
there were numerous errors in it. I have reviewed these specifics, along with my own
sources, and I find that the men were, on the whole, treated fairly. As usually happens,
comment from the subjects being written about did reveal a few erroneous details and
conflicting versions of events.
— J.K. August 12, 1987
Chapter 20
P. 291, line 25: “reported to” should read “gave reports to.”
Chapter 22
p. 310, lines 23-24: “Secord…in disaster” should read “Secord was involved in planning the
disastrous mission to rescue U. S. hostages in Iran, and was deputy commander of a second
rescue plan which was never implemented.”
P. 311, lines 10-11: “paid…illegal profits” should read “and was identified as part of a criminal
scheme. The holding company Clines was associated with paid a $10,000 fine and $100,000 in
civil settlements, and the operational company he had formerly been co-owner of repaid $3
million of the illegal profits.”
P. 312, line 5: change “it” to “the mission.”
P. 312, line 36: add “Apparently, the deal never produced any sales.”
P. 379, lines 3-4: “Clines…company,” should read “Clines’s various companies paid.”
P. 379, line 21: “didn’t come up” should read “was never satisfactorily answered.”
Contents
PROLOGUE
11
CAST OF CHARACTERS
13
1. The End of the Rainbow
2. The Cover-Up
19
34
3. The Golden Triangle
43
4. The Education of a Banker
S3
5. Corporate Veils
69
6. Sleight of Hand
81
7. Terrorists and Patriots
8. Into Africa
95
110
9. The Spooking of Australia
10. The Un-Bank
126
143
11. Laughing at the Law
165
12. The Asia Branches
181
13. The U.S. Branches
194
14. Banking in Opiumland
206
15. Officers and Gentlemen
16. The Drug Bank
217
229
17. The “Mr. Asia” Murders
18. Bernie of Arabia
243
257
19. The Admiral’s Colors
20. Men of Substance
21. What the Tape Recorder Heard
272
286
296
CONTENTS
8
22. The Wilson Connection
23. The Explosion
308
324
24. Thwarting the Investigators
340
25. “Everybody Left Alive Is Innocent”
26. The Agency’s Assets
355
362
APPENDIX: The Questions Whose Answers Are Secret 382
AFTERWORD by Admiral Earl P. Yates, USN (ret.)
ACKNOWLEDGMENTS
INDEX
398
401
Photographs appear following page 198
391
For some time I have been disturbed by the way [the] CIA has been diverted from its
original assignment. It has become an operational arm and at times a policy-making arm
of the Government. This has led to trouble and may have compounded our difficulties in
several explosive areas.
I never had any thought when I set up the CIA that it would be injected into
peacetime cloak and dagger operations. Some of the complications and embarrassments
that I think we have experienced are in part attributable to the fact that this quiet
intelligence arm of the President has been so removed from its intended role that it is
being interpreted as a symbol of sinister and mysterious foreign intrigue—and a subject
for Cold War enemy propaganda.
With all the nonsense put out by Communist propaganda about “Yankee
imperialism,” “exploitive capitalism,” “war-mongering,” “monopolists” in their namecalling assault on the West, the last thing we needed was for the CIA to be seized upon
as something akin to a subverting influence in the affairs of other people. . . .
But there are now some searching questions that need to be answered. I, therefore,
would like to see the CIA be restored to its original assignment as the intelligence arm
of the President, and whatever else it can properly perform in that special field, and that
its operational duties be terminated or properly used elsewhere.
We have grown up as a nation, respected for our free institutions and for our ability
to maintain a free and open society. There is something about the way the CIA has been
functioning that is casting a shadow over our historical position, and I feel that we need
to correct it.
—HARRY S. TRUMAN, December 22, 1963
In a government of laws, the existence of the government will be imperiled if it fails to
observe the law scrupulously. Our government is the potent, the omnipotent, teacher.
For good or ill, it teaches the whole people by its example. If government becomes a
lawbreaker it breeds contempt for law: it invites every man to become a law unto
himself. It invites anarchy.
—Justice Louis D. BRANDEIS
Prologue
As this book goes to press, the United States Government is consumed with a foreign
policy scandal. Arms were secretly sold to an Iranian government that the U.S.
administration publicly preached against, and there was at least the intention to divert
some of the proceeds to evade a Congressional prohibition on aiding rebels trying to
overthrow the Government of Nicaragua. To keep the activity secret, the White House
conducted its arms sales and Contra supply operations through a network of supposedly
private citizens, most of whom had recently held jobs with the armed forces or Central
Intelligence Agency.
Not only were laws broken governing the conduct of foreign policy, but private
profits were evidently made in the process, of a size still being determined. There are
daily expressions of shock and outrage about the “privatization” of foreign policy, and
about the White House’s obsession with covert activity, as if these were inventions of
the Reagan Administration.
They weren’t. The need, claimed by the past eight presidents, to pursue a perpetual
and largely secret global war by fair means or foul against what is said to be a
relentlessly expanding Soviet empire has justified gross violations of American law
against the interests of American citizens for forty years. What is happening new in
1987 is that a window has suddenly been opened on this shadow world before the
spooks who inhabit it could completely take cover.
By dealing with such an unreliable co-conspirator as Iran, some of whose leaders
delighted in exposing the arms sales, the Reagan Administration allowed its secret
operations to be blown with unprecedented prematurity. Yet it is important to keep in
mind that what we are seeing is not an aberration; the aberration is only that we are
seeing it, and what we are seeing is still not the most of it.
Nevertheless, some good may come from the unpleasant sight of so many greedy
arms dealers and callous and bumbling ex-generals. Some good may come from the
sense that all we achieved by sneaking
12
PROLOGUE
down from the ethical high ground was to become the butt of the Ayatollah Khomeini’s
jokes (not to mention the killing of a lot of rag-poor Nicaraguan coffee farmers and
their families). Perhaps all this will inspire the reassessment of a long-standing policy
by which we have surely outwitted ourselves more often than not. That policy, not just
the story of a colorful and crooked bank, is the subject of this book.
It is worth quoting again the words of Walter Lippmann, written after the failed
U.S. invasion of Cuba at the Bay of Pigs in 1961: “A policy is bound to fail which
deliberately violates our pledges and our principles, our treaties and our laws. . . . The
American conscience is a reality. It will make hesitant and ineffectual, even if it does
not prevent, an un-American policy. . . . In the great struggle with communism, we
must find our strength by developing and applying our own principles, not in
abandoning them.”
The Crimes of Patriots was essentially finished before the Iran-Contra affair
exploded. I have gone through the manuscript trying to highlight those longtime actors
in the shadow world who have suddenly been catapulted onto the front pages and into
the evening newscasts, and to relate their place in the Nugan Hand story to the events of
the moment. Among them are air force generals Richard V. Secord and Harry
(“Heinie”) Aderholt, CIA-men Thomas Clines, Theodore Shackley, and Rafael (“ChiChi”) Quintero, and even the Sultan of Brunei.
But actors come and go. It is the roles that stay, and that we need to be concerned
with.
Perhaps the most surprising fact in this book is this: As of today, no one has been
convicted of a crime for the activities of Nugan Hand. Only two relatively minor
figures—Patricia Swan, the secretary, and Michael Moloney, the lawyer who showed up
at the very end—have been charged, and only in connection with the cover-up, not with
the bank’s substantive work. Whether this means the others involved were innocent—or
why, if any were not innocent, more charges haven’t been filed—is something the reader
will have to judge from the facts herein.
Jonathan Kwitny New
York City May 1987
Cast of Characters
THE BANKERS
FRANCIS JOHN NUGAN Son of a Griffith, Australia, fruitpacker; chairman and half-owner
of the bank; shot dead in his Mercedes.
MICHAEL JON HAND Bronx-born Green Beret war hero, CIA operative, vice-chairman
and half-owner of the bank, pal of dope-dealers and of retired and not-so-retired
military-intelligence officials; now one of the world’s most wanted men.
THE YANKS IN THE BANK
DONALD E. BEAZLEY Florida banker, was rushed in late as president of the Nugan
Hand holding company to rescue the faltering bank. The U.S. banks he ran before and
after were also enveloped in scandal, but he’s never been charged with anything.
GENERAL EDWIN F. BLACK Was colleague and pal of CIA bosses Allen Dulles and
Richard Helms, boasted of being involved in “right-wing” groups, ran the Nugan Hand
Hawaii office.
GENERAL ERLE COCKE JR. Survived an execution, headed the American Legion, ran
the Nugan Hand Washington office.
WILLIAM COLBY Retired as Director of CIA after a long and controversial career in
clandestine services, became lawyer for Nugan Hand.
GEORGE FARRIS Military intelligence specialist and war buddy of Hand’s, worked in
the Nugan Hand Hong Kong and Washington offices, then moved into a special forces
training base.
DALE HOLMGREN Was head of flight services for the CIA’s airline, ran the Nugan
Hand Taiwan office.
MAURICE BERNARD (“BERNIE”) HOUGHTON The mysterious puppetmaster of Nugan
Hand, a Texas manipulator who made money where the wars were; was he also a spy?
ROBERT (“RED”) JANTZEN Was CIA station chief in Thailand; announced as Nugan
Hand officer there; inquired about drug connections, then backed out of the job.
GENERAL LEROY J. MANOR
Was chief of staff for U.S. Pacific Command, U.S.
Government liaison with Philippine President Marcos, ran Nugan Hand Philippine
office.
WALTER MACDONALD Former deputy director of CIA for economic research, became
consultant to Nugan Hand.
14
CAST OF CHARACTERS
GUY PAUKER Personal advisor to Kissinger, Brzezinski, Nugan, and Hand.
ADMIRAL EARL (“BUD”) YATES Was chief of U.S. strategic planning for Asia and the
Pacific; president of the Nugan Hand Bank.
BILLY and GORDON YOUNG Thai-born American brothers with on-again, off-again
CIA jobs for many years; helped Nugan Hand in the Golden Triangle drug zone.
THE AUSSIES (AND OTHERS) IN THE BANK
GEORGE BRINCAT The CPA who signed the phony books (but, then, so did Price
Waterhouse).
JOHN CHARODY Consultant in the Sydney office; on the outside, a business associate of
Sir Paul Strasser.
CLIVE (“LES”) COLLINGS Headed the Hong Kong branch.
NEIL EVANS The Chiang Mai (Golden Triangle) branch representative.
JERRY GILDER Chief of the sales staff, master extractor of cash from reluctant investors.
WILFRED GREGORY Ran the Philippine office alone, then worked with General Manor;
had his own ties to the Marcoses.
STEPHEN HILL The young money manager who agreed to testify to save his skin.
ANDREW LOWE Brought in Chinese customers; his commodity specialty was heroin, and
his in-law ran a big Hong Kong bank that backed Nugan Hand.
JOHN MCARTHUR Worked with Collings in Hong Kong.
JOHN OWEN Was career British naval officer; ran Nugan Hand Bangkok branch while
forwarding detailed reports on communist troop movements in Indochina to Mike
Hand.
RON PULGER-FRAME The money courier from Deak & Company who always made it
through customs.
GEORGE SHAW Link to the Lebanese money, much of it drug-related; agreed to testify
despite threats to his life.
GRAHAM STEER American-educated Australian, worked under Hand in Singapore and
Malaysia.
PATRICIA SWAN Nugan’s secretary and executive assistant.
TAN CHOON SENG Bookkeeper-administrator Hand hired in Singapore.
OTHERS ON THE SCENE
SIR PETER ABELES Australian transportation tycoon and partner of Rupert Murdoch;
his close associates employed Houghton and Hand; their close associates fixed his
Mafia problem.
BRIAN ALEXANDER Lawyer for the “Mr. Asia” dope syndicate—and for Frank Nugan’s
brother. Mysteriously vanished.
JOHN ASTON Alexander’s law partner who says he never realized there was cash in
those bags he sent to Nugan Hand on behalf of clients.
CAST OF C H A R A C T E R S
15
THE SULTAN OF BRUNEI Nugan Hand got to him long before Oliver North did.
LEO CARTER The Australian spy chief who vouched for Houghton.
TERRY CLARK Became head of the worldwide “Mr. Asia” drug gang, after having his
predecessor murdered; enjoyed chopping up bodies for multinational burials.
THOMAS G. CLINES CIA covert operations official; huddled with Hand, Houghton, and
Secord on military equipment deals for Pentagon; rescued Houghton from
Australia when the bank failed; later Secord’s deputy running Iran-Contra covert
arms network
ROBERT GEHRING Vietnam vet who worked in Houghton’s operation.
PAUL HELLIWELL The CIA’s drugs-and-money man for thirty years, who died, and his
Caribbean bank with him, right before the rise of Nugan Hand; was it a
replacement?
MICHAEL MOLONEY The lawyer Hand and Houghton brought in at the end.
KEVIN MULCAHY CIA man who blew the whistle on Ed Wilson, then wound up a corpse
outside a trailer park.
KEN NUGAN Frank’s brother, ran the fruit and vegetable business; the appearance of
mobsters’ names on his company’s checks was, he assured everyone, a
coincidence.
DR. JOHN K. and BARBARA OGDEN Lost their son, lost their daughter, lost every dime of
their $689,000 savings entrusted to Nugan Hand.
RAFAEL (“CHI-CHI”) QUINTERO CIA sabotage and assassination specialist under Clines;
purged Secord’s name from Houghton’s travel bag. Later organized Contra arms
deliveries for Secord.
MURRAY STEWART RILEY Former Australian Olympic star and cop, one of the biggest
dope smugglers who used Nugan Hand, socialized with Hand.
ABE SAFFRON The Sydney vicelord Hand and Houghton dealt with.
DOUGLAS SCHLACTER “J” in the task force report, he worked for Ed Wilson and
remembered Nugan Hand’s help in covert arms deals.
GENERAL RICHARD V. SECORD Houghton’s and Wilson’s pal, introduced Houghton to
Clines, later organized and ran the Iran-Contra arms network for the CIA and
White House.

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