If Iran-Contra prosecutor Lawrence Walsh had wanted to know the
extent of former Colonel Oliver North's involvement in the
smuggling of drugs from Central America to the United States,
Walsh might have made at least one phone call to Celerino 'Cele'
Castillo in San Antonio, Texas.
Between 1985 to 1991, Castillo was the Drug Enforcement
Administration's main agent in El Salvador, where, he says, he
uncovered "and reported" a huge drug and gun smuggling operation
that was run out of the Ilopango military airport by the 'North
Network' and the CIA.
North, the former Republican nominee for the U. S. Senate in
Virginia, initially prevailed at the nominating convention by
positioning himself far to the right of his rival, former Reagan
budget director James Miller III, promising that if elected he
will work to "clean up the mess" in Washington, and by cultivating
the support of the same fundamentalist Christian Republicans who
responded to the direct-mail campaign to finance the North
defense committee. Fortunately for America, North lost his bid for the U. S. senate.
But Castillo, the first government official with first-hand
knowledge of North's drug dealing to speak publicly about it,
says North belongs in prison, not in the U.S. Senate. "We saw
several packages of narcotics, we saw several boxes of U.S.
currency, going from Ilopango to Panama," Castillo said.
According to Castillo, the entire program was run out of
Ilopango's Hangars 4 and 5. "Hangar 4 was owned and operated by
the CIA and the other hangar was run by Felix Rodriguez, or 'Max
Gomez,' of the Contra operation [directed by North]. Basically
they were running cocaine from South America to the U.S. via
Salvador. That was how the Contras were able to get financial
help. By going to sleep with the enemy down there. North's people
and the CIA were at the two hangars overseeing the operations at
all times," Castillo said.
CIA spokesman David French said Castillo's allegations are "not
something that we would comment on."
Cele Castillo joined the DEA in 1979, after a tour with the First
Cavalry in Vietnam, where he earned a bronze star, and a six-year
stint as a police officer in Edinburg. His first DEA assignment
was in New York, working undercover investigating organized
crime. After that, because of his Vietnam experience, he was
transferred to Lima, Peru, where he conducted air strikes against
jungle cocaine labs and clandestine airstrips. In 1985, he was
transferred to Guatemala, where he oversaw DEA operations in
Belize, Honduras and El Salvador. Castillo posed as a member of
one of the drug cartels, he said, and almost immediately became
aware of the drug smuggling operations at Ilopango's hangars 4
and 5. "We took several surveillance pictures...and they were
running narcotics and weapons out of Ilopango, with the knowledge
of the U.S. embassy."
Though Castillo had been reporting his findings all along, to no
avail, a December 1988 report prepared by the Congressional
Subcommittee on Terrorism, Narcotics and International Operations
(the Kerry Committee) confirmed Castillo's allegations and
concluded: "There was substantial evidence of drug smuggling
through the war zones on the part of the individual Contras,
Contra pilots, mercenaries who worked with the Contras, and the
Contra supporters throughout the region."
The committee, chaired by Massachusetts Senator John Kerry, also
found that on March 16, 1987, a plane owned by known drug
smugglers was seized by U.S. customs officers after dumping what
appeared to be a load of drugs off the Florida coast: "Law
enforcement personnel also found an address book aboard the
plane, containing among other references the telephone numbers of
some Contra officials and the Virginia telephone number of Robert
Owen, Oliver North's courier," the committee reported. And on
July 28, 1988, DEA agents testifying before Kerry's committee
said it was North's idea in 1985 to give the Contras $1.5 million
in drug money being used by DEA informant Barry Seal in a sting
operation aimed at the drug cartels.
If that wasn't enough to compel investigators to pursue North
himself as a drug dealer, Castillo provided them with what should
have been the clincher. In a February 14, 1989, memo to Robert
Stia, the country attache in Guatemala, Castillo laid out in
minute detail the structure of the Ilopango operation and
identified more than two dozen known drug smugglers who
frequented Hangars 4 and 5.
Huge quantities of drugs and guns were being smuggled through
Ilopango by mercenary pilots hired by North, Castillo wrote.
"Now, all these contract pilots were documented [in DEA files]
traffickers, Class I cocaine violators that were being hired by
the CIA and the Contras," the memo stated. "And the U.S. embassy
in El Salvador was giving visas to these people even though they
were documented in our computers as being narcotics traffickers."
Among those Castillo identified was Carlos Alberto Amador, "a
Nicaraguan pilot mentioned in six (6) DEA files....The DEA was
advised by a source at the U.S. embassy in San Salvador that
personnel from the CIA had allegedly obtained a U.S. visa for
Amador." Amador, Castillo discovered, kept four planes at
Ilopango, and a frequent companion of his was was Jorge Zarcovick
who "is mentioned in twelve (12) DEA files," and "was arrested in
the U.S. for smuggling large quantities of cocaine."
Walter 'Wally' Grasheim was another smuggler tagged by Castillo.
"He is mentioned in seven (7) DEA files," Castillo wrote. "He is
documented as a cocaine and arms smuggler from South America to
the U.S. via Ilopango airport. He utilized hangars 4 and 5.
Grasheim is also known to carry DEA, FBI, and CIA credentials to
smuggle cocaine." "Wally Grasheim," Castillo said, "was an
American working hand-in-hand with Colonel Oliver North."
Grasheim lost his life while accompanying CIA contract arms
smuggler Eugene Hasenfus, whose plane was shot down during a
clandestine flight over Nicaragua in 1986.
When the DEA raided Grasheim's house in El Salvador, agents found
explosives, weapons, radio equipment and license plates, Castillo
said, adding that much of the weaponry and other material was
traced back to the U.S. embassy in El Salvador. Castillo said
that when he tried to gather more information on the munitions,
he was told by the Pentagon to drop the investigation.
It would not be the last time Castillo was told to back off. Nor
was it the last time he ignored such an order and kept on digging.
Much of Castillo's information came from a DEA informant who had
worked at the Ilopango airport, doing flight plans and keeping
flight logs. The informant, who used the pseudonym 'Hugo
Martinez,' was in an ideal position to witness and document
North's drug deals. Martinez passed the information he gathered
on to Castillo. In an interview, Martinez confirmed Castillo's
story about widespread drug and arms dealing by the CIA and the
North network at Hangars 4 and 5.
Castillo said additional information obtained after he was
transferred from El Salvador to San Francisco confirmed what he
had learned in El Salvador. While tracking drug smuggling into
Miami, Texas and San Francisco in 1991, Castillo arrested the
wife of Carlos Cabezas. In an attempt to make a deal for his
wife, who had attempted sell Castillo five kilos of cocaine,
Cabezas, a Nicaraguan, told Castillo that he was one of the
pilots who had worked for North, smuggling vast quantities of
cocaine into the United States from Ilopango. Cabezas described
in detail the operations at Ilopango and identified many of the
traffickers who worked there. The information he provided matched
Castillo's own findings.
Beginning in 1986, Castillo tried to report what he had
discovered, launch a full-scale investigation, and shut down the
smuggling operation. On several occasions, he met with Edwin
Corr, the then-U.S. ambassador to El Salvador, to tell him about
the operation. "His words to me were that it was a covert White
House operation run by Colonel Oliver North and for us to stay
away from the operation. My feeling was the fact that Corr did
not agree with what was going on at Ilopango but his hands were
tied. He was only following orders from the White House to give
all the assistance he could to Oliver North and his covert
operation." Corr, now a professor at the University of Oklahoma,
would only say, "I deny Cele's allegations that I told him to
back off *on the basis of White House pressure.*"
Castillo even managed to give the information he had gathered
directly to George Bush. On January 14, 1986, Castillo met the
then-Vice-President at a cocktail party at the ambassador's house
in Guatemala City. After describing his job to Bush, Castillo
detailed North's operation. Without missing a beat, Castillo
said, Bush "shook my hand and he walked away." [CN -- "This
scourge must stop!"]
Even though Castillo couldn't get anyone to act on his Ilopango
information, in July 1987, attache Robert Stia recommended him
for a bonus and a promotion. "Castillo is an extremely talented
agent," Stia wrote, "...a tireless worker, exceeding all
requirements of overtime and work hours. His administration of
cases is outstanding."
Nevertheless, as Castillo continued to pursue the North
investigation, he fell from favor with his superiors, who
suspended him for three days in 1990, and then in 1991
transferred him to San Francisco, where he worked undercover,
investigating Hells Angels in Oakland. In June 1992, after
further conflicts, Castillo resigned from the DEA.
Before resigning, though, in 1991, he tried to give the
government one last chance to use the information he had gathered
on North. He secretly met with FBI agent Mike Foster, who was
assigned to Special Prosecutor Lawrence Walsh. "Foster said it
would be a great story, like a grand slam, if they could put it
together. He asked the DEA for the reports, who told him there
were no such reports. Yet when I showed him the copies of the
reports that I had, he was shocked. I never heard from him again."
On May 4, 1989, North was convicted on the relatively minor
offenses of illegally accepting gratuities (his famous security
fence), interfering with a Congressional investigation and
obstruction of justice. But even those convictions were
overturned when an appeals court ruled that they were based on
testimony North gave under a grant of Congressional immunity.
Although they talked about drugs, neither Walsh nor the Iran-
Contra committee ever seriously investigated the drug-dealing
charges. North, who did not return phone calls made to his
campaign headquarters in Virginia, has consistently denied having
been involved in drug smuggling.
Another former DEA agent, Michael Levine, said he has pored over
North's diaries and found "hundreds" of references to drugs that
"have never been investigated." For example, Levine said, on July
9, 1984, North wrote: "RDEA, Miami. Pilot went, talked to
[Federico] Vaughn, wanted aircraft to go to Bolivia to pick up
paste, want aircraft to pick up 1500 kilos."
"My god," said Levine, author of The Big White Lie, "when I was
serving as a DEA agent, you gave me a page from someone in the
Pentagon with notes like that, I would've been on his back
investigating everything he did from the minute his eyes opened,
every diary notebook, every phone would have been tapped, every
trip he made."
But both Levine and Castillo said the investigation never
happened. (DEA officials have not returned repeated phone calls.)
In an interview, the FBI's Foster said, "Of course I can't
confirm or deny that [his interview with Castillo]. I am aware of
Mr. Castillo and his position on Central America," Foster said.
"In the course of the Iran-Contra investigation, it's no secret
that I was involved in that and was the FBI investigator in that,
but I am prohibited from commenting." Foster said he is very
skeptical about the drug claims generally. "There are individuals
that have a loose relationship with the government and those
people are not all choirboys and they have been doing all kinds
of weird things. But I think you would be hard pressed to show a
concerted government backing or involvement in [drug
It is just that kind of attitude, Castillo said, that led
officials to ignore North's operation, allowed him to evade
prosecution for drug dealing, and now has him poised to move into
the United States Senate.
"There was nothing covert going on in El Salvador regarding the
Ollie North operation and narcotics trafficking," Castillo said.
"What we're talking about is very large quantities of cocaine and
millions of dollars."