|English | Español||November 19, 2017 | Issue #33|
A Border Corruption Investigation "targeted" a U.S. Senator, and Was "Shut Down Overnight"
By Bill Conroy
Internal Firestorm task force memo on border corruption (72 kb PDF)
Firestorm task force leader’s letter to the commissioner of Customs (223 kb PDF)
Congressional statement by Rep. Bill McCollum on threat of convergence
Written testimony of Interpol executive on the threat of convergence of organized crime, drug trafficking and terrorism
Note: Acrobat Reader needed to view PDF documents
In early 2002, former Customs agent and Firestorm task-force member Steven Shelly—as well as other sources—advanced information alleging that a former U.S. Senator was a target of the task force.
Firestorm, which was composed of agents from several federal agencies, was shut down abruptly in late 1990 because it was getting too close to the truth, according to members of the Arizona-based task force.
“The ‘Firestorm’ task force that was shut down overnight, was shut down as a result of one phone call, because the list of suspects included a former United States Senator…,” claims Shelly. He makes that claim in a letter sent in March 2002 to several U.S. senators and a congressman.
Several other sources familiar with Firestorm’s operations also confirm that the former senator was in the task force’s investigative sights.
The former senator says he knew of the task force, but stresses he was not aware that he was being targeted for investigation by the G-man unit. He adds that any such probe would have been politically motivated, not based on any credible evidence.
Shelly says Firestorm’s “target” was former U.S. Senator Dennis DeConcini, D-Ariz.—who, at the time of the task force, was still serving in the Senate.
Shelly concedes that he does not know the specifics of why DeConcini was a Firestorm target. DeConcini served in the U.S. Senate for three terms, from 1977 to 1995—when he retired after choosing not to seek re-election. As of early 2004, he was working in Washington, D.C., as an attorney and a lobbyist.
Sources familiar with the Firestorm task force also point to an internal government document that likely put DeConcini on the task force’s radar screen. That document is a written summary of an interview conducted with an “informant” over a two-day period in July 1990 by FBI Special Agent Bradley Doucette and Customs Internal Affairs Special Agent John W. Colledge III.
The document is referred to in the public record of the 1992 congressional hearings that explored the demise of Firestorm.
Following is an entry from a diary included in the congressional record. The diary was maintained by Milan Tesanovich, the assistant U.S. Attorney assigned to the Firestorm task force. The diary entry is dated “July 12 & 13, 1990.”
“FBI S/A Doucette and Customs Internal Affairs S/A John W. Colledge, III, meet with an informant who provided detailed historical data concerning corruption in the Douglas, Arizona, area,” the diary entry states.
Among the allegations made in the document summarizing the interview with the informant is that DeConcini used his position as a U.S. Senator to back federal agents off of investigating Douglas real-estate magnate and political power broker Ronald “Joe” Borane, according to sources. The identity of the informant was not disclosed.
When confronted with the claim that he was a target of the Firestorm task force, DeConcini characterized it as “a serious allegation” that runs counter to everything he worked to do while in the Senate.
DeConcini points out that as a senator he was a champion of the U.S. Customs Service and worked to bolster the agency’s resources to better fight corruption and the war on drugs. While senator, he says he was often briefed on corruption issues related to the border.
“There were problems with Customs, such as inspectors allegedly waiving people through,” he says. “I was made aware of those things because I was chair of the subcommittee that appropriated money for Customs. And then I later served as chair of the Senate Intelligence Committee, so I would get weekly briefings on corruption issues related to the border and drugs—particularly along the Arizona border. So I was immersed in this issue while in office.”
DeConcini stresses that, if he was being investigated by the Firestorm task force, it was politically motivated.
“If I was a target of Firestorm, it was done out of malice,” he stresses, “because as a senator I tried to get rid of corruption in Customs, that’s what I devoted my time to, to funding law enforcement and trying to make it more responsible.”
DeConcini may well have been drawn into the scope of Firestorm due to politics, according to some sources in law enforcement. In particular, the former senator’s political connections to controversial Douglas, Ariz., businessman Ronald “Joe” Borane could have triggered the task force’s interest, they explain.
Sen. DeConcini says he made it a priority while in office to give Customs the muscle it needed to fight drug trafficking and the corruption it breeds.
Those efforts included ushering through legislation to expand the agency’s border presence and air-interdiction forces. As a result, DeConcini questions why the very same agency would make him the target of a task-force investigation.
What could have opened the door to Firestorm task-force excesses, according to DeConcini, were the internal problems at Customs during the early 1990s—which is when Firestorm came on line. He adds that efforts were made to reform Customs under the leadership of Raymond Kelly, who served as commissioner of Customs from 1998 until early 2001.
However, DeConcini concedes that even Kelly’s efforts may not have been successful, as some critics of Kelly’s Customs’ reign contend. “There may be some truth to the argument that the problems never really were completely fixed,” DeConcini adds.
The bottom line, according to some law enforcement sources familiar with Firestorm, is that it was Customs’ internal problems—which included task-force information leaks—along with turf wars between federal agencies participating in Firestorm that led to the unit’s demise.
“That task force (Firestorm) was shut down at a time when Customs was a very weak organization internally,” DeConcini explains.
Officials with U.S. Customs headquarters in Washington, D.C., failed to provide a comment on why Firestorm was shut down.
Still, Shelly says the speed with which the task force was dismantled, the fact that its leader was stripped of his command and transferred out of state, and the contention that the unit’s ongoing investigations were torpedoed and key task-force members targeted for retaliation lead him to believe there was more to the situation than bad management and agency egos.
Some clues as to what might have happened can be gleaned from an internal Customs memorandum, dated January 29, 1990. The memorandum was written by Juhasz and directed to Customs’ Southwest Regional Director for Internal Affairs.
“At the present time, it is an accepted fact among federal law enforcement agencies and the U.S. Attorney’s Office [Tucson] that law enforcement corruption in the border communities of Arizona has reached a crisis state,” the memorandum states. “It is the opinion of the SAC/IA (special agent in charge of Internal Affairs) Tucson that attacking only the Customs corruption is like putting a Band-Aid on cancer.
“The solution is the establishment of a multi-agency task force, to be co-located with Customs Internal Affairs, Tucson, Ariz., to deal directly and immediately with all aspects of law enforcement corruption on the Arizona border.”
The memorandum then goes on to identify some potential targets for the proposed task force.
“Current investigative information in this office indicates heavy involvement in the corruption of two Customs employees by an organization in Cochise County (Arizona) which is believed to include law enforcement and court officials,” the memorandum states. “There are strong indications of the same type of activity in Santa Cruz County, which, like Cochise County, is adjacent to the Mexican border.
“Other Federal agencies in Arizona implicate the same organizations as being part of the drug smuggling problem. The members of these organizations include….”
Listed among the credits in the memorandum are a number of high-ranking police and judicial officers in Douglas and Nogales, Ariz.—including the Justice of the Peace in Douglas.
In 1990, that individual was Ronald “Joe” Borane.
“Borane was a target of the task force,” Shelly confirms.
“All this is nonsense, Arizona politics,” Borane asserted in an interview.
According to observers familiar with Arizona politics, Borane has a reputation as a major political player.
“Borane is an influential Democratic politician, and any statewide politician would be foolish not to develop a relationship with him,” says Clarence Dupnik, who as of 2004 served as the sheriff of Pima County, where Tucson is located.
And it is politics that connects Borane to DeConcini.
In fact, DeConcini describes Borane as a “friend.” He says his relationship with Borane dates back to the mid-1970s, when DeConcini first met him while working on the gubernatorial campaign of Raul Castro, who served as governor of Arizona from 1975 to 1977.
“I wrote a letter on his behalf to the judge at his sentencing,” DeConcini says, referring to Borane’s felony conviction on ticket-fixing charges. “... Joe (Borane) is one of the best politicians in southern Arizona.
“... He knows how to make friends and deals, but I never knew of anything he did that was illegal.”
As for the ticket-fixing conviction, DeConcini says Borane got caught up in a sting operation and was convicted. “The record speaks for itself,” DeConcini adds.
Some sources in law enforcement and observers of Arizona politics indicate that DeConcini’s friendship with Borane, and the fact that Borane was a Firestorm target, may account, in part, for the Firestorm task force’s interest in the former senator.
In addition, in 1990, when Firestorm was heating up, DeConcini also was under fire for his role in the multi-billion dollar collapse of Charles Keating’s Lincoln Savings and Loan Association.
DeConcini, along with four other senators—dubbed the Keating Five—were accused of improperly intervening with federal regulators investigating the thrift’s collapse. The five senators received more than $1 million in campaign contributions from Keating.
In the summer of 1991, the Senate Ethics Committee cited DeConcini for questionable conduct. DeConcini, for his part, claimed at the time that he had done nothing wrong. Still, the scandal made him vulnerable politically and opened the door for further scrutiny, political observers contend.
DeConcini supporters stress, though, that any claim linking the former senator to illegal activities is way out of bounds and likely politically motivated.
Sheriff Dupnik says he knows DeConcini well and finds it hard to believe he was being targeted by Firestorm. In fact, his initial reaction to the claim was that it was “absurd.”
“There has never been the slightest inkling that he (DeConcini) has ever been involved in anything criminal,” Dupnik adds.
Borane describes DeConcini as “a very honorable man.”
“This whole thing is a political assassination,” Borane said. “Someone (like DeConcini) becomes a politician with influence, and all of sudden people take after him. It’s an unbelievable situation; it’s a nightmare.”
However, Shelly is unflinching in his claim that DeConcini was a target of Firestorm. He concedes that he does not know for a fact that DeConcini was responsible for pulling the plug on Firestorm, but adds “if anyone had the power to shut it down so quickly and completely, he had that power.”
In the end, though, it is the unanswered questions, more than anything else, that have brought the Firestorm task force back from the ashes.
Juhasz puts some of those questions to the Commissioner of Customs in a letter he drafted in 1991, shortly after the demise of Firestorm:
“I was recently told that I cannot participate in any activities in Arizona. I was told that to do so would ‘violate the agreement,’” Juhasz states in the letter. “I ask: What agreement? Certainly none that I am a party to. The specter of some back-room, smoke-filled meeting that culminated in an agreement to ‘call off the bulldog Juhasz’ smacks of improprieties, unethical behavior and possibly illegal action.
“The final question is: Who can exert so much political pressure in Washington, D.C., that I am not only removed from my position as (Internal Affairs/special agent in charge) in Tucson, but prohibited from participating in any capacity in law enforcement activities in Arizona?”
Former Customs Agent Shelly characterizes the government’s efforts to battle corruption within its ranks as more show than go. In his March 2002 letter to the senators and congressman, he says “for the past 10 years, the corrupt employees have not had much to fear as far as being exposed and prosecuted.
“Our government is aware of and tolerates corruption…,” he adds in the letter.
In an interview, Shelly conceded that we may not be able to eliminate all corruption in law enforcement.
“But we can eliminate the corruption that we know about,” he stressed. “Those who know and refuse to act become just as culpable as the crooked cops. Politics aside, something has to be done.”
And, time is of the essence, particularly when it comes to corruption along the U.S./Mexican border. U.S. Rep. Bill McCollum, R-Fla., made a chilling prediction in a December 13, 2000, statement before the House Subcommittee on Crime, which he chaired at the time.
“In Russia, organized crime groups have developed strategic alliances globally with drug traffickers,” McCollum stated. “What is alarming is that these strategic alliances may not be limited to narcotics. One especially disturbing, and not unrealistic, scenario is the possibility of a strategic alliance between Russian criminals and a terrorist group related to the supply and shipment of weapons to be used in an attack here in the United States.”
Far out? Unfortunately, no. Ralph Mutschke, assistant director of the criminal intelligence directorate of the International Criminal Police Organization (Interpol), told McCollum’s subcommittee on December 13, 2000, that, South American drug cartels have been forming alliances with Eastern European and Russian organized crime groups. These Russian and Eastern European mafia groups “have offered drug cartels access to sophisticated weapons that were previously not available,” Mutschke said.
He added, “Helicopters, surface-to-air missiles, rocket-propelled grenades, and even submarines are on the drug cartels’ shopping list.”
And the drug cartels are not the only bad guys with an interest in acquiring high-powered weapons. The publication Money Laundering Alert published a report in December 2002 detailing an alleged drugs-for-arms deal involving the Autodefensas Unidas de Colombia (AUC)—which is a Colombian paramilitary group that the United States considers a terrorist organization. The investigation resulted in the arrest of several individuals in Costa Rica.
“An undercover agent from the Ukraine recruited to help the U.S. FBI and DEA posed as a source of Russian-made weapons,” the Money Laundering Alert reports. “High-ranking AUC officials wanted to purchase ‘five shipping containers of Warsaw Pact weapons’ in exchange for $25 million in cocaine and cash.”
Information supplied by the U.S. Drug Enforcement Administration indicates that as of year-end 2002 the AUC had “conducted 804 assassinations, 203 kidnappings and 75 massacres with 507 victims, and is considered by international human rights groups and the U.S. Department of State to be responsible for 70 percent of the human rights violations in Colombia.”
In yet another drugs-for-arms case, an indictment was unsealed in November 2002 in San Diego that accuses three individuals there of plotting to “exchange five metric tons of hashish and 600 kilograms of heroin for four ‘Stinger’ anti-aircraft missles,” the Money Laundering Alert reports in its December 2002 issue.
“... The three men met in mid-September 2002 with the U.S. (undercover) agents in Hong Kong, where they allegedly told the agents ‘they intended to sell the missles to the Taliban, an organization which the defendants indicated was the same as al-Qaeda,’” the Money Laundering Alert reports. “They are charged with conspiracy to provide material support and resources to a foreign terrorist organization.”
That brings us back to former Customs agent Fitzgerald’s allegations. Remember, she claims the Tijuana cartel controls a large rail yard in Guadalajara, Mexico. If true, then how much Afghan heroin would it take to convince the leaders of the cartel to open up the rail yard to al-Qaeda? How much heroin would it take to convince the Russian mafia to provide al-Qaeda with a shipment of Humvees and bazookas, or even a misplaced nuclear device from the fallen Soviet Empire?
The whole terror connection to the drug trade is complicated even further by the influence of U.S. intelligence agencies, which historically have played covert roles in propping up the narco- and arms-trafficking activities of parties deemed to be acting in the “interest” of the United States. Such covert activity on the part of U.S. intelligence operatives has already backfired in the past, unleashing our own dragons on us – i.e. Osama Bin Laden.
Lok Thye Lau, a former FBI agent who drew national attention after revealing he spied on China for the Bureau, says organized crime, including drug trafficking, has corrupted the governments of many countries, such as China. Lau says the United States would be “stupid” not to take advantage of this fact in the intelligence game.
“I was dealing with life and death stuff on a pretty regular basis,” Lau says, referring to his overseas intelligence assignment. “If I got killed, and they do kill people, the day I died they would not want my family to know. That way, my family would not be pulled in. Every day, intelligence operatives are killed, but the government is not going to say, ‘Oh, that was one of ours.’ It’s all covert.”
Although Lau is prohibited from discussing the specifics of his spying mission due to national security concerns, his assignment did provide him with the expertise to brief CIA agents on the topics of “Chinese alien smuggling, Asian organized crime and Asian cultural issues in general,” according to government documents.
“Until 9/11, the government was saying the FBI can’t conduct undercover work overseas and the CIA can’t do domestic surveillance. Look at me and you know that it was not true.” Lau says. “I’m like one of the first to do what I did for the FBI, and I assure you there have been a lot of people after me.”
Lau, who claims the FBI discarded him after he had served his purpose, stresses that in the underworld of covert operations, the legal and moral norms of society often give way to the law of the jungle. If left unchecked, he warns that can lead to some dire consequences for the soul of the individual and society.
“They taught me to be ruthless, and for a while I was immersed in that. Thank God for a conscience, which is why I pulled back. But if you become a dragon slayer, you can’t help becoming a dragon yourself.”
Next in Chapter 12:
A pattern of alleged discrimination and corruption surfaces in a Customs counter-terrorism intelligence unit. In one case, a high-level Hispanic female intelligence agent alleges management persecution was a major factor in causing her to have a miscarriage; in another case, a supervisor alleges upper-level Customs intelligence officials condoned the falsification of documents. Several whistleblowers claim terrorism investigations could be compromised by the poor morale prevalent in the intelligence unit.
Read the rest of Bill Conroy’s Borderline Security:
Bill Conroy has worked as a reporter or editor for the past eighteen years at newspapers in Wisconsin, Arizona, Minnesota and Texas. His investigative reporting over the past five years has focused on corruption and discrimination within federal law enforcement agencies.
- The Fund for Authentic Journalism