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John Simkin

The CIA and the Nugan Hand Bank

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In 1971, Edwin Wilson left the CIA to run shipping companies for a secret Navy intelligence organization called Task Force 157. This included World Marine Incorporated in Washington. Wilson also ran this company for his own benefit. In 1973 he earned a $500,000 fee by delivering a spy ship to Iran under the cover of World Marine.

In 1973 Frank Nugan, an Australian lawyer, and Michael Hand, a former CIA contract operative, established the Nugan Hand Bank. Another key figure in this venture was Bernie Houghton, who was closely connected to Ted Shackley and Thomas Clines.

Nugan ran operations in Sydney whereas Hand established a branch in Hong Kong. This enabled Australian depositors to have access to a money-laundering facility for illegal transfers of Australian money to Hong Kong. According to Alfred W. McCoy, the "Hand-Houghton partnership led the bank's international division into new fields - drug finance, arms trading, and support work for CIA covert operations." Hand told friends "it was his ambition that Nugan Hand became banker for the CIA."

In 1974 the Nugan-Hand Bank got involved in helping the CIA to take part in covert arms deals with contacts within Angola. It was at this time that Edwin Wilson became involved with the bank. Two CIA agents based in Indonesia, James Hawes and Robert Moore, called on Wilson at his World Marine offices to discuss "an African arms deal". Later, Bernie Houghton arrived from Sydney to place an order for 10 million rounds of ammunition and 3,000 weapons including machine guns. The following year Houghton asked Wilson to arrange for World Marine to purchase a high-technology spy ship. This ship was then sold to Iran.

By 1976 the Nugan-Hand Bank appeared to have become a CIA-fronted company. This is reflected in the type of people recruited to hold senior positions in the bank. This included Admiral Earl Yates, retired chief strategist of the U.S. Pacific Command, as president. Other appointments included William Colby, retired director of the CIA, General Leroy J. Manor, the former chief of staff of the U.S. Pacific Command, General Edwin F. Black, former commander of U.S. forces in Thailand, Walter McDonald, retired CIA deputy director for economic research and Dale Holmgren, former chairman of the CIA's Civil Air Transport.

The investigative journalist, Jonathan Kwitny, became convinced that the Nugan-Hand Bank had replaced the Castle Bank & Trust of Nassau, as the CIA's covert banker. Former CIA agent, Kevin Mulcahy later told the National Times newspaper "about the Agency's use of Nugan Hand for shifting money for various covert operations around the globe."

Castle Bank had itself been closed down as a result of an IRS investigation. This came to an end as a result of pressure being applied on the IRS. According to the Wall Street Journal, “pressure from the Central Intelligence Agency… caused the Justice Department to drop what could have been the biggest tax evasion case of all time.”

In February 1976, Admiral Bobby Ray Inman, the new head of the Office of Naval Intelligence, discovered that Edwin Wilson was involved in some dubious undercover business deals. A few months later Wilson was asked to leave the ONI. Wilson continued to run the CIA-fronted companies he had established. The largest of these was Consultants International and over the next few years amassed a fortune of over $20 million. This enabled him to buy a 2,338-acre farm in Northern Virginia, where he often entertained his close friends, Ted Shackley and Thomas Clines.

Much of his money was made in the arms trade. His most important customer was Moammar Gaddafi, the dictator of Libya. Wilson claimed that it was Ted Shackley of the CIA who first suggested he should go to Libya. Wilson got contracts to sell Libya army uniforms, ammunition, explosive timers and 20 tons of C-4 plastic explosives.

In 1976 Wilson recruited Raphael Quintero to kill a Libyan dissident in Egypt. Quintero selected two brothers, Rafael and Raoul Villaverde, to carry out the killing. However, the killing was later called off.

One of the men Wilson employed was former CIA officer Kevin Mulcahy. He became concerned about Wilson's illegal activities and reported them to the CIA. However, Ted Shackley, Deputy Director of Operations, was initially able to block any internal investigation of Wilson. However, in April, 1977, The Washington Post, published an article on Wilson's activities stating that he may be getting support from "current CIA employees". Admiral Stansfield Turner, Jimmy Carter’s new director of the CIA, ordered an investigation and discovered that both Shackley and Clines had close relationships with Wilson. Turner demoted both men.

In 1978 Clines left the CIA. He now joined with Raphael Quintero and Ricardo Chavez (another former CIA operative) to establish API Distributors. According to David Corn (Blond Ghost) Edwin Wilson provided Clines with "half a million dollars to get his business empire going". In 1979 Clines established International Research and Trade Limited in Bermuda. Later that year he joined forces with Hussein Salem in providing U.S. military hardware to Egypt.

After leaving the CIA in September, 1979, Ted Shackley formed his own company, Research Associates International, which specialized in providing intelligence to business. He was also given consulting work with API Distributors, the company established by Clines, Quintero, and Chavez.

According to Alfred W. McCoy (The Politics of Heroin: CIA Complicity in the Global Drug Trade): "Throughout 1979 the Wilson network and the Nugan Hand Bank began to build a close commercial alliance in the netherworld of national security subcontracting". Shackley and Clines were also drawn into a relationship with the Nugan Hand Bank. Michael Hand wrote to Shackley on 27th November, 1979, suggesting a business meeting. Hand's latter also referred to Bernie Houghton, who had worked for Shackley in Vietnam.

Michael Hand probably wanted to talk about Edwin Wilson. In 1979 a Washington grand jury began gathering incriminating evidence about his illegal arms sales. To avoid arrest he moved to London. In the winter of 1979, Wilson had a meeting with Bernie Houghton and Thomas Clines in Switzerland in an attempt to help him out of his difficulties. This included a non-delivery of 5,000 M16 automatic rifles to Libya. The three men discussed ways of using the Nugan Hand Bank to float a $22 million loan to finance the delivery. Hand was obviously concerned that if Wilson was arrested he might begin talking about his dealings with the Nugan Hand Bank.

Michael Hand also had talks with William Colby, the former director of the CIA. It is not known what was discussed at this meeting but Colby submitted a bill to Nugan Hand Bank for $45,684 for his legal advice.

On 27th January, 1980 Frank Nugan was found dead in his car. Bernie Houghton was in Switzerland at the time and he immediately rang his branch office in Saudi Arabia and ordered the staff to leave the country. Houghton also visited Edwin Wilson's office in Switzerland and left a briefcase with bank documents for safekeeping. Soon afterwards, a witness saw Thomas Clines going through the briefcase at Wilson's office and remove papers that referred to him and General Richard Secord.

Two days after Nugan died, Michael Hand held a meeting of Nugan Hand Bank directors. He warned them that unless they did as they were told they could "finish up with concrete shoes" and would be "liable to find their wives being delivered to them in pieces".

According to one witness, Thomas G. Clines helped Bernie Houghton escape from Australia. Michael Hand also left the country accompanied by James O. Spencer, a man who served with Ted Shackley in Laos. The two men travelled to America via Fiji and Vancouver. Hand then disappeared and has never been seen again.

The Australian authorities were forced to investigate the bank. They discovered that Ricardo Chavez, the former CIA operative who was co-owner of API Distributors with Thomas Clines and Raphael Quintero, was attempting to take control of the bank. The Corporate Affairs Commission of New South Wales came to the conclusion that Chavez was working on behalf of Clines, Quintero and Wilson.

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This fits with what I know of Shackley, as the figure who took covert financing to the next level. My understanding is that his Laos opperation c.1966 was the first totally self-sufficient CIA program; by this I mean it was paid for by drug-running involving Laos and other countries, so that the CIA didn't have to ask the Senate for any money, or tell it much. Is this overstating the case?

If Ted Shackley was so good at covert funding, would it be safe to assume that he was directing the Nugan Hand machinations?

Fianally, I was wondering if there are any connections with Nugan Hand and later financing adventures such as Iran Contra, and especially BCCI. I mean connections beyond Shackley and Clines involvement in both.

Are there any other lines of continuity?

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If Ted Shackley was so good at covert funding, would it be safe to assume that he was directing the Nugan Hand machinations?

Fianally, I was wondering if there are any connections with Nugan Hand and later financing adventures such as Iran Contra, and especially BCCI. I mean connections beyond Shackley and Clines involvement in both.

Are there any other lines of continuity?

The Nugan Hand Bank started carrying out its CIA work in 1976. Shackley was Deputy Director of Operations at the time. He therefore was second-in-command of all CIA covert activity. Given his close association with people like Michael Hand, Bernie Houghton and Edwin Wilson, Shackley is the prime suspect. Thomas Clines was probably the field officer (he seems to have played a major role in the clean-up operation). However, it is unlikely that Shackley would have used Nugan Hand as the CIA banker without the approval of the director of the CIA. Who was the director of the CIA in 1976? George Herbert Walker Bush.

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If Ted Shackley was so good at covert funding, would it be safe to assume that he was directing the Nugan Hand machinations?

Fianally, I was wondering if there are any connections with Nugan Hand and later financing adventures such as Iran Contra, and especially BCCI. I mean connections beyond Shackley and Clines involvement in both.

Are there any other lines of continuity?

The Nugan Hand Bank started carrying out its CIA work in 1976. Shackley was Deputy Director of Operations at the time. He therefore was second-in-command of all CIA covert activity. Given his close association with people like Michael Hand, Bernie Houghton and Edwin Wilson, Shackley is the prime suspect. Thomas Clines was probably the field officer (he seems to have played a major role in the clean-up operation). However, it is unlikely that Shackley would have used Nugan Hand as the CIA banker without the approval of the director of the CIA. Who was the director of the CIA in 1976? George Herbert Walker Bush.

Fiji???

From posts in the Sprague topic that may be of interest here:

"Donald Freed, Gemstone (1974)

The full story remains to be told. But during 1972-Z3, our research group, the Citizens Research and Investigation CommitteeCRIC), receive severa bits of unconfirmed information which are worthy of note:

(1) On July 13, 1973 Roger Gordon, fifty-three, a member of the rigtit-wing Secret Army Organization (SAO) fled from a hiding place in Australia to beg asylum in Suva, Fiji. According to the Associated Press, Gordon "had secret information concerning Watergate" and feared for his life. His information: that the heavy-set man with the "Joisey brogue" seen giving orders toBremer on an Ohio ferry was Anthony Ulasewicz, a White House operative."

"John, I'm just offering this observation as a question, not to digress or anything. I've been reading this topic over time and don't have much to offer. One thing that on a couple of occasions has jumped out at me now is the reference to Fiji. I find it puzzling at first why anyone seeking refuge would contemplate Fiji? As someone living in a country fairly close to it and seeing its vunerability it just seems odd. Perhaps an answer may be found in its recent history. There was an attempted coup there, I think it involved 'native' Fijians asserting a traditional but unconstitutional right of 'rulership' over the largely Indian, Chinese majority. Perhaps within this 'military' clique of traditional rulers some clue as to why he considered Fiji a safe place?"

and:

"Again, John, I may be going right off on a tangent here but I thought I'd look into this a bit further.

Contrary to the impressions one gained from the events through media, the story is much more in the modern world.

Speight, the frontman of the coup had been educated in Andrews university in Michigan, a 'leading adventist university'. He then spent some time in Australia doing things like selling computers.

He had business problems. The coup is suggested by some as being an attempt to loot.

He was mainly involved in companies exploiting Fiji's forestry resources.

Michigan has a huge forestry industry. Fifth in the US in acreage. 12 billion a year in related monies. 200 000 employed.

Speights dad attempted a coup in 87.

I realsise the timeline is a bit out of place as far as events re Gordon. But the ingredients of money, computers, australia, america, (forestry? Adventists? Michigan?)"

Unfortunately if relevant it might 'tip the hand' but if possible a perusal of relevant Fiji census' may be fruitful?

Edited by John Dolva

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If Ted Shackley was so good at covert funding, would it be safe to assume that he was directing the Nugan Hand machinations?

Fianally, I was wondering if there are any connections with Nugan Hand and later financing adventures such as Iran Contra, and especially BCCI. I mean connections beyond Shackley and Clines involvement in both.

Are there any other lines of continuity?

The Nugan Hand Bank started carrying out its CIA work in 1976. Shackley was Deputy Director of Operations at the time. He therefore was second-in-command of all CIA covert activity. Given his close association with people like Michael Hand, Bernie Houghton and Edwin Wilson, Shackley is the prime suspect. Thomas Clines was probably the field officer (he seems to have played a major role in the clean-up operation). However, it is unlikely that Shackley would have used Nugan Hand as the CIA banker without the approval of the director of the CIA. Who was the director of the CIA in 1976? George Herbert Walker Bush.

Fiji???

From posts in the Sprague topic that may be of interest here:

"Donald Freed, Gemstone (1974)

The full story remains to be told. But during 1972-Z3, our research group, the Citizens Research and Investigation CommitteeCRIC), receive severa bits of unconfirmed information which are worthy of note:

(1) On July 13, 1973 Roger Gordon, fifty-three, a member of the rigtit-wing Secret Army Organization (SAO) fled from a hiding place in Australia to beg asylum in Suva, Fiji. According to the Associated Press, Gordon "had secret information concerning Watergate" and feared for his life. His information: that the heavy-set man with the "Joisey brogue" seen giving orders toBremer on an Ohio ferry was Anthony Ulasewicz, a White House operative."

"John, I'm just offering this observation as a question, not to digress or anything. I've been reading this topic over time and don't have much to offer. One thing that on a couple of occasions has jumped out at me now is the reference to Fiji. I find it puzzling at first why anyone seeking refuge would contemplate Fiji? As someone living in a country fairly close to it and seeing its vunerability it just seems odd. Perhaps an answer may be found in its recent history. There was an attempted coup there, I think it involved 'native' Fijians asserting a traditional but unconstitutional right of 'rulership' over the largely Indian, Chinese majority. Perhaps within this 'military' clique of traditional rulers some clue as to why he considered Fiji a safe place?"

and:

"Again, John, I may be going right off on a tangent here but I thought I'd look into this a bit further.

Contrary to the impressions one gained from the events through media, the story is much more in the modern world.

Speight, the frontman of the coup had been educated in Andrews university in Michigan, a 'leading adventist university'. He then spent some time in Australia doing things like selling computers.

He had business problems. The coup is suggested by some as being an attempt to loot.

He was mainly involved in companies exploiting Fiji's forestry resources.

Michigan has a huge forestry industry. Fifth in the US in acreage. 12 billion a year in related monies. 200 000 employed.

Speights dad attempted a coup in 87.

I realsise the timeline is a bit out of place as far as events re Gordon. But the ingredients of money, computers, australia, america, (forestry? Adventists? Michigan?)"

Unfortunately if relevant it might 'tip the hand' but if possible a perusal of relevant Fiji census' may be fruitful?

It is something worth exploring.

As an Australian you might be interesting in reading this article that suggests Ted Shackley was involved in the overthrow of Gough Whitlam's government.

http://www.newdawnmagazine.com/articles/20...0Cover-Up1.html

http://www.newdawnmagazine.com/articles/20...0Cover-Up2.html

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