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Bush Picks Drug Cover-up Figure to Head DEA

Tuesday, 08 May 2001 12:00 AM

Hutchinson was replaced by Mike Fitzhugh, who was reluctant to let investigators Russell Welch of the state police and William Duncan of the IRS present evidence of money laundering to a grand jury. According to a memo obtained later by Arkansas Times reporter Mara Leveritt, an FBI agent in Hot Springs notified the agent in charge of the Little Rock office that Fitzhugh would be "withholding presentation" about the investigation at Mena from the grand jury.

The memo is dated days before notorious durg trafficker Barry Seal's murder, and a month before he was to come to Arkansas to appear before that same grand jury. The agent in Hot Springs further reports that Fitzhugh "advised that he will not utilize Seal as a government prosecution witness in view of his lack of credibility in other mitigating circumstances."

Wrote Leverrit, "For almost three years, a federal grand jury in the Western District of Arkansas considered questions about drug-running, money-laundering, and illegal airplane modification - all of which investigators believed were being conducted at the Mena airport. But Fitzhugh reportedly focused only on the drug-running allegations, the aspect of the case the jurors felt would be the most difficult one to prove about anyone except Seal, and he, by then, was dead.

According to statements from one of the jurors, Fitzhugh refused to consider the money laundering or conspiracy charges, for both of which the jurors believed evidence was substantial. "We asked him about it," the juror said, "and it was like just blown off. We were never given a straight answer."

Fitzhugh has denied having stymied the grand jury, but he has never explained why, in the three years it met, Welch and Duncan, the central investigators in the case, were never called to testify.

In 1995, the American Spectator magazine published an article by L.D. Brown, a former member of Bill Clinton's Arkansas State Police security detail, in which he described participating in two secret flights from Mena in 1984, during which M-16 rifles were traded to Nicaraguan Contra rebels in exchange for cocaine. Brown also claims that Clinton knew of the activity.

Writes Mara Leveritt in the Arkansas Times: "That announcement spurred Fort Smith lawyer Asa Hutchinson, chairman of the Arkansas Republican Party, to request yet another congressional inquiry into long-standing allegations of money-laundering at Mena. Hutchinson was the the U.S. attorney for the western district of Arkansas when investigators first presented evidence supporting those allegations. In an argument disputed by police investigators, Hutchinson claims he left office before the evidence was well established. Since he harbors political ambitions, he has an interest in clearing his name."

From a congressional deposition from IRS investigator William Duncan:

Q. Would you describe the nature of your instructions and the manner in which you carried out those instructions as they relate to activities surrounding the Mena Airport matter?

A. I was assigned to investigate allegations of money laundering in connection with the Barry Seal organization, which was based at the Mena, Arkansas airport.

Q. And can you - how long a duration were you involved in this investigation?

A. I received the first information about Mena and illegal activities at the Mena Airport in April of 1983, in a meeting in the U.S. Attorney's Office, Fort Smith, Arkansas. Asa Hutchinson was the U.S. Attorney then. Also present at that meeting was Drug Enforcement Administration Agent Jim Stepp, S-T-E-P-P.

Q. Did you discover what you believed to be money laundering?

A. Yes, I did.

Q. Who was the object of your investigation, and what institution?

A. Rich Mountain Aviation, Incorporated based at the Mena Airport. Barry Seal was not actually a target. We had targeted the employees and cohorts of his which operated out of the Mena Airport.

Q. What did you do with the evidence of money laundering that you gathered from your investigation?

A. Presented it to the United States Attorney's Office, Western Judicial District, Fort Smith, Arkansas.

Q. And what were your recommendations to the U.S. attorney?

A. That those individuals and corporation - the corporation be prosecuted for violations of the money laundering statutes, also there were some perjury recommendations and some conspiracy recommendations.

Q. Did you present to the U. S. Attorney a list of prospective witnesses to be called?

A. Yes, I did.

Q. For a grand jury?

A. Yes.

Q. And do you have the names of those witnesses?

A. There were a variety of witnesses. There were some 20 witnesses. He called three witnesses. The witnesses including - included the law enforcement personnel who had participated in the investigations, Barry Seal, members of his organization, people who were involved in the money laundering, and various financial institution officers who had knowledge.

Q. Mr. Duncan, the money laundering to which you refer, did that arise out of an alleged drug trafficking operation managed from the Mena, Arkansas airport?

A. It did.

Q. And it has been alleged that the Central Intelligence Agency had some role in that operation. Is that the same operation that you investigated?

A. Yes.

Q. And when you submitted the witnesses, the names of the prospective witnesses to the U. S. Attorney in Arkansas, are you referring to Mr. - what was the name of the U.S. attorney?

A. Asa Hutchinson.

Q. Asa Hutchinson. And what was his reaction to your recommendations?

A. It had been my experience, from my history of working with Mr. Hutchinson, that all I had to do is ask for subpoenas for any witness and he would provide the subpoenas and subpoena them to a grand jury. His reaction in this case was to subpoena only three of the 20 to the grand jury.

Q. Now, of the three witnesses, who were - what was the nature of the evidence that would have been elicited from those witnesses?

A. Direct evidence in the money laundering.

Q. And did those witnesses testify for the grand jury?

A. yes, they did.

Q. Were you present at the time of the grand jury?

A. No, I was not.

Q. You were not?

A. I was in the witness room, but I was not in the grand jury.

Q. I see. What was the result of the testimony given by the three witnesses to the grand jury?

A. As two of the witnesses exited, one was a secretary who had received instructions ... and I think on some occasions had discussed with Barry Seal, the methodology. She was furious when she exited the grand jury, was very upset, indicated to me that she had not been allowed to furnish her evidence to the grand jury. ... She was the secretary for Rich Mountain Aviation, who participated in the money laundering operation upon the instructions of Hampton, Evans.

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Hutchinson was replaced by Mike Fitzhugh, who was reluctant to let investigators Russell Welch of the state police and William Duncan of the IRS present evidence of money laundering to a grand jury. According to a memo obtained later by Arkansas Times reporter Mara...
Tuesday, 08 May 2001 12:00 AM
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