Operation Gladio: The Unholy Alliance Between the Vatican, the Cia, and the Mafia

by Paul L. Williams

The money for the opiates would eventually come from Nazi gold that had been laundered and manipulated by Dulles and Stephenson through the World Commerce Corporation, a financial firm established by Wild Bill.4 But that was still in the future.

By the close of World War II, Helliwell and a number of fellow Army intelligence officers—E. Howard Hunt, of Watergate fame; Lucien Conein, a former member of the French Foreign Legion with strong ties to the Corsican Mafia; Tommy “the Cork” Corcoran, a lawyer serving the Strategic Service Unit; and Lt. General Claire L. Chennault, the military advisor to Chiang Kai-shek and the founder of the Flying Tigers—had created the Civil Air Transport (CAT) from surplus aircraft, including C-47 Dakotas and C-46 Commandos.5 The CAT fleet transported weapons to a contingency force of the KMT in Burma. The planes were then loaded with drugs for their return trip to China.

The pilots who flew these bush-type aircraft were a motley group of men, often serving as agents or go-betweens with the Chinese National guerrillas and the opium buyers. Some were former Nazis, others part of the band of expatriates that emerges in countries following any war.7 Helliwell and his compatriots had created a model for trafficking in drugs that would result in the formation of Air Ame...

12 And so, when Helliwell, who was not a second-story man, communicated his idea to the OSS brass, he was assured of a captive audience. Donovan, Angleton, and Dulles viewed Helliwell's proposal as answered prayer. Selling smack to the black jazz subculture would provide US intelligence with a steady supply of revenue for Gladio throughout the postwar era.

Protection of the drug trade would become reflected in the fact that not one major drug bust was conducted by US officials from 1947 to 1967, despite the rise in heroin addicts from 20,000 to 150,000.

After 1948, Congress and the White House remained in the dark about most developments within the Agency, including Gladio operations. During the 1950s, the Eisenhower administration directed the CIA to undertake covert activities in Iran (1953), Guatemala (1954), and Indonesia (1957). But even these missions were conducted without consultation with any Congressional subcommittee on intelligence.1 Congress was briefed in advance of the 1961 Bay of Pigs invasion and several clandestine missions in Southeast Asia during the Vietnam War. But no evidence has surfaced that either Congress or the White House sanctioned the establishment of Castle Bank and Trust, the Bank of Credit and Commercial International (BCCI), or the Nugan Hand Bank—all of which were solely owned and controlled by the CIA for money laundering purposes.

In the wake of Watergate and revelations about the CIA's involvement in the toppling of the government of Salvador Allende in Chile, Congress passed the Foreign Assistance (Hughes–Ryan) Act in 1974, which stipulated that the president must be personally informed of all covert operations and must endorse a “finding” that such operations are necessary for “national security.”

3 THE CHURCH COMMITTEE Despite this legislation, the CIA continued to engage in subversive undertakings, including the shipment of arms to the rebels in Angola and to the Kurds in northern Iraq. When news of such undertakings began to surface, the Senate established the Church Committee in 1974 to probe into the activities of the CIA. In its final report, the committee upheld the following: The overwhelming number of excesses continuing over a prolonged period of time were due in large measure to the fact that the system of checks and balances—created in our Constitution to limit abuse of Governmental power—was seldom applied to the intelligence community. Guidance and regulation from outside the intelligence agencies—where it has been imposed at all—has been vague. Presidents and other senior Executive officials, particularly the Attorneys General, have virtually abdicated their Constitutional responsibility to oversee and set standards for intelligence activity. Senior government officials generally gave the agencies broad, general mandates or pressed for immediate results on pressing problems. In neither case did they provide guidance to prevent excesses and their broad mandates and pressures themselves often resulted in excessive or improper intelligence activity. Congress has often declined to exercise meaningful oversight, and on occasion has passed laws or made statements which were taken by intelligence agencies as supporting overly-broad investigations. On the oth...

LIMITED HANGOUTS

Who, then, was directing the killings, the terror attacks, and the coup d'états? Who was sanctioning the transactions with the mafias and the drug cartels? Who was creating the secret armies, the neofascist societies, and the bogus banks? The answer, in part, resides in the strange story of Michele Sindona's purchase of the Franklin National Bank in 1972. Sindona purchased the controlling interest in the bank from Laurence Tisch.

One of the world's richest men, Tisch was the acting chairman and chief executive officer of CBS. He also owned a chain of movie theaters, a cigarette manufacturing plant, a conglomerate of hotels, and a fleet of oil tankers.6 During World War II, Tisch served under William “Wild Bill” Donovan at the Office of Strategic Services (OSS) and never severed his ties to the intelligence community. He was a distinguished member of the Council on Foreign Relations (CFR), a Washington “think tank.”

When we change presidents, it is understood to mean that the voters are ordering a change in national policy. Since 1945 three different Republicans have occupied the White House for a period of sixteen years. Four Democrats have held this most powerful post for seventeen years. With the exception of the first seven years of the Eisenhower administration, there has been no appreciable change in foreign or domestic policy direction…. When a new President comes on board, there is a great turnover in personnel but no change in policy. Example: During the Nixon years Henry Kissinger, CFR member and Nelson Rockefeller's protégé, was in charge of foreign policy. When Jimmy Carter was elected, Kissinger was replaced by Zbigniew Brzezinski, CFR member and David Rockefeller's protégé.11

THE PROBLEM BANK

Tisch never responded to the letter. Neither did the regulatory agencies. Arthur F. Burns,

chairman of the Federal Reserve, opted to turn a blind eye to the transaction, as did Peter G. Peterson, the secretary of Commerce, and CIA directors Richard Helms and James Schlesinger. All four men, along with Tisch and David Kennedy, were prominent members of the Council on Foreign Relations.

If the situation was being manipulated by the CFR, the puppeteers most probably were the elite group within the organization who formed the Trilateral Commission in 1973. David Rockefeller became the chairman of the new commission, which openly sought to create a new world order controlled by multinational corporations and banks.

During Operation Condor, Rockefeller traveled throughout South America, telling the newly installed dictators how to run their governments.24 The effects of his visits south of the border were crystallized in Chile, where in 1976 the military regime under General Augusto Pinochet ignored international condemnation and the congressional cut-off of American aid (due to its terrorist activities), thanks to $927 million in loans from Chase Manhattan, Citibank, Morgan Guaranty Trust, and other US banks.

The Trilateral Commission, in effect, had made American bankers a higher authority than the elected represen...

One of the most bewildering questions in the sordid saga of Franklin National remains the rationale behind the Federal Reserve's decision to shell out hundreds of millions to the Sindona bank.

But the money kept pouring into Franklin until the Long Island bank finally collapsed on October 8, 1974. By that time, the Fed had shelled out $2 billion to Franklin without any hope of recovery.

It was the largest bank failure in American history at that time and the first since the Great Depression.27

such estimates failed to take into account the massive amounts of drug money flowing into the Vatican's coffers from the drug trade.

Nor did they realize that the massive disappearance of funds was necessary to further the strategy of tension and the cause of Gladio.

After the collapse of Banca Privata and Franklin National, the sound of Sindona's falling financial institutions reverberated throughout Europe. In a matter of weeks, Bankhaus Wolff of Hamburg, Bankhaus Herstatt of Cologne, and Amincor Bank of Zurich lay in financial ruins.34 Untold billions fell thro...

So much opium was flowing into Saigon that 30 percent of the American servicemen in Vietnam became heroin addicts.5 Some of this same heroin was smuggled into the United States in body bags containing dead soldiers.

Cash from the network continued to be deposited by the mob in parochial banks throughout Italy.

From these financial firms, including Banco Ambrosiano, the money flowed into the IOR (which continued to collect its 15 percent processing fee) before the funds were transferred to privately held mob accounts in Switzerland, Liechtenstein, Luxembourg, and the Bahamas. But this system was not equipped to handle the billions generated from the heroin trade throughout the world. And so a host of new laundries were established by the CIA.

the fall of Saigon on April 30, 1975.

Saigon now became a dead end for Southeast Asia's drug traffic, thanks to the antidrug policies of the Viet Cong. Crude opium still crossed the border from Laos to service the city's declining addict population, but choice No. 4 heroin was no longer available. The syndicates that had produced the high-grade product moved to markets in Europe and the United States.

Between 1978 and 1980 the Golden Triangle was hit with two severe droughts. The droughts were followed by two seasons of intense monsoon rains, which reduced the region's opium production to a record low.

The usual 600-ton opium harvests were cut to 160 tons in 1978 and 240 tons in 1979.37 The natural catastrophes were accompanied by concerted efforts by the Burmese and Thai governments to eradicate poppy production, necessitated by the fact that opium remained the main source of revenue for the Shan guerrilla armies. From 1976 to 1979, the Burmese army destroyed four major heroin laboratories near the Thai border, netting impressive quantities of precursor chemicals.38

turning point had been reached. Southeast Asia could no longer remain the main source of heroin revenue for Gladio. New poppy fields had to be planted in countries that possessed the proper climate and terrain—cool plateaus above five hundred feet.

Before the outbreak of the Vietnam War, Turkey was an important source of opium in Europe and the United States. But in 1967 the Turkish government announced its plans to abolish opium production. Within a matter of months, the number of Turkish provinces producing poppies declined from twenty-one to four. The total ban was imposed in 1972.

In August 1978, when it seemed that matters couldn't get any worse, Pope Paul VI suffered a massive heart attack and died at Castel Gandolfo, and his successor—Albino Luciani, who called himself John Paul I, issued a call for reform.

As soon as the laundries were created, the CIA set up Air America North America, a fleet of Seneca cargo planes that operated out of the Wilkes-Barre/Scranton airport in Avoca, Pennsylvania.

Almost overnight, the eight phony firms became multimillion dollar businesses that had been established without capital expenditure. It was a mind-boggling accomplishment. The Ponzi scam served a threefold purpose. The first was to provide a new source of arms revenue for “gladiators” involved in the strategy of tension and right-wing regimes, even the regimes at war with America's closest allies. Bellatrix, for example, used $200 million of its assets to purchase French-made Exocet AM-39 missiles for Argentina's military junta in its struggle with England over the Falkland Islands.10 Other offshore companies engaged in obtaining Libyan arms supplies for the Argentine troops and for Nicaragua's Anastasio Somoza Debayle, whose regime was threatened by left-wing Sandinista National Liberation Front.11 Since the Vatican owned the companies, Holy Mother Church was becoming a principal source of murder and violence throughout Italy and Latin America.

The second purpose of the scam was for the Vatican Bank to obtain financial control of the wealthy Milan bank.

The shell companies used a portion of the loans to purchase Ambrosiano stock. Since the bank's charter prohibited any institution or person gaining more than 5 percent of the shares, the stock was purchased by a multitude of phony corporations that were spin-offs of the eight phony firms. The United Trading Corporation, for example, spawned a host of nominal subsidiaries, including Ulricor, La Fidele, Finproggram, Ordeo, Lantana, Casadilla, Marbella, Imparfin, and Teclefin.

To conceal the fraud, Calvi opened Ambrosiano Group Banco Comercial in Managua. Its official function was “conducting international commercial transactions.” But its real function was to serve as a repository beyond the purview of the Guardia di Finanza, where all evidence concerning the fraudulent and criminal devices used to acquire majority interest in the Milan parent bank could be concealed.

The third purpose of the scam was to provide funding for Solidarity in Poland. As soon as he was crowned with the tiara, John Paul II met in private with Calvi to demand that an ample share of the money from the Ponzi scheme be channeled to Lech Wałęsa, who had been “sent by God, by Providence.”20 Such payments met with the approval of Zbigniew Brzezinski, President Carter's national security advisor, and General Vernon Walters, the US ambassador-at-large.

By 1981, over $100 million in funds from the drug cartels and the illegal bank loans flowed into the coffers of the struggling Polish labor movement, making the new pope a great hero in his native country.22 Few, including Wałęsa, opted to look the gift horse in the mouth to discern that the true source of the manna from heaven was the drug trade.

By 1985, the Afghan rebels were receiving $250 million a year in dirty money from the CIA to battle the 115,000 Soviet troops occupying the country. This figure was double the number of Soviet troops who had been deployed to Afghanistan in 1984. The annual payments to the Muslim guerrillas reached nearly $1 billion by 1988. By this time, the CIA was also shipping highly sophisticated weaponry, including Stinger missiles, to the jihadists, whom they mistakenly viewed as “freedom fighters.”2

By 1980, CIA began to send hundreds of militant Muslim missionaries, all members of the radical Tablighi Jamaat, into American mosques to call on young black men to take up arms in the holy war to liberate their Muslim brothers.

In 1988, as the first half of the Soviet contingent began its withdrawal from Afghanistan, Operation Gladio came to an end in Western Europe.

The official figures of the undertaking in Italy from the Gladio Commission showed that 14,591 acts of violence with “political motivation” had occurred between January 1, 1969, and December 31, 1987.

Through Gladio, 491 people had been killed and 1,181 injured or maimed. The figures were without ...

But the most alarming finding for those who dug into the Gladio story was that the secret armies had been used to mount terror attacks that could be blamed on the Communists in order to discredit left-wing political parties at the voting polls. These attacks, the researchers learned, were intended to create maximum fear. They ranged from bomb massacres in trains and marketplaces to violent coups that toppled governments.23

“The CIA can neither confirm nor deny the existence of documentation regarding your inquiry.”32

At this writing, the Gladio files remain classified as confidential and unavailable for inspection. The refusal to disclose any information about the undertaking is in keeping with Operation Mockingbird. Katharine Graham, publisher of the Washington Post and a Mockingbird operative, said, “There are some things the general public does not need to know, and shouldn't. I believe democracy flourishes when the government can take legitimate steps to keep its secrets and when the press can decide whether to print what it knows.”33

Without the Cold War excuse, our foreign policymakers had a real hard time justifying our joint operations and terrorism schemes in the resource rich ex-Soviet states with these same groups, so they made sure they kept their policies unwritten and unspoken, and considering their grip on the mainstream media, largely unre-ported. Now what would your response be if I were to say on the record, and, if required, under oath: “Between 1996 and 2002, we, the United States, planned, financed, and helped execute every major terrorist incident by Chechen rebels (and the Mujahideen) against Russia.

Between 1996 and 2002, we, the United States, planned, financed, and helped execute every single uprising and terror related scheme in Xinjiang (aka East Turkistan and Uyhurstan). Between 1996 and 2001, we, the United States, planned and carried out at least two assassination schemes against pro Russian officials in Azerbaijan.” Sibel Edmonds, FBI Whistleblower, “Friends–Enemies–Both?” Boiling Frogs Post, 2010