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The Last Circle resurrects Octopus mystery

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The Last Circle, By Cheri Seymour (TrineDay LLC, Walterville, Oregon, 2010, 584 pages.)

Book Review by Dennis Moore October 1, 2010

(San Diego) Former investigative reporter Cheri Seymour, a San Diego County resident, has written a non-fiction thriller to end all thrillers.

The Last Circle is ripped from the headlines of one of our era’s most controversial murder scandals: the killing of investigative journalist Danny Casolaro, whose discoveries about a shadowy organization that he dubbed “The Octopus” reached into the Mafia, the Cali Drug Cartel, and even the U.S. Department of Justice.

Casolaro, a Washington D.C. journalist, began his probe with an investigation into the theft of a revolutionary new software program that was actually the forerunner of artificial intelligence. It was called PROMIS, or Prosecutor’s Management Information System, and it was contracted by the U.S. Department of Justice to upgrade the DOJ’s outdated case management system.

Casolaro worked closely with Bill Hamilton, owner and developer of the PROMIS software, to locate and identify the persons responsible for illegally modifying the software, installing a backdoor or Trojan Horse in the program, and selling it worldwide to foreign countries—thus allowing the U.S. government to secretly monitor intelligence operations in those countries. But Casolaro learned more than he bargained for.

The PROMIS software investigation led him into a labyrinth comprised of international spies, drug traffickers, money launderers, and unsolved murders dating as far back as 1981. He called this the “Octopus” because its tentacles reached into every facet of criminal enterprise, including the Mafia and the Cali Drug Cartel. In August 1991, Casolaro filled his briefcase with documents and headed out to Martinsburg, Virginia to “bring back the head of the Octopus,” according to his closest friends who said he was “ecstatic” about something he had recently uncovered. He never returned.

He was found dead at a Martinsburg hotel on August 10, 1991. The coroner ruled his death a suicide, but all his documents and briefcase were missing from the hotel room and never recovered. Three months after Casolaro’s death, Seymour jumped on the investigative trail he left behind, and 18 years later, his story and Seymour’s are revealed in this riveting book, The Last Circle.

One of the most provocative outcomes of this 18-year on-and-off investigation was the discovery that five days before his death, Casolaro had uncovered a connection between Mike Abbell, a former Director of International Affairs at the Department of Justice in Washington, D.C., and the Cali Drug Cartel in Columbia. Seymour provided that information to a U.S. Customs Agent in 1993; he followed up on that lead, and in 1995 Mike Abbell was indicted for money laundering, drug conspiracy and racketeering for the Cali Cartel.

The indictment was published on the front page of the Washington Post, but the story behind the indictment is published in The Last Circle. That is what Seymour’s book is about, the story behind the story. Seymour recalled that on February 19th, 2000, the stalwart, soft-spoken Mountie of the RCMP, Sean McDade visited Seymour at her southern California home and explained that high-ranking Canadian officials may have unlawfully purchased the PROMIS software from officials in the Reagan-Bush administration.

RCMP, the Royal Canadian Mounted Police, had reportedly traced some banking transactions that supported this claim. If his investigation was successful, he said, “it could cause the entire U.S. Republican Party to be dismantled and more than one presidential administration would be exposed for their knowledge of the [PROMIS] software transaction.” The scope of Seymour’s book includes behind-the-scenes dynamics of a globe-trotting undercover intelligence operative named Robert Booth Nichols.

Nichols’ labyrinthine career encompassed the covert operations of a maze of politicians, NSC, CIA, and DOJ officials, organized crime figures, intelligence agents, arms sales, drug-trafficking, high-tech money laundering, and the death of Danny Casolaro. Seymour states in her book that Nichols was aptly described in magazine articles as “Clark Gable without the ears,” tall with probing brown eyes, his demeanor simultaneously controlled and dramatic with an international flavor.

He’d been the weapons technical advisor for Steven Seagal’s movie, “Under Seige,” and it became apparent why Seagal gave him a cameo appearance as a military colonel in the movie. At times reading like something out of Robert Ludlum’s The Bourne Supremacy, Seymour’s book is an investigative thriller that points fingers and name names all the way up to its conclusion with the 2009 arrest of a self-described Mafia “hit-man” contracted to kill a Cabazon tribal leader in 1981 who had opposed both development on tribal lands of the first Indian Casino in California and the terrible weapons of Wackenhut.

Through law enforcement investigators from agencies as far-ranging as the FBI, U.S. Customs, police and sheriff’s departments, and even the RCMP national security division, Seymour learned that the official head of the Octopus resided in the U.S. Department of Justice, supported by an out-of-control presidential administration. Its tentacles were comprised of a cabal of “Old Boy” cronies, true believers, who held that the end justified the means in their obsession to quell the expansion of communism in neighboring countries and throughout the world in the 1980s.

They gave corruption a new meaning as they stampeded through the Constitution and acted like cowboys toward the intelligence community, blazing new trails into drug cartels and organized crime while simultaneously growing new tentacles that reached into every facet of criminal enterprise.

The theft of high-tech software (PROMIS) for use in money-laundering and espionage, illegal drug and arms trafficking in Latin America, and exploitation of sovereign Indian nations were just a few of these enterprises.

Mind you, the high-tech software (PROMIS) was the linchpin to all the sordid acts and criminal behavior revealed in Seymour’s The Last Circle, including the murder of Danny Casolaro. The Last Circle refers to Dante’s Inferno. Seymour states that there was a last circle represented in Dante’s Inferno, but in retrospect it seems fitting. In 1306 A.D., Dante poeticized nine circles, the ninth being the last level before the final descent into Hell. “The last circle housed those souls who had been traitors to their country, their friends, and their lords.”

Because Seymour had provided a group of law enforcement men and women with the very same information that Casolaro had been working on in the last five days of his life–information that resulted in the subsequent indictment of a former career DOJ official connected to Robert Boot Nichols and the Cali Cartel– Seymour was provided with documents and reports of the best kept secret in Washington, D.C.

These law enforcement people had direct knowledge of FBI wiretaps of Robert Booth Nichols and his associates which had captured (on tape) members of the Gambino and Buffalino crime families, in collusion with the Department of Justice and the U.S. Attorney general, the highest law enforcement authority in the nation, arranging the shutdown and sealing of an FBI investigation of MCA Corporation in order to facilitate the largest corporate sale in U.S. history to the Japanese.

Seymour states in her book that she was told that there is no one in America who has the power to prosecute the Octopus criminals because the tentacles have become an integral, and accepted, culture within our society and indeed, within our economy. With that in mind, it became clear to Seymour that the only avenue left to expose the history of Octopus was through publishing this book, The Last Circle, because for decades major media, government committees, U.S. Representatives and Senators had ignored the legacy of war, corruption and greed left behind by the Octopus which she says still flourishes today.

This book even includes a reference to the famous “Zapruder” video tape of the assassination of President John F. Kennedy, indicating the tentacles of the “Octopus,” and what those tentacles could have people believe. The author quotes Robert Booth Nichols in her book, stating; “Nothing is as it appears to be.”

The intrigue in this book further includes Seymour being targeted for assassination, due to her investigative reporting in affairs of Danny Casolaro and Robert Booth Nichols, among others. She was warned: “They’re going to kill you, if you don’t RUN!”

She did take a brief hiatus in San Diego with her mother after this threat was made. Obviously, she escaped this fate, for I actually sat next to her and talked with her a few weeks ago at a meeting of the San Diego Writers/Editors Guild. She impressed me as someone who would go to great lengths to get at the truth. This is an exciting true-life thriller from end to end.

Read more about The Last Circle at Seymour’s website:

The Last Circle book can be purchased through Barnes & Noble bookstores, on the Internet, and directly from Trine Day Publishing, P.O. Box 577, Walterville, OR 97489 – Tel. 1-800-556-2012 – Website:


Written by nuganhand

January 23, 2011 at 1:07 am

Nugan Hand and Abe Saffron

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Can of Worms II  [Book extract]


Some Faces in the Crowd

Criminal organisations in their characteristics match legitimate organisations: there are big ones: there are small ones: people float in and out of them. It is remarkable, absolutely remarkable, how often you come across the same people in very diverse activities, all of which are criminal.

– Douglas Meagher, QC, counsel assisting Costigan Royal Commission.

Many names recur in Royal Commissions and other inquiries. Some appear to have interlocking relationships that cover a variety of relationships. Among these milieu personalities are:

Frederick (Paddles) Anderson, 70, is described in TFR3 (Volume 3: The Associates of Murray Riley, report by the Commonwealth-NSW Joint Task Force on Drug Trafficking (October 1982)) as a ‘well-known criminal’.

Until his death in January 1985, Anderson was thought to be first among equals in the Sydney milieu. In Melbourne in 1940, he got into an argument with a Melbourne personality, John C. Abrahams. In the following altercation, Abrahams was killed. Anderson was charged with his murder, found not guilty, and returned to Sydney. In the following months, Anderson made frequent appearances in Sydney magistrates’ courts, where he described himself as a machinist living in Surry Hills. According to McCoy, in one three-day period, he was charged with being in a house ‘frequented by thieves’; with ‘having demanded money with menaces from a bookmaker’ and with ‘having assaulted the bagman’; and with consorting with known criminals at a house in William Street, East Sydney.

Commonwealth Police running sheets indicate that Anderson was among those present at the milieu summit of July 1972. This was a series of meetings held at the home of Karl Bonnette at William Street, Double Bay and ‘alleged to be called to discuss the current activities of organised crime.’ Others present were said to be Leonard Arthur McPherson, George David Freeman, Stanley John Smith, Milan (Iron Bar Miller) Petrecevic, Arthur William (Duke) Delaney, and Leo (The Liar) Callaghan.

Also in attendance was said to be Albert Ross Sloss, 61, of Dowling Street, Potts Point, (Labor) MLA for King since 1956; deputy chairman of the parliamentary Labor Party, and vice-chairman of the Wentworth Park Trust, since 1968; director of the Sydney Hospital 1958-64; member of the Lord Howe Island Board. Sloss denied that he was at the meeting.

Bonnette denied that any of them had been at his home.

Karl Frederick Bonnette, 49, is described in TFR3 as a ‘drug importer and trafficker’, and was named by the Premier, Mr Wran, as a leading member of the Sydney underworld. Bonnette was considered to be most likely to succeed Anderson as the one the milieu ultimately defers to.

He was born in Melbourne, has described himself as self-employed, as dealing in cars, boats, diamonds and gold, and as unemployed. Among other names he has used are Karl Solomon, K. Rogers and Frederick Brock. He changed his name by deed poll in 1977 to Graham John Allemann in order to gain entry to the US.

Among his associates were Barry James Pyne, 41, described in TFR3 as ‘drug-trafficker’ and named as a suspect in the 1975 murder of drug courier Maria Hission. Bonnette also knew John Marcus Muller, alias Miller and Milner, a heavy at The Palace (otherwise the 22 Club), a Kings Cross casino, and named as one of the last three men seen with Juanita Nielsen before she disappeared in July 1975. Muller was killed in the driveway of his home in June 1979 in a shooting police believed could have been connected with an attempt on the life of George Freeman six weeks previously.

Bonnette has been to the US, England, Germany, the Philippines, Hong Kong, Israel, Argentina, Venezuela, Brazil, and Colombia. From 1976, he had business dealings with a number of people arrested in June 1978 in the seizure of $70 million worth of buddha sticks. In a four-year period, Bonnette, using various names, put $771 416 through a number of bank accounts, but was not too proud, in two months prior to June 1978, to collect $1917 in sickness benefits from the Department of Social Security.

Abraham Gilbert Saffron , 65, in 1943, with Hilton Kincaid, opened the Roosevelt Club at 32 Orwell Street, Kings Cross, largely for the benefit of US soldiers, until Justice Maxwell, who later described it as ‘the most notorious and disreputable nightclub in the city,’ closed it late that year. After a period in Newcastle, Saffron reopened the club after the war.

In the following years, using his family and friends as dummies, Saffron acquired, in breach of Licensing Court regulations, an interest in the licences of a number of hotels. A Royal Commission concluded that Saffron used the licences to supply the Roosevelt Club and sly grog shops. The Commission also found that Saffron had ‘engaged in systematic false swearing’. In October 1952 he was indicted for perjury but was acquitted when the court ruled that his testimony before the Royal Commission was not admissible as evidence about that same testimony. The Licensing Court barred Saffron, his relatives and any known associates, from holding liquor licences until 1966 when he successfully appealed against a judgment denying him a liquor licence at his Lodge 44 motel at Edgecliff.

In 1956, Saffron was also charged with having obscene photographs at his premises in Kings Cross. He was convicted and fined £10 but won a reversal on appeal.

Saffron was out of the newspapers until 1973 when he appeared before the Moffitt Royal Commission on Organised Crime in Clubs, where it emerged that Commonwealth Police, investigating jack Rooklyn’s activities in Jakarta, had reported that ‘now Saffron is purchasing or leasing premises to be used as brothels in conjunction with Rooklyn’s casinos.’

In March 1974, a customer at Saffron’s Lodge 44 motel, Ramon Sala, an international smuggler with Sydney convictions on currency and drug charges, had had his passport impounded and faced further proceedings. Morgan Ryan, then a solicitor of the Sydney firm Morgan Ryan and Brock, made representations on Sala’s behalf to Lionel Murphy, then Federal Attorney-General. Murphy directed that Sala’s passport be returned. Sala left the country, and so avoided passport proceedings. Six days later, Interpol said his passport was false.

In 1975 Saffron’s movements were monitored by the FBI, Scotland Yard, and crime intelligence agencies in the Philippines and Fiji; he was invariably searched when he left and re-entered Australia. It has been alleged Morgan Ryan made representations to Attorney-General Murphy and to Federal Police Commissioner Jack Davis about Saffron being subjected to airport searches. Authorities in Canberra ordered that Customs baggage searches of Saffron be abandoned.

This matter was investigated by a Public Services committee. Murphy, Justice Murphy of the High Court, said he had given no direction on the matter. The committee’s report, tabled in September 1984, said the downgrading of surveillance on Saffron was ‘reasonable and appropriate’; continual searching, it said, alerted a suspect and was likely to achieve nothing.

Early in 1978, the South Australian Attorney-General, Peter Duncan, named Saffron in State Parliament as ‘a principal character in organised crime in Australia.’ In July of that year, the NSW Transport Minister, Peter Cox, discovered from media reports that a building in Darlinghurst Road, Kings Cross, housed a gambling club, a brothel and a sex shop. The building was on a prime piece of real estate owned by the Public Transport Commission. Investigation showed that the site was initially leased to Constance Developments, a company owned by Sir Paul Strasser and Robert Ryko. Without the approval of the Public Transport Commission, the Strasser-Ryko company had sub-let the property to two Saffron companies. In 1977, the head lease, with the approval of the PTC, was transferred to Togima Leasing, of which the directors and nominal shareholders were all businessmen associated with Saffron companies.

To put an end to illegal activities on Government property, the Government bought Togima out of the lease for $2.6 million. A spokesman said legal action had not been taken against Togima because this would only remedy matters in the short term and it was difficult to get evidence.

In the 1981 Police Tribunal inquiry into Deputy Commissioner Bill Allen. it emerged that Saffron, described by justice Perrignon, as ‘unsavoury and involved in illicit activities’, had met Allen seven times at Police Headquarters. This was given as a reason to sustain the tribunal finding that Allen had brought discredit on the police force.

The report of the Commonwealth-NSW Joint Task Force on Drug-Trafficking says: ‘There is little doubt that Saffron was involved in at least this one transaction with Nugan Hand. Though its precise nature cannot be defined, the transaction involved in some way Hong Kong and the sum of $50 000… That at least Saffron chose to lie about his association with Hand… only adds to the suspicion that there was something either illegal or improper about it.’

When his name was brought up in 1982 at the Costigan Royal Commission in relation to a tax avoidance scheme, Saffron issued a statement through his lawyers saying he had never had anything to do with Nugan Hand.

George David Freeman , 49, is described in TFR3 as a ‘well-known crime figure involved in illegal gambling activity.’

In a 1978 appearance before the Woodward Royal Commission, Stanley John Smith explained his income on the basis of winning on racehorses, cards and roulette. Smith’s barrister, Mr Cochrane, said that Smith was ‘putting himself up, not as a normal punter, but rather as someone who has taken notice of tips from a man who knows, Mr Freeman, and in a sense Mr Freeman is well regarded… he is well regarded in the racing community and he knows what horses are going to come home.’

Justice Woodward: ‘That would be on the basis it is not a matter of luck; it is a matter of organisation?’

Cochrane: ‘Perhaps, I would not put it that strongly, but perhaps…’

At the 1983 Street Royal Commission, evidence was given by a magistrates’ court clerk, Cam Abood, that Freeman gave the then NSW Chief Stipendiary Magistrate Murray Farquhar race tips and that he (the clerk) placed the bets for Farquhar and collected his winnings. He noted that Freeman’s tips won 98 per cent of the time.

One of the milieu’s greatest mistakes occurred in July 1977. On 27 July, Freeman went into the members’ enclosure at Randwick racecourse as the guest of Farquhar. The error has caused endless trouble.

Freeman made another mistake the following year. On 28 March 1979, Bruce McDonald, deputy leader of the NSW Opposition, asked a question which suggested that Freeman had ‘unusual and undue influence’ over the police squad that was supposed to control gambling, the 21 Division. That night, Freeman was given time on Channel 7’s Michael Willesee Show to deny any involvement in organised crime. The next day, seeking to confront McDonald, he went with a Willesee film crew to Parliament House. That evening in the Upper House, Barrie Unsworth, who had been approached by the television team, said he believed that Freeman and the Willesee team had committed a ‘gross breach of privilege.’

On 3 April, the Independent MLA, John Hatton, moved an urgency motion deploring the action of Freeman, ‘a man designated within the administration of the Minister for Police as an organised crime figure, in bringing a television crew on to the steps of Parliament House…’ Drawing on material in a confidential NSW Police Crime Intelligence Unit report of March 1977, Hatton summarised Freeman’s career thus:

‘It has been recorded that Freeman should be considered one of the leading criminal figures in this State, together with Stanley John Smith, with whom he has been closely associated, and who is said to have replaced the so-called Mr Big, Leonard Arthur McPherson. The links with international organised crime are well established… In April 1978, just a year ago, Freeman was deported from the United States of America after being arrested in Las Vegas in connection with a false passport offence.

‘His last recorded conviction in Australia was for a similar offence, when he used a false passport to enter the United States of America with Stan Smith in 1968, when they were guests of one Joseph Dan Testa, nominated as a member of the Chicago organised crime family… It was largely the investigations prompted by the appearance of Testa in Sydney in subsequent years, and the associations he made here, that led to the Moffitt Royal Commission in 1973-74. As a result of the Moffitt Royal Commission, Mr Freeman was made the number one target of the NSW Police Crime Intelligence Unit, which was established as a direct result of that inquiry.

‘We are talking about a key criminal. Inquiries show that Freeman was also the Australian contact man for one Danny Stein, nominated as an associate of notorious American organised crime figures, including Meyer Lansky, and described by law enforcement authorities as representing hidden interests in Las Vegas casinos, and an illegal betting network raided by the Federal Bureau of Investigation, and shut down by the State of Nevada. No honourable member would need reminding that in July 1977, George Freeman was photographed in company with the Chief Stipendiary Magistrate, Murray Farquhar, at Randwick races, on which occasion Freeman was removed from the members’ enclosure.

‘Of even more relevance to the question of urgency, and to members of this House, particularly when it is remembered that Freeman was on the steps of Parliament House, is the fact that the NSW police have evidence that he was the principal figure in what might be called the Taiping conspiracy. After the Premier announced the Government’s intention to legalise casinos, underworld leaders and illegal casino owners met at the Taiping restaurant in Elizabeth Street, Sydney. It is urgent that it be recognised that, on a tape recording made of that meeting, Stan Smith is heard referring to Freeman as being “with” the casino operators. Smith called upon the assembled gathering to put up hard cash to bribe members of this Parliament to try to secure the control of casino licences for criminal interests…’

The Labor Party voted against Mr Hatton’s motion and it was defeated 60-34.

Three weeks later, at Freeman’s Yowie Bay home, a gunman with a light calibre weapon shot Freeman in the left side of the neck. The bullet passed through his mouth and exited just below the right temple without doing serious harm. Police told The Sun that the weapon indicated an ‘amateur’ gunman, but there was speculation that some other organised crime leader might have taken the view that Freeman’s approach to Parliament House had drawn too much attention to organised crime activities.

Leonard Arthur McPherson , 63. Giving evidence in 1983 at the Juanita Nielsen inquest, McPherson denied having told Federal police that a former NSW police officer, Fred Krahe, had killed Miss Nielsen. He claimed that Federal police had sent false information to Manila in 1977 warning that McPherson was entering the Philippines to assassinate President Marcos. Arrested at gunpoint, McPherson and two other Australians were held for three days in death row in the dreaded Fort Benefacio prison, facing the prospect of a firing squad, before being released.

McPherson’s name has continued to be linked with Manila. In 1980, the Woodward Royal Commission reported that a wanted criminal, Martin Olson, was running a bar in Manila for McPherson, and that he was ‘looking after McPherson’s prostitution business in Manila.’ Woodward also reported that during 1975 a person was ‘alleged to have gone to Manila, at least once a month’ to bring back ‘white powder’ for McPherson.

The Commission said there was reliable evidence that the courier was in the company of George David Freeman and Danny Stein. ‘NSW police received information … that the purpose of Stein’s visit to Australia at that time was to organise importation of drugs from the “Golden Triangle for transhipment to the United States,’ the Commission said. In 1973, during his Royal Commission, Justice Moffitt found it would be ‘wrong to conclude that McPherson is not on the scene of organised crime or connected with persons seeking to make money illicitly from the registered clubs.’

In a front page article in The Sunday Telegraph in 1979, McPherson denied any involvement in organised crime, or that he was in fact Mr Big. His denial included references to newspaper stories suggesting he was responsible for twelve murders. ‘If these accusations are meant to be against me they are false,’ he said. ‘I wouldn’t even know of twelve people who have been murdered.’

Stanley John (The Man) Smith first came to police attention in 1954. In 1966, he and McPherson attracted overseas attention when they were barred from Hong Kong. A senior Hong Kong police officer advised the Sydney CIB that they had boasted of wanting to get in on ‘big time’ smuggling of gold and narcotics.

In 1968, Smith and Freeman used false passports to go to the US to spend six weeks as guests of Joe Testa. Both were convicted on passport charges on their return. In December that year, Smith was described by police in a consorting case as a ‘standover criminal and international shop thief.’ Smith was fined in 1970 in connection with the attempted sale of amphetamines following a robbery at May and Baker’s warehouse at Waterloo, Sydney. He unwittingly frightened politicians out of legalising casinos in New South Wales when a tape recording of his 1976 Taiping speech, in which he recommended bribing politicians to secure legal casino licences, was made public.

He denied before the Woodward Commission that he had anything to do with drugs. He said: ‘I am not involved in drug matters and these allegations are all the more hurtful to my family and myself when the fact is that my eldest son, who is twenty-one years of age, is currently serving a jail sentence for drug-related offences and has been a hopeless heroin addict for some years now. We have tried to face this problem and rehabilitate him, without success, and the allegations now being made are in the circumstances particularly hurtful.’

Justice Woodward found that Smith was involved in drug-trafficking. In 1979, he was convicted and jailed for fifteen months for possession of cannabis. The conviction, however, took place in Victoria, not New South Wales.

Note: Stanley John Smith should not be confused with any of the numerous other Smiths in the milieu: Arthur Stanley (Neddy) Smith, described in TFR3 as ‘drug importer and trafficker’, who was the informer for Sergeant Roger Caleb Rogerson, and the man who arranged the fatal meeting between Rogerson and Warren Lanfranchi in 1981; Neddy’s half-brother Edwin William Smith, jailed for possession of 1.6 kilograms of heroin; Edward James (jockey) Smith; or Raymond Smith, an early acquaintance of Murray Stewart Riley.

Written by nuganhand

January 23, 2011 at 12:49 am

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Cabinet papers echo drugs/corruption ‘Underbelly’

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Vast Underworld exposed

by Damien Murphy, SMH

January1,  2011

THERE were so many bodies being found and stories about drugs and corruption in circulation that royal commissions galore started up as Australia turned into an early real-life draft of Underbelly.

The tone was set early in the year when Justice Philip Woodward’s New South Wales Royal Commission into Drug Trafficking, looking in part at the murder of Griffith businessman Donald Mackay, was attacked by colourful former Whitlam government minister Al Grassby, another Griffith local and community relations commissioner.

He tagged it ”ethnic slander”.

Meanwhile, the tide came in when the final report of Justice Edward Williams’s Royal Commission into Drugs identified Sydney as the centre of a $59 million heroin trade. It also found weakness in coastal surveillance and customs.

Frank Nugan, a merchant banker facing stock fraud charges, was found dead in his Mercedes-Benz outside Lithgow, NSW, in January 1980. His partner, Michael Hand, a former US soldier with links to the CIA, gave evidence that the bank was broke, and left the country.

Finally, journalist Bob Bottom’s pieces on painters and dockers in January’s Bulletin magazine – alleging fraud, standover tactics, violence and intimidation – raised cabinet concerns. The Federated Ship Painters and Dockers Union, especially in Victoria, had a mean reputation – partly because it was one of the few organisations likely to employ men finishing sentences at Pentridge Prison.

The union’s nefarious activities fitted happily with the Fraser government’s campaign against industrial unrest. Of course, the union’s thuggish hierarchy did little to ease the public’s alarm.

Union secretary Jack ”Putty Nose” Nicholls said: ”We catch and kill our own.”

Within a year he too was dead. Nicholls’s body was discovered in his car outside Wangaratta after he had fled to Brisbane with the union’s membership roll. He purportedly left a suicide note:

”To my members and executive, I tried very hard but the rotten Fraser government did not want me to survive. Do not think I have taken the easy way out but the rotten system has cut me life short. I had big ideas for advancement but these were chopped short. Farewell Comrades. Jack Nicholls XX.”

Another colourful union member, Billy ”The Texan” Longley, toldThe Bulletin he could name 30 people who had been ”knocked off” by the P&Ds. ”They have either been killed for money or simply their mouths. This is not just in Melbourne, but in Sydney, Brisbane, Perth.”

A memo to cabinet warned that the union was fleecing the navy and ANL shipping. One shipping line staff member blew the gaff, telling The Bulletin, ”I cannot see any problem employing criminals when we know they are criminals”.

Cabinet decided that only a royal commission could settle the question of what was happening in the union.

Frank Costigan, QC, was picked to head a joint federal-Victorian royal commission.

He started hearings at Williamstown Court on October 1, 1980, just down the road from the naval dockyard.

Nugan Hand bank was linked with money laundering and drugs as investigations continued through the year.

Cabinet’s interest had been sparked by the findings of the Woodward inquiries in NSW and the discovery, near a Victorian surf beach, of the bodies of two Sydney operatives of the Mr Asia drug syndicate, Douglas and Isobel Wilson.

Attorney-general Peter Durack and administrative services minister John McLeay recommended a joint federal-state inquiry into the syndicate. ”Due to the great public concern an announcement of the government’s intention is urgently required,” they said.

Donald Stewart was appointed commissioner and eventually had his terms of reference extended to take in the Nugan Hand matter.

In the years to come, the various royal commissions exposed a world of corruption few Australians realised existed. The late Kerry Packer was enmeshed in the P&D inquiry. Another result was the introduction of legislation, the Crimes (Taxation Offences) Act 1980, which put an end to ”bottom of the harbour” schemes.

Written by nuganhand

January 23, 2011 at 12:45 am

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Whitlam, the CIA and Nugan Hand

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November 11: Coup? What coup? [Green Left Weekly]

Sunday, November 21, 2010

By John Jiggens

Protest in support of Gough Whitlam after the constitutional coup, Sydney. Photo: Qu1j0t3/Flickr

Remembrance Day, on November 11, was celebrated again this year in the Australian media with pictures of red poppies and flag-draped coffins and historic photos of Australian soldiers who gave “the ultimate sacrifice” from the human-made wasteland of Flanders to the stony deserts of Afghanistan.

Paying tribute to the ten soldiers killed this year in the long war in Afghanistan, Governor-General Quentin Bryce said that Australians were good at remembering: “We seem to know what we ought to hold onto and what is best let go.”

This art of selective forgetting is one the Australian media is particularly good at.

Remembrance Day passed with scarcely a mention that this year, November 11 marked the 35th anniversary of the constitutional coup — the dismissal of the elected government of Labor prime minister Gough Whitlam by another governor general, John Kerr.

The exception — a brief AAP report by Peter Veness — called Whitlam’s dismissal “the most divisive event in Australian politics”. It concluded that the details of the dismissal have long been “muddied”, but: “One thing is certain. The pain still remains.”

Like many, I well remember that day. My mother rang to tell me the news, and like her, I was astounded. How could the governor-general dismiss an elected government?

Didn’t we live in a democracy? Didn’t the Australian people elect their government?

I flexed off early from my public service job and attended a huge meeting in Brisbane’s King George Square. I heard impassioned speeches calling for a general strike and rumours (which turned out to be true) that Kerr was moving to call out the army.

I wondered what the army would do (I wonder). Would they act like Chilean military dictator General Pinochet, whose US-backed overthrow of the overthrow of the elected left-wing government of Salvador Allende was accompanied by the massacre of thousands?

Lest we forget.

Former Australian prime ministers Robert Menzies, Howard Holt, John Gorton, Bob Hawke and John Howard all compliantly sent Australian troops to fight US wars. But in the early 1970s, Whitlam’s government had the courage to bring Australian soldiers home from the US war in Vietnam.

For this audacious action, Labor would never be forgiven by then-US president Richard Nixon, the CIA, Rupert Murdoch, the CIA, and corrupt conservative premiers Bob Askin (NSW) and Joe Bjelke-Petersen (Queensland) — who all hated Whitlam as though he were Che Guevara.

Whitlam’s election in 1972 began a short-lived era in which the stated aims of the new Labor government were to promote equality and involve the people in decision-making processes.

Within two weeks of Whitlam’s election, conscription was abolished and draft resisters released from jail. Voting rights were extended to all Australians over 18, and university fees abolished.

Whitlam’s youth constituency also gained community radio stations, and the Whitlam government intended to decriminalise marijuana. Aborigines were granted land rights in the Northern Territory.

Whitlam was less subservient than his Liberal predecessors to Washington’s foreign policy directions. He took a more critical line in foreign policy, condemning Nixon’s 1972 bombing offensive against North Vietnam and warned he might draw Indonesia and Japan into protests against the bombing.

The People’s Republic of China was recognised and the Whitlam government spoke up in the United Nations for Palestinian rights. The French were condemned for testing nuclear weapons in the South Pacific, and refugees fleeing the CIA-backed coup in Chile were welcomed.

Nixon and the CIA found such independence intolerable. After Whitlam was re-elected in 1974, and Jim Cairns became his deputy, Nixon ordered the CIA to review US policy towards Australia. Although the CIA’s response to Nixon has never been released, it seems it began a covert operation to destabilise the Whitlam government began then.

The puppet masters who led the coup were Ted Shackley and Marshal Green. Nixon appointed Green as US Ambassador to Australia in 1973. Nick-named “the coup-master”, Green had been involved in several countries where the CIA had masterminded coups, such as Indonesia (1965) and Cambodia (1970).

Green’s goals were to maintain US bases in Australia and to protect US economic interests.

Green let it be known that if the Labor government honoured one of its key election pledges to reclaiming ownership of oil refineries and mining industries, the US would respond. Green carefully cultivated the Fairfax, Murdoch and Packer dynasties that controlled the Australian media.

Ted Shackley, known as the “Blond Ghost”, joined the CIA in 1951. Over the next two decades, he emerged as the agency’s “dirty tricks” specialist, directing the CIA’s campaign against Cuba and Fidel Castro’s government in 1962.

In 1966 he became Chief of Station in Laos and directed the US secret war there — earning his other nickname, “the Butcher of Laos”.

In 1971, he became head of the CIA’s Western Division (covering North and South America) where he plotted the overthrow of Allende. In 1974, Shackley became head of the Eastern Division of the CIA, covering Asia and Australia.

Shackley’s speciality was financing black operations through the drug trade and he learned the dark art of running drug armies during the secret war in Laos. One of his foot soldiers in Laos was Michael Hand, co-founder of the Nugan Hand bank.

Michael Hand helped forge documents used by the media to discredit the Whirtlam government, while his partner Frank Nugan was the conduit for CIA money to the Liberal Party. Millions of dollars flowed to the conservative parties via Nugan Hand.

Shackley played a key role in the security crisis of November 1975, which revolved around the US military base at Pine Gap. Whitlam had threatened that if the US tried to “bounce” his government, he would look at the presence of US bases in Australia.

The lease for Pine Gap was due for renewal in December 1975. On 10 November 1975, the day before Whitlam was sacked, Shackley sent an extraordinary cable from the CIA to ASIO’s director general, threatening to remove ASIO from the British-US intelligence agreement because he considered Whitlam a security threat.

The cable was published by the Financial Review in 1977 and has been widely reprinted. It shows Shackley’s involvement in the security crisis.

Shackley was furious that Whitlam had accused the CIA of funding the opposition conservative parties and had claimed CIA money was being used to influence domestic Australian politics. In particular, Whitlam was asking questions about the close relationship between Richard Stallings, who ran the so-called joint facility at Pine Gap, and National Party leader Doug Anthony.

“The CIA has grave concerns as to where this type of public discussion may lead”, Shackley’s cable said.

In his 1977 speech calling for a royal commission into the activities of the CIA in Australia, Whitlam called Shackley’s cable “a clear example of the attempted deception of the Australian Government by the American intelligence community … The message was offensive in tone, deceitful in intent and sinister in its implications.”

For the Australian media, the message of Remembrance Day 2010 was clear: sleeping dogs must be allowed to lie. There could be nothing nobler to aspire to than the service of our imperial overlords, and to remind the Australian people that these imperial overlords had subverted a democratically elected government was well off message.

[John Jiggens has been involved in civil liberties and anti-corruption campaigning for many years. He is the author of a number of books, including the recently released The Killer Cop & the Murder of Donald Mackay, about the drug trade, Nugen Hand Bank and the overthrow of the Whitlam government.]

Written by nuganhand

January 23, 2011 at 12:42 am

Posted in Uncategorized