Chiang Kai-shek, APACL and the Moonies

Domestically the China Lobby was an important precursor of the modern rollback Right, but far more important were the international linkages developed between the CIA and the first major contra army, the Nationalist Chinese.

After being routed from the Chinese mainland, Chiang Kai-shek and his troops (described by U.S. Army Gen. Joseph Stilwell as “a Gestapo”) had established themselves on Taiwan by a massacre of perhaps 20,000 Taiwanese. From 1950 to 1970, Chiang and his Nationalist Chinese played major roles in the U.S.-directed covert warfare programs in East Asia. Wherever the CIA went, they were able to make use of the natural networks of Chinese businessmen all over the Pacific. According to Asia scholar Franz Schurmann, the Chinese supplied the CIA with saboteurs, commandos, agents, smugglers, spies, and “businessmen” to help out in the complex world of East Asian transactions.

Close cooperation between U.S. covert intelligence agencies and the Taiwanese government continued in this period. This included the establishment of the Political Warfare Cadres Academy, allegedly with the help of Ray Cline, who was Taiwan CIA Station Chief from 1958-62. This school provided warfare training to thousands of Third World military figures. Prominent graduates include El Salvador’s Roberto d’Aubuisson, widely viewed as the mastermind of his country’s death squads; Lieutenant Colonel Domingo Monterrosa, a Salvadoran military commander whose troops massacred an estimated one thousand civilians at Mozote in December 1981; Amilcar Santamaria, a rightist Honduran political figure; and numerous other intelligence officers in the armies of Latin American dictators.

Concurrently, the United States collaborated with Chiang Kai-shek and South Korean intelligence in founding the Asian People’s Anti-Communist League (APACL) in 1954. Ex-Nazi collaborators from Eastern Europe also helped set up APACL. This organization had the purpose of uniting conservatives from all over the Asian continent to battle communism. Possibly arranged through Taiwanese CIA station chief Ray Cline, U.S. funds seem to have helped start APACL. APACL also drew sustenance from the coffers of the Japanese Right. Ryoichi Sasakawa and Yoshio Kodama were prominent members of the wartime fascist Tojo clique who had been convicted of war crimes. In a manner analogous to the rehabilitation of German Nazi war criminals to serve the interests of the West, these individuals were freed in 1948 and helped to bankroll APACL.

Intertwined with APACL was the Unification Church of right-wing Korean Reverend Sun Myung Moon. Moon received major financing from Sasakawa (who has called himself the world’s wealthiest fascist) and Kodama. The Korean CIA (whose precursor may have been set up in part by General Singlaub, CIA deputy chief in South Korea in the 1950s), organized by South Korean dictator Park Chung Hee to support his 1961 military coup, adopted the Unification Church as its political arm. Park, as head of one of the world’s chief rollback governments, was also a major actor in APACL. In both Korea and Japan, the Moonies and APACL were closely interrelated.

Two important rollback activities in Asia were the Nationalist Chinese attempt to overthrow the Chinese government and the multiple coups in Laos to prevent neutralist governments from gaining power. (See Chapter One.) These two related operations, spanning the 1950 to 1970 period, were the true moments of birth for Rollnet (Note: this is the author’s term that refers to a “global rollback network” against communism); individuals joined in covert warfare in Asia then spread out as rollback operatives throughout the world.

Arms and Drugs in Burma

The Burma-based Nationalist Chinese operations directed against communist China in the 1950s were supplied by the CIA airline Civil Air Transport (CAT), with some pilots drawn from the ranks of ex-Nazis recruited by the United States. CAT was originally organized by Gen. Claire Chennault in consultation with Colonel Richard Stilwell, the CIA’s Office of Policy Coordination chief for the Far East. Also used in these activities was the CIA-run Sea Supply Corporation, which brought arms to the Chinese contras. Sea Supply was run by Paul Helliwell who, as chief of the OSS mission in China during World War II, had used opium bricks to pay off local informants, initiating intelligence-related involvement with drug traffic. Continuing this tradition, Nationalist Chinese trafficked in Burmese opium, using CAT planes delivering arms to ship the opium out, to-ultimately reach the world market. These GIDO (guns in, drugs out) operations persisted in Laos and later in Vietnam and Central America.

During this period the China Lobby was taking out full-page ads asserting (without evidence) that communist China was behind the heroin trade. But the truth about the Burmese operation leaked, causing a scandal leading to Stilwell’s dismissal and the cessation of direct CIA support for the Chinese contras. However, APACL, probably using the same CAT planes, took over the supply operation.

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Besides Burma and Laos, a third Southeast Asian GIDO operation involved the pro-U.S. Montagnards in South Vietnam, whose loyalty was to some extent bought by Air America assistance in bringing the Montagnards’ opium crop to the world market. Mafioso Santos Trafficante, fresh from his covert work against Cuba, was also a key organizer of this drug network. The multiple purposes of the drug smuggling were to gain the favor of opium growers, to generate funds for the secret operations themselves, and to gain personal profit. The networks created by GIDO operations formed the basis of Rollnet: U.S. military and intelligence personnel, contra armies, airlines, banks, arms, and drug dealers.

The drug trade run through Air America blossomed. As well as supplying the habits of the addicts that at one point comprised over 5 percent of the U.S. armed forces, heroin from the “Golden Triangle” came home to hook tens of thousands of U.S. citizens. Most of the drugs came through Florida via anti-Castro Cuban networks working with the Trafficante organization, with Trafficante himself visiting Southeast Asia to coordinate the setting up of regional heroin factories to supplement the Corsican networks that heretofore had provided the only source of street heroin.

With the fall of the Saigon regime in 1975, the covert assets that had been carefully nurtured over the years were removed for future use. Under the direction of Assistant Secretary of Defense Erich von Marbod and the CIA apparatus headed by Shackley, millions of dollars worth of arms and profits from the heroin trade were transferred out of Vietnam. Money was deposited in secret accounts around the world. Of special note was the use of the Nugan Hand Bank in Australia, which would provide a secret source of funding over the next few years for U.S. covert operations, including the destabilization of the Australian Labor Party and possibly the South Africa-backed Savimbi insurgency in Angola.

Nugan Hand’s connection with the entire Rollnet web is underscored by the people intimately involved with its activities. Individuals associated with the bank included Theodore Shackley, Thomas Clines, and Edwin Wilson, later convicted of selling arms to Libya. The president of the bank, which stole the savings of low-level military personnel, was retired Rear Adm. “Buddy” Yates, who had been the chief of staff for planning for U.S. forces in Asia and the Pacific. The head of the bank’s Hawaiian operations was retired Gen. Edwin Black, who had been the commander of U.S. troops in Thailand as well as assistant army chief of staff in the Pacific. Former CIA Director William Colby served as a lawyer for Nugan Hand. The bank reportedly laundered money for Suharto of Indonesia, provided services for Marcos of the Philippines, and assisted the Shah in shifting money out of Iran.

Southeast Asia, then, was the cradle of the global rollback network. Close behind in importance was Latin America, in particular the operations involving Cuba.