Sept. 19, 1998
Nazi Echo: Argentina, Death Camps & the Contras
By Marta Gurvich & Robert Parry
The tracks of secret financing for the Nicaraguan contra war may cross a troubling money-raising tactic passed on from Adolf Hitler's Nazis to their ideological heirs in Argentina: the liquidation of property from victims killed in death camps.
An investigation in Spain is examining evidence that an intelligence officer in Argentina's Dirty War was responsible for selling the property of Argentines after they were "disappeared" -- that is, taken to secret concentration camps and murdered. Money from the victims' property may have ended up in Swiss bank accounts maintained by Argentine military officers.
The Argentine intelligence officer accused of overseeing the property liquidations is Raul Guglielminetti. In closed-door U.S. Senate testimony in 1987, one of his accomplices also fingered Guglielminetti as the manager of a Miami-based money-laundering operation that funnelled tens of millions of dollars in Bolivian drug money to the Nicaraguan contras and to other right-wing paramilitary operations in Latin America.
The extent of the contra connection to various Bolivian drug smuggling operations reportedly is one of the surprises contained in the still-secret volume two of an internal CIA investigation into contra-cocaine trafficking. But the CIA so far has refused to release the 600-page volume two. CIA spokesmen say the agency eventually may release an unclassified summary, but will likely keep much of volume two secret.
In Spain, meanwhile, the property-liquidation case is one part of a larger examination of Argentina's Dirty War by Judge Baltasar Garzon. The judge has been investigating the fate of Spanish citizens who "disappeared" in Argentina during the late 1970s and early 1980s when the military slaughtered some 10,000 to 30,000 people who were considered politically suspect.
Garzon's investigation is looking at evidence that Guglielminetti oversaw the selling of property stolen from the victims, with the proceeds allegedly deposited in nearly 100 Swiss bank accounts belonging to Argentine officers.
Earlier this year, the inquiry led to confirmation that at least six Argentine military officers maintained secret bank accounts in Switzerland. But it was not clear whether those accounts contained proceeds looted from Dirty War victims or money from other sources.
Still, the historical echo of Hitler's financial strategies is striking. During Hitler's World War II extermination campaign against European Jews, the Nazis raised capital by selling the possessions of death-camp victims, including gold melted down from wedding bands and extracted from teeth fillings.
Hitler's government transferred large amounts of this wealth through Swiss banks and used the money to buy vital goods from neutral countries, including Argentina.
Argentina then was dominated by the quasi-fascist movement of Gen. Juan Peron. The country harbored strong sympathies for the Axis powers, especially Italian fascist leader Benito Mussolini. After World War II, many Nazis escaped along "rat lines" to Argentina and other South American countries which protected war criminals, including Adolf Eichmann, Josef Mengele and Klaus Barbie.
International Jewish groups long have suspected that Argentina played a role, too, in laundering the Nazis' legendary ODESSA funds to fascist survivors of the Third Reich. In the decades that followed, some fascist and neo-fascist operatives branched out, linking up to organized crime and earning money as narcotics traffickers.
Others found jobs assisting Latin American intelligence services suppressing leftist insurgencies. The ex-Nazis shared their skills in torture and other intelligence techniques.
The Cold War further heightened the region's political tensions, with terror and counter-terror campaigns reaching a peak in the early 1970s. [For details on the Nazis in South America, see Martin A. Lee's The Beast Reawakens; Henrik Kruger's The Great Heroin Coup; and iF Magazine, Nov.-Dec. 1997.]
Into that combustible ideological mix stepped the shadowy figure of Raul Guglielminetti. Born in 1941, Guglielminetti's criminal history dates back to 1960, when he was investigated on fraud charges but released.
In 1964, he got into more hot water over alleged illegal trafficking in contraband and illegal possession of weapons. His first conviction was in 1965 for car theft.
Back on the street in 1970, Guglielminetti started his career as a political henchman. He helped suppress a labor strike and earned the favorable notice of police in the province of Neuquen. Friendly police officials set him up with a job as a journalist at the newspaper, Sur Argentino.
Later, Guglielminetti moved to Bahia Blanca in Buenos Aires province where he led ultra-right storm-troopers and declared himself a Nazi. In the mid-1970s, as the violence between rightists and leftists escalated, Guglielminetti joined a right-wing death squad, known as the Argentine Anti-communist Alliance.
In 1976, Argentina's right-wing generals mounted a coup which ousted Isabel Peron, a weak president who had taken office after Gen. Peron's death. The generals then launched a full-scale Dirty War with thousands of Argentines "disappearing" off the streets and into secret concentration camps where they faced torture and death.
The Dirty War also meant new employment opportunities for the 33-year-old Guglielminetti. He joined the military intelligence service, known as the SIDE, and worked in the infamous Batallion 601. A later government investigation would identify him as a member of a paramilitary squad that kidnapped, tortured and killed leftist activists.
According to that investigation, Guglielminetti was put in charge of selling the victims' properties which the military government had stolen. In the early days of the Dirty War, the military and police simply plundered the valuables, taking money, jewels and other personal items.
Later, the federal police chief ordered a more systematic handling of the confiscated property, according to Guglielminetti's own testimony in an Argentine court. The booty was transferred to the chiefs of the military brigades and then turned over to government authorities for liquidation and use in various projects.
Guglielminetti claimed that he never personally took money from the people he arrested, but acknowledged receiving rewards of as much as $50,000 for successful seizures of funds belonging to subversive organizations.
According to a book about Guglielminetti's exploits, entitled La Pista Suiza [The Swiss Clue] by Juan Gasparini, Guglielminetti's squad earned extra money by kidnapping businessmen, many of them Jewish. The businessmen were held for large ransoms while the government blamed the kidnappings on leftists.
Gasparini reported that Guglielminetti was involved in at least six such kidnappings, making him a wealthy man. Guglielminetti once entered Spain carrying $1 million, which he said belonged to a friend.
After crushing their internal enemies, the victorious generals expanded their anti-communist crusade beyond Argentina. As part of that strategy, Guglielminetti shifted his base of activities to Miami.
There, he allegedly oversaw a secret money-laundering operation that moved drug proceeds to anti-communist forces around the Western Hemisphere, including support for the Nicaraguan contras.
In testimony before a U.S. Senate subcommittee, another Argentine intelligence officer, named Leonardo Sanchez-Reisse, described that operation. A financial expert, Sanchez-Reisse said he had been recruited by Argentine intelligence in 1976 and specialized in the service's international operations. In the Miami money operation, he said his boss was Guglielminetti.
Sanchez-Reisse testified that the Miami operation was based in two front companies: Argenshow, a promoter of U.S. entertainment acts in Argentina, and the Silver Dollar, a pawn shop that was licensed to sell guns.
He asserted the real activity of the companies was to transfer more than $30 million -- much of it from drug lords -- into various political and paramilitary operations in South and Central America. He claimed the operation was approved by the CIA, which maintained close ties to the Argentine generals.
According to Sanchez-Reisse, the money operation's first major activity was funnelling drug proceeds into a 1980 coup to overthrow an elected center-left government in Bolivia. That new government had offended Bolivia's powerful cocaine barons, including Roberto Suarez, then one of the biggest traffickers in the world.
Suarez and his key ally in the Bolivian army, Gen. Luis Garcia Meza, struck back by organizing a coup d'etat with Argentine assistance. Sanchez-Reisse said Suarez provided the money that was funnelled through Guglielminetti's financial network.
Using ambulances, the Argentine generals delivered weapons and other military equipment to right-wing Bolivian paramilitary forces.
The money for the 1980 coup came from "drug traffickers [in Bolivia who] were interested to overthrow the government of Bolivia," Sanchez-Reisse testified before a Senate subcommittee in 1987.
The money "was shipped from Bahamas to United States. ... It was money [that] belonged to people connected with drug traffic in Bolivia at that time, specifically Mr. Roberto Suarez in Bolivia."
Explaining how he knew the money came from cocaine trafficking, Sanchez-Reisse said, "I know that Mr. Roberto Suarez doesn't make his money growing peanuts."
Besides the weapons from Argentina, the Bolivian putschists got help from an international band of ex-Nazis and neo-nazis led by Klaus Barbie, known as the Butcher of Lyon for his work in Hitler's Gestapo.
In July 1980, the coup overthrew the Bolivian government and slaughtered many of its supporters. Some victims were tortured by Argentinean experts flown in to demonstrate their expertise.
The putsch, which became known as the Cocaine Coup, installed Garcia Meza and other drug-connected military officers who promptly turned Bolivia into South America's first modern narco-state. The secure supply of Bolivian cocaine was important to the development of the Medellin cartel in the early 1980s.
[For details on the coup, see The Big White Lie by former DEA agent Michael Levine; Cocaine Politics by Peter Dale Scott and Jonathan Marshall; and iF Magazine, Nov.-Dec. 1997.]
Many of the Argentine intelligence officers who assisted in the Cocaine Coup followed up their victory in Bolivia by moving northward into Central America to train a ragtag force of Nicaraguan contras. Sanchez-Reisse said the Argenshow-Silver Dollar money was soon flowing in that direction as well.
Over 18 months, Sanchez-Reisse testified, more than $30 million went through Guglielminetti's operation. The money supported the Bolivian coup, the contras and other right-wing paramilitary activities in Central America.
Sanchez-Reisse said the money moved through accounts from around the world -- Switzerland, the Bahamas, Grand Cayman, Liechtenstein and Panama.
Soon, the contras were serving as an international brigade in Argentina's war against leftist subversion. In December 1980, Argentine intelligence dispatched a contra assault team to attack a Costa Rican radio station which was broadcasting information critical of the Argentine Dirty War. Three Costa Ricans were killed in the raid. [See The Nation, Oct. 7, 1991]
Working with anti-communist Honduran officers, the contras began murdering scores of political dissidents in Honduras and other Central American countries. A later Honduran government investigation described the "disappearances" of nearly 200 victims in that country alone.
The Honduran investigation, completed in 1994, singled out a dozen Argentine "advisers" for blame in the Honduran Dirty War. One of those Argentine advisers was Sanchez-Reisse, Guglielminetti's partner in the Miami money-laundry.
In 1981, President Reagan formally authorized the CIA to collaborate with the Argentine intelligence services in building up the contra army. In the contra operation, Sanchez-Reisse said, Guglielminetti befriended John Hull, a CIA-connected farmer who let contras use his ranch in northern Costa Rica and later faced accusations of drug trafficking. [For more details on Hull, see The Consortium, Aug. 10, 1998, or iF Magazine, Sept.-Oct. 1998.]
But the secret U.S.-Argentine collaboration had unintended consequences. The Argentine junta apparently thought that the Reagan administration would tolerate the seizure of the Falkland Islands from Great Britain. In 1982, the generals invaded the islands off Argentina's coast.
Washington, however, sided with its longtime allies in London. British forces quickly routed the Argentines. The disgraced generals relinquished power in 1983.
With the election of a civilian government, Sanchez-Reisse said the financial records for the secret money operation were spirited away by plane to Switzerland. The book, La Pista Suiza, also suggests that Guglielminetti might have hidden the list of "disappeared" victims in either Spain or Switzerland.
While in Switzerland himself, Sanchez-Reisse was jailed in connection with a kidnapping-extortion case. Guglielminetti came to his partner's defense. Guglielminetti wrote to the Swiss courts and asserted that he was with Sanchez-Reisse either in Florida or on a Caribbean boat trip at the time of the kidnapping. But Sanchez-Reisse still spent two years in Swiss jails.
For years, Guglielminetti dodged the legal consequences for his intelligence activities. Through his contacts in the army, he became a bodyguard for civilian president Raul Alfonsin. Only after Guglielminetti's Dirty War deeds were made public was Alfonsin embarrassed by the association.
According to the Spanish newspaper, El Pais, Guglielminetti moved to Spain in 1984 and lived in a luxurious mansion at La Moraleja, near Madrid. El Pais estimated Guglielminetti's fortune at $11 million, apparently generated from kidnappings and other illicit enterprises.
In 1985, Alfonsin's government finally lodged criminal kidnapping charges against Guglielminetti in the case of a murdered businessman. Guglielminetti was arrested in Spain and extradited to Argentina. Eventually, he was convicted in 1987 on charges of armed assault. He served four years in prison.
Meanwhile, Sanchez-Reisse decided that his best course of action was to talk about his experiences. He supplied information that appeared in the book, La Pista Suiza, including the disclosure that secret records about the Dirty War were hidden in Swiss banks.
Then, facing an Argentine extradition request, he fled to the United States where he gave testimony about the drug aspects of the operations before a Senate Foreign Relations subcommittee on narcotics and terrorism. The closed hearing, chaired by Sen. John Kerry, D-Mass., was held on July 23, 1987. The transcript was declassified several years later, but received no press attention beyond an Oct. 7, 1991, article in The Nation.
In 1996, an investigative series in the San Jose Mercury News renewed interest in the contra-drug issue. That fall, Jack Blum, former counsel to Kerry's subcommittee, appeared before the Senate Intelligence Committee and recalled Sanchez-Reisse's "remarkable testimony."
Blum said Sanchez-Reisse "told the subcommittee that ... the Argentine military intelligence people used the profits from their control of the Bolivian cocaine market to finance an anti-communist 'battalion' which operated all over the continent. ... I should remind this committee that the Argentines were the ones who first trained and supported the contra resistance movement."
The first volume of a two-part CIA report on contra-drug trafficking -- released earlier this year -- also revealed connections between the contras and Bolivian cocaine. For instance, the report cited a 1982 trip by two contra-connected drug traffickers to Honduras, where they met with contra commander Enrique Bermudez.
He urged them to help raise money and advised that "the ends justify the means." The drug traffickers, Norwin Meneses and Danilo Blandon, then continued on to Bolivia to complete a cocaine deal, according to the CIA report. [For details on CIA volume one, see iF Magazine, Mar.-Apr. 1998.]
Though Sanchez-Reisse's testimony had little impact in the United States, his declarations had more effect in Europe. His disclosure of the hidden financial records in Switzerland prompted the Spanish judge, Garzon, to seek Swiss cooperation in tracking down stolen money and, possibly, documents about the Dirty War.
Garzon's interest led to the discovery earlier this year that at least a half dozen Argentine officers -- and possibly many more -- maintained secret bank accounts in Switzerland.
Back in Argentina, Guglielminetti continued to live on the edge of the law as his far-right allies regained some of their political influence. He benefitted from a court pardon given to lower-level Dirty War officers who were found to have followed orders from superiors.
His old partner was less lucky. This year, Sanchez-Reisse was arrested in the city of Rosario on charges of stealing a painting from a museum.
Recently, Guglielminetti's name has surfaced in new acts of political violence and government corruption, but mostly he has kept a low profile. Even 15 years after the end of the military dictatorship, he remains a mysterious and sinister figure, with many dangerous secrets and many powerful friends.
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