F. The Initiation of the Federal OCDETF Case
After the unsuccessful search warrant in October 1986, the FBI and the DEA continued their investigation of Blandon under the direction of the Los Angeles U.S. Attorney's Office. Soon after the search warrants, Aukland contacted the U.S. Attorney's Office and proposed that the case be pursued as an Organized Crime Drug Enforcement Task Force (OCDETF) case, and in January 1987 the OCDETF committee within the U.S. Attorney's Office approved pursuing the matter. The investigation was then pursued as an OCDETF case, led by Aukland, until the summer of 1987 when the case was closed after efforts to infiltrate Blandon's organization proved unsuccessful and Blandon moved to Miami.
The following sections describe how the OCDETF case was initiated, investigated, and eventually closed. We first discuss the background to the adoption of the OCDETF case, then the investigative steps that were taken, including the unsuccessful attempts to have confidential informants penetrate and make purchases from the Blandon organization. We also explore the proposed use by DEA of Norwin Meneses as a source of information against the Blandon organization.
1. Background to the OCDETF case
In a November 10, 1986, investigative report, Aukland noted that soon after the LASD searches on October 27, Schrettner contacted Assistant U.S. Attorney Crossan Andersen of the U.S. Attorney's Office about the investigation. According to the investigative report, "Andersen feels that this would be an excellent joint narcotics and money laundering case." The report noted that on October 30, 1986, Andersen advised Aukland that "any requests for consensual monitoring, pen registers, etc. should be made through [Andersen]." The report also related that a task force of FBI, DEA, IRS, and possibly Bureau of Alcohol Tobacco and Firearms agents would be created to target the principals of the Blandon organization. Aukland noted:
It is believed the FBI source [referring to LA CI-1] may be able to make cocaine purchases, and if so, appropriate surveillances will be established to identify distributors and stash locations. It is also believed that extensive surveillance of Blandon will prove fruitful in identifying members of the network.
Aukland also contacted the Santa Ana Criminal Investigative Division of the IRS, which agreed to assist the task force investigation in the financial aspects of the case. On November 17, 1986, Aukland wrote another report, stating that he planned to seek OCDETF designation for the case and to obtain an off-site location from which to work it.
OCDETF is a federally funded program within the Justice Department that is intended to enhance law enforcement cooperation in dismantling major drug trafficking nationwide. The OCDETF program is divided into regions throughout the country. Within each OCDETF region, a committee is established that is comprised of representatives from United States Attorneys' offices and from federal, state, and local law enforcement agencies, to coordinate work on major drug cases. The OCDETF program in the Los Angeles area was coordinated by the Los Angeles U.S. Attorney's Office, and supervised by Assistant U.S. Attorneys Andersen and Jim Walsh, the assistant chief and the chief, respectively, of the Major Narcotics Section of the U.S. Attorney's Office. Andersen chaired an OCDETF committee that met once a week to discuss cases presented for consideration and to decide whether they should be adopted as OCDETF cases. According to Andersen, the practical significance of designation as an OCDETF case was that it meant the case would be managed vertically within the U.S. Attorney's Office -- that is, handled by one prosecutor throughout the various stages of the case -- and it also freed funds in the various agencies for use on the case.
When we interviewed him, Assistant U.S. Attorney Andersen said that in the 1986-1987 period, he was handling a heavy load of drug cases as well as managing the OCDETF program. He supervised ten cases directly and oversaw the other twelve OCDETF prosecutors who had OCDETF cases. He said he had little recollection of the Blandon case, although he recalled the name. When we showed him the paperwork on the Blandon OCDETF case, which indicated that the case was approved by the OCDETF committee and supervised by him, he still had only a slight recollection of it, not remembering its details. Similarly, Jim Walsh, the chief of the U.S. Attorney's Office Major Narcotics Section, remembered the case vaguely but did not recall in detail what happened to it.
Documents in U.S. Attorney's Office and FBI files show, however, that Andersen supervised the Blandon OCDETF case directly. For example, on November 25, 1986, Andersen wrote a letter to the Chief of the IRS's Criminal Investigation Division in Laguna Niguel, California, formally requesting IRS agents to assist in the investigation. The letter, containing the notation "Sensitive Investigative Information," referred to Danilo Blandon, Ronald Jay Lister, and Aparicio Moreno and stated:
As you know this is a narcotics investigation involving FBI, DEA and LASO units in Riverside and Whittier, California, respectively. It is a sensitive matter since it involves allegations of drug running in support of the CONTRA movement in Nicaragua and wholly unconfirmed allegations of CIA involvement.
The letter stated that Andersen had reviewed the investigative leads to date and believed that it was probable that criminal violations had been and were being committed. The letter requested the assistance of IRS agents in the case.(12)
2. Meeting with Assistant District Attorney Susan Bryant-Deason
On January 14, 1987, Aukland and Schrettner met with LASD Sergeant Huffman and Los Angeles Assistant District Attorney Susan Bryant-Deason concerning the Blandon investigation. The LASD Report contains a lengthy discussion about this meeting and Bryant-Deason's role in the LASD case. According to the LASD Report, Bryant-Deason referred the case to the U.S. Attorney's Office after this January 14, 1987 meeting. This is not accurate. While the state authorities may have considered it to be a referral, the federal agencies and the U.S. Attorney's Office were already pursuing the matter well before January 14, 1987.
We interviewed Bryant-Deason about her recollection concerning this meeting. She currently is a Superior Court judge in Los Angeles County. In 1987, she was a Los Angeles Assistant District Attorney who had previously been cross-designated for several years to the Los Angeles U.S. Attorney's Office to prosecute federal drug cases. She told us she had only a vague recollection of the Blandon matter. She recalled that the LASD deputies had set up the January 14, 1987, meeting with her because they were frustrated after the searches had come up dry and they wanted to "brain-storm" about the case. She remembered Aukland and Schrettner attending the meeting, along with Sergeant Huffman. She recalled suggesting that the LASD take the case to the Los Angeles U.S. Attorney's Office, because the District Attorney's office did not have the resources to handle it, and the U.S. Attorney's Office was better suited to handle the matter.
Bryant-Deason thought she recalled hearing at the January 14 meeting that one of the persons whose house had been searched asked to call his CIA operative, and the officers let him make a call. She said that she was also told that the CIA had avowed that this person was not connected to the CIA in any way. She also said that the officers brought a box of documents to the meeting, apparently bank documents, which looked as if they had been neatly copied on a photocopy machine. She remembered being struck by the amounts of money reflected in the bank documents and references to the U.S. Treasury. These most likely were the documents copied by Aukland, containing the records seized from Blandon's house which appeared to be Contra bank accounts.
Bryant-Deason said she had no recollection that the officers already had contacted the Los Angeles U.S. Attorney's Office before their meeting with her. Instead, she recalled volunteering to arrange for someone at the Los Angeles U.S. Attorney's Office to see the officers. After the meeting, and after her supervisors agreed that the case should be referred to the U.S. Attorney's Office, she said she called Jim Walsh, the chief of the U.S. Attorney's Office Major Narcotics Section. Because Walsh was out of town, she spoke to the person next-in-line in that section, who she thought was Assistant U.S. Attorney Andersen.(13) Bryant-Deason told us that she had been unaware that the U.S. Attorney's Office was already involved with this investigation. She thought that Andersen told her that the documents were going to be sent to a "special prosecutor" in Washington, who Bryant-Deason believes was the Iran-Contra special prosecutor, and that Andersen later told her the special prosecutor did not express an interest in the documents.(14) She did not know what eventually happened to the U.S. Attorney's Office investigation of Blandon, and she said it was never confirmed to her that there was any CIA involvement in the case.
Sergeant Huffman took notes of the meeting with Bryant-Deason. These notes corroborate that the FBI and DEA were already planning to submit the case to the OCDETF committee. The first sentence of Huffman's notes states: "FBI Agent Aukland will present the case of Danilo Blandon to the Organized Crime Drug Enforcement Task Force (AKA Presidential Drug Task Force) next week. At that time it is anticipated that the case will be adopted by the U.S. Attorney's Office via O.C.D.E.T.F for investigation & prosecution." In fact, as we describe below, this occurred the week after the meeting.
3. Approval of the OCDETF Case
On January 21, 1987, the Los Angeles OCDETF committee met and formally accepted the Blandon investigation as an OCDETF case. Assistant U.S. Attorney Andersen was listed on the OCDETF Investigation Initiation Form as the case attorney and Aukland was listed as the contact agent. The initiation form stated that the FBI, DEA, IRS, U.S. Customs Service, ATF, and U.S. Attorney's Office approved the case, and it listed the principal targets of the investigation to be Danilo Blandon, Ronald Lister, Norwin Meneses, Aparicio Moreno, Orlando Murillo, and Richard [Last Name Unknown] aka Oklahoma Dick.
The initiation form discussed the background of the investigation, including the source information in DEA and FBI files and the unsuccessful LASD search warrant. The form stated that the goal of the OCDETF task force was to determine the organization's means of cocaine importation, to determine the distribution of income, and to identify and prosecute the main subjects and associates of the drug networks. It stated that an FBI source who was deemed reliable would be the initial contact in the attempt to make drug purchases from the Blandon organization. The FBI and DEA offices in Riverside agreed to assign one agent each to the case, and the IRS committed two agents.
12. Andersen did not remember this letter or the basis for the section of the letter referring to the Contras and the CIA. He noted that he would normally try to include the IRS in any case where money laundering might be involved.
13. When first asked about this matter in October 1996 by a former colleague in the Los Angeles District Attorney's Office, after the San Jose Mercury News articles were published, Bryant-Deason has stated that the person she thought she spoke to in the U.S. Attorney's Office was the second in command of the OCDETF program; she recalled his first name began with a "D" and his last name began with an "A." Bryant-Deason's colleague later asked her if the Assistant U.S. Attorney she had contacted was Darryl McIntyre (an attorney in the Major Narcotics Section of the U.S. Attorney's Office). She said she thought so, and this was reported in the LASD Report. However, McIntyre was not second in command of the Narcotics Section; Crossan Andersen was. Moreover, McIntyre had committed suicide before the January 14th meeting with Huffman, Aukland, Schrettner, and Bryant-Deason occurred. A Los Angeles Times article published on December 30, 1986, confirmed that McIntyre's body was discovered with a self-inflicted gunshot wound on December 27, 1986. Bryant-Deason told us she was sure she had only one meeting about this matter with the LASD officers and she must have been mistaken when she had guessed that it was McIntyre, rather than Andersen, whom she had called afterwards.
14. Documents from Blandon's house were forwarded by Andersen to the Department of Justice in connection with the Iran-Contra independent counsel's investigation, and Aukland also sent these documents to the FBI in connection with the same investigation. Andersen had no recollection about this or what happened with the documents. Our review of the files of the Office of Independent Counsel indicates that it did not investigate Blandon or use these documents. FBI agent Michael Foster, who worked on the independent counsel's investigation, told us that the independent counsel's investigation did not focus on drug allegations.