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43-085

MARCH 1975

Printed for the use of the Committee on Government Operations

U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON: 1975

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MEMORANDUM

To: Members of the Permanent Subcommittee on Investigations. From: Senator Henry M. Jackson, Chairman.

This staff study deals with the allegation of Frank Peroff that Federal drug enforcement agents deliberately sabotaged a major heroin inquiry when the names of Robert Vesco and his associate, Norman LeBlanc, were mentioned as possible financiers for the drug plot.

In the pursuit of its own investigation into why the Vesco-LeBlanc lead was not properly pursued, staff investigators came upon other information which revealed a questionable relationship between Federal drug enforcement personnel and Robert Vesco.

Independent inquiry by the subcommittee staff, conducted after the Peroff executive hearings of May and June of 1974, established that agents of the Bureau of Narcotics and Dangerous Drugs (BNDD), the predecessor of DEA, were used in early June of 1972 to conduct sweeps of Vesco's New Jersey offices and home to detect the presence of eavesdrop and wiretap equipment. These BNDD agents were highlytrained experts in electronic surveillance techniques.

At the time of these sweeps, Vesco was the subject of an investigation by the Securities and Exchange Commission concerning his role in massive stock swindles. That probe was to become a central aspect of the Government's charges against Vesco, former Attorney General John Mitchell and former Commerce Secretary Maurice Stans in 1973 that Vesco sought to blunt the SEC inquiry with $250,000 in contributions to President Nixon's reelection campaign.

Further inquiry by the subcommittee staff has also found that subsequent efforts to extradite Vesco-first from Costa Rica, then from the Bahamas-in connection with the Mitchell-Stans trial have been subject to serious and authoritative criticism. In Costa Rica, for example, President Daniel Oduber said on May 6, 1974, in an open letter to Vesco, that he was not convinced the U.S. Government did its best to extradite Vesco from Costa Rica.

Of paramount importance in the subcommittee's investigation was whether the Peroff case was an aberration or was symptomatic of a much greater problem within DEA. In this regard, the subcommittee will continue to examine the operations of the Drug Enforcement Administration. The DEA, patterned after and staffed to a large extent by the defunct BNDD, was responsible for the failure of the Bouchard heroin inquiry. It was also DEA personnel who took the actions that precluded the professionally sound resolution of the VescoLeBlanc undeveloped lead.

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MEMORANDUM

To: Members of the Permanent Subcommittee on Investigations.
From: Senator Henry M. Jackson, Chairman.

This staff study deals with the allegation of Frank Peroff that Federal drug enforcement agents deliberately sabotaged a major heroin inquiry when the names of Robert Vesco and his associate, Norman LeBlanc, were mentioned as possible financiers for the drug plot.

In the pursuit of its own investigation into why the Vesco-LeBlanc lead was not properly pursued, staff investigators came upon other information which revealed a questionable relationship between Federal drug enforcement personnel and Robert Vesco.

Independent inquiry by the subcommittee staff, conducted after the Peroff executive hearings of May and June of 1974, established that agents of the Bureau of Narcotics and Dangerous Drugs (BNDD), the predecessor of DEA, were used in early June of 1972 to conduct sweeps of Vesco's New Jersey offices and home to detect the presence of eavesdrop and wiretap equipment. These BNDD agents were highlyexperts in electronic surveillance techniques.

trained

At the time of these sweeps, Vesco was the subject of an investigation by the Securities and Exchange Commission concerning his role in massive stock swindles. That probe was to become a central aspect of the Government's charges against Vesco, former Attorney General John Mitchell and former Commerce Secretary Maurice Stans in 1973 that Vesco sought to blunt the SEC inquiry with $250,000 in contributions to President Nixon's reelection campaign.

Further inquiry by the subcommittee staff has also found that subsequent efforts to extradite Vesco-first from Costa Rica, then from the Bahamas in connection with the Mitchell-Stans trial have been subject to serious and authoritative criticism. In Costa Rica, for example, President Daniel Oduber said on May 6, 1974, in an open letter to Vesco, that he was not convinced the U.S. Government did its best to extradite Vesco from Costa Rica.

Of paramount importance in the subcommittee's investigation was whether the Peroff case was an aberration or was symptomatic of a will continue to examine the operations of the Drug Enforcement much greater problem within DEA. In this regard, the subcommittee

tent by the defunct BNDD, was responsible for the failure of the Bouchard heroin inquiry. It was also DEA personnel who took the actions that precluded the professionally sound resolution of the VescoLeBlanc undeveloped lead.

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