Peroff objected, saying he was to meet Bouchard at noon. His protests falling on deaf ears, Peroff said, he asked if he could at least call Bouchard. Peroff said Savoie refused him that request. At the airport, Peroff said, he was confined to a limited area, precluding him from getting to a phone. All Savoie would reply to his questions was the response of "ask Rick," Peroff said. Rick was the nickname of Richard Dos Santo (p. 92).

In New York, Dos Santos met the plane, Peroff said. "I did ask Rick" what this was all about, Peroff said. Wearing a "big smile," Dos Santos suggested he call Bouchard, Peroff said. Bouchard's line was busy, Peroff said. From his room back at the Hilton Inn, Peroff kept calling Bouchard. But the line stayed busy for several days. He said he did get through to Bouchard's associate, Louis Cote, and Cote explained that Bouchard's phone was out of order (p. 92).

On August 1, 1973, Dos Santos called him at the Hilton. Peroff said. Dos Santos said he was on his way over and not to call Bouchard until he got there, Peroff testified. This time the call went through. Dos Santos taped the conversation, Peroff said (pp. 92, 93).

Conrad Bouchard was "unbelieveably enraged," Peroff said. Bouchard shouted that "the deal was as good as dead" and accused Peroff of being to blame. Peroff said that during the call Dos Santos told Peroff to try to persuade Bouchard that due to his short cash position the Lear jet had been repossessed (p. 92).

But Bouchard was not receptive to excuses at this point, for, as Peroff assessed the situation, this phone conversation with Bouchard was "really where this investigation ended." (Pp. 92, 93.)

Peroff added that Bouchard told him that if Peroff were in Montreal at that moment he would have him killed. Bouchard explained that "I should consider myself lucky that I was not dead," Peroff testified (p. 93).

SUMMARY OF PEROFF'S POSITION

To Peroff's way of thinking, DEA agents and other government officials had no intention of allowing the Bouchard heroin case to succeed because of Robert Vesco's reported involvement. That was why they sent him to Montreal at the very time Bouchard wanted him in Costa Rica, Peroff said (p. 94).

Instructing Peroff to demand money-$10,000--from a man known to be financially bad off was another effort to make sure the heroin venture collapsed, Peroff said (p. 94).

But Bouchard surprised the DEA when he vowed to come up with some of the front money, Peroff testified. Proof of his premise, Peroff said, could be found in the fact that as soon as drug agents learned Bouchard was doing "his best to raise a portion of the money and give it to me. I was yanked out of Montreal without explanation and sent back to New York" (p. 94).

The final blow came when Dos Santos directed him to tell Bouchard that the Lear jet had been repossessed. Peroff said. Peroff testified that Bouchard had no further use for Peroff in the heroin deal since without the Lear jet "I could not participate in any transaction." (P. 94.)

Government witnesses did not address themselves directly to the Peroff theory as to why the Bouchard case had failed. John J. O'Neill, for example, dismissed Peroff's position out of hand, asserting time and again that the Bouchard heroin inquiry was doomed to fail from the start and that the Vesco-LeBlanc lead was a complete fiction.

In turn, the DEA-Customs inquiry concluded that even if the Vesco-LeBlanc angle were deserving of further investigation it was Peroff, by refusing to fly to Costa Rica when ordered, who undercut the case; the government was not to blame.

Once, however, a government witness conceded the Peroff theory had merits but he rejected it anyway. Richard Dos Santos, formerly with DEA, now back with Customs, testified that Peroff did everything he was told to do on the July 27 trip and that the Mounties held up their end of the venture as well but that two developments occurred which led them to send Peroff back to New York. First, Dos Santos said, the RCMP finally concluded Bouchard was lying to Peroff. Second, he said, the RCMP decided Bouchard knew Peroff was an informant and might kill him (pp. 272–274, 276). Dos Santos offered no documentation to support his view.

Subcommittee Chief Counsel Howard J. Feldman asked:

Assuming that Mr. Peroff's allegations are correct, that Bouchard, when asked to put up money, said he would come un with $5,000, and that Peroff was, in effect, spirited out of Montreal, do you have any explanation of why this particular transaction was killed after all the investment that went into it?

Dos Santos replied: "I can't reconcile that with what we know, if Mr. Peroff is to be believed" (p. 272).

Dos Santos said the controversy over why Peroff left Montreal July 30 could be resolved in deciding which side to believe-the Mounties, on the one hand, who told him they directed Peroff to leave town for valid reasons; or Peroff, who claimed the entire exercise was intended to destroy the case. Dos Santos said he accepted the word of the Mounties. "I don't believe there is anything that would occur that would make me disbelieve or doubt their integrity," Dos Santos said (p. 272).

JUDY PEROFF TESTIFIES

Judy Peroff, Frank's wife, testified before the Subcommittee May 17, 1974 (pp. 170-173). She also submitted a Subcommittee affidavit sworn to April 17, 1974 (p. 173).

In the affidavit, Mrs. Peroff said that "on or about" August 1, 1973, shortly after her husband's July 30 return from Montreal, Richard Dos Santos came to their room at the Hilton Inn Hotel.

Taking a tape recorder from his attache case, Dos Santos equipped the phone with the device and with a head set enabling him to listen and record simultaneously, Mrs. Peroff said.

Then her husband and Dos Santos placed the call to Conrad Bouchard. Mrs. Peroff said Frank got Bouchard on the line and a "very heated conversation" ensued.

She said that Dos Santos, listening to both ends of the call, wrote out things for Peroff to say in notes the DEA agent passed to her hus

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band. In one of these notes, Frank was instructed to tell Bouchard that the Lear jet "had been repossessed," Mrs. Peroff said.

At the completion of the conversation, she, her husband and Dos Santos talked for a few moments. Mrs. Peroff said Dos Santos conceded that "the case was over-it was finished."

But, Mrs. Peroff said, Dos Santos, while acknowledging the collapse of the Bouchard inquiry, went on to propose another venture. Dos Santos "began talking to Frank" about "a new case he could work on with Mr. Bornstein of the [Queens County] District Attorney's Office." Mrs. Peroff recounted.

Mrs. Peroff added:

It is hard for me to put into words as I think back on how I felt at this time. After the long months of effort and money and problems and worries that had gone into the case to bring it to the point where it was-it was an indescribable letdown and disappointment to have it end this way. We both felt that things had started going wrong immediately after the name of Robert Vesco was brought into the case. We felt that this fact and this alone was the reason for the death of this case.

DOS SANTOS REMEMBERS AUGUST 1

Richard Dos Santos told Senators that he might have been in the Peroff's hotel room at the Hilton Inn August 1, 1973. But he was not present, he said, during a telephone conversation between Peroff and Bouchard (p. 278).

Subcommittee Chief Counsel Howard Feldman read to Dos Santos those sections of Mrs. Peroff's affidavit in which she asserted that Dos Santos was there during the Bouchard call and listened to it, taped it and, to some extent, orchestrated it (p. 278).

Dos Santos denied that he could have taped the call because "I did not have a tape recorder." (P. 279.)

But, Dos Santos testified, he did have a recollection, although not a very precise one, that Peroff did play for him a recording of a Bouchard conversation. In this taped conversation, Dos Santos testified, he thought he remembered Peroff telling Bouchard that the Lear jet had been repossessed (pp. 279, 280).

Dos Santos said Peroff used the story of how the jet was repossessed "to cover his backside" with Bouchard (p. 280).

While he was fairly sure he had heard that Peroff had given Bouchard this account, he wasn't sure where he heard it-from a recording, from Peroff having told him about it or even from discussions with the Subcommittee staff. "The mind plays funny tricks," Dos Santos testified (pp. 279, 281).

But the contested phone call to Bouchard and the story of how the Lear jet had been repossessed were of diminished consequence by August 1 anyway, according to Dos Santos. The Bouchard heroin inquiry, with its alleged Vesco-LeBlanc angle, all but died on July 30, the day Frank Peroff was sent away from Montreal. Dos Santos said: For whatever it is worth, or whether it is good or ill, when he came back from Montreal on that last occasion, it was my

understanding, my belief-whether there is anything to substantiate this, I don't know-that that portion of the investigation was at least in limbo if not dead (p. 276).

Dos Santos testified that hopeless as the situation seemed July 30 he did admonish Peroff not to give up entirely. "Don't break the umbilical cord," were the only words of guidance Dos Santos said he gave Peroff that day. "I don't recall giving him any [other] instructions with regard to Bouchard," Dos Santos said (p. 277).

O'NEILL CLAIMS IGNORANCE OF JULY 20 CALL, MEMORANDUM

The subcommittee, in seeking to establish why Frank Peroff was ordered to leave Montreal July 30, also sought to determine why, on July 27, when he insisted he was expected in Costa Rica, the decision was made that he go instead to Canada.

Peroff testified that when he returned to New York from Puerto Rico Bouchard had assured him the heroin transaction was soon to be consummated. Then on July 20, following instructions from Bouchard, Peroff claimed to have received a call in a phone booth from a man "with a New York accent" who waived the need for a password and arranged to recognize Peroff on sight upon his arrival in Costa Rica. All that was left for him to do, Peroff said, was to call Bouchard and "tell him the color for sure of the plane and the estimated time of arrival in Costa Rica, and that was it." (P. 122.)

Apprised of the purported July 20 phone call, John J. O'Neill told the Subcommittee it was "all news to me." (P. 633.)

Manuel told O'Neill that Peroff claimed to have been in contact with the Royal Canadian Mounted Police July 20 and that the Mounties as well as DEA agents, knew about the call from the "man with the New York accent." (P. 633.)

To that, O'Neill replied:

I am not aware of it. I have no knowledge. I spoke to nobody in Canada who told me about that (p. 633).

Manuel then showed O'Neill a memorandum written to him by Richard Dos Santos at 11:40 a.m., July 20, 1973 in which Dos Santos informed O'Neill that the Mounties had just received word from Peroff that the heroin venture was soon to be launched. O'Neill said this was the first time he had ever seen the July 20, 1973 memorandum (pp. 633, 634).

In the July 20 communication, Dos Santos said he had received a call from Corporal Claude Savoie of the RCMP. Savoie reported that Peroff had been in touch with the Mounties. Peroff was said to have told Savoie that he had talked with Bouchard and that Bouchard had told him that he was "still waiting for the guy to come back and that as soon as he came the deal was go." (Pp. 633, 634.) The Dos Santos memorandum to O'Neill went on to say that, according to Savoie, Peroff was asking the Mounties to utilize him as an informant and work out an arrangement with DEA headquarters, bypassing New York DEA altogether. Savoie said Peroff was told the RCMP would not bypass New York DEA but it was recommended

that the New York office meet with Peroff and the Mounties regarding "Frank's further utilization."

The Dos Santos memorandum of July 20, 1973 before him, O'Neill said:

To my recollection, this is the first time I have seen this. This is the first I have seen this memo . . . As I told you when you recited the list of things that was the first I had heard of it (p. 634).

Richard Dos Santos, in his appearance before the Subcommittee, was shown a copy of the July 20 memorandum for John J. O'Neill. Dos Santos testified that he remembered writing the memorandum and that his mention of the conversation with Savoie had reference to a call from Savoie that occurred "days or possibly even hours" before he wrote the memo (pp. 425-426).

Looking at the Dos Santos memorandum, O'Neill testified, "This is the first I have seen of this memo." (P. 634).

Philip Manuel, Subcommittee Investigator, asked:

In other words, you were in the decision-making process in this case and you were not even getting the benefit of information such as this. Is that your testimony?

"Yes," O'Neill replied (p. 634).

This discussion then followed:

MANUEL. How could you possibly make an intelligent decision without having the benefit of this type of information? O'NEILL. When you add it all up, it still comes down to the same thing.

MANUEL. I don't know whether it does or not, Mr. O'Neill. O'NEILL. When he asked for the money, when he went there and asked that this thing be backed up, this information be backed up, it still came out zero (pp. 634-635).

Manuel pointed out that had O'Neill known about the purported July 20 calls from Bouchard and from Costa Rica, O'Neill might not have sent Peroff back to Montreal. O'Neill said there was no way he could have known about the July 20 conversations because he spoke to Peroff for the last time July 17 (p. 635).

Manuel asked:

So you don't know whether he got such instructions or not to go to Costa Rica?

"Right." O'Neill said (p. 635).

O'Neill seemed to be asserting that proof of the wisdom of his sending Peroff to Montreal July 27 was in the fact that no heroin transaction and no trip to Costa Rica ever occurred after July 27. Moreover, he said, Bouchard did not confirm the July 20 conversation when he met July 27 with Peroff. Manuel asked O'Neill how it was that he knew Bouchard did not confirm on July 27 the July 20 conversation, O'Neill testified that he was sure Bouchard did not confirm what he had said July 20. This exchange ensued: