MANUEL. It seems to me regarding your concern about Mr. Peroff's well being, while he was in Montreal, if Peroff had his instructions from Bouchard to go to Costa Rica and you sent him into Montreal, not knowing that he had received these instructions, you could have gotten him killed in Montreal. Right?

O'Neill. No, because that would have been worked out. In other words, the idea for him to go to Montreal is to get money, if possible, in Montreal. If not, and he did receive itlet me ask you this. I will reverse the logic. Why when Bouchard met him on the 2-that Friday, the 27th? Was that the day that they met? Why did not Bouchard reaffirm the conversation that he had had one week previous with him? Why did he not then give him these instructions face-toface? Why didn't they firm it up and make it absolutely totally clear (p. 636) ?

Manuel said there was no DEA documentation to show one way or the other what Bouchard had told Peroff about Costa Rica. Moreover, the demand for advance money which Peroff confronted Bouchard with raised a new obstacle to the project, a difficult obstacle at that, for Bouchard had few financial resources and Peroff was demanding thousands of dollars from him before he, Peroff, would go to Costa Rica. Accordingly, Manuel asked:

Mr. O'Neill, do you have any evidence or indication that there was no confirmation of the July 20 phone call from Bouchard to Peroff at the July 27 meeting in Montreal? O'Neill replied:

My recollection, my answer to that is I have no evidence. because this is the first I ever heard about it (p. 637). This discussion followed:

FELDMAN [Subcommittee chief counsel]. So that when they met in Montreal, there might have been a reconfirmation of this, the July 20 phone call?

O'NEILL. The fact that it wasn't reconfirmed might lead one to believe that maybe it was never

FELDMAN. Wait. We don't know if it was reconfirmed.
O'NEILL. NO. What I am saying-

FELDMAN. Did they tape this conversation between Bouchard and Peroff when he was in Montreal?

O'NEILL. I don't know. You would have to ask them. FELDMAN. Have you talked to them about any taped conversations?

O'NEILL, No. I think ask them.

FELDMAN. Have you gotten any briefing from them on what happened in Montreal?

O'NEILL. The briefing was Connie [Conrad Bouchard] came over, saw him for an hour, left, went home and took the phone off the hook.

FELDMAN. Did they tell you what happened in the hour
with the RCMP?

O'NEILL. The conversation was very vague, very general.
Connie gave information that he was expecting another load
in the airport and he gave some vague information about it.
FELDMAN. Did they tape the meeting?

O'NEILL. I don't know.

FELDMAN. What? Were they just reading notes?

O'NEILL. No. This I got from Bowers and I was on leave then. So I didn't get this information until the middle of August when I came back again (pp. 637, 638).

POSTSCRIPT ON JULY 20

In retrospect, from Frank Peroff's point of view, July 20 was a day of wasted effort. It was on this day that Dos Santos sent the memorandum to O'Neill saying that Peroff had reported to the Mounties Bouchard's hope that the heroin deal was close to being launched. And it was also on this day that Peroff claimed to have received the final instructions on the Costa Rica trip. But along with these signs of progress was the issue of the outstanding warrants on Peroff and what might happen to him because of them. Manuel asked Dos Santos:

As of the close of business July 20, which would have been a Friday, to your knowledge had a decision been reached to have Mr. Peroff arrested on the warrants from Florida?

"No," Dos Santos testified, explaining that the decision was still pending. That judgment would be made later by John O'Neill and possibly his superiors, Dos Santos said (pp. 436, 437). Dos Santos was wrong. The decision was already made. The wire requesting New York police to arrest Peroff was sent the day before-July 19-by Orlando Sheriff's deputies.

Curiously, Dos Santos testified that during the July 22-27 period— a time when Dos Santos and Peroff had several conversations, both in jail and out-the two men did not discuss either the July 20 phone call Peroff was supposed to have received from the "man with the New York accent" or the related conversation Peroff had with Bouchard which Dos Santos cited in his July 20 memorandum to O'Neill. Peroff testified the opposite, insisting that he did try to convince Dos Santos that final arrangements for the Costa Rican trip had been made.

It is one of the many inconsistencies in the testimony that Dos Santos would not discuss with Peroff the substance of his July 20 memo to O'Neill. But Dos Santos on three occasions testified that he could not remember discussions between himself and Peroff on these subjects from the time Peroff went to jail until Peroff got on the plane for Montreal July 27 (pp. 264, 266).

DOS SANTOS STATES PURPOSE OF JULY 27 TRIP

According to his testimony, there was no doubt in the mind of Richard Dos Santos as to why Frank Peroff was sent to Montreal July 27, 1973. From the moment Peroff was released from the Queens County jail, it was understood, Dos Santos said, that Peroff was to return to

Canada to pursue the heroin inquiry and to seek to obtain evidence that Robert Vesco and Norman LeBlanc were prepared to finance the drug transaction (pp. 262, 438, 439, 446, 447).

Dos Santos told Senators that as of July 27, the RCMP had reason to believe that Bouchard's allegations about Vesco and the heroin conspiracy were worthy of further inquiry (p. 262). Accordingly, Dos Santos said, Peroff was dispatched to Montreal to provide for "further investigation" of Bouchard's heroin plot (p. 440).

Dos Santos said the decision to have Peroff go to Montreal was made by himself and by the RCMP. Dos Santos said, "I am pretty sure I" also "consulted with" John J. O'Neill. But, Dos Santos added, he kept no notes and wrote no memoranda about the consultations with the Mounties or with O'Neill so he could provide the Subcommittee with no specifics about them (p. 440).

O'Neill seemed to know what was going on, Dos Santos said, because O'Neill was dealing directly with the RCMP. But, Dos Santos said, "except for isolated incidents," he, Dos Santos, was never informed of the substance of the O'Neill-RCMP talks (p. 441).

The final instructions he gave to Peroff, Dos Santos said, were that Peroff was to tell Bouchard that without a substantial sum of advance money, the executive jet could not be made ready for the trip to Costa Rica or to Rome (p. 442).

Manuel asked Dos Santos why Peroff was sent to Montreal July 27 when, according to the tapes, Bouchard didn't want Peroff in Canada; he wanted him in Costa Rica, picking up $300,000 from Vesco, LeBlanc or one of their operatives. Dos Santos replied:

Well, there are a number of answers to that, I think, but I can't provide them (p. 443).

Dos Santos explained that he did have the authority to send Peroff to Montreal but persons higher on the DEA ladder were the only ones with the power to have Peroff go to Costa Rica. Dos Santos said that, to his knowledge, no one at DEA was even considering the possibility of having Peroff go to Costa Rica (pp. 443, 444).

Once Peroff was in Montreal, Dos Santos said, Peroff followed his instructions, asked Bouchard for advance money and then found himself with no description of the airplane the heroin plot was built around (p. 445).

Corporal Claude Savoie of the Mounties was troubled by the fact that Peroff had no details of his executive jet. So Savoie called him, Dos Santos said, and warned, "It is very important that Frank have that memory." That was when Dos Santos went out and found a Lear jet and relayed its description to Savoie, who passed it on to Peroff, Dos Santos said (p. 444).

Subcommittee Chief Counsel Howard J. Feldman asked Dos Santos if it was Corporal Savoie's belief that Peroff went to Montreal July 27 for the "purpose of seeing Bouchard on the so-called Vesco-LeBlanc

connection."

"I felt it was," Dos Santos replied (p. 446).

As for DEA Agent Sidney C. Bowers of the Montreal office, Dos Santos could not remember him being involved in Peroff's July 27 visit. Dos Santos said he felt at the time that Bowers knew about the Vesco-LeBlanc lead. Dos Santos said he thought Bowers knew why

Peroff was in Montréal-that is, to pursue the Vesco-LeBlanc anglebut that Bowers might have had another assignment that weekend that kept him from taking part in Peroff's undercover work (p. 447). While in the past Agent Bowers had managed Peroff's activities in Montreal, on this visit the DEA office in Montreal was not directly notified that Peroff was coming, Dos Santos said. Dos Santos had to deal directly with the RCMP and it was the Mounties who were then to keep Bowers and other DEA agents advised of what was happening, Dos Santos said (pp. 447, 448).

Two other DEA agents in Montreal-Jack McCarthy and Ronald Swanson, both formerly of BNDD-may have had some information about Peroff's coming to Montreal July 27, Dos Santos said, but he did not know how much. Dos Santos was not sure who was heading up the Montreal office at the time. He had heard that Bowers would not be in charge and that Swanson "was going to be the man" (p. 448).

Subcommittee Chief Counsel Feldman asked Dos Santos to explain the channels through which the DEA Montreal office learned that Peroff was on his way to Canada. Dos Santos replied:

I can't answer that question. I may have called them myself. I may have talked with McCarthy, but I don't recall making the phone call (p. 449).

Dos Santos said it was his understanding that O'Neill had been talking to McCarthy about the case. But, Dos Santos added, "Exactly who was calling the shots for Uncle Sam in Montreal at that time, I don't know" (p. 448).

O'NEILL STATES PURPOSE OF JULY 27 TRIP

Dos Santos said the purpose of the July 27 trip was to pursue the Vesco-LeBlanc lead in the Bouchard heroin inquiry. O'Neill had a slightly different way of saying it but, in general, he did not conflict on this point with Dos Santos.

There were, said O'Neill, two reasons for Peroff to go to Montreal. First, O'Neill said, the DEA and the RCMP wanted Peroff in Montreal "to check to see if Vesco would finance" the 100- to 300-kilogram heroin deal (p. 612).

The other reason for sending Peroff to Montreal July 27, O'Neill said, was "to see if Bouchard was going to run" away from Canada. Peroff was to gain "general intelligence" about Bouchard's present circumstances (p. 612).

It was apparent from O'Neill's testimony, however, that he meant. for the Subcommittee to understand that the second reason-to gain "general intelligence"-out weighed in importance the first reason, the pursuit of the heroin deal and identification of its backers.

Again, O'Neill said, neither he nor the RCMP had much hope left at this point for the heroin deal ever being executed. O'Neill said he told Dos Santos that he, O'Neill, and the Mounties did not believe in the heroin plot or the Vesco-LeBlanc angle. O'Neill was informed that Dos Santos had testified just the opposite. Dos Santos said the Mounties did believe in the Vesco-LeBlanc angle and wanted Peroff in Montreal to pursue that very lead. But O'Neill told Senators that his point of

view was more accurate and he repeated his assertion that Dos Santos "was generally aware of the fact that people in Canada did not hold out very high hopes" for the Bouchard heroin inquiry or the VescoLeBlanc involvement (pp. 613, 614).

Dos Santos said the decision for Peroff to go to Montreal was made by himself and the RCMP and he generally remembered talking to John J. O'Neill about it. O'Neill said the decision was made by the Mounties after "our talking to them." (P. 611.)

O'Neill noted that the same day Peroff went to Canada he, O'Neill, went on annual leave (p. 614).

Manuel asked why Peroff was directed to demand money from Bouchard when the general feeling at the time was that Bouchard was broke and that was why Bouchard needed a backer such as Vesco for the heroin deal (p. 615).

There was considerable testimony to support the contention that Bouchard was the last person to be counted on to be able to finance from his own resources a large heroin transaction. Court costs had cut into his cash reserves, for one thing. For example, it was the DEA Administrator himself, John R. Bartels, Jr., who told Senators that in July of 1973 "it was known that Bouchard had neither funds nor associates who were likely to assist him" in a substantial heroin transaction (p. 463). Other witnesses had also asserted that Bouchard would have difficulty financing a heroin purchase on his own.

Citing Bartels' observation about Bouchard's lack of funds, Manuel asked O'Neill what purpose could be served by demanding cash from the nearly bankrupt Conrad Bouchard. To present the full meaning of John O'Neill's explanation on this point, this discussion between O'Neill and Manuel is reprinted:

MANUEL. Specifically what did you discuss with Dos Santos and what did Dos Santos instruct Mr. Peroff to do?

O'NEILL. I wanted Peroff to ask Bouchard for money.
MANUEL. Why?

O'NEILL. Peroff was alleging that he had access to huge sums of money, $600,000 I think was the figure, and that he should instruct Bouchard, Dos Santos should instruct Peroff to ask Bouchard for money to show a sign of good faith on the part of Bouchard to show that there was a narcotic deal that was in the offing and that it would be worth Peroff's time and energy to stay with them.

MANUEL. Forgive me, Mr. O'Neill. I am a little bit confused. You say you had information that Mr. Bouchard had access to large amounts of money, yet as I recall it in Mr. Bartels statement yesterday he said that everybody was aware that Bouchard had no money.

O'NEILL. NO. I said Bouchard alleged that he had access to large sums of money.

MANUEL. Who did he allege that to?
O'NEILL. TO Peroff.

MANUEL. When?

O'NEILL. On the tape.

MANUEL. Which tape?