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clothing shop he had associated with criminals, served as a fence for stolen goods and took part in several fraudulent financial schemes.
Since the 1964 arrest, Peroff said, he had been arrested five or six times on various state charges for which warrants were issued in Florida. The warrants were based on charges of grand larceny, fraud, possession of a weapon, writing worthless checks and traffic violations. Peroff was not convicted on any of the charges.
A man with a talent for business enterprises, Peroff has worked at a variety of commercial pursuits, several of which, he claimed, were legitimate. Others, he said, were not legitimate. Peroff said he owned or managed construction companies in Florida, sold furniture in New York, manufactured kitchen equipment in Washington, D.C. and managed, co-owned or sold supplies for car wash establishments in Northern Virginia, Maryland, Florida and Oregon. Peroff said that while involved in these enterprises he occasionally took part in questionable or illegal transactions, some having to do with fraudulent and stolen securities.
Another enterprise Peroff entered into was the leasing of private aircraft. He used this aircraft to smuggle contraband out of the Bahamas and into the United States and Canada. Operating out of Orlando, Florida in the late 1960's and into 1972, Peroff worked at his Bahamian smuggling activities while, at the same time, he went into more reputable pursuits such as land ventures.
In his testimony before the Investigations Subcommittee May 17, 1974, Peroff stressed his assertion that in his dealings in the Bahamas, in Florida and elsewhere, he had won the reputation for being a person with ready access to private aircraft to be used for illegal purposes. Peroff put it this way:
. . . over the years I have been able to use private aircraft in the furtherance of certain criminal activities. I gained the reputation in certain criminal circles as a person who had the capabilities to fly in and out of the United States, Canada and elsewhere, undetected (p. 11). Peroff said that while in the Bahamas in 1970 he met Conrad Bouchard of Montreal. Conrad Bouchard was a major figure in the Canadian underworld. His criminal activities included smuggling, counterfeiting and stolen securities.
Peroff said he entered into frauds involving stolen securities and counterfeit currency with Bouchard. Peroff said his dealings with Bouchard were halted temporarily in 1972 when Bouchard was arrested in Montreal for narcotics violations.
For the purposes of this investigation, the relationship Frank Peroff established in the Bahamas in the early 1970's with Bouchard is important. In working with Bouchard, Peroff was able to convince the Canadian racketeer that he was trustworthy. It was this trust that proved valuable for Peroff as he switched sides, becoming an informant for law enforcement agencies in Europe, Canada and the United States.
III. THE JOHN BARNES CASE
PEROFF AS INFORMANT
It was in his role as a confidential informant for the U.S. Drug Enforcement Administration (DEA) that Frank Peroff came upon information that led him to report to agents that Robert Vesco and his associate, Norman Le Blanc, were to finance a $300,000 heroin transaction. Peroff arrived at this information in the summer of 1973 in the midst of his negotiations involving a narcotics deal with the Canadian racketeer, Conrad Bouchard.
But, by this time—by the summer of 1973—Peroff was not a newcomer to informant work. He had been performing informant services for Federal enforcement agencies since March of 1972. The first information he passed on to Federal agents was in the form of a counterfeit $50 bill he had obtained in England, in early 1972.
Peroff, at this time a resident of Orlando, Florida, had taken possession of the counterfeit currency during a trip to England and the Continent. He made this trip to make arrangements for his family to join him in Europe and live there permanently. While the actual move did not take place until the spring of 1972, the Peroffs' decision to take up residence in Europe seems to have coincided with the arrest in early 1972 in Montreal of Conrad Bouchard. The Royal Canadian Mounted Police (RCMP) arrested Bouchard for trying to smuggle into Canada 33 pounds of pure heroin January 15, 1972.
Peroff told Subcommittee staff that he had taken the counterfeit currency to the FBI in New York. From there, he said, he was referred to the U.S. Secret Service, the Federal agency charged with responsibility for counterfeit investigations. Agents listened, Peroff said, as he described the criminal organization in England which was printing and trying to distribute the bogus money. Peroff said he offered to help the Secret Service break the counterfeit ring.
A short time later, back in Orlando, a Secret Service agent contacted him. Arrangements were made for Peroff to meet other agents on his next trip to Europe. Accordingly, Peroff said, in March of 1972, in London, in a room in the Brittania Hotel, he did meet with Secret Service and Scotland Yard officers.
At that time, Peroff said, he provided more information to the law enforcement agents. In the course of this exchange, Peroff said, he became acquainted with one of the agents, Frank W. Leyva, chief of the Secret Service European operations. Leyva's office was in Paris.
When Peroff told Subcommittee staff of his first informant activities with Federal agents, investigators sought to check the accuracy of what he was saying.
CONNELLY RECALLS PEROFF MEETING
Robert Connelly was the resident agent for the Secret Service in Orlando when Peroff decided to turn over to the Government the coun
terfeit $50 bill he had obtained in England. Subcommittee Investigators Manuel and Gallinaro interviewed Connelly in Orlando January 25, 1974.
Connelly said that in approximately early 1972 he was contacted by Secret Service Agent Jack Holtzhower of the Counterfeit Division in Washington, Þ.C. Holtzhower told Connelly of Peroff's having gone to the New York office of the Service with information and evidence that could be useful. Holtzhower directed him to talk to Peroff, Connelly said.
Before contacting Peroff, Connelly checked with the Orlando County Sheriff's Office and the Orlando Police Department and found that Peroff had an arrest record and criminal history but, Connelly noted, he found no outstanding warrants on Peroff. Connelly said he did not check Peroff's past with the Florida Department of Law Enforcement (FDLE) because he did not think it was necessary to do so.
After interviewing Peroff and viewing several counterfeit bills Peroff displayed for him, Connelly concluded Peroff could help the Secret Service and advised his superiors in Washington accordingly. Connelly said he was then directed to assist Peroff with flight reservations on a trip Peroff was planning to Europe. Connelly said he was to try to arrange a flight for Peroff which would enable him to meet in London with Secret Service and other law enforcement agents. Connelly said he did make arrangements for such a meeting.
Connelly said Peroff called him several times from Europe after the London meeting. In his first call, Peroff complained about the way he had been treated in London by Frank Leyva and Harris Martin of the Secret Service and by Scotland Yard personnel. Connelly said Peroff continued to call from time to time, the last call being from London or Spain about a month after Peroff had left the U.S. Connelly said he had not spoken with Peroff since the final telephone call.
MARTIN RECALLS BARNES CASE
Harris Martin, the special agent in charge of the Counterfeit Division of the Secret Service, dealt with Peroff in early 1972 when Peroff became an informant. Martin described his agency's dealings with Peroff in a January 18, 1974 memorandum prepared at the request of the Subcommittee. The memorandum was made part of the hearing record. Martin, now Deputy Assistant Director for Administration in the Secret Service, testified before the Subcommittee June 14, 1974 (pp. 851-877).
In the memo, Martin said that Peroff had gone to the office of the Federal Bureau of Investigation in New York with information about a counterfeit money plot. The FBI referred Peroff to the Secret Serrice. Martin said Peroff appeared in the Service's New York office March 13, 1972.
Presenting a bogus $50 bill, Peroff told Secret Service agents that he had obtained the currency recently from John Barnes in London. Martin said Peroff was of the opinion that the supply of counterfeit was unlimited. Martin said Peroff offered to help the Secret Service locate the plant where the money was being printed.
Martin said a Secret Service agent in Orlando, Robert Connelly, arranged for Peroff to meet a short time later in London with other agents. Peroff was to pay for his own airfare. On March 24, 1972, Martin and the chief of European operations, Frank Leyva, met Peroff in London. Martin said Peroff gave them information about the alleged counterfeiter, John Sidney Barnes, an Englishman, and added that Barnes and other persons-most of whom Peroff named-were involved in a wide variety of illegal activities in Europe with the use of stolen and counterfelt securities. Martin told Senators that he went on this interveiw of Peroff because he happened to be in London at the time and no other agent was available to accompany Leyva at the meeting (p. 860).
Martin said in his memorandum that Peroff asked if the Secret Serrice would pay his expenses while he served as an informant in Europe. Martin said he told Peroff that the Service would not pay his expenses but, at the conclusion of the case, a reward would be paid, the size of which would be determined by the value of the information Peroff had provided.
Martin said he then arranged for Peroff to meet with Inspector Robert Wilson of the Forged Currency Squad, Scotland Yard. However, Martin said, while Peroff did meet later with Scotland Yard, “no tangible results were obtained from his [Peroff's] assistance." Martin said that in July of 1973 Scotland Yard raided the plant where Peroff's bogus $50 bill had been printed. But, Martin said, none of the persons named by Peroff "could be associated with the activity."
LEYVA RECALLS BARNES CASE
Frank Leyva, chief of Secret Service operations in Europe, prepared a memorandum for the Subcommittee January 7, 1974 in which he related his dealings with Frank Peroff. The memorandum was made a part of the Subcommittee hearing record.
Leyva said that at a March 24, 1972 meeting in London attended by himself, Harris Martin, Scotland Yard officers and Peroff it was understood that Peroff would work with Scotland Yard on the Barnes counterfeit case. Leyva returned to Paris.
However, Peroff called Leyva from London on March 27, 1972 to say he would not work with Scotland Yard anymore. Leyva said he surmised that Peroff had made this decision because Scotland Yard "wouldn't meet his terms."
On April 30, 1972, Peroff came to Leyva's office in Paris and displayed a bogus $100 bill. Leyva said Peroff claimed the counterfeit note was from the John Sydney Barnes collection and that he had been offered the opportunity to dispose of $200,000 by one of Barnes associates, Keith Jeffries.
Later-on May 11, 1972—Peroff again met with Leyva, this time in the hotel in Paris where Peroff was staying, Leyva said that at this meeting Peroff told him he had not accepted the Barnes money from Jeffries because it was of “poor quality" but the Barnes organization was putting together "an offer of better notes.” Leyva said Peroff was confident he could now purchase a large amount of the Barnes phony money.
Leyva said that on May 18, 1972 he received a call from Peroff
. Now in Sweden, Peroff said he had been working hard on the John Barnes counterfeit case, had been_travelling widely and absorbing considerable expenses. Leyva said Peroff told him he was planning a visit to Paris in two days to work out “financial arrangements” with the Secret Service. Leyva said he replied that “there would be no such talks since we did not make it a practice to keep anyone on a retainer basis.”
Leyva said he did not hear from Peroff again until January of 1973 and that contact was in connection with another case. In his memorandum, Leyva made no further reference to the John Barnes counterfeiting case.
POSTSCRIPT ON THE BARNES CASE
Harris J, Martin, head of the Secret Service counterfeit division, said that when Scotland Yard raided the plant where the bogus currency was being printed that no one associated with the facility had been previously identified by Peroff. Nonetheless, information provided by Peroff in the John Sydney Barnes case was considered valuable enough to justify continued inquiry.
In a report filed in Rome June 19, 1973, Customs Attache Mario Cozzi said both principals in the inquiry--John Barnes and Keith Jeffries-should be made the subjects of a 7-category case" "to insure appropriate Customs examination on any future arrivals in the United States." The Subcommittee obtained a copy of the Cozzi report and it was made part of the hearing record.
Cozzi wrote that Frank Peroff “appeared to be very well versed" in the activities he accused Barnes and Jeffries of being involved in such as passing counterfeit money and phony stocks and trafficking in the "controlled currency of new African nations, i.e., Zambia, etc.”
Cozzi went on to say that investigators had gone to the trouble of tracing Barnes' and Jeffries' whereabouts. He said that Barnes, a British subject, and his wife, Jane, stayed at the Holiday Inn in Rome from November 28 to December 1, 1972 and that Jeffries, also an Englishman, was at the American Hotel in Rome December 23 to 25, 1972.