VALENTINE THINKS HE LEARNED OF VESCO LINK IN OCTOBER

However, at another point in his testimony, O'Neill said he was not completely sure but he thought he might have reported the substance of the July 6 tape to his boss, Wayne T. Valentine, Assistant Regional Director for DEA's New York office (p. 564).

Valentine testified before the Subcommittee June 12, 1974. He said that the first time he learned that Robert Vesco and Norman LeBlanc were linked to the Bouchard inquiry was in September or October of 1973 when he also found out that Frank Peroff was telling people that DEA had sabotaged the investigation (pp. 665, 667).

Valentine said he could not understand why John J. O'Neill did not tell him about the Vesco-LeBlanc lead in July when it first surfaced. But, Valentine said, "In all fairness, I do not recall Mr. O'Neill telling me." (Pp. 665, 666). Yet, Valentine added, there was still a possibility that O'Neill did tell him in July or August and he, Valentine, had simply forgotten about it. But, he said, he could not be certain either way (p. 666).

But other aspects of the case-certain problems created by Frank Peroff, for example-Valentine was made aware of. He said Richard Dos Santos asked him in July to use his authority to expedite payment of expense money owed Peroff (p. 664). In addition, when Peroff brought his family to New York, Valentine said, he approved of John O'Neill's decision not to pay for the family's airfare. Valentine said he was involved in the decision-making process regarding Peroff "to the extent that I concurred with Mr. O'Neill on the government not paying for his family's trip to New York." (P. 667.)

By his remarks, Valentine sided with O'Neill-and differed with Peroff-in characterizing the dispute over the Peroff family's being in New York. Octavio Pinol, the DEA agent who took the Peroffs to the airport in San Juan July 17, said he used a Government Travel Request to pay for Peroff's airfare but, he added, the Peroff family had their own tickets. Pinol made these remarks in the sworn DEA-Customs inquiry statement.

The precise language was as follows:

DEA Inspector Edwin L. Stamm. Were you to furnish him [Peroff] with a ticket to go to New York [July 17]?

PINOL. Right.

STAMM. How about his family?

PINOL. NO. His family had their return tickets from Customs, the return tickets to New York.

Moreover, as already indicated in this staff study, the Subcommittee obtained copies of the tickets the Peroff family used to fly to New York from Puerto Rico July 17, 1973. The tickets were purchased in March by Mario Cozzi of Customs and ultimately paid for by the Secret Service.

Similarly, Peroff testified that the question of who paid his family's way back to the States was never an issue since their airfare was already paid for. The issues that set off the dispute had to do with disagreements over how to carry out the Costa Rica trip, the delays in

payment of expense money owed Peroff and the very fact that Peroff had brought his family to New York at all-not who paid their way. Their way was already paid.

CONFLICT OVER O'NEILL'S RESPONSE TO JULY 6 TAPE

O'Neill led the Subcommittee to believe that he had no confidence in Peroff's information concerning the Bouchard heroin plot and the alleged participation of Robert Vesco and Norman LeBlanc. But Dos Santos testified just the opposite. Dos Santos told Senators that O'Neill was excited and enthusiastic about the Vesco angle. Dos Santos said that by bringing Robert Vesco to justice on a drug charge O'Neill "felt probably that he would be a hero." (P. 307.)

In his testimony before the Subcommittee, Dos Santos meant to leave no doubt in Senators' minds that John J. O'Neill had high hopes for the Vesco lead and had every intention to pursue this new development with vigor. Dos Santos said:

I was approached by John [O'Neil!] who apparently had been in contact with Peroff-whoever initiated the phone call I don't know-and he made me aware that he was aware of Vesco and expressed great enthusiasm and interest (p. 324). Dos Santos added that, to his knowledge, O'Neill's enthusiasm for the Bouchard-Vesco lead remained and never did decline (p. 324). Dos Santos described for Senators John O'Neill's response when O'Neill heard the July 6 tape recording in which Bouchard first mentioned the Vesco and LeBlanc involvement. Dos Santos said it was sometime in early July of 1973 when

O'Neill heard the conversation, apparently heard the recording, and came out of his office and said to me words to the effect that, "I just talked to Frank. Do you know who this guy Vesco is?" He was very enthused (p. 399).

Dos Santos said O'Neill's "enthusiasm certainly indicated he knew who" Robert Vesco was (p. 400). Subcommittee Investigator Manuel asked Dos Santos if by referring to O'Neill's enthusiasm he meant to convey the idea that O'Neill intended to "make a special effort in this case because Robert Vesco's name had come up." Dos Santos replied, "I got that impression." (P. 400.)

In the sworn DEA-Customs interview, Dos Santos again described O'Neill's reaction to the possible involvement of Robert Vesco in the Bouchard inquiry. Dos Santos said, "O'Neill was very elated at the prospect of locking up Robert Vesco." Dos Santos said O'Neill personally told him how elated he was.

What Dos Santos had to say about O'Neill's reaction to the VescoLeBlanc angle conflicted with what O'Neill said his reaction was. O'Neill said his reaction was as follows:

I thought Bouchard was doing what he had been doing all along, just holding out hope for Peroff. . . Bouchard was on trial in Canada and he was positive that he was going to be convicted [and would] spend the rest of his life in jail.

He wanted a fast, sure way of escape from Canada. The best
and the fastest that he had was Frank Peroff . . . Bouchard
knew that Peroff had a plane and that Peroff promised to get
him a passport (pp. 528, 529).

O'Neill referred to the Vesco-LeBlanc lead as "another trick and ploy" by Bouchard "to string Frank Peroff along and this time he is dangling Robert Vesco and $100 million in front of him." (P. 530.) But, O'Neill said, he did pass the information on to the DEA office in Montreal.

O'Neill said he asked Agent Jack McCarthy, assigned to the DEA office in Montreal, to "check it and verify" the Bouchard comments. O'Neill described his instructions to Agent McCarthy this way:

I told him that we had just received a call from-I don't know if I identified him as Peroff or the informant with the plane; that there was going to be a meeting this weekend between the father of LeBlanc, who are very high-ups in Canada, and Bouchard; that there was a final okay for this deal to be given on this deal on this weekend and would he pass the information to the Canadians and would they let us know what happened (pp. 530, 531).

O'Neill said he was more convinced than ever that Bouchard was lying on the July 6 tape when the weekend passed and Agent McCarthy reported back to him that Bouchard was placed under surveillance by the Mounties and it was noted that the Canadian racketeer did not leave his house Saturday or Sunday so he could not have attended the heralded meeting (pp. 531, 568).

Manuel asked O'Neill if any of the information from the surveil lance was transmitted by the RCMP to DEA in writing. O'Neill said it was not, that information provided by the RCMP was in writing only in certain prescribed circumstances and that this was not one of them (pp. 531, 532).

Similarly, O'Neill said, he did not commit to writing, nor did he have anyone else commit to writing, any of the surveillance information coming to him from the Mounties. Explaining why he kept no records on these matters, O'Neill said his office had a "tremendous backlog" of paperwork and he was trying to reduce the amount of written communications (p. 532). O'Neill said:

I am trying to keep paperwork down to a minimum so we don't add to that. I try not to reduce-I don't want to call it worthless but that type of information I don't think should be reduced to writing (p. 532).

In fact, O'Neill said, there was no documentation filed on the VescoLeBlanc lead because "I didn't consider it important." (P. 532.) Accordingly, O'Neill felt that too much stress was being placed by the Investigations Subcommittee on the names of Robert Vesco and Norman LeBlanc. He said that in his experience in law enforcement he had heard the names of many important people bandied about and that he had had to learn to keep his perspective and not to become carried away by the excesses of name droppers. O'Neill explained:

The idea that anybody's name, Vesco, LeBlanc-I have heard Eleanor Roosevelt, the Pope, the President, everybody. The idea of a name like Vesco or LeBlanc holds no particular fascination for me. I wasn't enthusiastic (p. 533). O'Neill added:

If they would have told me Giuseppe Cotroni, I would have been more enthusiastic. If they had told me Victor Cotroni, I would have been more enthusiastic (p. 533).

Philip Manuel, Subcommittee Investigator, reminded O'Neill that Giuseppe Cotroni was considered to be involved in the case. O'Neill discounted the Giuseppe Cotroni connection to the case, saying:

Peroff met Cotroni once, I believe. I am not sure, but I think he did meet Giuseppe Cotroni once (p. 533).

Manuel pointed out that agents felt in July of 1973 that Giuseppe Cotroni was involved in the heroin plot. O'Neill, not completely responsive to Manuel's comment, said:

I said there was going to be a meeting between the big man in Canada and I describe the big man in Canada to be Cotroni. The name Cotroni was not given by Bouchard or Peroff. The name Cotroni was mine, that there was going to be a big man in Canada, that had the means, resources and responsibilities needed to go along with this. That would be Vic Cotroni (p. 534).

Manuel asked:

You just assumed, then, that Vic Cotroni would be a particpant in this? (P. 534.)

O'Neill replied, "Anything that large happening in Canada would be Vic Cotroni." (P. 534.)

As for Vic's brother, Giuseppe Cotroni, O'Neill belittled the idea that he, Giuseppe Cotroni, could be involved in a big heroin deal. O'Neill explained that Giuseppe Cotroni had gotten out of jail a year and a half ago and the confinement had reduced him in stature and consequence in the underworld. O'Neill explained:

When he was in jail he was bordering on-I will tell you what he was doing. Half of the time he was in the chapel on his knees crying and begging for forgiveness. The other half of the time he was threatening to kill, murder and maim the other inmates.

When he came out of jail his brothers recognized him as their brother, recognized the responsibility they had for him as a brother, and totally and completely cut him off of any business that they were doing (p. 534).

O'Neill said he learned of the demise of Giuseppe Cotroni from the Royal Canadian Mounted Police (p. 534).

BOWERS TESTIFIES ABOUT JULY 6 TAPE

Sidney Bowers, the DEA agent in Montreal, told the Subcommittee that about July 8, 1973 he came into his office while another DEA agent, Jack McCarthy, was on the phone with New York Group Supervisor John J. O'Neill. Bowers said he heard the name Robert Vesco mentioned and when McCarthy hung up he asked him what the Vesco reference was all about (pp. 773, 774).

Bowers testified that DEA Agent McCarthy replied, "That was John O'Neill in New York and he says that Frank has now come up with the Vesco name. Vesco is going to be the money man on the thing." Bowers said his own reaction to McCarthy was, "That should be interesting." (P. 774.)

Bowers said he tried to contact Richard Dos Santos to learn more details about the Vesco matter. Bowers said Dos Santos returned his call and played for him a portion of a taped telephone conversation between Peroff and Bouchard (p. 781). The quality of the tape was poor, Bowers said, and Dos Santos explained the poor fidelity by saying, "It is not good. We got this over the phone from Puerto Rico." (P. 779.) Bowers did say, though, that the quality of the tape was good enough for him to pick up the name Vesco (p. 778).

Bowers said it was his understanding that after taping the call with Bouchard, Peroff called the DEA New York office and the conversation with Bouchard was re-recorded there by "Dos Santos or somebody." (Pp. 779, 780.) Bowers said he did not know the whereabouts of the DEA re-recording which Dos Santos had played for him over the telephone (p. 780).

Bowers was not sure exactly what day it was in mid-July when Dos Santos played for him a recording of the Peroff-Bouchard conversation in which Robert Vesco was named as a conspirator. But, after checking his diary, Bowers testified that the day might well have been July 16 (p. 788).

The July 16 entry in the daily diary did spell out the fact that Bowers and Dos Santos had talked on the telephone that day. In addition, Bowers, again refreshing his memory with his diary, testified that Dos Santos told him that Peroff was troubled by the possible participation of anyone as powerful as Robert Vesco in the Bouchard heroin smuggling effort. And, Bowers said, if it were true, if Vesco were, in fact, a party to the proposed crime, Peroff had every reason to be worried. "I could understand his concern because of the power and the money that this man [Vesco] had," Bowers told Senators (p. 786).

Bowers said that Dos Santos told him that what scared Peroff about the possible Vesco role was that "there might be security problems with Vesco's reported contacts in the government, that there might be a leak and Frank would be, in the vernacular, out front on the thing." (P. 786.) Bowers did not say specifically which government the leaks might spring from-the U.S. Government, the Canadian or the Costa Rican-but Bowers could not have meant Costa Rican because he said that as of July 16, 1973 he did not know there was a Costa Rica angle to the Bouchard heroin inquiry (p. 787).