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Mr. Morales. November 666 Papa Fox, Beechcraft.
Senator Kerry. That's the same Beechcraft as before?
Mr. Morales. That's the same one. The same number as before.
Senator Kerry. Is that the same aircraft?
Mr. Morales. That I saw in my place in 1983?
Senator Kerry. Is that the same one?
Mr. Morales. The same one - the same number.
Senator Kerry. And the date of this is when?
Mr. Morales. It's 83-6-25.
Senator Kerry. And the name listed on it?
Mr. Morales. Marcos Aguado.
Senator Kerry. That plane- for the record, did you state earlier whether or not that plane was used in narcotics trafficking?
Mr. Morales. Yes, it was.
Senator Kerry. It was.
Mr. Morales. To my knowledge, though.
Senator Kerry. Excuse me one second. [Pause.] The documents thus far identified will be made a part of the record. [The information referred to appears in the appendix.]
Senator Kerry. Notwithstanding their being part of the record, we're going to hold those particular documents in committee at this point in time. They will not be released until further documentation has been established regarding them. You had a series of meetings in Costa Rica, Mr. Morales; is that correct?
Mr. Morales. Yes, I did, Senator.
Senator Kerry. In 1984?
Mr. Morales. Yes, I did.
Senator Kerry. Were those meetings also with the same group of people you have described thus far?
Mr. Morales. Yes.
Senator Kerry. They wee with Popo Chammoro, Marco Aguado.
Mr. Morales. Commandante Tito.
Senator Kerry. OK. Who else?
Mr. Morales. Carol Prado, and -
Senator Kerry. Would you describe who Commandante Tito was?
Mr. Morales. Commandante Tito is, he was the second one in command in the field, field command, after Eden Pastora.
Senator Kerry. And you met with him in Costa Rica?
Mr. Morales. Yes, I did.
Senator Kerry. What was the substance of those discussions?
Mr. Morales. I was looking for - can you hold on for one second, please? [Pause.] My discussions with Commandante Tito -
Senator Kerry. Now if I could ask you to wait for one second. [Pause.] Excuse me, Mr. Morales. Please proceed.
Mr. Morales. My conversations with Commandante Tito arrive from a series of threats to my life in 1984, and I did request for them to supply with some of the best soldiers to be my bodyguards.

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Senator Kerry. Did they grant that?
Mr. Morales. Say that again, please?
Senator Kerry. Did they give you them? Did you get the bodyguards?
Mr. Morales. No. They never arrived to Miami. I did not like the way they carry themselves, and I didn't think it was proper, the proper people for me at that time.
Senator Kerry. When you were in Costa Rica, did you have discussions about drug trafficking?
Mr. Morales. Yes, I did.
Senator Kerry. Who did you have those discussions with?
Mr. Morales. Mr. Chammoro, Mr. Octaviano, and the pilots, the rest of the pilots.
Senator Kerry. Now let me ask you a couple of hard questions, though maybe they're not hard. Do you know - I don't want you to guess, I don't want you to surmise, I don't want you to sort of have an opinion - but do you know personally whether or not other narcotics suppliers were also assisting the Contras.
Mr. Morales. Yes, I know.
Senator Kerry. You know that?
Mr. Morales. Yes, they did.
Senator Kerry. Were they?
Mr. Morales. Yes.
Senator Kerry. How do you know that?
Mr. Morales. Because I have many conversations with them about the same situation. Some of my friends -
Senator Kerry. These are people you know to be in the business?
Mr. Morales. Yes.
Senator Kerry. How much money did you personally direct toward - strike that. How much - can you estimate the amount of narcotics in dollars that you shipped back as part of this scheme for transfer of weapons down there?
Mr. Morales. How much was the money?
Senator Kerry. How much money in narcotics value was brought back in as part of this linkage in 1984 and 1985? What was the street value of the drugs that came in?
Mr. Morales. Many, many, many millions of dollars. Many millions of dollars. Many.
Senator Kerry. Can you give us an estimate of the kilos of cocaine?
Mr. Morales. In 1984, the kilos of cocaine in July were going around $32,000, $34,000, $35,000 a kilo. That is $35 million right there, in July.
Senator Kerry. It's $35 million?
Mr. Morales. In July.
Senator Kerry. In July.
Mr. Morales. July, yes. And after those two trips, we did six more that every one of them brought to the Bahamas 2,500 pounds of marijuana. Six-or eight-I do not remember exactly - to which the pilot was, like I testified before, as a copilot, the rest of them, he was a pilot. Those,

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let's put it at six trips, involved 2,500 pounds of marijuana. That's 9,000 pounds of marijuana.
Senator Kerry. What is the period of time for the 9,000 pounds of marijuana?
Mr. Morales. From July to October.
Senator Kerry. July to October.
Mr. Morales. Maybe, maybe - not October, because right in November was when I had to be ready for the water champion in 1984, and it was the same time when I took -
Senator Kerry. OK. You were still boat racing during all of this?
Mr. Morales. Oh, all the time, yes.
Senator Kerry. All the time.
Mr. Morales. Yes.
Senator Kerry. Even after you were indicted?
Mr. Morales. The second time I did it at their request.
Senator Kerry. No, no. You were still racing your boats even after you were indicted?
Mr. Morales. Yes, I did.
Senator Kerry. Up until the time you went to jail?
Mr. Morales. Yes, I did.
Senator Kerry. So, 9,000 pounds of marijuana until about October.
Mr. Morales. At that time, it was around $330 -
Senator Kerry. What's the value of the 9,000 pounds?
Mr. Morales. The wholesale value was $330. Retail value was around $500, in the streets.
Senator Kerry. $500?
Mr. Morales. Dollars a pound in the streets. I never went to the retail value myself. I used to give the whole load to just ---
Senator Kerry. You just wholesaled?
Mr. Morales. [continuing]. One person, and he would take care of the whole situation.
Senator Kerry. And that was it?
Mr. Morales. Yes. I sold him at around $330 a pound. That is 9,000 pounds times $330.
Senator Kerry. Did the cocaine continue to come in after October or November 1985?
Mr. Morales. Right after my meeting with them in late December 1984, yes.
Senator Kerry. No. It's 1985 now. When did it stop? When was the last shipment?
Mr. Morales. After I - before I got arrested. The last shipment was on June 8, 1986.
Senator Kerry. OK.
Mr. Morales. No. I'm sorry. January 8, 1986.
Senator Kerry. January 8, 1986.
Mr. Morales. That was the last trip with the 421 kilos of cocaine. Sorry - 413 kilos of cocaine.
Senator Kerry. Where did that trip come from? Where did it originate? Did that take weapons down?
Mr. Morales. Costa Rica. Costa Rica.

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Senator Kerry. Did the flight come from Florida?
Mr. Morales. Florida.
Senator Kerry. Did it take weapons?
Mr. Morales. No weapons down.
Senator Kerry. Just narcotics?
Mr. Morales. Narcotics coming back.
Senator Kerry. Were the narcotics that came back, did those narcotics, was that a separate pickup? Did you get them through the same people in Costa Rica?
Mr. Morales. Every one of my deals ---
Senator Kerry. I'm sorry. I didn't understand.
Mr. Morales. Excuse me. Every one of the dealings that I have through Costa Rica, every one of them had to do with the Contras. I never did any on my own, or somebody else. I didn't need, I didn't have the need to go to Costa Rica.
Senator Kerry. Did anybody explain to you why the Contras were turning to drugs or using drugs? I man, did you ask for an explanation, or did you care?
Mr. Morales. It was, yes, we had several meetings about that. It was the lack of help from the United States to them, in part. They were struggling for money, for supplies.
Senator Kerry. Now I want to come back to one other question. What happened to the law enforcement efforts down there that you were able to just fly this stuff in and out of the airports with impunity?
Mr. Morales. Everybody was about. We took care of everybody over there, in the airport, in the ranch.
Senator Kerry. In Miami?
Mr. Morales. No, no. I'm talking about south.
Senator Kerry. In Costa Rica?
Mr. Morales. Yes.
Senator Kerry. What about Miami? How do you just fly in and out of Miami with guns? Didn't anybody ever ask about an arms export control act, or say "What are you doing taking weapons out, or are those guns?" Did anybody ever walk up and say "What's that shipment?"
Mr. Morales. Never. We never had that fear, either. It was never in our minds that someone, something like that will happen.
Senator Kerry. Were there Customs at each of those airports?
Mr. Morales. Yes, at every one of them.
Senator Kerry. Were there any arrangements with any of the Customs officials at any of those airports?
Mr. Morales. No. Not to my knowledge.
Senator Kerry. None to your knowledge.
Mr. Morales. The guns, I was told, I was told by Marcos Aguado that he was the one who was going to take care of that situation. He told me do not worry. "We have officials around the plane." Those were his exact words. We have, I am going to be, we have officials around the plane.
Senator Kerry. Now, when the drugs flew back in, did they come in in daytime or nighttime?
Mr. Morales. They come in in {sic} nighttime. A few of them in daylight. But a few of them.

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In the United States, they came twice at night. The rest of them came daytime.
Senator Kerry. Now here you are. You have been indicted before. You have a known reputation in the region as a narcotics trafficker. You are leading a pretty flashy lifestyle. You have helicopters, planes at your disposal, you are racing fast boats, with a lot of money moving around. And you're telling us that at this airport, with all of this knowledge about you, you were still able to move around without any fear?
Mr. Morales. I was very, very surprised myself. [Laughter.] But, in fact, in fact that was what happened, Senator. It happened that way. That is the fact. And not only one time. Many times. Many times.
I remember one time, as a matter of fact, when the agents asked one of the mechanics who used to work in my plane like this, did Morales airplane left already? That's exactly what he told me. I don't know if it does. You can tell if it's true or not, but I remember that particular time.
Senator Kerry. What were the circumstances of your finally being arrested in June 1986?
Mr. Morales. How that happened?
Senator Kerry. [Nods affirmatively.]
Mr. Morales. They just went to my house and arrest me in my house. There was a helicopter. [Pause.] That was June - the last shipment, coke.
Senator Kerry. The last shipment?
Mr. Morales. It's 413 kilos of cocaine from south, sorry, from Costa Rica to the Bahamas.
Senator Kerry. Why didn't you get away with that one, since you had done it with such impunity up until then?
Mr. Morales. At that time, Mr. Gerardo Duran and the other pilot were busy doing some other activities in Costa Rica. Therefore, they asked me to look for a pilot, which I did. I talked to my accountant and I told him to find a pilot. We did and we failed. That was the DEA informer, the DEA guy.
Senator Kerry. So, you found a DEA informer as a pilot?
Mr. Morales. Yes. He was the one who flew the plane back to the Bahamas, and he was the one who told the BIA, I mean, the Customs, citations, planes, helicopters, the Bahamas, and Operation BAT-B-a-t- about the plane that was coming from Costa Rica to the Bahamas.
Senator Kerry. OK. I'm going to let counsel proceed here with a few questions while I just review some things here to make sure I have covered all my areas. Then we will see where to go.
Mr. Blum. Mr. Morales, I'd like to return to a flight that was made in December, as I understand it, 1984. You met in Costa Rica at a hotel; is that correct?
Mr. Morales. The flight took off from Costa Rica on December 26 or 27.
Mr. Blum. Where did that flight leave from?
Mr. Morales. It took off from Tamarindo Airport.
Mr. Blum. And where did that flight go to?

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Mr. Morales. It was going to go to Great Harbor. But the flight never occurred, never went through. The pilot was flying at that time. He flew over Nicaragua, and had some problems with the air force of Nicaragua, and had to come back to this particular airport and unload the drugs.
Senator Kerry. Mr. Morales, what I'm going to do is recess for about 45 minutes now, to give you a chance to have a break and get a little lunch.
Mr. Morales. Can I mention ---
Senator Kerry. Let me just say that we're going to come back at 2 into some period of continued open session before going into executive session. There is some information about how you got frequencies, how you know what the Coast Guard was doing, and other things that I want to pursue with you, as well as a couple of other areas.
Mr. Yavitz. We'd like to correct the record.
Senator Kerry. So, if I could ask people to remain seated while the marshals escort the witness out, then we will be back here at 2 o'clock in open session.
Mr. Yavitz. Excuse me one moment.
Senator Kerry. Yes.
Mr. Yavitz. The flight that he was talking about was December 1985, rather than 1984.
Mr. Blum. We'll straighten that out when we get back after lunch.
Senator Kerry. Right. I understand that. We stand recessed until 2 o'clock.
[Whereupon, at 1:15 p.m., the committee was recessed, to reconvene at 2:15 p.m., the same day.]

AFTERNOON SESSION

The subcommittee met at 2:15 p.m. in room SD-419, Dirksen Senate Office Building, Hon. John Kerry (chairman of the subcommittee) presiding.
Present: Senator Kerry.
Also present: Jack Blum, subcommittee staff.
Also present: Sheldon Yavitz, Esq., Miami, FL, counsel to Jorge Morales.
Senator Kerry. The hearing will come back to order.
We will proceed, as I said before the break, with a completion of some of the testimony in open session, and then we will go into closed session to pursue some of the issues that came up earlier. Let me just come back to one or two areas quickly, and then I want counsel to pursue the area that he was beginning to pursue before the break, and then I will come back at the end.
Just quickly, Mr. Morales, isn't it a fact that you during 1984 and 1985, you continued to give money to the Contra figures you've identified because you personally believed that your case was going to be assisted by doing that? Is that accurate?
Mr. Morales. Yes, it is.
Senator Kerry. How did you come to believe that your case pending before the Federal court could be affected by these actions?

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Mr. Morales. Because it is a fact that eventually, after I started doing business, if you want to call it that-
Senator Kerry. Again, let me ask you to speak close to the microphone and speak slowly and clearly.
Mr. Morales. Because right after the fact that I had the meeting with these gentlemen, it was a fact that I see my case going away. I used to know in advance what was going to be happening in court.
Senator Kerry. In court?
Mr. Morales. Yes. They used to tell me about it.
Senator Kerry. How would you know in advance what would happen?
Mr. Morales. They used to tell me about it.
Senator Kerry. Who would tell you?
Mr. Morales. Octaviano. Yes, Octaviano.
Senator kerry. He would tell you what was going to happen to your case?
Mr. Morales. Yes.
Senator Kerry. Did the things he tell you in fact happen?
Mr. Morales. Every one of them.
Senator Kerry. Specifically what?
Mr. Morales. That they were going to postpone the case, that many times that I have a meeting with him we specifically sit down and talk about the case, and one time he told me, toward the end of 1985 - 1984, I'm sorry, that he was going to talk directly with the Washington people. He mentioned a few names. He came back and had a meeting with me and we have the meeting again in which he assured me that it was going to be no problem whatsoever.
Senator Kerry. When you say he mentioned names, without mentioning the
names, did he mention the names of people in law enforcement or in politics?
Mr. Morales. Politics.
Senator Kerry. Elected officials?
Mr. Morales. Yes.
Senator Kerry. OK.
Mr. Morales. And also in law enforcement.
Senator Kerry. Also what?
Mr. Morales. Law enforcement.
Senator Kerry. Now, during 1984 when you were helping to ship weapons to
Costa Rica, were you aware at that time of other supply efforts to the Contras?
Mr. Morales. Some of them, yes.
Senator Kerry. Which ones?
Mr. Morales. Some of the people in the business were helping the Contras.
Senator Kerry. Like who?
Mr. Morales. Helping the same group of people, the same group of contra leaders in Costa Rica.
Senator Kerry. But who were the people that were helping them?
Mr. Morales. Senator, I believe we've already been through the same question and we were supposed to have that in closed session, as is customary.

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Senator Kerry. OK, so that falls in that group of names that you want to talk about.
Mr. Morales. Yes.
Senator Kerry. During that period of time, were you aware of Southern Air Transport?
Mr. Morales. No, sir.
Senator Kerry. You never had any contact with Southern Air Transport?
Mr. Morales. None whatsoever.
Senator Kerry. Were you ever asked to aid in any of the resupply efforts other than the weapons, any of the flights that resupplied Contras over Nicaragua itself?
Mr. Morales. Besides the ones I did myself, the ones I did?
Senator Kerry. Well, did you fly flights over Nicaragua?
Mr. Morales. No.
Senator Kerry. So, besides the flights that you flew weapons, did you ever fly any other supply missions?
Mr. Morales. No.
Senator Kerry. Were you aware of other supply missions?
Mr. Morales. Yes.
Senator Kerry. And how were you aware of them?
Mr. Morales. Through them. They disclosed many times about the situation and other groups of people helping them out in the same effort.
Senator Kerry. Did they ever mention the name of General Secord?
Mr. Morales. Not to my recollection.
Senator Kerry. Or of Oliver North or any of the other individuals?
Mr. Morales. No.
Senator Kerry. What abut Rob Owen?
Mr. Morales. Yes.
Senator Kerry. They mentioned the name of Rob Owen?
Mr. Morales. Yes, they did.
Senator Kerry. Who mentioned the name? What were the circumstances of that?
Mr. Morales. What he was in charge of, to help square away the situation between the Government of the United States, the Embassy, and the Contras in Costa Rica.
Senator Kerry. When was that? Let's be more precise here.
Mr. Morales. 1984, late 1984.
Senator Kerry. Was this in one of the meetings with the leaders with Chammoro and ---
Mr. Morales. Yes, with Chammoro.
Senator Kerry. And how did his name come up?
Mr. Morales. I really do not recall, Senator.
Senator Kerry. But you recall his name being raised?
Mr. Morales. Yes, I do recall it. He was talking this particular thing.
Senator Kerry. Did you ever meet him?
Mr. Morales. Not that I know of.
Senator Kerry. Did you ever have any dealings with him?

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Mr. Morales. No. And I have seen him in so many meetings that I have with so many American people in Costa Rica, so I do not recall specifically talking to him, no.
Senator Kerry. Did any of your pilots additionally fly for other people besides you, or were they exclusively flying missions for you?
Mr. Morales. No, they did fly for some other people.
Senator Kerry. They did. Did they also fly for themselves?
Mr. Morales. Yes, they did, some of them they did. Some of them not.
Senator Kerry. Now, when you flew-strike that. Did you know how to evade the surveillance of the Coast Guard and others, Drug Enforcement, et cetera?
Mr. Morales. Yes, we did.
Senator Kerry. Can you describe that to us? What were the measures that you had to take to avoid detection, and how did you know about them.
Mr. Morales. It was not that much measures to avoid the surveillance.
Senator Kerry. Say that again?
Mr. Morales. It was not that much to do about it. It was very easy for us to do it.
Senator Kerry. Why was it easy?
Mr. Morales. Because we knew the frequency. We knew how to get in and out. As a matter of fact, that was the main point, to get in.
Senator Kerry. In where?
Mr. Morales. In United States.
Senator Kerry. How would you get into the United States?
Mr. Morales. By boat, by plane.
Senator Kerry. But did you have - wasn't the Coast Guard patrolling?
Mr. Morales. Yes.
Senator Kerry. How did you avoid the Coast Guard patrol?
Mr. Morales. We had frequencies on every one of them locally, agencies.
Senator Kerry. You had every one of the frequencies?
Mr. Morales. Every one of them.
Senator Kerry. Did you have similar radio equipment?
Mr. Morales. Yes, we did.
Senator Kerry. And how did you get those radio frequencies?
Mr. Morales. You just can buy them in a store. You can buy them in any store, any radio store.
Senator Kerry. You can buy the radio?
Mr. Morales. In any radio store, like Radio Shack.
Senator Kerry. How did you know what frequency to tune the radio into?
Mr. Morales. I was given by some of the Contras, I was given by some of the Cuban people, and also through a foreign country, which pretty soon we're going to go to that one in closed session.
Senator Kerry. Now let's divide this up carefully and precisely. You say some of the frequencies were given to you by Cuban people?
Mr. Morales. Yes.

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Senator Kerry. Coast Guard frequencies were given to you by the Cubans?
Mr. Morales. Coast Guard, Secret Service, DEA, police, Immigration, Customs.
Senator Kerry. All by the Cubans?
Mr. Morales. Yes.
Senator Kerry. What frequencies did the Contras give you?
Mr. Morales. Some of the Customs and local police in Miami.
Senator Kerry. Did you have special frequencies in the countries you landed in.
Mr. Morales. Yes, we did.
Senator Kerry. Who arranged for you to have those frequencies?
Mr. Morales. I did.
Senator Kerry. How did you get them?
Mr. Morales. I have a code. It's in the radio. You just put the code.
Senator Kerry. How did you get the code?
Mr. Morales. You just put it in the radio, and previously to flying you arrange that.
Senator Kerry. Who gave it to you, the code?
Mr. Morales. I did.
Senator Kerry. But you can't make up a code if somebody else doesn't understand what it means.
Mr. Morales. Oh yes. You can put it in the radio. It's like a transponder.
Senator Kerry. Transponder?
Mr. Morales. You can put the numbers 113 or 103 or 133, and that's all.
Senator Kerry. But did somebody in Costa Rica tell you, these numbers will work?
Mr. Morales. I had them and I gave them to Popo and to Geraldo. They used to do the arrangements.
Senator Kerry. What other countries besides Costa Rica and the Bahamas did you fly into?
Mr. Morales. With drugs. With and without it.
Senator Kerry. To get drugs.
Mr. Morales. Colombia.
Senator Kerry. And any others?
Mr. Morales. Haiti.
Senator Kerry. Any others?
Mr. Morales. No.
Senator Kerry. So, the Bahamas, Haiti, Colombia?
Mr. Morales. And Costa Rica
Senator Kerry. And Costa Rica. Now, did you also have a special frequency that you - did you communicate by special telephone with the leaders? Did you have some special means of communication?
Mr. Morales. Yes.
Senator Kerry. Or was it just by regular telephone?
Mr. Morales. Yes, I did, I had a special frequency, Cinco Sarban 153.
Senator Kerry. Where was this based?
Mr. Morales. It was based in the north. They have a few bases. They have one in the north and south of Costa Rica, and they have

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one in the main house, in the main safety house, also in San Juan, Costa Rica.
They had a few of them inside Nicaragua. I remember talking to Mr. Chammoro from inside Nicaragua or the border, the river. Sometimes the communications was bad; we'd have to use the phone.
Senator Kerry. Were these telephone communications you made when you were in Costa Rica or in the air or in Miami?
Mr. Morales. I was in my office, in my home.
Senator Kerry. In Miami?
Mr. Morales. Yes.
Senator Kerry. Did you have a special antenna in your office?
Mr. Morales. Yes, I did.
Senator Kerry. And a special radio system?
Mr. Morales. Yes, I did, the same equipment that I have in the planes, too.
Senator Kerry. All right. Let me let counsel proceed here for a while and we will come back.
Mr. Blum. Before we broke for lunch, I was beginning to ask you about a trip in 1984, December 1984, from Costa Rica to Great Harbor in the Bahamas. I would like to go back to the origins of that trip. You said you had a meeting in Costa Rica in a hotel; is that correct?
Mr. Morales. Yes, I did. That was late 1984; December 20.
Mr. Blum. And who was present in that meeting of December 1984?
Mr. Morales. I had several meetings. There was Popo---
Mr. Blum. Popo Chammoro?
Mr. Morales. Popo Chammoro. There was Mr. Octaviano Cesar, Commandante Tito, Carlo Prado.
Mr. Blum. Carlo Prado.
Mr. Morales. And about probably six or eight pilots, Costa Rican pilots.
Mr. Blum. Were drugs discussed at those meetings?
Mr. Morales. Yes, we did.
Mr. Blum. And what was the discussion? Was it that drugs were going to be brought back into the United States?
Mr. Morales. Yes.
Mr. Blum. Who was to supply those drugs?
Mr. Morales. I do not have no idea, other than the Contras.
Mr. Blum. In other words, the group - from that group, there would be drugs given to you?
Mr. Morales. Yes. I would make one point in that situation. I had never used Costa Rica for fuel stop. Every one of the trips that I went to Costa Rica with the Contras, they were supplying the drugs. I was never supplying the drugs. I didn't need to go all the way to Costa Rica, because I had my suppliers directly from Colombia.
Mr. Blum. So, they told you that there were drugs, those drugs were drugs they wanted to get into the United States. Was there one specific person in the group who talked about it?
Mr. Morales. No
Mr. Blum. It was a general conversation?

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Mr. Morales. General conversation.
Mr. Blum. How much cocaine did then get delivered to you to put on the plane?
Mr. Morales. That day, 320 kilos. There were two trips. There was some confusion over there. It was 161 in one trip and 320 in another trip.
Mr. Blum. All right. Now, what was the first trip?
Mr. Morales. It was 160 kilos.
Mr. Blum. And that trip started from what airport?
Mr. Morales. It started from Costa Rica to Great Harbor, the Bahamas.
Mr. Blum. And did it get to Great Harbor?
Mr. Morales. Yes. That was in the beginning of 1985, the very beginning.
Mr. Blum. What was the plane that was used; do you recall?
Mr. Morales. Yes, it was a Titan.
Mr. Blum. And do you know who the pilot was?
Mr. Morales. It was Mr. Geraldo Duran.
Mr. Blum. And what happened to the drugs after the plane was unloaded at Great Harbort?
Mr. Morales. I took the drugs and I was there, and I sent them to Miami, actually sent it to Miami. I was aware - I was present at the time when the plane landed. I took the precautions that needed to be done. I flew back to Miami, and later on I received the drugs in Miami.
Mr. Blum. You then took possession of the drugs in Miami?
Mr. Morales. Not myself, the people who used to work for me.
Mr. Blum. Your organization.
Mr. Morales. Yes.
Mr. Blum. Your organization sold those drugs?
Mr. Morales. Yes, we did.
Mr. Blum. And what happened to the money which was the proceeds of this sale?
Mr. Morales. We sent the money to the Contras.
Mr. Blum. And who took that money for the Contras?
Mr. Morales. Different pilots. Francesco Ugalde. We used to call him General Franco.
Mr. Blum. And that was taken in the form of cash out of the United States on later flights?
Mr. Morales. Cash, and some other money was taken by Geraldo through the international airport.
Mr. Blum. Let me go to the second flight from Costa Rica. Again, was that a flight to Great Harbor, December 1984? You said 200 some kilos?
Mr. Morales. No, it was early 1985.
Mr. Blum. That was early 1985.
Mr. Morales. The plane, the 666, crashed, I believe, I understand.
Mr. Blum. That crashed?
Mr. Morales. I understand that.
Mr. Blum. All right. Was there ever another flight from Costa Rica to Great Harbor involving cocaine?
Mr. Morales. December 1985 and January 1985-1986, I'm sorry.

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Mr. Blum. OK. Apart from 1986, then, there were a total of two flights with cocaine?
Mr. Morales. More than two. There were two in July, July or August. It was 1984. There was one in December - no, I am sorry.
Mr. Blum. We just talked about 100 kilos of cocaine.
Mr. Morales. No, 160.
Mr. Blum. 160.
Mr. Morales. 161, to be exact. 161, 163. I'm not - that was in the earlier 1985.
Mr. Blum. Earlier 1985?
Mr. Morales. Yes, very early. After that, we did in 1985 another flight, December 27, from Costa Rica to Great Harbor.
Mr. Blum. And how much was on that flight?
Mr. Morales. We didn't fly - we didn't make a flight to Otonorundo Airport to Great Harbor. There were 421 kilos.
Mr. Blum. And what happened to that flight?
Mr. Morales. The pilot for some reason flew over Nicaragua and had some problems with the air force in Nicaragua. Therefore, he had to come back to the same field. After that, that was when I told my man to get a new pilot, and ---
Mr. Blum. That's when you had a pilot who was a DEA informant?
Mr. Morales. That's right, and he picked up 415 kilos. There were eight missing in the runway because when the plane came back it took a little time for the people to get it all squared away, to recuperate the merchandise.
Mr. Blum. Now I would like to go back to the question of your knowledge and meeting with John Hull and your awareness with John Hull. When did you first hear about John Hull?
Mr. Morales. Early in 1980, 1981.
Mr. Blum. What did you hear about him and who did you hear it from?
Mr. Morales. I hear it from Colombian friends, which the situation is that they like to go between different areas, rather than to go from Colombia directly to the Bahamas. So, they look for places to stash the merchandise, points for fuel stops. And that's when I became aware of Mr. John Hull. That was by 1981.
Mr. Blum. So, you heard of him from associates in Colombia, that his ranch was a facility for refueling and storing drugs, refueling drug flights; is that correct?
Mr. Morales. It is very well known, that fact.
Mr. Blum. Now, when did you first see him? You mentioned the office, your office.
Mr. Morales. That was in July, June 1983.
Mr. Blum. And what was he doing there, again?
Mr. Morales. He was with Mr. Gustavo Velez, a Colombian friend of mine.
Mr. Blum. What was the purpose?
Mr. Morales. The purpose was to deliver to Salvador - it was a discussion to Salvador, Costa Rica. We had 48 grenade launchers. I

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put 40 in the plane and the plane took off toward Salvador with grenade launchers in some boxes.
Mr. Blum. In other words, he wanted to ship 40 grenade launchers from Opalaca to El Salvador?
Mr. Morales. I did.
Mr. Blum. And your cargo airline - you were also in the air charter business - flew those grenade launchers for him; is that correct?
Mr. Morales. Yes, we did.
Mr. Blum. And you didn't personally meet him, but you knew that that shipment occurred?
Mr. Morales. I saw him right in the lobby of my office. I did not introduce - I was not introduced to him formally. I didn't want to. The purpose of him being here was to be introduced to me. I did not want whatsoever to talk to him.
Mr. Blum. To your knowledge, was there an export license for the grenade launchers?
Mr. Morales. No, there was not.
Mr. Blum. Do you know where the grenade launchers came from?
Mr. Morales. I do not recall if we bought them or if it was given by Gustavo. I recall having the grenade launchers in a warehouse that I used to have on 135th Street and 17th Avenue, Miami.
Mr. Blum. These were grenade launchers that came out of your supply?
Mr. Morales. I do not recall if we bought them or Gustavo supplied them. I do recall that we had the grenade launchers in my warehouse.
Mr. Blum. And when did you next see John Hull?
Mr. Morales. 1984, December.
Mr. Blum. And where was that?
Mr. Morales. In Carlare Hotel, Costa Rica.
Mr. Blum. Did you actually meet him on that occasion?
Mr. Morales. No. I saw him right in the bar on the pool.
Mr. Blum. You were sitting with your group of people talking?
Mr. Morales. He was right there.
Mr. Blum. He was sitting at the same bar, but you never in fact met him?
Mr. Morales. Right, in the same bar.
Mr. Blum. Your pilots did report to you, however, that they flew to his ranch; is that correct?
Mr. Morales. Yes, many times.
Mr. Blum. And refueled there and returned back to the United States?
Mr. Morales. They did.
Senator Kerry. At this point in time, we are going to recess long enough to let me get to the floor and vote and return. We will stand in recess until I get back.
[Recess.]
Senator Kerry. We will reconvene. The hearing will come back to order. We intend to proceed a little further here. Let me just take a moment, if I can, for you people to give you a sense of where we're going here.

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I would obviously like to be able to proceed with a series of hearings as rapidly as possible. But we have some limitations in staff and ability to be able to pursue all the leads that we have as rapidly as we would like. But we do intend to hold further hearings.
Earlier this morning, Senator McConnell alluded to some hearings potentially next week. As some of you know, we had an individual testify in closed session a little over a week ago. It may or may not be possible to have that session open to the public.
It is my hope certainly to be able to do so as fast as possible; in addition, to be able to have additional witnesses, no matter what they may or may not have to say.
But I want to emphasize that these hearings are obviously incomplete, and there is no pretention on the part of the chairman or, I think, any member of this committee to insinuate or to leave a perception in anybody's mind that one story is somehow fait accompli as to the entire picture. It is not.
There is much yet to be discovered, much to be corroborated, much work to be done.
But I also want to point out to the members of the press and observers that this is not the first witness who has made very serious allegations, which follow a pattern of how a fervor to put into place supply lines to the Contras and how a fervor to keep them alive at any cost may have opened up channels for abuse of other sorts.
I emphasize at this point that there is no evidence that some high-ranking official in the administration or elsewhere approved of that. But that's not the issue. No allegation has ever been made that someone specifically approved.
But if a particular policy results in actions being taken the derivatives of which are a significant flow of narcotics into this country, we obviously ought to be deeply concerned about that.
And whether it was the aberrations of a few or whether it was a systematic process of the many that came about as a consequence of clandestine operations that permitted easy access in and out of the country, egress and access, we obviously have to be concerned about the results of that, and I am concerned about it.
And if it has facilitated the flow of drugs into the streets of the United States, into our communities, affected our kids and adults and others in this country with further addiction and other problems, it is clearly something to be deeply concerned about, whether it is an aberration, a derivative or a systemic process.
That is why this committee is so concerned about it and shy we're pursuing it.
There's another reason we're deeply concerned. We went through a battle over certification for the Bahamas as to full cooperation in antidrug trafficking efforts. Other countries clearly make decisions and policies that affect us, and we make decisions that affect them.
It seems to me that if whole economics of other countries are based on narcotics trafficking, if newspapers are bought and sold or television stations, if political campaigns are contributed to through the proceeds of narcotics trafficking, and a narcotics cartel grows to have power which can affect the outcome of those elections, as well as decisions made by existing governments, we're in trouble, all of us.

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And I think before these hearings are over we're going to see a pattern which is going to be very, very disturbing about the degree to which policies and government decisions and international affairs have in fact come to be controlled by those where are in the narcotics traffic, about the degree to which there is a subinstitutional network which is destroying the fabric of institutions which we overtly embrace, and finally the degree to which a narcodollar, a narcodollar, is beginning to become an important player in the lives of too many institutions which are supposed to be immune to it.
I hope that that will ultimately be the benefits of these hearings, that it will help us and guide us in our policy decisions regarding these matters.
Now, coming back, Mr. Morales, before we go into executive session I'd like to ask you some broader questions, if I can, about that. You have said to us that you knew of other narcotics dealers who were also assisting the Contras. Were they assisting them by supplying weapons or cash?
Mr. Morales. Weapons and cash.
Senator Kerry. And cash, both?
Mr. Morales. Both.
Senator Kerry. Over what period of time did this take place?
Mr. Morales. 1984, that I'm aware of.
Senator Kerry. And is that because that was the time when they were under the most pressure to survive?
Mr. Morales. I really cannot tell about that.
Senator Kerry. You don't know that. But that's when you became most aware of it?
Mr. Morales. Yes.
Senator Kerry. Regarding political contributions, do you ever make contributions to political campaigns?
Mr. Morales. Yes, I did.
Senator Kerry. Did you make contributions with narcotics dollars, with the profits from your ---
Mr. Morales. Yes, I did.
Senator Kerry. Did you make those through other people?
Mr. Morales. Through other people and directly.
Senator Kerry. Were they in this country and elsewhere?
Mr. Morales. They were in different countries than this.
Senator Kerry. And this country?
Mr. Morales. No, not this one.
Senator Kerry. Did you contribute to any of the local campaigns in Miami?
Mr. Morales. No.
Senator Kerry. Did you involve yourself in the presidential elections of any countries?
Mr. Morales. Yes, I did.
Senator Kerry. In which countries? [Pause.]
Mr. Yavitz. We would prefer to discuss that matter in a closed session. Even the mention - I think he is rather worried as to the mention of the country.
Mr. Morales. Rather than the people.
Senator Kerry. Well, I think that it seems to me that the mention of the name of the country does not articulate which party or

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which side or which candidate you may have participated with. But I think it's fair for us to have an indication of which presidential race and which country.
Mr. Morales. I did participate in Haiti, the Bahamas, in Costa Rica.
Senator Kerry. All right, three countries.
Mr. Morales. Yes.
Senator Kerry. All right. We will pursue in executive session the timeframes of that and which individuals and decide later whether or not we will release that. Can you tell us the sum of money, however, that you made available in each of those countries?
Mr. Morales. How much money it was?
Senator Kerry. How much money was involved in your participation in Haiti? How much money was involved.
Mr. Morales. I do not know how much in Haiti. I do not recall. I can tell roughly in the Bahamas and Costa Rica.
Senator Kerry. All right. In the Bahamas, approximately how much money was involved?
Mr. Morales. It was quite a few, because I've been following those gentlemen for many years and contributed to them a lot of money.
Senator Kerry. Approximately? In the thousands, hundred thousands?
Mr. Morales. Hundred thousand, yes, a lot more than that.
Senator Kerry. $100,000, $200,000?
Mr. Morales. No more than that.
Senator Kerry. A million?
Mr. Morales. No, I would say probably around a figure, probably $600,000 maybe.
Senator Kerry. How much?
Mr. Morales. $600,000, maybe more.
Senator Kerry. $600,000, somewhere in that vicinity. And was this money contributed specifically for election purposes, or was it contributed as part of your process of doing business there?
Mr. Morales. Both.
Senator Kerry. Both.
Mr. Morales. To buy the protective situation in that country for the narcotics, the narcotics business.
Senator Kerry. And how much money in Costa Rica?
Mr. Morales. $200,000.
Senator Kerry. We will go into greater depth with that afterward. With respect to the effort with the Contras, there came a time when you realized your case wasn't going to be affected; is that correct?
Mr. Morales. Yes, it was.
Senator Kerry. When was that?
Mr. Morales. Late 1986 - I'm sorry. Yes, 1986.
Senator Kerry. Had you already stopped doing the trafficking at that time between the Contra leaders and yourself?
Mr. Morales. Senator, let me specify that it was two times. It was late 1985 and also there was another process in 1986 as well.

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Senator Kerry. And is that when you decided to stop participating in that?
Mr. Morales. I decided to stop participating in that Contra effort in 1985, in the end. And I didn't do any more business with them in 1986, but I felt that I should draw back from that effort because it was not going to go nowhere, especially in 1986, when I was arrested and indicted again. I knew the whole thing was gone.
Senator Kerry. OK. If you could speak slowly and clearly there, so we could follow each work, that would be helpful.
Mr. Morales. Especially in 1986, when I was arrested again, so I feel that the whole situation was, sort of speaking, gone for me to try to help the Contras.
Senator Kerry. Did you personally support the Contras?
Mr. Morales. Yes, I did.
Senator Kerry. You still do?
Mr. Morales. No, not any more.
Senator Kerry. Is there a reason for that?
Mr. Morales. Well, I'm incarcerated. I don't have any more money.
Senator Kerry. No, but I mean, but if you had money you would still be willing to help?
Mr. Morales. The truth, yes.
Senator Kerry. What happens? What do you say to ---
Mr. Morales. Let me clarify that point, Senator. Not the same Contra leaders, which some of them are just trying to look for power and trying to fight in between them, who's the one that's going to get the signature on the check.
I would probably help the Contra effort, the war against communism, as well as anybody else living in a democracy in the same way that we live, not directed to the same Contra leaders or to someone which I don't believe what they do.
Senator Kerry. Now, somebody's going to come in here some time, privately or otherwise, maybe publicly, and say Jorge Morales is lying.
Mr. Morales. Senator, I suppose they are going to, but I have to remind you that I am testifying under oath, and I'm telling you the truth. And I'm wiling to go through any polygraph test whatsoever to prove that what I am saying is the truth.
Besides that, I have several other people, other persons through which I engaged this effort to support the Contras. Some of them belong to the Contras. They are willing also to tell you the way it was.
Senator Kerry. And you're going to share with us their names in closed session?
Mr. Morales. Yes, sir.
Senator Kerry. And you're willing to make available to us the documents that helped to support these statements that you've made?
Mr. Morales. Definitely, sir.
Senator Kerry. Well, Mr. Morales, I want to thank you for the public portion of your testimony, and we are going to now go into closed executive session in order to discuss some of these matters further.

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So, we will recess for about 5 minutes while we clear the room of the television and audio equipment in order to be able to do that. In fact, we are going to go into the back room here, so if we could move you into the back room we will do that.
We stand recessed until we reconvene in executive session.

[Whereupon, at 3:07 p.m., the subcommittee proceeded in executive session.]

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