Ex-Prosecutor Linked to
Alleged Obstruction Effort
Investigators Probe Intriago's Activities on
Behalf of Banker
(http://search.washingtonpost.com/wp-srv/WPlate/
1999-09/16/214l-091699-idx.html)
By Douglas Farah
Washington Post Foreign Service
Thursday, September
16, 1999; Page A23
The publisher of a leading newsletter on money laundering
coordinated a team that obtained confidential government
information to help a wealthy Venezuelan banker who has been
described in U.S. State Department cables as a money launderer for
drug cartels, according to congressional investigators and
documents obtained by The Washington Post.
Charles Intriago, 57, a Miami lawyer and
former federal prosecutor, launched the effort on behalf of banker
Orlando Castro-Llanes, 73, who in 1997 was convicted of bank fraud
in Manhattan. He was Intriago's sole legal client, and he
bankrolled Intriago's newsletter, Money Laundering Alert, with
$80,000 in 1989.
Intriago is the well-known host of a
biennial national money-laundering conference that attracts
authorities from the Justice Department, Internal Revenue Service,
U.S. Customs Service and the FBI. Federal officials fly in at
government expense and they buy Intriago's highly respected
newsletter--$345 for 12 issues--to learn the latest on money
laundering.
Intriago, who is also a Democratic
National Committee trustee, relied on his government connections
to help in a vast effort to purge law enforcement files of
information linking Castro-Llanes to drug trafficking. Between
1991 and 1995, he hired a team of former federal officials and
investigators who obtained the identities and personal data of
confidential government informants, according to internal
documents, prosecutors' records and interviews with former
Intriago employees.
The Post obtained a copy of a chronology
that Intriago kept detailing the team's efforts. Assistant
Manhattan District Attorney John W. Moscow sent the chronology to
federal prosecutors in 1996 saying it detailed "an apparent
conspiracy to obstruct justice."
Now the House Government Reform Committee
is preparing to issue a report that supports the contention of
Manhattan prosecutors that Intriago misused his federal
connections and violated privacy and campaign finance laws,
according to a draft of the committee's report obtained by The
Post.
The committee's investigation started
with an allegation that Intriago coordinated $50,000 in illegal
campaign contributions made by two of Castro-Llanes's relatives to
the 1992 Clinton-Gore campaign. The matter was referred to the
Justice Department, but Manhattan prosecutors and the committee
contend that Justice failed to act.
Intriago, who refused to testify before
the committee during a public hearing in 1998, citing his Fifth
Amendment rights, denied in an interview making illegal campaign
contributions or committing any violations to get information for
his client.
"I engaged in an effort to clear a
well-financed, vile smear campaign against Orlando Castro-Llanes,"
Intriago, who was an aide to the late Rep. Dante B. Fascell (D-Fla.),
told The Post. "We were aggressive, but we did everything by
the book. I will go to my grave knowing Castro-Llanes is the
victim of a smear campaign."
Castro-Llanes is currently under house
arrest in Venezuela, facing bank-fraud charges. Richard Sharpstein,
his Miami attorney, said the allegations against his client were
"totally without merit."
Committee Chairman Dan Burton (R-Ind.)
said he was "very troubled" by Justice's handling of the
Intriago case because "Mr. Intriago illegally obtained
confidential law enforcement information on behalf of a client
suspected of laundering drug money."
Castro-Llanes, once one of the wealthiest
men in Latin America, unsuccessfully attempted in 1990 to buy the
prestigious Banco de Venezuela. The board of Banco de Venezuela
paid Thor Halvorssen, Venezuela's controversial government drug
czar, $1.2 million to investigate whether Castro-Llanes was using
drug money.
Halvorssen concluded that Castro-Llanes
was laundering drug money. Intriago counters that Halvorssen ran a
"smear campaign" and fed lies to U.S. officials.
Castro-Llanes's troubles in the United
States began in 1991, when a $1 million account controlled by a
Castro-Llanes bank was frozen in a U.S. Customs Service money
laundering investigation in New York.
To clear his name, Castro-Llanes turned
to Intriago, who put together a team: a retired judge, a former
federal prosecutor and a former senior CIA officer as well as
former officials from the Customs Service, the U.S. Drug
Enforcement Administration, the IRS, the Treasury Department and
the Federal Reserve. Intriago also contracted Philip Manuel
Resource Group, a Washington-based investigative firm.
The team met with federal prosecutors in
New York, who later unfroze the $1 million account. Philip Manuel
and two others met with DEA Administrator Robert Bonner in
Washington on Aug. 12, 1992, to "request cleansing of DEA
files," the Intriago chronology states. "Bonner
declines."
The team approached several different
federal agencies and eventually obtained DEA intelligence on
Castro-Llanes and the names of at least four confidential Customs
informants against Castro-Llanes, according to committee documents
and sources and former Intriago employees.
A report written by congressional
investigators for the Burton committee and obtained by The Post
alleges that Robert Van Etten, then the Customs Service's special
agent in charge in Manhattan, "sent confidential U.S. Customs
Service memorandums to Intriago on an informant" who was
jailed in Venezuela.
In a telephone interview, Van Etten
called allegation "absolutely untrue" and said, "I
never did that."
Customs sources told The Post the sealed
envelopes containing the informant names were removed from the
Customs Service safe and opened without authorization. One of the
informants was named in the Venezuelan press, prompting death
threats. One lost his job. One was arrested and beaten in Caracas.
And the last one died of natural causes.
The team obtained telephone records and
credit histories on the informants, according to Manuel's internal
documents. It also got the personal phone records of a customs
agent and the credit card records of a U.S. official stationed in
Caracas.
An internal memo that an investigator
sent to Manuel details specific prices for pulling bank records,
credit histories and telephone records. Such information is
available only through a court-issued subpoena, which was never
obtained.
Edward V. Hickey, Manuel's lawyer, said
his client had followed "standard investigative
procedure" to get the information. "That sort of
information was available through the early 1990s through
information brokers throughout the country," Hickey said.
Intriago said he did not know how or why
the records were obtained but said he would not "even
remotely acquiesce" to illegal acts or engage in any threats.
Intriago's team soon sprang a leak of its
own.
Richard Lucas, a former IRS agent working
for Manuel in Miami, audited one of Castro-Llanes's bank's New
York accounts in October 1993 in an attempt to prove that it was
clean. But Lucas concluded that most of the $4 billion passed
through the account was "suspicious transactions and
laundered money," according to a sworn affidavit Lucas gave
committee investigators.
Lucas told Manuel, who told Intriago.
Lucas and Manuel, in separate statements to the committee, said
they asked Intriago to alert law enforcement. But Intriago did
not. He told The Post he felt Lucas was "completely
wrong," mistaking routine currency transactions for money
laundering.
In December 1993, Lucas met with customs
agents in New York. When Intriago found out, he fired Manuel,
according to Lucas and Manuel.
Manuel would later state in an affidavit
that Lucas, using the name "Bob Roberts," secretly sold
internal documents on Castro-Llanes to Halvorssen for $35,000.
Lucas denies it. But Halvorssen
acknowledged paying for the documents in late 1994 and passing the
information to Robert Morganthau, Manhattan district attorney.
On April 3, 1996, Morganthau charged
Castro-Llanes, his son and grandson with defrauding depositors in
Venezuela and Puerto Rico of $55 million.
By then Castro-Llanes was living in
Miami. His banks failed when Venezuela's banking system collapsed
in 1994.
Castro-Llanes, his son and grandson were
convicted in Manhattan in 1997. Castro-Llanes served 25 months in
prison, then voluntarily returned to Venezuela, where he awaits
trial on charges of bank fraud and embezzlement.
Morganthau's prosecutors came across a
$50,000 campaign contribution to the 1992 Clinton-Gore campaign
from Castro-Llanes's grandson and another relative. Intriago had
asked the relatives, who are U.S. citizens, to make the
contributions and then Castro-Llanes reimbursed them, according to
documents obtained by prosecutors. Castro-Llanes's grandson
alleged that Intriago coordinated the scheme.
Intriago said the contributions were made
voluntarily with no promise of reimbursement.
Intriago has been a Democratic National
Committee trustee since 1992, personally giving $63,000 to the DNC
from February 1992 to December 1993. In October 1993, Intriago
arranged for Castro-Llanes to meet with President Clinton at the
White House and have a picture taken with him.
A Justice Department spokesman said the
department would not comment on why no action was taken on
Morganthau's referral because of the House committee's ongoing
investigation.
Meanwhile, Intriago's conferences
continue to attract top names in law enforcement.
In April, the group of "federal
faculty" listed for Intriago's conference at Miami's
Fontainebleau Hilton included officials from the FBI, Justice, the
Customs Service and the Office of the Comptroller of Currency.
"He runs a good conference,"
said Gerald McDowell, Justice's money-laundering chief. "All
I can say is I like the guy."
Staff writer Charles R. Babcock and
researcher Robert Thomason contributed to this report.
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