the witness hereinbefore named, having been previously cautioned and sworn, or affirmed, to tell the truth, the whole truth, and nothing but the truth testified as follows:
1 drugs into the United States and using the cash generated from
2 that to perform operations which I perceived to be not put
3 before Congress in any form.
4 Q. So you had two conversations with Mr. Gregg?
5 A. Actually, I had more than that.
6 Q. Well, can you tell us about the other conversations, and
7 can you identify approximately the dates that they occurred?
8 A. Between 1984 and 1986. And Iíd be happy to furnish you
9 with copies of my telephone --
10 Q. Sure.
11 A. -- logs that -- the telephone bills that I still have.
12 Q. And you can specifically identify more than one, several
13 conversations with Mr. Gregg?
14 A. Six or eight conversation with Mr. Gregg, and theyíre all
15 on the telephone records that I have.
16 Q. Right. Well, we will return to that. Okay. Off the
17 record a minute.
19 Q. Mr. Brenneke, Iíd like to return for a moment to the
20 question of payment of money from the Gotti organization that
21 you have stated went to the CIA. And Iím not certain that it is
22 clear how you knew that the money, that the some $50,000,000,
23 did you say --
24 A. Yes.
25 Q. -- in money, how you knew that money went to the Central
1 Intelligence Agency. Could you explain again what happened to
2 the money that you took to Panama, where it was deposited, where
3 it went, and how you knew where the money went to?
4 A. Iíd be happy to. I set up, in 1969 or 1970, a number of
5 corporations in Panama City. Those corporations in turn opened
6 bank accounts. Those bank accounts were accounts that I would
7 normally use in the course of my business with the CIA to
8 transfer money into the accounts, and from there to transfer
9 them into specific accounts in Spain or, as I say, in some cases
10 other countries in Europe. The ultimate destination was
11 Switzerland, where those funds were. I knew where they went,
12 because Iím the person who went in and gave the order to the
13 banker to move them.
14 Q. And you had an arrangement with the CIA to organize those
15 banks for the CIA, to open the account?
16 A. That was what I specialized in doing. I laundered money
18 Q. How long did you -- were you engaged in the activity of
19 laundering money before you went to work for the CIA?
20 A. Never. I mean, I -- we werenít laundering money at the
21 point -- when I first was recruited, which was in Ď68, Ď69, all
22 we were doing was selling mutual fund stock offshore.
23 Q. So youíre saying that you were recruited by the CIA to
24 organized and open accounts for the CIA for the purpose of
25 laundering money?
1 A. Thatís correct.
2 Q. And how many accounts did you open for the CIA, and can you
3 identify where those accounts were opened and in which banks?
4 A. Yes, I can. They were opened in Panama. The accounts --
5 or the companies, if you wish, I will provide you with the
6 Articles of Incorporation --
7 Q. Yes.
8 A. -- as they were drafted at that time.
9 Q. We will ask you to submit those as an exhibit to your
10 testimony. And, of course, we will have to come together again
11 in order for that to be presented, those documents to be
13 And just describe for the moment, since weíre going to have
14 to come back again with these documents, the countries, the
15 names of the banks that you recall that you opened, where you
16 opened accounts for the CIA?
17 A. Panama City, Banquo DeMexico, at one point we were using a
18 Citibank correspondent down there whose name escapes me. I just
19 donít recall it. We had a man on-site who worked for us, as
20 well as worked for Ron Martin, a man named Johnny Mollina,
21 M-O-L-L-I-N-A, I believe. John was -- would spend a lot of his
22 time in Panama City there and worked in one of the banks that we
23 used. I set up an account in -- well. I set up more than one
24 account in Madrid that was used. I set up an account in
25 Brussels at Bank Lambert that was regularly used. I set up
1 accounts at Credit Suisse and --
2 Q. Is that a Swiss bank?
3 A. That is a Swiss bank. And Bank of Credit & Commerce,
4 commonly referred to as BCCI, also a Swiss bank. A bank that no
5 longer exists called Bank Hoffman. And to facilitate matters --
6 not to drag this out, to facilitate matters I set up a bank in
7 Panama City on behalf of the mutual fund company I worked for so
8 that I could ultimately control how the transfers were handled.
9 Q. And you organized a bank in Panama for the CIA?
10 A. I organized it for the company I worked for, that was -- it
11 was subsequently used by the CIA and it was used by members of
12 the organized crime families. The bank was called U.S.
13 Investment Bank. It really existed in Panama City. You could
14 actually go in and open a checking account there.
15 Q. And the money that you got from the Gotti organization that
16 you put on the airplane and returned to Panama on the next trip,
17 you personally took to a bank in Panama City?
18 A. You bet, I did.
19 Q. And you deposited that money. And can you tell us the
20 amount of those deposits, and the directions that you would give
21 to the officers at the bank, and the name of the bank, and where
22 the money would go? Just detail that for us?
23 A. All right. The money would go into -- letís take Banquo
24 DePanama, the Panamanian National Bank down there, as an
25 example. I would go in. I would meet with -- at times I would
1 meet with, for instance, Johnny Mollina. John worked for one of
2 the banks down there, I think it was City that he worked for at
3 one time. In any case, I would go in. I knew the bank officers
4 by name. Unfortunately, I donít recall all their names since
5 itís been many years ago. And I would provide them with
6 directions as to how the money was to be transferred and where
7 to transfer, that is, is it to be transferred by cashierís check
8 and courier to Madrid in a specific account there or is it to be
9 just wire transferred to Madrid as a transfer of funds from
10 IFMA, a Panamanian corporation, to IFMAís affiliate in Madrid or
11 Brussels at Bank Lambert. They needed to know that. And then I
12 would have to tell them at the other bank that money was coming
13 into that account.
14 Q. So you would notify the CIA bank, or the bank having the
15 CIA account in Spain or in Switzerland?
16 A. Yes.
17 Q. That the deposit had been made in Panama?
18 A. Correct.
19 Q. How would you notify them?
20 A. Generally by telephone. And they would be told that --
21 there were a variety of codes that were used, but the message
22 was very simple, youíre going to receive money in this account,
23 the money will probably stay in the account anywhere from 24 to
24 72 hours, at which time it will be transferred out of that
1 Q. Did you ever utilize bearer bonds for the purpose of
2 laundering money?
3 A. Sure did.
4 Q. Can you tell us how that was handled?
5 A. Sure. It was handled in two ways; when U.S. Investment
6 Bank was active in Panama it would issue bonds, no names on
7 them, which was common. Itís common in Europe, itís common in
8 Central and South America. And those bonds actually belong to
9 the individual that is carrying them; as, for instance, the
10 stock in IFMA belongs only to the person who happens to have it
11 in his hand at that moment. You lose it, you lose your money.
12 Q. And what would you do with the bearer bonds?
13 A. The bearer bonds would be taken generally by courier to --
14 in some cases to Banque DeMexico in Mexico City and transferred
15 from there or sent from there by their couriers. By 1985, late
16 1985, it was getting uncomfortable in Panama, and so some of the
17 Venezuelan banks in Caracas were used. And they would -- the
18 same procedure was followed, though; the money would be
19 deposited into an account, you would walk into the bank, for
20 example, and sit down with the Vice-President or Managing
21 Director of the bank. You were clearly a large depositor and a
22 large customer for that bank. And you just simply explained that
23 you wanted to deposit this money in this bag, and he would just
24 kindly go ahead and do so for you.
25 Q. Mr. Brenneke, under whose direction were you working in
1 order to carry out the function of depositing the money from the
2 sale of the drugs to the New York --
3 A. Bob Kerritt, an officer of the Central Intelligence Agency
4 in Washington, D.C..
5 Q. All right. Now, would you spell his name for us?
6 A. K-E-R-R-I-T-T.
7 Q. And would you talk with him regularly about his operation?
8 A. Yes, I would.
9 Q. And do your telephone logs --
10 A. Probably would not show it, because I never made the calls
11 from my home phone.
12 Q. I see. But you do recall the conversations?
13 A. I have notes of the conversations.
14 Q. You have notes of the conversations?
15 A. Yes, sir. I certainly do.
16 Q. And you can -- do you remember the dates? Will those notes
17 bear the dates?
18 A. The notes bear dates.
19 Q. We will ask you at some future, subsequent date to refresh
20 your recollection so that you can produce a memorandum of dates
21 and times and any other information concerning your
22 conversations with Mr. Kerritt?
23 A. Iíll be happy to do that. Iíll also be happy to furnish
24 you with memoranda that I sent to government agencies
25 specifically complaining about the use of drugs in this
2 Q. One further question, before I defer to my associate. You
3 mentioned a Mr. Rupp that was a co-pilot that went with you.
4 Have we identified who he is, and where he might be located?
5 A. Yeah. Harry Rupp, Heinrich Rupp is his correct name,
6 H-E-I-N-R-I-C-H, Rupp, R-U-P-P, lives in the Denver, Colorado
7 area. I think he lives in the city of Aurora, which is near
9 Q. Have you seen him subsequent to his being a co-pilot with
10 you on these operations?
11 A. Of course. Iíve been at his home frequently, and I
12 testified in his behalf when he was indicted and tried two years
13 ago, 1988.
14 Q. What was he indicted for?
15 A. Bank fraud.
16 Q. Was he acquitted?
17 A. No, he was found guilty on destroying -- well, along with
18 the president and the officers of the savings and loan, of
19 basically looting it.
20 Q. Okay.
21 A. And I testified on his behalf, saying that since that was
22 common in our line of work, what was the problem.
23 Q. All right. Let me just ask a couple of general questions
24 in order to try to reach a conclusion here. Did you ever
25 discuss your concerns with the CIA Director, the late Bill
2 A. Yes, I did on a number of occasions. And Mr. Caseyís
3 telephone logs would reflect phone calls to me, made to me in --
4 specifically in Lake Oswego, which was at that time the location
5 of my office.
6 Q. So Mr. Casey called you?
7 A. Yes, sir, he did.
8 Q. On how may occasions?
9 A. Two that I can recall specifically.
10 Q. What was the nature of the conversation with Mr. Casey?
11 A. What went wrong in Central America.
12 Q. Can you relate to us that discussion; tell us what he said
13 and what you said?
14 A. Certainly. Bill Caseyís main concern -- there were two
15 main concerns to him; one, exposure of the operations in Central
16 America; and two, why did the system breakdown. To me he
17 sounded like sort of a general or supervisor who doesnít have
18 his hands on the pulse of whatís really happening out in the
19 trenches. And by this time I had caused sufficient problems for
20 CIA and others in South and Central American that the Israelis
21 had in fact sent over a team of people to shut down the Israeli
22 involvement in anything that closely resembled the drug
23 business. I could get no assistance of any kind similar to that
24 from the United States Government, and I explained that to Mr.
25 Casey. And his first question was, why I had gone to Israel,