Francesco/who-killed-jfk huggingface dataset:
[157-10014-10144.pdf — page 19]
- 15 -the corporation, if it had means of financing other than annual appro- priations, could continue to operate in the absence of any action by Congress on its budget program." The statute creating a particular Government corporation may provide specifically that the corporation may use its profits in the conduct of its business.The Government Corporations Control Act certainly did not contem- plate Government corporations in the sense that the Agency must have them. Neither is it feasible for Agency proprietaries to be created by act of Congress or overseen precisely as provided for in the normal Government corporation in the Act. Nevertheless, the Agency has felt that the appropriate and reasonable policy would be to treat and control them insofar as possible in accordance with the terms of that law.Such being the case, the Agency believes there is no need to have more restrictive rules applied to its corporations in the use of funds, including profits, than are applied to Government Corporations under the other Act or statutes. Thus, the use by a proprietary of its earnings to carry on its corporate affairs without an offset against Agency appropriations is considered a legitimate practice and does not constitute an illegal augmentation of appropriations.With rare exception, principally the large air and insurance proprietaries, operating proprietaries have not been self-sustaining from bona fide income. Such income, including profits, as is received is retained by the proprietaries consistent with the usual operating practices of business enterprises.The use of proprietaries' profits, however, is controlled, by annual reviews and audits within the Agency of the total capital.
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investment, and profits situations of the corporations in the context of the operational objectives and the cover needs of the corporations. In effect the annual project review is based upon an audit as searching as that required for statutory Government corporations.F. Disposition of Funds Returned from ProprietariesAny proprietary with funds excess to its current or foreseeable needs is required to return such funds to the Agency. Also, all funds realized from the liquidation or termination of a proprietary are returned to the Agency except in a limited number of situations when transferred to another proprietary for "similar use." On the basis of an opinion of 3 February 1975 by the CIA General Counsel, the Agency has revised its policy for the treatment of all returns of funds from proprietaries; all such returns are to be remitted to the U.S. Treasury as Miscellaneous Receipts. Prior to this change in policy, returns had been treated as refunds of the previously recorded expenses up to the amount of such expense for a particular proprietary with any excess amounts returned to the Treasury as Miscellaneous Receipts (Appendix C).G. Disposal of ProprietariesAir America, the Agency's largest proprietary, at its peak had total assets of some $50 million and more than 8,000 employees (who accounted for more than 90 percent of the people employed directly by all proprietaries). It is in the process of being liquidated because it is no longer required. The Air America complex included a number of other companies with the Pacific Corporation as the holding company. The general plan for liquidation of Air America is for the Pacific Corporation to sell off Air America, Inc. and Air Asia, Ltd. (the Taipei maintenance operation). A private New York firm (R. Dixon
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- 17 -Speas Company) was engaged to estimate a fair market value for the complex. Although an intensive search for competitive bidders was made, the Agency was unable to find buyers for any of the affiliated companies except the Taipei maintenance facility. The sale of this company as a going concern to the successful bidder was closed on 31 January 1975. The remaining parts of Air America are being liquidated by sale of individual assets upon completion of existing contracts. Funds realized from the sales could be as much as $25 million and will be returned to the Treasury.Agency financial support for Radio Liberty and Radio Free Europe, both sizeable proprietaries, was terminated in FY 1971 and responsibility for their funding and operation was assumed by the Department of State.Southern Air Transport was sold on 31 December 1973 because its contingency capability was no longer needed. The Agency realized $6,470,000 from this sale. Cash received was $3,345,000 which included a $1.2 million award in arbitration of a dispute over the proceeds of the sale of an aircraft by Southern Air Transport after the sale of the company by the Agency. The balance was paid by the purchaser to Air America to retire a debt owed by Southern Air Transport. A group of employees of Southern Air Transport filed a civil action disputing the propriety of the sale of the company by the Agency, but the case was dismissed with prejudice on 17 July 1974.A more detailed list of various disposals of smaller proprietaries and what, if any, relationships remained thereafter between the Agency and any subsequent entity appears infra page 39, Section V.
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# H. Relations with Tax, Regulatory, and Other AgenciesManagement and control of proprietaries often requires "cooperative interface" with outside agencies to gain beneficial working relationships and, as necessary, any appropriate authorizations. These relationships are described below.For those proprietaries which maintain commercial books and other financial records. U.S. and State tax returns are prepared annually by commercial managers based on the corporation's financial records. For other entities where only internal Agency records are maintained, tax returns are prepared by Agency specialists in a manner to reflect the normal operations of a bona fide commercial business. Close coordination is maintained with the Internal Revenue Service, which is aware of the Agency's use of proprietary commercial entities. In the event an Agency entity is singled out for IRS audit, it has been agreed that the Agency, through the Office of General Counsel, will notify IRS of Agency ownership. The IRS then cancels the audit in order to conserve auditor manpower.The Air proprietaries necessitated contact with the Civil Aeronautics Board, the Federal Aviation Agency and the National Transportation Safety Board. Specific problems were discussed, usually with the Office of General Counsel of the agency concerned by the CIA General Counsel.The Air Proprietaries dealt with State Department and the Agency for International Development, generally on a contractor/customer basis, although senior personnel of those agencies were advised by the Agency of its ownership of the companies.
[157-10014-10144.pdf — page 23]
- 19 -Those proprietaries which engaged in the shipment of weapons or other items on the Munitions Control list required Agency assistance in obtaining the necessary export licenses. The ownership of the companies was discussed with State Department Office of Munitions Control and the Bureau of Alcohol, Tax and Firearms.The radio proprietaries, while funded by CIA, did receive policy guidance from the Department of State to ensure that their broadcasts were in conformance with U.S. foreign policy.The Agency has intervened with the Department of Labor on behalf of survivors of employees of the proprietaries in order to assist them in receiving the available benefits under the applicable Workmen's Compensation Acts.The Agency, on behalf of the proprietaries, interceded with the Defense Department to have the proprietaries' contracts exempt from the Renegotiation Board. There was a normal exemption based on the rules of the Board which was given for contracts performed entirely outside the United States.CIA requested the Air Force to consider the interest of the Agency in connection with the awarding of commercial contracts to its proprietaries. Initially this was done in the mid-1950's on the basis of a policy decision by the Operations Coordination Board that the air proprietary in the Far East, then operating at a deficit, was an instrument of value to national security. The Agency was able to maintain a standby capability without budget subsidies if awarded enough business to support large commercial aircraft. This applied to the passenger and cargo aircraft.
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- 20 -The U.S. Forest Service was advised of the ownership of a pro-prietary and asked to award contracts to the proprietary in order tohelp it develop a commercial posture and permit its aircraft to beassociated with that type of flying.NW 50955 DocId: 32423532 Page 25
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## IV. A DESCRIPTION OF THE VARIOUS PROPRIETARIESThe operational needs of the Agency have required it to venture forth into many areas where proprietaries were a perceived necessary vehicle. These areas have included air support, media publications, proprietary management (accounting and management), insurance (personal insurance coverage, annuity coverages, and escrow account maintenance for agent personnel), covert procurement (general merchandise, arms, ammunition and police related equipment), cover support (commercial cover, such as management consultant firms, importing companies, travel agencies, energy research organizations, behavior psychology companies), personnel services (tape transcription, personnel investigations for security clearances and approvals, public accounting firms, electoral and political analysis firm keyed into foreign elections), operational support (purchase of condominiums in foreign countries, sporting goods business in United States with sales in Latin America, various overseas foundations to provide grants, export/import firms, a company which holds a note for certain U.S. Government funds borrowed by a consortium of aluminum companies for the extraction of bauxite in Guinea to insure U.S. control of bauxite extraction activities in Guinea), and various other miscellaneous categories.The number of employees of proprietaries as of October 30, 1975 was 321. Of this number 78 were U.S. Agency employees, 178 were U.S. proprietary hires, and 65 were foreign proprietary hires. The various types of funding and payrolling mechanisms used by the Agency (Devised Facilities incorporated in the U.S.; Devised Facilities-Notionals which
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- 22 -are not incorporated but are sole proprietorships; and Notionals,which are merely business names, are not formally constituted orregistered which do business at the address of an answering serviceor witting attorney) totaled 326 as of October 31, 1975. There were31 Devised Facilities, 67 Devised Facilities-Notionals, and 228Notionals.There follows a list of some of these proprietaries with briefdescriptions of their functions. There are 97 in number. Followingthat list is a description of the major headquarters-controlled proprie-taries provided as of September 24, 1975. In addition, there isincluded a listing of all proprietaries during the period 1952 through1974 (total 399) with the highest net equity balance on agency recordsand the net worth balance as of December 31, 1974. The smallest networth balance is $400 and the largest is $31,778,000.The year 1967 was selected to demonstrate the number of employeesin use by Agency proprietaries. In that year, the Agency owned approxi-mately 158 proprietaries. These proprietaries employed approximately14,416 persons. Ninety-two percent of the employees were accountedfor by three proprietary complexes as follows:JBGREED 10,218TPTONIC 1,800QRACTIVE 1,30013,318TPTONIC and QRACTIVE (Radio Free Europe and Radio Liberty) were turnedover to the Department of State and are now being managed by the Boardof International Broadcasters. The JBGREED complex (air supportcapability in the Far East) is in the process of liquidation and
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- 23 -currently has 63 employees. In addition to the proprietaries mentioned above, the Agency managed 243 funding and payrolling mechanisms which provided payrolling services for 149 employees.
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- 24 -PROPRIETARY LISTAIR SUPPORTIUBETON ComplexThe below four companies comprise an air support capabil- ity for worldwide contingency use. The complex is based in the Southeastern portion of the United States with cer- tain commercial business operations overseas.1. IUCONTROLA Florida corporation which acts as the holding company for the principal operating company in the complex (immediately below); assets consist solely of stock in the principal operating company; no employees.2. IUBERYLA Florida corporation based in South Florida; a small air service company which can be quickly expanded to meet Agency air support requirements.3. IUEPOCHA Florida corporation which operates from an airport in the Southeastern United States; a wholly owned subsidiary of IUBERYL (immediately above) which operates a fixed base aviation facility; provides an alternative air support capability.4. IUPIECESA Florida corporation based in Miami which acts as a purchas- ing agent for aviation supplies for the activities of the complex; can provide the same service for prospective Agency air support activities; is a wholly-owned subsidiary of IUBERYL (above).
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- 25 -JBGREED ComplexThe below five companies comprised an air support capability in the Far East. All entities are in process of being liquidated or sold.5. JBCRYINGA Delaware corporation with corporate offices in Washington, D.C., which acts as the holding company for JBCHOKE, JBHEEDFUL, and PROPRIETARY C (see below).6. JBCHOKE withA Delaware corporation which corporate offices in Washington, D.C., which has terminated all flying services contracts. The company will be liquidated by sale or disposal of assets.7. JBHEEDFULA Taiwan corporation with corporate offices in Taipei which ceased flying operations in 1968 but has continued to provide ticketing and other services on behalf of other affiliated companies.8. PROPRIETARY BA Hong Kong corporation located in Hong Kong which provides computerized accounting services for JBCHOKE.9. PROPRIETARY CA Thailand corporation located in Bangkok, Thailand which is the custodian for JBCHOKE files pertaining to Thai employees and contractual services in Thailand; will be dissolved when Thai law no longer requires retention of these records.FROM Single EntityNOV 6 1975CIA10. HBSANDTRAPA Delaware corporation located at Washington National Airport which has provided secure air support for Agency employees and classified pouches between Headquarters and other Agency facilities in
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26Media PublicationsThe below six companies comprise a worldwide book distribution and manuscript publishing activity.11. QRBLONDA Liberian corporation with a representative (banker) in Brussels which pays book distribution costs; funds are controlled by members of the New York corporation (PDPORTAL/300 - below) and paid through this corporation to avoid some of the problems of funding a domestic company in the total amount required to effect project operations; no employees except for the Brussels representative, who is paid on a fee basis.12. QRBLUFFA Liberian corporation which is used as attribution for Agency funding to the above two proprietaries; no employees.13. PDPORTAL/200A German non-profit organization, located in Munich, which acts as the home office of its Rome Branch and is also used as the ostensible source of all the Agency funding to other project entities; no employees; maintains a branch, PDPORTAL/500, in Rome, Italy.14. PDPORTAL/100A limited partnership located in London, England.15. POPORTAL/400A corporation located in Paris, France.16. PDPORTAL/300A New York corporation located in New York City.
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- 27 -Single Entities17. TOMOSAICA Delaware corporation based in London which provided an in- ternational news feature service; the project also supported the publication of books of propaganda value; the news feature service has been discontinued and the corporation will soon be dissolved.18. AELEDGERA French corporate entity located in Europe which publishes a foreign-language weekly periodical, which is disseminated to recipients in and out of Russia and contains articles on Soviet and Bloc matters including a large amount of material prepared covertly in the USSR by Soviet dissidents; the periodical attempts to encourage and assist activities of moderate segments of Soviet society.19. AEDYNAMICA New York corporation located in New York City which pub- lishes periodicals and selected books for infiltration into the Soviet Union and distribution to travelers and Soviets residing outside the USSR; fosters regional nationalism within the USSR; supports a private organization of regional nationalities; supports the AEDYNAMIC branch office in Munich, Germany.20. QRMYSTICA sole proprietorship located in the Washington metropolitan area owned ostensibly by an Agency employee whose journalistic services are utilized in support of foreign operations.Proprietary ManagementLPPANDA ComplexThe below three companies support a one man accounting and management company in Europe which provides services to other proprietary operations.FROMNOV 6 1975CIA
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21. LPREMEDYA one man accounting and management company located in Europe.22. LPCLOUDA dormant company at one time associated with the cover of the individual now covered by LPREMEDY.23. LPCHAIR/AA New York company with no employees which serves as a communication channel from Headquarters to LPREMEDY.Single Entities24. LPHOCUSA New York management and accounting company (three employees) which provides accounting and related financial management assistance to other proprietary organizations.25. LPSUGARA Maryland management and accounting company (three employees) which provides accounting and related services to other proprietary organizations.26. LPBERRY/BA New York legal and accounting firm (three employees) which provides legal and accounting services to other proprietary organizations.InsuranceMHMUTUAL ComplexThe below 25 proprietaries comprise a clandestine support mechanism which provides personal insurance coverages, annuity coverages, and escrow account maintenance for agent personnel in a manner to preclude attribution to the United
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States Government. The complex also underwrites insurance risks of certain proprietary organizations and administers the pension plans of these organizations. In addition, the complex has been used to provide a limited amount of support to other Agency operations specifically, the acquisition of operational real estate and as a conduit for the funding of selected foreign covert activities. Twelve full-time employees are involved in the management of the complex, with the assistance of three proprietary management firms. All expenses except for the salaries of Government employees assigned to the complex are paid from earned income. The companies involved are:27. MHANVIL/AAn attorney at law operating as a sole proprietor in Washington, D.C., he is the Agency manager of the insurance complex.28. MHGRETA Panamanian company which provides ownership for MHCROZE, an investment proprietary, (see below) and owns an apartment in Buenos Aires; no employees.29. MHCROZEA Panamanian company which serves as an investment vehicle and a primary mechanism for the management of funds, no employees.30. MHSLACKA Delaware corporation which provides payroll cover for project personnel and serves as an investment vehicle for funds; seven employees.31. MHVODKAA Bermuda company which is a reinsurance vehicle for all types of casualty and property insurance for other Agency proprietaries and directly issues death and disability, term life, annuity and other coverages for Agency non-staff.personnel; no employees.32. MHDRYADA Panamanian company which serves as owner of MHLUMEN and MHSPRAY (see below); no employees.
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33. MHLUMENA Liberian company which serves as owner of MHFETCH (see below) and as the source of an operational loan; no employees.34. MHFETCHA Bahamian company which serves as owner of MHKOALA and MHWHIFF (see below); an investment vehicle and manager of non-staff pension plan; no employees.35. MHKOALAA Liberian company currently inactive and slated for dis- solution; no employees.36. MHWHIFFA Bermuda company which is a reinsurance vehicle for all types of casualty and property insurance for Agency proprietaries and for life and annuity coverages for non-staff personnel; no employees.37. MHMOLARLiechtenstein anstalt which serves as the beneficial owner of MHBOMBE (see below); no employees.38. MHBOMBEA Bahamian company which serves as a holding company for MHTWANG and MHONSET (see below) and as an investment vehicle; no employees.39. MHONSETA Delaware corporation which serves as an investment vehicle and quarantor of a mortgage on a former Agency activity; no employees.40. MHTWANGA Cayman Island corporation which handles certain annuities, escrow, term life insurance, a pension plan and funding of MHPIQUE (see below); no employees.
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41. MHPIQUE    A Florida company which provides payroll cover for three non-staff personnel who handle the Cuban dependents program payments and correspondence; three employees.42. MHDELFT    A Swiss company which serves as a holding company for MHHAWSE (see below) and as a standby asset; no employees.43. MHHAWSE    A channel Island company that serves as a direct underwriter of term life insurance and annuity contracts for non-staff Agency personnel; no employees.44. MHSEΡΟΥ    A Panamanian company that serves as beneficial owner of MHUNDER (see below) and for direct underwriting of term life and annuities for non-staff personnel; no employees.45. MHUNDER    A Panamanian company which is slated for dissolution; no employees.46. MHALATE    A Liechtenstein company which owns property in Lusaka; no employees.47. MHJORUM    A Panamanian company which directly underwrites death and disability, term life and annuities for non-staff personnel, no employees.48. MHBLARE    A Florida company now in dissolution resulting from abandonment of Agency project; no employees.
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49. MHRUCHE    A Liechtenstein anstalt which is a general use standby    asset; no employees.50. MHCLUMP    A Liechtenstein anstalt which serves as a standby asset    for general reinsurance use; no employees.51. BGJASMINE    A European insurance and reinsurance company which issued    direct death and disability coverage to contractor personnel en-    gaged for a DDS&T project, and reinsured other risks arising out    of the project; no employees.Logistics SupportThe below three entities operated by the Office ofLogistics provide a covert procurement mechanismfor the Agency.52. KMJAGGERY    A Delaware corporation located in Washington, D.C., which    purchases general merchandise in a manner which cannot be traced    to the United States Government; total purchases from January to    September 1974 were $437,500; no outside commercial business; five    employees.53. TPLENTIC    A Delaware corporation with an address in New York which    arranges research and development and production contracts in    a manner which cannot be traced to the United States Government;    the company has no employees and is managed by Headquarters    officials in alias.