0000
104-10301-10001
2025 RELEASE UNDER THE PRESIDENT JOHN F. KENNEDY ASSASSINATION RECORDS ACT OF 1992
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CIA Internal Use Only
Access Controlled by DDO
HISTORICAL STAFF
CENTRAL INTELLIGENCE AGENCY
WESTERN HEMISPHERE DIVISION
1946 - 1965
DDO HP 324
by
David R. McLean
Approved:
David A. Phillips
Chief, Western Hemisphere Division
Directorate of Operations
December 1973
VOLUME I
Copy No. 1: WH
Copy No. 2: O/DDO
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Latin American officers in Panama, and also supplied
material for the US Army Intelligence School to use
in training foreign students on Communism. Nine CIA
officers lectured at a Fort Holabird course for senior
Latin American officers in 1961, capping their presenta-
tion by producing a Soviet defector who spoke on the
267/
Soviet intelligence service.
CIA maintained a station in Havana throughout
1960 but faced increasing operational difficulties--
some of CIA's own making. Probably the outstanding
flap was the capture of three TSD technicians, caught
in the act of planting a microphone in the New China
News Agency office. An analysis of this operation,
made when the technicians were released 18 months later,
showed that they had ignored many of the basic rules
of trade craft. On the other hand, the Cubans had given
268/
them only perfunctory interrogations.
3
In 1960 the Havana Station consisted of: CHECKCHECK memes
A. Noe 1], chief of station; Arthur Avignon, deputy;
about six case officers and as many secretaries. Life
was unpleasant; Castro agents shadowed American Em-
bassy personnel, monitored their telephone conversa-
tions, and tried to pump their children about what
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daddy was doing. As relations between the United
States and Cuba deteriorated the station concentrated
on support for the Cuban invasion then being planned,
and on developing stay-behind assets. Frank Belsito
and later Ralph Seehafer were designated as "stay-
behind officers" and regularly reported on a dozen
or so agents and nets, a few of which survived the
station's closing.*
The break in diplomatic relations with Cuba
was predictable, and during the fall of 1960 Embassy
dependents were moving themselves and their house-
hold effects back to the United States. Avignon
made a special trip on the Havana-Key West ferry
to take out his personal car, silverware, and a
$1,500 violin. Station files not absolutely essen-
tial were crated and shipped back to Headquarters.
Case officers were working 15-hour days, seven-day
weeks.
When the break came, the Embassy had three
days' notice that it would close on 4 January 1961.
The CIA station had just installed a new incinerator
* One stay-behind agent, AMFOX-1, was still report-
ing in 1973 but WH Division believed he had been
doubled.
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and managed to burn what files it could not ship to
Key West on the attache aircraft. When they were
not burning papers or smashing technical equipment,
case officers were caching radios or making advance
payments to agents left behind.
On 4 January station personnel met at the
Embassy, rode in convoy to the ferry, and sailed to
the States. A few, like William J. Murray, had main-
tained houses until the end and lost everything in
269/
them.*
This was the period when Fidel Castro, as yet
unrestrained by his more cautious and practical Soviet
advisors, was busily stirring up trouble in the
Western Hemisphere and popularizing the phrase
"exporting the revolution."
A typical target was
Honduras, the poorest and most primitive country in
Central America. CIA's reaction was also typical
of the "nation-building" and "institution-building"
approach to countering subversion.
When Castro began his propaganda campaign in
* Two years later Congress authorized the Department
of State to reimburse its employees the depreciated
value of furnishings left in Cuba. Payments fell
far short of replacement costs.
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of assets commencing with a close per-
sonal relationship between the station
chief and the President of Mexico, high-
level telephone taps, photographic sur-
veillance, unilateral intelligence as-
sets and a broad scale of covert action
capabilities.
Within a week of the inspector's visit
Frederick W. Cole was relieved as chief of station
in La Paz, partly because of comments made by Ambas-
sador Ben Stephansky, a former labor attache who had
not worked closely with CIA. Lyle T. Shannon, COS,
Panama City, left WH Division (perhaps coincidentally)
a few months after the Inspector General had described
him thus:
The chief of station is a GS-18 who
has served in many different posts in
the Agency. He has been in Panama for
about five years. A wide gap in human
relations exists between the chief of
station and his staff. He is coldly
aloof and is reputed to brook no dif-
ference of opinion even on questions
He is a
of operational procedures.
hard-driving administrator. His tal-
ents along this line are granted even
by the Ambassador, who bluntly dis-
credits his ability as an intelligence
officer. 275/
Although the separate Task Force W (TFW) was
not officially established until 8 March 1962, the
planning and execution of the Bay of Pigs operation
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were for all practical purposes conducted indepen-
dently of WH Division and therefore are not covered
in this history. There was an informal but under-
stood shortcut in the chain of command; basic deci-
sions were made at the DDP, DCI, or Presidential
level. Although some of the key personnel were de-
tailed from WH Division, the Cuban Headquarters unit
was in another building and no one pretended that
J. C. King was running the show.
Jacob D. Esterline, a veteran WH Division
officer who later became deputy chief of the divi-
sion, was chief of the Cuban unit during the buildup
and invasion attempt, and took his orders from the
DDP. When the Cuban unit was made officially autono-
mous as TFW and later as the Special Affairs Staff
(SAS), it was headed first by William K. Harvey and
then by Desmond FitzGerald, Bruce B. Cheever and
John L. Hart, none of whom had previous service in
WH Division. It was not until 1965 that the Cuban
unit really lost its autonomy and again came firmly
under WH Division.
Actual expenditures in FY 1961 illustrate
the disparity between Cuban operations and the
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parent WH Division.
In that year total obligations
99
for Cuban operations were $41,498,743], or almost
four times the $11,003,991] spent in the rest of
Latin America. Except for Cuba 1961 was a repre-
sentative year, and these were the obligations for
regular stations throughout the hemisphere:
Brazil
$1,498,101
Colombia
$301,389
Mexico
1,384,505
Dominican Rep.
261,148
Venezuela
922,424
Costa Rica
231,351
Argentina
802,302
El Salvador
222,037
Chile
646,768
Honduras
103,820
Panama
579,310
Nicaragua
92,088
Uruguay
521,082 Haiti
77,675
Guatemala
418,778
Paraguay
54,606
Peru
Ecuador
Bolivia
380,422 West Indies
41,864
336,367
303,210
Puerto Rico
24,377
276/
Until the nearly 1,200 prisoners taken at the
Bay of Pigs could be ransomed with shipments of phar-
maceuticals, CIA regularly supported their dependents
in the United States. In the opinion of the General
Counsel, if a dependent had sued, courts would probably
have found that Cuban Brigade members were entitled to
the benefits of the Federal Employees' Compensation
Act. Thus by mid-1962 CIA was disbursing $311,500
per month to the dependents, plus bonuses and medical
care for invaders who managed to return. These ex-
penses, however, were paid from special funds outside
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the WH Division budget.
Probably Castro's attempt to export his revo-
lution reached its peak in 1962. The first Castro-
inspired guerrilla action in Latin America occurred
in March of that year, when Indians in the interior
of Peru attacked the towns of Huampani and Satipo.
A Lima Station penetration agent identified their
leader as Cuban-trained and reported that radios and
weapons had been smuggled in from Cuba to start the
278/
attack.
At year's end the US Government planned to
assemble for the Organization of American States a
white paper on Cuban subversion in Latin America,
and in February 1963 WH Division chiefs of station
met in Panama to discuss their contributions with.
the DCI. From this meeting came a picture of Castro's
campaign of subversion.
Argentina reported that left-wing Peronists
were an attractive target for Cuba; police had cap-
tured a group of terrorists organized and directed
by John William Cooke, an ex-Peronist then in Cuba.
Bolivia knew of 217 activists trained in Cuba within
nine months and was looking forward to debriefing
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Everyone breathed easier, and the Chief, WH
Division, described the operation as "one of the
most tightly held of our Cuban activities."
Two
years later the hold was not so tight, for on 26 March
1965 the New York Times front-paged a reasonably com-
plete and accurate account of the great sugar-sabotage
operation under the headline:
PRESIDENT KENNEDY BALKED
CIA PLOT ON RUSSIAN SUGAR
Press services picked up the story.
United
Press International doffed its cap to "enterprising
U.S. agents," but added that "White House interven-
tion foiled the Central Intelligence Agency's Carib-
283/
bean melodrama." CIA, as usual, had no comment.
For across-the-board coverage of Cuba in
the early 1960's the Mexico City Station was tops.
Reporting on the Cuban Embassy, the COS said in Feb-
ruary 1963:
We intercept their mail, photograph
all the people who go in and out of the
Embassy, cover their telephones completely,
and within a few hours of the conversa-
tions have resumes of all the phone calls.
We cover their trash, and this has been
found to be useful. And included in the
usefulness was the discovery of a man who
was doublecrossing us, who we thought was
a good penetration of the Embassy.
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CIA had seven different microphones in the
Cuban Embassy, one hidden in a leg of the coffee
table in the Ambassador's office.
Like most audio
operations, this one produced a lot of chaff, but
it also yielded bits of operational information
showing connections between the Embassy and local
Communists and students. At the airport the station
was getting photographs of all travellers to Cuba,
plus about 300 photos per day of their passports
and documents.
24
[Included in the take from the Cuban Embassy
were the serial numbers of weapons bought by Commu-
nists for smuggling into Guatemala, plus the names
and positions of the sellers. Complicating the ex-
ploitation of this information was the fact that the
weapons had been sold by Mexican officials, and while
the station wanted to stop the smuggling and appre-
hend the Communist smugglers it had no desire to
upset sensitive relations with the Mexican Government
8 Two high-level officers of the Cuban Embassy,
one of them the cultural attache were recruited CIA
penetrations. The station had sent three agents into
Cuba and was getting reports from them by secret
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writing. Meanwhile it was servicing 17 accommoda-
tion addresses for Headquarters and Miami.
In spite of all this, there was little exploi-
table evidence that Cuba was using Mexico as
a base
for subversion in the rest of Latin America. Mexico
was the only Latin American nation to maintain diplo-
matic relations with Cuba in the face of an OAS reso-
lution intended to isolate the island. Anxious to
retain this bridge to the Western Hemisphere, Castro
had ordered his Embassy to do nothing which might be
284/
considered offensive by the Mexican Government.
No such restraint was applied to Venezuela,
where Castro-supported terrorism was rampant. On
2 November 1963, on a tip from a campesino, the
Servicio de Inteligencia de las Fuerzas Armadas
(SIFA) found a cache of more than three tons of
Cuban arms on a beach on the Paraguana Peninsula
in northwest Venezuela. CIA learned about it promptly
through liaison.
Jonathan G. Hanke, a Caracas case officer,
brought sample weapons to Washington, where CIA was
able to raise the serial numbers and Cuban Army in-
signia which had been ground off. Richard Helms,
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blocs in the country: Barrientos, supported by the
campesinos; General Alfredo Ovando Candia, supported
by the army; and the Communists and leftists, sup-
ported by tough mine and factory workers. To have
Barrientos elected, CIA first had to promote a
credible election by underwriting the campaigns of
both the selected winner and his token opposition
at the polls.
The real question was whether elections would
be held at all. In 18 months the La Paz Station
spent $585,000, first to persuade the armed forces
to clamp down on the leftists, then to persuade
Barrientos to run, then to convince Ovando he should
not interfere, and finally to promote enough politi-
cal opposition to make the election plausible. In
a genuine tour de force, COS Lawrence M. Sternfield
produced what OAS observers called a democratic and
honest election--and got the results from the elec-
toral tribunal four days before the election.
y P
On 7 April 1964 President Lyndon B. Johnson
presided at a White House meeting which laid down
general guidelines for CIA action against Cuba.
Others at the meeting included Secretary of State
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Dean Rusk, Secretary of Defense Robert S. McNamara,
General Maxwell Taylor of the Joint Chiefs of Staff,
Presidential Advisor McGeorge Bundy, DCI John A.
McCone, DDP Richard Helms and FitzGerald.
There was
no question about charging CIA with the following
types of activity:
1.
Collection of intelligence.
2. Covert propaganda to encourage
low-risk forms of active and passive
resistance.
3. Cooperation with other agencies
in economic denial.
4. Attempts to identify and estab-
lish contact with potential dissident
elements inside Cuba.
5. Indirect economic sabotage.
There was sharp disagreement, however, over
whether CIA should continue infiltrating sabotage
agents into Cuba. McNamara, Taylor and McCone favored
more sabotage raids, but Rusk and Bundy feared that
CIA raids might undermine the US "clean hands" pos-
ture in the OAS or give the Soviets an excuse for
delaying turnover of their surface-to-air missile
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(SAM) sites to the Cubans.
Finally Rusk recommended that CIA's raiding
assets be kept in being but not actually used--at
least until the OAS and SAM sites problems could be
.clarified. The President accepted this recommenda-
Although CIA did try to keep its sabotage
tion.
agents ready, the White House decision spelled the
end of the Agency's sabotage (though not support and
306/
intelligence-collecting) infiltrations of Cuba.
Agency-sponsored radio propaganda aimed at
Cuba reached its peak in early 1965 with an actual.
expenditure of about $1,500,000 and expansion still
planned. The semi-notional Cuban Freedom Committee
served as cover for Radio Free Cuba, which broad-
cast a total of 77 hours weekly from transmitters'
in Miami, Key West, and New Orleans.
Started in 1961, the Cuban Freedom Committee
retained a public relations firm and spent $7,000
annually to establish its cover by soliciting bona
In its first year these
fide public contributions.
totalled $5,000, but by 1965 public support had dwin-
dled to $200. One of the difficulties was that any
widespread US appeal for funds for Radio Free Cuba
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would perforce have to attack Castro, and might there-
fore be considered domestic propaganda exceeding CIA's
charter.
Outside the committee, CIA operated a trans-
mitter calling itself Radio Americas and broad-
casting from Swan Island, and bought time for anti-
Cuban broadcasts from three commercial stations.
Programming on these four stations totalled 119
hours weekly in addition to the 77 on Radio Free
307/
Cuba.
Swan Island, roughly a mile and a half long
and three-quarters of a mile wide, lies in the Carib-
bean 125 miles north of the Honduran coast. Both the
United States and Honduras claimed sovereignty over the
island in the 1960's. The US Weather Bureau had manned
a weather station there since 1949, and CIA first set
up a covert transmitter in 1954 to support its propa-
ganda against the Arbenz regime in Guatemala.*
Apart from the question of its real impact-in
Cuba and the psychological problems of a staff living
* Under a 1971 agreement the US relinquished its claim
to sovereignty but retained the right to operate a
weather station.
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in almost total isolation, the Swan Island transmitter
raised a nightmare of cover complications. Operating
as Radio Americas, it was supposedly under cover of
the Vanguard Service Corporation, an Agency proprie-
tary which offered no services, and the Gibraltar
Steamship Corporation, another proprietary which
operated no steamships. A Boston millionaire who
claimed to own the island collected rent from the
Vanguard Corporation, which could not afford to argue,
but not from the Weather Bureau, which disputed his
Vanguard contracted with Coastal Air of
claim.
Miami for one light-aircraft supply flight a week
and with the Logistics Service Corporation of Phila-
delphia, a Philco subsidiary, to maintain the island
facilities and transmitting equipment. All of this
enabled CIA to play tapes and broadcast the commen-
taries of the three Cuban announcers stationed on
the island, but it did not prevent Radio Habana
from pinpointing the transmitter and calling it a
308/
CIA propaganda mechanism.
Nevertheless in early 1965 Congressman Roman.
C. Pucinski (D-Ill.) a member of the Cuban Freedom
,
Committee executive board, was pressing CIA to saturate
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the Cuban airwaves and smuggle or airdrop transistor
radios into Cuba to expand the audience. Inside the
Agency FitzGerald politely rejected the congressional
advice but pointed out that WH Division already was
planning the University of the Air,* which would
broadcast college-level courses to divide the loyalty
309/
of Cuban students.
1
Another congressional critic was Senator
Eugene McCarthy (D-Minn.), perennial sponsor of bills
to create a CIA Watchdog Committee and author of a
January 1964 Saturday Evening Post article entitled
"The CIA Is Getting Out Of Hand." In April 1965
FitzGerald and Seymour Bolten of WH Division met
with the Senator to discuss the Christian Democratic
social and political programs of the Catholic Church
in Latin America. After this meeting McCarthy, a
devout Catholic, considerably tempered his assess-
310/
ment of the Agency.'
US relations with Cuba entered a new phase
after the Cuban missile crisis of 1962 when Agency
* This project was abandoned following press expo-
sure of CIA's relations with American universities
and student groups.
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facilities provided the Kennedy administration with
positive information on the buildup of Soviet mis-
.
sile capability on the island. This episode is docu-
mented elsewhere and is outside the scope of this
present paper.
One of FitzGerald's major successes against
Cuba was in the field of economic warfare--called
the MHVIPER program in CIA. After a hurricane
ripped through the island in 1964, Castro's econo-
mists and publicists began a campaign to persuade
free-world sugar brokers that the Cuban sugar crop
had been badly damaged and exports would be low.
The object, of course, was to drive up sugar prices
on the world market, on which Castro depended for
hard currency to finance imports.
3
At first the campaign worked and sugar prices
did skyrocket. But FitzGerald was not convinced,
and sent Natalie Scott to London to study economic
reports from the British Embassy in Havana. Partly
on the basis of her research, the US Government's
sugar-crop forecasters concluded that despite the
hurricane Cuba would harvest more sugar than ever.
FitzGerald arranged to have a Department of
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State official leak this general conclusion to the
New York Times. Sugar prices dipped, but rallied
when Castro indignantly denied the Times story.
The Department then officially announced the US Govern-
ment estimate that there would be no shortage of
As it turned out, the US estimate was
Cuban sugar.
right.
After the official announcement world sugar
prices dropped several cents per pound, and this
time they stayed down. At a time when fluctuations
of one cent a pound meant millions of dollars to
the Cuban economy, publication of the essentially
correct estimate upset Castro's attempts to manipu-
311/
late the market.
Late in the summer of 1964 the DDI told Fitz-
Gerald that the Department of State was inquiring
informally about the possibility of setting up a
CIA channel for plausibly deniable clandestine con-
tacts with Cuba. FitzGerald replied:
It seems to me that the establishment
of a continuous two-way conversation with
Fidel Castro at a time when we have noth-
ing to convey to him would be a serious
mistake.... It may be that Secretary Rusk
feels that the present establishment of
conversations with Fidel Castro should
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be considered in order to make sure that
we will have the ability to speak to him
when or if the time comes. On this score
I 
do not feel there is any reason for worry.
There are a number of ways in which we can
communicate to Fidel Castro virtually at a
moment's notice. 312/
Part of CIA's economic warfare against Cuba
involved an elaborate scheme to supply tampered pet-
roleum additives through an Agency mechanism in An-
twerp. This was planned as subtle sabotage; after
being mixed with Soviet petroleum the additives would
surely but imperceptibly incapacitate Cuban machinery.
Unfortunately, the doctored additives proved anything
but subtle and the Cubans promptly discovered they
313/
were unusable.
Also a failure was an attempt by Francis S.
Sherry and William C. Boner, Jr., of the Cuban Oper-
ations Group (WH/COG) to persuade Detroit automobile
executives to produce spare parts deliberately de-
signed to break down. Sherry and Boner went to De-
troit in early March 1965 and explained to manufac-
turing vice presidents that the defective parts
could be sent to Cuba through third-country suppliers.
But the automobile executives refused to cooperate;
they feared that their companies' reputations would
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be ruined if the doctored parts accidentally got in-
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to the wrong channels.
In the wake of the ill-fated Bay of Pigs in-
vasion of 1961 and the active years of 1962-1964,
anti-Castro operations began to diminish in 1965.
Operations continued but at a slower pace. John L.
Hart had the title of Deputy Chief, WH Division, for
Cuba (DCWHD/C), and operated a large base in Miami
with virtual autonomy. A chain of safehouses,
training sites and boat-moorages stretched through
the Florida keys to Key West. From these CIA
launched maritime operations which regularly placed
and retrieved agents from the Cuban coast, but whose
intelligence product often did not justify the
315/
effort.
Meanwhile CIA ran a dwindling number of
on-island intelligence agents, including some
handled in cooperation with the US Navy base at
Guantanamo, where hundreds of Cubans still worked
by day and returned to Castroland at night. As
the Cuban General Directorate of Intelligence (DGI)
improved and expanded under Soviet tutelage, CIA
agent networks were rolled up and even singleton
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agents dropped out of contact. Typical was Radio
Habana's 12 May 1965 announcement that "31 counter-
revolutionaries, members of a CIA espionage network"
had been arrested. Of the 14 actually named in the
broadcast, WH Division identified six who had worked
with Juan Bautista Perez Luis (AMTAUP-10), chief
gardener at the naval base and principal agent for
CIA. Although he had been debriefed in Miami in Jan-
uary, Perez' location and status were not known in
316/
May.
Probably the most successful political oper-
ation in WH Division's history was the Chilean elec-
tion of 4 September 1964 in which Eduardo Frei of
the Christian Democratic Party decisively defeated
Salvador Allende, Marxist leader of a Communist-
dominated coalition.* Drawing on covert mechanisms
established by Santiago Station years earlier, plus
new procedures and assets developed for the election,
the campaign to assure Frei's victory cost CIA about
$2,600,000. Its success kept Allende at bay until
1970, when no such intervention by CIA was authorized.
* For a full description, see "The Chilean Election
Operation of 1964, a Case History, 1961-1964."
CSHP-1.
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that FitzGerald had won the President's confidence
in several meetings. Freeman, who had been in Mexico
only a few months, apparently simmered down after his
318/
talk with the assistant secretary.
The Mexico City Station devoted a major part
of its time to running or supporting operations
against Cuba; 47 percent of its cable traffic con-
cerned Cuban operations. Mexico was the only Latin
American country maintaining diplomatic relations
with Castro and had the only direct air link to Ha-
vana. WH Division assigned top priority to recruit-
ing agents in place in Cuba, and Mexico City Station
not only ran its own operations but supported the
tentative plans of other stations.
1
The variety and volume of technical operations
created a heavy workload managing safehouses, listen-
ing posts, and vehicles. For photography alone the
station had six base houses commanding the entrances
to target embassies, two mobile photosurveillance
trucks, and three agents trained in photosurveillance
on foot. It was such projects that provided informa-
tion on the visits of Lee Harvey Oswald, President
. Kennedy's assassin, to the Cuban and Soviet Embassies
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in Mexico.
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CIA's clandestine information on Oswald, in-
cluding a photograph showing him in front of the
Soviet Embassy, was turned over to the FBI, which
promised to safeguard Agency sources and methods.
Instead, the Bureau showed the photograph to Oswald's
mother in Dallas and told her it was a CIA photo.
The mother gave the press a garbled story about the
photo, the FBI gave the press the correct story,
and eventually CIA's clandestine information became
part of the voluminous Warren Commission report on
the Kennedy assassination. In the process Mexico
City Station had to abandon its photosurveillance
base houses, which had been thoroughly blown.
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In the early 1960's WH Division built an ex-
tensive political polling mechanism around the Insti-
tute for the Comparative Study of Political Systems,
a proprietary whose project cryptonym was JMTUBA.
From 1962 to 1966 the institute conducted 20 polls
in nine Latin American countries. Their cost cannot
be computed because many of the expenses were charged
to other projects.
In FY 1965, for example, political polls in
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D