Fired WSJ Reporter Connected to Iran-Contra Arms Dealer

June 24, 2017
Submitted by: Love Knowledge
Category: Politics

The post Fired WSJ Reporter Connected to Iran-Contra Arms Dealer appeared first on WhoWhatWhy.

The Wall Street Journal recently fired Jay Solomon, its chief national security correspondent, for failure to disclose business deals with one of his sources — including selling weapons to a foreign power.

Solomon says he was in over his head and apologized, while denying that any money had changed hands or that he had consummated any arms deals with his source.

The revelations about Solomon would be remarkable enough even if he were not also the author of a book lambasting such activities, or that his source, Farhad Azima, had not been implicated in the Iran-Contra scandal 30 years ago.

This excerpt from Inside Job, by Stephen Pizzo and colleagues, describes how Azima used loans from financial institutions involved with organized crime and connections to some shady characters working withUS intelligence agencies to build an air-cargo business that survived both the Iran-Contra scandal and the trillion-dollar bankruptcy of US savings and loans institutions that followed Presidents Reagan and George H.W. Bush’s “deregulation” of the financial industry.

Whether dupe, cut-out, patsy, useful idiot, victim of a set-up, or willing accomplice to a con in which he played the mark, Solomon certainly knew who Azima was — and is. So should have his employers.

WhoWhatWhy Introduction by Doug Vaughan.

The excerpt below is from Chapter 9, “Tap-dancing to Riches”, from Inside Job: The Looting of America’s Savings and Loans by Stephen Pizzo, Mary Fricker, and Paul Muolo (McGraw Hill, 1989)

In Kansas City, back in 1980, little Indian Springs State Bank had been struggling to break out of its small shopping center location, squeezed between Wig City and Athlete’s Foot shoe store. The board of directors of the Indian Springs bank was unhappy with the bank’s lackluster performance, so they hired William Everett Lemaster, 56, away from a rural bank in Lexington, Missouri, because he had “impeccable credentials,” a former chairman of Indian Springs State Bank told an American Banker reporter.

One of Lemaster’s first moves was to hire former local attorney Anthony Russo (whose credentials were anything but impeccable), who reportedly told Lemaster he could drum up all kinds of new business for the bank.

The two men were very different: Lemaster was tall, thin, and distinguished and reminded associates of an ambassador; Russo was 10 years younger, short, fat, and talkative, and he wore an ostentatious display of jewelry. Russo was plugged into centers of power in Kansas City from his years as a prominent criminal attorney there, and Lemaster may have wanted to use those contacts to invigorate the Indian Springs bank. The kind of contacts Russo had, however, were not necessarily the best medicine for a small financial institution.According to an official of the Kansas City Crime Commission, Russo had defended organized crime figures in Kansas City, in particular the Nick Civella crime family. Russo himself had served 16 months in Fort Leavenworth federal penitentiary in 1976-77 for bribery and interstate promotion of prostitution and had voluntarily relinquished his license to practice law rather than chance disbarment.

Nevertheless, Lemaster hired him in 1981 to be vice president of Indian Springs State Bank.

Bank records showed that Lemaster’s plan to make Russo a bank officer was met with dismay by bank regulators in Kansas City, who knew about Russo’s reputation and his 16 months in prison. The Kansas City regulators passed the application along to Washington with a strong recommendation to deny approval. Inexplicably their warning was overruled by Washington and on August 19, 1981, the FDIC’s board of review authorized Russo to be an Indian Springs officer but restricted his activities to “new business development.” Russo’s job at Indian Springs was to locate new depositors from among his wide-ranging business and personal contacts, and he had plenty to offer in that capacity.

A former Indian Springs board member later told a reporter that Russo was well suited to his new job: “He could walk up to someone and say that they were to move their account to Indian Springs State Bank, and people would do it with no questions asked.”

At about the same time, Iranian-American businessman Farhad Azima, 39, was invited to be a bank director. Lemaster had met Azima when Lemaster was an “advisory director” for Global International Airways, owned by Azima and headquartered in Kansas City. Russo was also an “advisory director” for Global. Lemaster and Russo’s role as “advisory directors” was to assist Global in finding financing.

Stephen P. Pizzo, Author & Journalist. Inside Job: The Looting of America’s Savings and Loans by Stephen Pizzo, Mary Fricker, and Paul Muolo. Photo credit: stephen.pizzo.com and McGraw-Hill

In 1978 Azima had founded Global International Airways to ship cattle to Iran, he told a Kansas City Star reporter, but when the Shah of Iran was ousted in 1979, Azima had to adjust his business plan. With money borrowed from an Arabian international bank, Global International quickly became one of the nation’s largest charter airlines, with 900 employees worldwide and twenty planes, including seventeen 707s, two 727s, and one 747.

Global International Airways first came to the public’s attention in 1979 when it had an airplane stranded for three days on an airfield in Tunis, Tunisia. The pilot had been paid $93,000 in advance to make the flight, but when his payment arrived in $100 bills in a suitcase, he became suspicious. (Azima told us cash transactions are common in the international charter air freight business.) And when cargo was loaded on his plane at the Tunisian airport, he demanded to see the relief supplies he was supposed to be flying from Lebanon to Nicaraguan refugees in Costa Rica. Let me see the “lettuce,” he insisted.

The “lettuce” turned out to be twin-barreled 57-millimeter guns with several dozen cases of ammunition labeled in Chinese. Azima said Global refused to deliver the cargo once they discovered what it was. Later the Tunisian government said the Palestine Liberation Organization had been sending arms to the Sandinistas. A Global crewman told the Star of a standing joke among the crew: “They [airport personnel] would ask us what our cargo was and we’d tell them cabbages and cabbage launchers.”

Apparently to discourage nosy airport personnel, former pilots said subsequent shipments stopped masquerading as cabbages. The boxes “had Red Cross stickers all over the sides,” one of Global’s former pilots said.

Global International developed a reputation among intelligence community insiders as one of the CIA’s secret charter airlines. Former Air America pilots (2) showed up on Global’s pilot roster and logs show them flying arms and other supplies to Ecuador, Peru, Nairobi, Thailand, Haiti, and Pakistan. All the flights, Azima later claimed, had State Department approval. Although at first Azima issued (facetiously, he told us) “no comments” when asked by reporters if he had worked for the CIA, he later denied that he or any of his companies knowingly did work for the agency.

He attributed the stories of CIA involvement to his pilots’ fanciful imaginations.

It is undisputed, however, that Global did a significant amount of business with persons connected to the CIA. As part of the Camp David Accords, President Jimmy Carter promised Egypt tons of American military aid. Much of that aid was shipped by Egyptian American Transport and Services Corporation (EATSCO), a company set up in 1979 by Thomas Clines (former CIA director of training who in 1986 would become a prominent figure in the Iran-Contra scandal) and Hussein Salem — who was a former Egyptian government official and a friend of Azima.