Dope inc. : Britain's opium war against the U.S

by Konstandinos Kalimtgis also by David Goldman and Jeffrey Steinberg


Part I: History
Britain's First Opium Wars
Palmerston's Fifth Column, USA
Britain's "Noble Experiment"
Part II: How the Drug Empire Works
Banking and the World's Biggest Business
From Opium to Dirty Money
How the Drug Trade is Financed
Britain's Gold and Dirty Diamond Operations
Hong Kong - The World's Drug Capital
The Peking Connection
How the Royal Institute of International Affairs Runs Drugs and Dirty Money
Canada - North America's Hong Kong
All in the Family - The Real Syndicate
Part III: Organized Crime
The Bronfman Gang
The Kennedys - Organized Crime in the Government
Britain's Assassination Bureau - Permindex
Permindex Unveiled - Resorts International Intertel
The Jacobs Family's Emprise - Sports and Crime
The Philadelphia Story
Part IV: Creating the Market - The British Origins of the Counterculture
Part V:  The Drug Lobby - The Criminals Come Out in the Open


Lyndon H. LaRouche, Jr.

New York City

October 18,1978

It is with proper pride that we dedicate this book to the often- unsung U.S. intelligence and law enforcement officers who have so often, so obscurely, died or languished in undeserved imprisonment in the silent war of the United States against the British monarchy's illegal drug traffic into our nation.

This book is published with special thanks to those intelligence and law enforcement officials who have given us such extraordinary assistance in cross-checking facts in putting the story together. These have included officials not only in the USA, but our nation's French ally, and also patriots in Canada embittered against what the Bronfmans and others have done to their nation and our own.

It is no exaggeration to sum up the situation thus: the only proper comparison for today's British drug traffic into the USA is the British monarchy's 19th century Opium Wars against China. There is more than a parallel. The same Hong Shang and other banking interests that developed their wealth in the China opium trade are involved in the financial side of the traffic against the USA — aided by those leading elements of the Zionist Lobby which have controlled organized crime in the USA and the Caribbean since the early 1920s.

This is a calculated form of political warfare against the USA by the British monarchy. Not only are the London-centered Canadian, Hong Kong, Singapore, and British West Indies financial interests involved in pulling tens of billions out of the USA — our biggest source of balance-of-payments losses — but this is a pre- calculated political warfare. The evil British intelligence executive — and head of the Aristotle Society — Bertrand Russell proposed this use of drugs as political subversion back during the 1920s. Among Russell's most prominent collaborators in this effort was Aldous Huxley, coordinator of the 1960s introduction of psychedelic substances to U.S. youth.

The fight against illegal drugs and against the evil forces of "decriminalization" is nothing less than a war against Britain, to the purpose of saving our youth and our nation from the destruction the British monarchy has projected for us.


Dope, Inc. was commissioned in September 1978 by U.S. Labor Party National Chairman Lyndon H. LaRouche, Jr., and was produced under his direction. At that time the Labor Party launched an international campaign against organized crime and drug traffic. As LaRouche has pointed out numerous times in the pages of the Labor Party's newspaper, New Solidarity, the forces that run the drug trade are the same forces that are now unleashing every capability — including scenarios for thermo- nuclear war — to halt the emergence of a new monetary system represented by the July 6 establishment of the European Monetary System in Bremen, West Germany, a system founded on the principles elaborated by LaRouche in his 1975 proposal for an International Development Bank. An October 1978 statement issued by LaRouche — "A National Strategy to Control Crime" — formed the kernel of this book.

This book is the product of a 100-person combined research team of the U.S. Labor Party in New York City, the Mexican Labor Party in Mexico City, and the European Labor Party in Wiesbaden, West Germany. The efforts of this team, since its founding in January 1974 under the direction of Lyndon LaRouche, drew the circle tighter around the perpetrators of narcotics traffic over a period of years.


The authors particularly acknowledge the efforts of Marilyn James, Richard Schulman, and Alfred Ross, whose research supplied the core of this book, and the contributions of Kathy Burdman, Scott Thompson, Paul Goldstein, Harald Hermann, Joseph Brewda, Roger Moore, Michelle Steinberg, Peter Wyer, Karen Steinherz, and Peter Ennis. Our appreciation also goes to Linda Frommer, the book's editor, who accomplished the final stage of the manuscript's completion.

The authors are unfortunately unable to thank by name the many former and currently serving law enforcement officers of several nations who took the greatest risk in coming forward with information and experience to indict the most dangerous enemy of all.


America is at war. For the first time since 1865, the battle- ground is not abroad, but on the streets and schools of American cities. Casualties registered in the course of the conflict are incomparably higher than at any other time in American history. We are fighting for our lives, and in the most literal sense, for the lives of our children. Until now, we have been losing.

The enemy's most deadly weapon is dope.

Unlike most wars, which force both combatants deeply into debt, in this undeclared war the offensive power becomes wealthier and wealthier, while the stupefied victim becomes impoverished. In return for destroying the minds, and in many cases the lives, of the 48 million Americans hit by this weapon, the enemy exacts a payment of $50 billion in retail drug sales alone in the United States, and $200 billion worldwide. That $200 billion, robbed from the world's productive sector, is the slush fund for everything evil in the world, including political terrorism — and including the murder of American Presidents.

There is not a parent, thinking over the destruction of a child, who really believes that drug abuse is a self-inflicted crime. Americans, no matter what else they have learned to tolerate, believe that the advancement of the next generation is part of the way things should be. If an entire generation of Americans is in jeopardy of being lost, then someone has done this to them.

We will tell you precisely who has done this — who has the ability to control the flow of dope from the mountains of the Far East and the valleys of Colombia to American high schools, who controls the banks which launder the $200 billion in take, who puppeteers the crime syndicates in charge of retail distribution, and who corrupts our political life. It is the same people against whom we fought the American Revolution, who set up the world opium trade a century and a half ago, and who run it today: the aristocratic and banking oligarchy of Great Britain..

Look into the motionless stupor of the mind of a youth who has been sapped and destroyed by addiction. Incapable of reason, incapable of thought, today's addicted youth lives for only one thing: his "fix," his "high." Then consider the body count of Britain's Opium War against the United States: Over 48 million Americans, mostly between the ages of 12 and 25 are officially known by the Drug Enforcement Administration to be frequent users of heroin, cocaine, and marijuana. Over one-fourth of the American people are severely wounded or dead in a war the country has not yet mobilized to fight.

The Drug Enforcement Administration has released these statistics on drug use by Americans:

500,000 daily users (other sources place this hardcore addict figure at between 750,000 and 1 million)

4,000,000 occasional users


575,000 users between the ages of 12-17

4,500,000 users between the ages of 18-25

1,000,000 users over the age of 25

11,000,000 daily users
24,000,000 occasional users

These figures do not include that portion of the population addicted to amphetamines, barbiturates, and hallucinogens. This figure alone according to recent reports from the National Institute of Drug Abuse constituted between 12 and 25 percent of all patients admitted to federally funded drug clinics during 1977. The last census taken of drug abuse in 1974, issued as a Report to the President, calculated conservatively that close to one and a half million Americans had "gotten into trouble"—been arrested, treated, or hospitalized — through the use of amphetamines or barbiturates. When calculated for only youth of high school age, the rate of amphetamine and barbiturate use was four times as great as that of the adult population.

Since the inauguration of Jimmy Carter, whole categories of drug abuse are no longer monitored. The computer system of the Drug Enforcement Administration has been shut down. Behind that action is the grim fact that many of Mr. Carter's domestic policy advisors are on record as being committed to decriminalization of deadly drugs — beginning with marijuana. If such policies go through, statistics will be meaningless: drug abuse will treble within months of legalization.


The $200 billion take for the British drug traders will climb to $300 billion.


The world's biggest business

How is the $200 billion monstrosity of world drug revenues hidden? In the most important way, it is not. The flow of narcotics and dirty money is conducted in the full light of day, the same way rum-running was conducted during Prohibition. Only misdirection prevents the public from understanding who the enemy is. Massive crimes are not hidden under cover of darkness, but under the cover of an effective lie. The operative lie in this case is "Free Enterprise."

When Sam Bronfman sold his rotgut to American mobsters, supplied by the old British distillers and financed by the old British banks, it was a matter of free enterprise: what the mob did with it after it crossed the American border was of no concern to him. When Meyer Lansky made his first heroin connection with Britain's dope-trading Keswick family in Shanghai in 1920, the sale was legal and in the light of day; what the mob did with the heroin later was not the responsibility of Britain's Far East traders.

Now, when the Hong Kong and Shanghai Bank "launders" the $10 billion annual flow of narcotics money through Hong Kong, is it anything but a matter of "free enterprise" where their deposits come from and their loans go? When the Bronfmans in Canada and the Jacobs family of Buffalo finance organized crime, is it anything more than a "free enterprise" business relationship? The entire army of the enemy was built, and functions, under the open view of the public.

In fact, the chain of interlocking "free enterprise" relationships that describes the flow of drugs and dirty money in and out of the United States only masks the type of conspiracies that Americans see not in pulp thrillers, but in nightmares. We will uncover these conspiracies, the spider's web of the British monarchy — the Italian-surname organized crime syndicates, London's Zionist-cover terrorist operation, the secrets of Peking's dope-running foreign intelligence organization. We will trace them all back to their common "mother," the great aristocratic families of Britain.

With this report, you will see your enemy as he is, behind the veils of misdirection, past the Hollywood parodies of organized crime. We are now in sight of the day when we will turn the tide against the dope warriors of Great Britain — by striking at the head of the beast.


The Rate of Increase in Marijuana Use in the USA

The above graph of confiscations of marijuana by federal enforcement agencies provides only a rough barometer of the accelerated increase of marijuana smuggling into and use in the USA between 1969 and 1974. As is common knowledge, from 1974 to the present, marijuana use has gone up at a rate whose acceleration dwarfs that depicted above.


In the past year alone, "drug decriminalization" campaigning by British agents-of-influence in the White House, and governors and Congressmen in the hip-pockets of Edgar Bronfman and Meyer Lansky, has caused marijuana use to increase at an astronomical rate.


History of Britain's First Opium Wars


This is the setting for what follows below: narcotics are pouring in from abroad through a well-organized, efficient group of smugglers. One-fifth of the population abuses drugs, an epidemic surpassing any known since the Great Plagues. Not only the poor, but the wealthy and the children of the wealthy have succumbed. Within the nation, organized crime displays its drug profits without shame, ruling local governments, and threatening the integrity even of national government. None of their opponents is safe from assassins, not even the chief of state. Law enforcement is in shambles. The moral fiber of the nation has deteriorated past the danger point.

And one of the leading dope-traffickers writes to his superiors abroad, "As long as this country maintains its drug traffic, there is not the slightest possibility that it will ever become a military threat, since the habit saps the vitality of the nation." (1)

The description is familiar, but we are not writing of America in 1978, but China in 1838, on the eve of the first Opium War, when Great Britain landed troops to compel China to ingest the poison distributed by British merchants.

An American President lies dead of an assassin's bullet.

Corrupt members of the Cabinet cover the tracks leading to a conspiracy, including the leading narcotics mobs, ethnic-based secret societies, and a foreign government. The public does not believe that the assassin acted alone, but the weight of the cover-up, the silence of the leading press, and the deaths of witnesses blur the trail from the public’s view.


Was that the death of John F. Kennedy? It was also the death of Abraham Lincoln.

During the last century, British finance protected by British guns controlled the world narcotics traffic. The names of the families and institutions are known to the history student: Matheson, Keswick, Swire, Dent, Baring, and Rothschild; Jardine Matheson, the Hong Kong and Shanghai Bank, the Chartered Bank, the Peninsular and Orient Steam Navigation Company. Britain’s array of intelligence fronts ran a worldwide assassination bureau, operating through occult secret societies: the Order of Zion, Mazzini’s Mafia, the “Triads” or Societies of Heaven in China.


Paging back over the records of the narcotics traffic and its wake of corruption and murder, the most uncanny feature of the opium-based Pax Britannica is how shamelessly, how publicly the dope-runners operated. Opium trading, for the British, was not a sordid backstreet business, but an honored instrument of state policy, the mainstay of the Exchequer, the subject of encomia from Britain’s leading apostles of “Free Trade” — Adam Smith, David Ricardo, Thomas Malthus, James Mill, and John Stuart Mill. The poisoning of China, and later the post-Civil War United States, did not lead to prison but to peerages. Great sectors of the Far East became devoted to the growing of the opium poppy, to the exclusion of food crops, to the extent that scores of millions of people depended utterly on the growing, distribution and consumption of drugs.

The Keswicks, Dents, Swires and Barings still control the world flow of opiates from their stronghold in the British Crown Colony of Hong Kong. Jardine Matheson, the Hong Kong and Shanghai Banking Corporation, and the Peninsular and Orient Steam Navigation Company still control the channels of production and distribution of the drugs from the Far East, through the British dominion of Canada, into the United States.


By an uninterrupted chain of succession, the descendants of the Triads, the Mafia, and the Order of Zion still promote drug traffic, dirty money transfers, political corruption, and an Assassination Bureau even more awesome than the conspiracy that claimed Abraham Lincoln's life. Of course, the drug revenues of this machine are no longer tallied in the published accounts of the British Exchequer. But the leading installations of the drug traffic are no more hidden than they were a hundred years ago. From the Crown Colony of Hong Kong, the "HongShang" Bank (a.k.a. Hong Kong & Shangai Bank) does what the Keswicks set it up to do: provide centralized rediscounting facilities for the financing of the drug trade. Even the surnames of senior management are the same.

Even today, the grand old names of Prohibition liquor and dope-running rouse the deep awareness of Americans: Bronfman, Kennedy, Lansky. Are the denizens of the India opium trade, of the Prohibition mob, imprisoned in the history books and behind the movie screen? Not infrequently, the observer feels a momentary lapse in time, and sees not a history book, but the morning newspaper, not the late-night movie, but the evening television newscast.

The story we have to tell happened twice. It first happened to China, and now it is happening to the United States. Emphasizing that neither the names nor the hangouts of the criminals have changed, we begin by telling how it happened the first time.



1 - Britain's First Opium Wars

From 1715, when the British East India Company opened up its first Far East office in the Chinese port city of Canton, it has been official British Crown policy to foster mass-scale drug addiction against targeted foreign populations in order to impose a state of enforced backwardness and degradation, thereby maintaining British political control and looting rights. While the methods through which the British have conducted this Opium War policy have shifted over the intervening 250 years, the commitment to the proliferation of mind-destroying drugs has been unswerving.

It was the British Crown's categorical opposition to and hatred for scientific and technological progress that led it to adopt an Opium War policy during the last decade of the 18th century. Having stifled the development of domestic manufacturing during the previous century, the British Crown found its treasury rapidly being drained of silver reserves — the only payment the Chinese Emperor would accept in exchange for silk, tea, and other commodities Britain imported.


To reverse the silver exodus, which threatened to collapse the financial underpinnings of the British Empire, King George III mandated the East India Company to begin shipping large quantities of opium from Bengal in the British Crown Colony of India into China. The dual objective was to favorably alter the balance-of-payments deficit and to foster drug addiction among China's mandarin class. By the time of the American Revolution, East India Company opium trafficking into China was officially reported to be at a scale 20 times the absolute limit of opium required for medical and related use.

In a very direct sense, the Founding Fathers of the United States fought the American Revolution against the British Crown's opium policy.

After the American Revolution, Smith's call for a dramatic increase in opium exporting into China was enacted with a vengeance. From 1801 to 1820, official British figures placed the opium trade at approximately 5,000 chests per year. By the late 1820s, a network of trading companies operating under overall East India Company "market control" was founded to facilitate the trade. Some of these British opium houses, including the biggest, Jardine Matheson & Co. Ltd., maintain an active hand in Far East heroin trafficking to this day.

The establishment of these trading companies — the core of Britain's Opium War infrastructure — fostered an epidemic- scale increase in opium trafficking into China. By 1830-31, the number of chests of opium brought into China increased fourfold to 18,956 chests. In 1836, the figure exceeded 30,000 chests. In financial terms, trade figures made available by both the British and Chinese governments showed that between 1829-1840, a total of 7 million silver dollars entered China, while 56 million silver dollars were sucked out by the soaring opium trade. (4)

When the Chinese Emperor, confronted by a galloping drug addiction crisis, tried to crack down on the British trading companies and their dope smugglers, the British Crown went to war.

In 1839, the Chinese Emperor appointed Lin Tse-hsu Commissioner of Canton to lead a campaign against opium. Lin launched a serious crackdown against the Triad gangs sponsored by the British trading companies to smuggle the drugs out of the "Factory" area into the pores of the communities. The Triad Society, also known as the "Society of Heaven and Earth," was a century-old feudalist religious cult that had been suppressed by the Manchu Dynasty for its often violent opposition to the government's reform programs. The Triad group in Canton was profiled and cultivated by Jesuit and Church of England missionaries and recruited into the East India Company's opium trade by the early 19th century. (5)

When Lin moved to arrest one of the British nationals employed through the opium merchant houses, Crown Commissioner Capt. Charles Elliot intervened to protect the drug smuggler with Her Majesty's fleet. And when Lin responded by laying siege to the factory warehouses holding the tea shipments about to sail for Britain until the merchants turned over their opium stockpiles, Elliot assured the British drug pushers that the Crown would take full responsibility for covering their losses.

The British Crown had its "casus belli." Matheson of the opium house Jardine Matheson joyously wrote his partner Jardine — then in London, conferring with Prime Minister Palmerston on how to pursue the pending war with China:

. . . the Chinese have fallen into the snare of rendering themselves directly liable to the Crown. To a close observer, it would seem as if the whole of Elliot's career was expressly designed to lead on the Chinese to commit themselves, and produce a collision. Matheson concluded the correspondence: "I suppose war with China will be the next step." (6)

Indeed, on October 13, 1839, Palmerston sent a secret dispatch to Elliot in Canton informing him that an expeditionary force proceeding from India could be expected to reach Canton by March, 1840. In a follow-up secret dispatch dated November 23, Palmerston provided detailed instructions on how Elliot was to proceed with negotiations with the Chinese — once they had been defeated by the British fleet.

Palmerston's second dispatch was, in fact, modeled on a memorandum authored by Jardine dated October 26, 1839, in which the opium pusher demanded: 1) full legalization of opium trade into China; 2) compensation for the opium stockpiles confiscated by Lin to the tune of £2 million; and 3) territorial sovereignty for the British Crown over several designated off-shore islands. In a simultaneous memorandum to the Prime Minister, Jardine placed J&M's entire opium fleet at the disposal of the Crown to pursue war against China. (7)

The Chinese forces, decimated by ten years of rampant opium addiction within the Imperial Army, proved no match for the British.

The British fleet arrived in force and laid siege in June of 1840. While it encountered difficulties in Canton, its threat to the northern cities, particularly Nanking, forced the Emperor to terms. Painfully aware that any prolonged conflict would merely strengthen Britain's bargaining position, he petitioned for a treaty ending the war.

When Elliot forwarded to Palmerston a draft Treaty of Chuenpi in 1841, the Prime Minister rejected it out of hand, replying, "After all, our naval power is so strong that we can tell the Emperor what we mean to hold, rather than what he should say he would cede." Palmerston ordered Elliot to demand "admission of opium into China as an article of lawful commerce," increased indemnity payment, and British access to several additional Chinese ports. (8)

The Treaty of Nanking, signed in 1842, brought the British Crown an incredible sum of $21 million in silver — as well as extraterritorial control over the "free port" of Hong Kong — which to this day is the capital of Britain's global drug-running.

The First Opium War defined the proliferation of and profiteering from mind-destroying drugs as a cornerstone of British Imperial policy. Anyone who doubts this fact need only consider this policy statement issued by Lord Palmerston in a January 1841 communiquι to Lord Auckland, then Governor General of India:

The rivalship of European manufactures is fast excluding our productions from the markets of Europe, and we must unremittingly endeavor to find in other parts of the world new vents for our industry (i.e., opium — ed.). . . If we succeed in our China expedition, Abyssina, Arabia, the countries of the Indus and the new markets of China will at no distant period give us a most important extension to the range of our foreign commerce. . . . (9)

It is appropriate to conclude this summary profile of Britain's first Opium War by quoting from the 15th edition of the Encyclopedia Britannica, published in 1977. What the brief biographical sketch of Lin Tse-hsu — the leader of the Chinese Emperor's fight to defeat British drugging of the Chinese population — makes clear to the intelligent reader is that British policy to this day has not changed one degree:

... he (Lin—ed.) did not comprehend the significance of the British demands for free trade and international equality, which were based on their concept of a commercial empire. This concept was a radical challenge to the Chinese world order, which knew only an empire and subject peoples.


... In a famous letter to Queen Victoria, written when he arrived in Canton, Lin asked if she would allow the importation of such a poisonous substance into her own country, and requested her to forbid her subjects to bring it into his. Lin relied on aggressive moral tone; meanwhile proceeding relentlessly against British erchants, in a manner that could only insult their overnment.

 Britain's opium diplomacy

Not a dozen years would pass from the signing of the Treaty of Nanking before the British Crown would precipitate its second Opium War offensive against China, with similar disastrous consequences for the Chinese and with similar monumental profits for London's drug-pushers. Out of the second Opium War (1858-1860), the British merchant banks and trading companies established the Hong Kong & Shanghai Corporation, which to this day serves as the central clearinghouse for all Far Eastern financial transactions relating to the black market in opium and its heroin derivative.

Furthermore, with the joint British-French siege of Peking during October 1860, the British completed the process of opening up all of China. Lord Palmerston, the High Priest of the Scottish Rites, had returned to the Prime Ministership in June 1859 to launch the second war and thereby fulfill the "open China" policy he had outlined 20 years earlier.

Like the 1840 invasion of Canton, the second Opium War was an act of British imperial aggression — launched on the basis of the first flimsy pretext that occurred. Just prior to his ordering of a northern campaign against Peking (which permitted the British to maintain uninterrupted opium trafficking even while a state of war was underway), Lord Palmerston wrote to his close collaborator Foreign Secretary Lord John Russell (grandfather and guardian of the evil Lord Bertrand Russell).


"We must in some way or other make the Chinese repent of the outrage," wrote Palmerston, referring to the defeat suffered by a joint British-French expeditionary force at Taku Forts in June 1859. The expeditionary fleet, acting on orders to seize the forts, had run aground in the mud-bogged harbor and several hundred sailors attempting to wade to shore through the mud were either killed or captured. "We might send a military-naval force to attack and occupy Peking," Palmerston continued. (10)


Following Palmerston's lead, The Times of London let loose a bloodcurdling propaganda campaign:

England, with France, or England without France if necessary. . . shall teach such a lesson to these perfidious hordes that the name of Europe will hereafter be a pass- port of fear, if it cannot be of love throughout their land. (11)

In October 1860 the joint British-French expeditionary force laid siege to Peking. The city fell within a day with almost no resistance. Despite French protests, British commander Lord Elgin ordered the temples and other sacred shrines in the city sacked and burned to the ground — as a show of Britain's absolute contempt for the Chinese.

Within four years of the signing of the Treaty of Tientsin (October 25, 1860), Britain was in control of seven eighths of the vastly expanded trade into China. This trade amounted to over £20 million in 1864 alone. Over the next 20 years, the total opium export from India — the overwhelming majority of which was still funneled into China — skyrocketed from 58,681 chests in 1860 to 105,508 chests in 1880. (12)

Furthermore, the opening of China prompted the British opium traders to diversify into "legitimate business." The opium firms opened cotton traffic into China — to the point that cotton cloth shipments into China (like the opium shipments) quadrupled from 1856-1880 from 115 million yards of cloth to 448 million yards.

The London opium traffickers' diversification into the cotton trade at the close of the second Opium War intersected with the same London oligarchy's shifting of its principal strategic policy focus to the destruction of the United States — beginning with the efforts to wreck the republic via the British-sponsored Civil War.

The massive expansion of cotton exporting was undertaken with full knowledge that U.S. cotton production — centered in the Deep South slavocracy — would be severely disrupted with the pending "civil war" destabilization in North America. (13)

The slave and cotton trade in the South was run to a significant degree by the same Scottish-based families that also ran the opium traffic in the orient. The Sutherland family, which was one of the largest slave and cotton traders in the South, were first cousins of the Matheson family of Jardine Matheson. The Barings, who founded the Peninsular & Orient Steamship Line heavily involved in the opium trade, had been the largest investors in U.S. clipper shipping from the time of the American Revolution. The Rothschild family as well as their later "Our Crowd" New York Jewish banking cousins, the Lehmans of Lehman Bros., all made their initial entry into the United States through the pre-Civil War cotton and slave trade.

In the case of the U.S. Civil War, the British opium traffickers bet on the loser. By the mid-1860s, cotton goods from the southern United States were back on the international markets, triggering waves of bankruptcies among London speculators who bet on dramatic inflation in the prices of Indian and Egyptian cotton. As in the period immediately following Britain's loss of its American colonies during 1776-87, the oligarchy turned to an expanded opium traffic to paste over the losses.

To facilitate the planned expansion of the opium trade, the British banking and merchant circle founded the Hong Kong & Shanghai Corporation in 1864. Almost simultaneously, the Matheson family founded Rio Tinto (now Rio Tinto Zinc), a tin mining venture in Spain which soon began shipping these ores as a method of payment for the opium.

Who founded the Hong Kong and Shanghai Corporation? The same circle of merchant banking, trading, and shipping families — centered around the British monarchy — who opened the East India Company's opium trade as an instrument of British state policy during the previous century.

The following points summarize British Opium War policy against China through the 19th century:

Protecting the opium market

Even through the early decades of the present century, Britain retained an open diplomatic posture on behalf of unrestricted drug profiteering.

In 1911, an international conference on the narcotics problem was held at The Hague. The conference participants agreed to regulate the narcotics trade, with the goal in mind of eventual total suppression. The success of the Hague Convention, as it was called, depended on strict enforcement of the earlier Anglo- Chinese agreement of 1905. Under that agreement, the Chinese were to reduce domestic opium production, while the British were to reduce their exports to China from British India correspondingly.

The Chinese, who had subscribed enthusiastically to both the 1905 and 1911 protocols, soon discovered that the British were completely evading both by sending their opium to their extra- territorial bases, Hong Kong and Shanghai. Opium dens in the Shanghai International Settlement jumped from 87 licensed dens in 1911 at the time of the Hague Convention to 663 dens in 1914! (14) In addition to the trafficking internal to Shanghai, the Triads and related British sponsored organized crime networks within China redoubled smuggling operations — conveniently based out of the warehouses of Shanghai.

If anything, British profiteering from the opium trade jumped as the result of the reversion to a totally black-market production-distribution cycle. Ironically, the legalization of the opium trade into China forced upon the Emperor through the Opium Wars had cut into British profits on the drug. Legalization had brought with it the requirement that the British opium merchants pay import duties, an overhead they did not have to absorb when the drug trade was illegal.

In yet another act of contempt for the Hague Convention, Britain issued a major new loan to Persia in 1911. The collateral on that loan was Persia's opium revenues. (15)

Even with the post-Versailles creation of the League of Nations, Britain flaunted its drug trafficking before the world community. During this period, Her Majesty's opium trafficking was so widely known that even the Anglophile U.S. newsweekly The Nation ran a series of documentary reports highly critical of the British role. (16)

At the Fifth Session of the League of Nations Opium Committee, one delegate demanded that the British government account for the fact that there were vast discrepancies between the official figures on opium shipments into Japan released by the Japanese and British governments. The British claimed only negligible shipments, all earmarked for medical use, during the 1916-1920 period; while the Japanese figures showed a thriving British traffic. When confronted with this discrepancy as prima facie evidence of large-scale British black market smuggling of opium into Japan, the British delegate argued that such black marketeering merely proved the case for creating a government owned opium monopoly.

As late as 1927, official British statistics showed that government opium revenues — excluding the far more expansive black market figures — accounted for significant percentages of total revenue in all of the major Far East Crown colonies. (17)

British North Borneo            23 percent
Federated Malay States      14 percent
Sarawak                            18 percent
Straits Settlements             37 percent
Confederated Malay            28 percent

In India as well, official Crown policy centered on protection for the opium market. According to one recently published account, when Gandhi began agitating against opium in 1921

. . . his followers were arrested on charges of "undermining the revenue." So little concerned were the British about the views of the League of Nations that after a commission under Lord Inchcape had investigated India's finances in 1923, its report, while recognizing that it might be necessary to reduce opium production again if prices fell, went on to warn against diminishing the cultivated area, because of the need to safeguard "this most important source of revenue."

. . . while the British Government was professing to be taking measures to reduce consumption of opium and hemp drugs, its agents in India were in fact busy pushing sales in order to increase the colony's revenues. (18)

Lord Inchcape — who chaired the India Commission which endorsed continued opium production in British India — was a direct descendant of the Lord Inchcape who during the previous century founded the Peninsular & Orient Steamship Line and subsequently helped found HongShang as the clearinghouse bank for opium trade. Through to the present, a Lord Inchcape sits on the boards of P & 0 and the HongShang.

In 1923, the British-run opium black market represented such a seriously perceived international problem that Representative Stephen Porter, Chairman of the U.S. House of Representatives Foreign Affairs Committee, introduced and passed a bill through Congress calling for country-by-country production and import quotas to be set on opium that would reduce consumption to approximately 10 percent of then-current levels. The 10 percent figure represented generally accepted levels of necessary medical consumption.

Porter's proposal was brought before the League of Nations Opium Committee — where it was publicly fought by the British representative. The British delegate drafted an amendment to Porter's plan which called for increased quotas to account for "legitimate opium consumption" beyond the medical usage. This referred to the massive addict population in British colonies and spheres of influence (predominantly in Asia) where no regulations restricted opium use.


The enraged U.S. and Chinese delegations led a walkout of the plenipotentiary session; the British rubberstamped the creation of a Central Narcotics Board designated with authority to gather information and nothing more; and the journalists stationed in Geneva henceforth referred to what remained of the Committee as the "Smugglers Reunion." (19)

A chest of opium in 1820 sold for $2,075 on arrival at the port of Canton. While this figure tended to drop marginally as the volume of traffic increased after 1830, any calculation of cash valuation of the opium trade into China establishes a figure that very nearly parallels "the present $100-200 billion (when appropriate calculations are made to account for differences in purchasing power of the dollar in ratio to total volume of world production) in annual "black" revenues.


2 - Palmerston's Fifth Column,USA

The assassination bureau

Narcotics traffic was the business of organized crime during the 19th century no less than in the 20th, and Britain's Opium War cabinet spun out a web of criminal connections that crisscrossed the globe. Prime Minister Palmerston conducted, the opium business behind a screen of respectability, in full public view.
What remained hidden — until the report of the Military Commission that heard evidence on the Lincoln Assassination — was the importance of Palmerston's secret life, as Patriarch of the Scottish Rite of Freemasonry.

It does not surprise the modern student that the perpetrators of the narcotics traffic show up in every element of the dirty side of 19th century politics, including presidential assassinations. But the extent of the web of criminal networks put in place by Palmerston could have come out of a Gothic horror story, American counterintelligence specialists of the time, such as Edgar Allan Poe and Samuel Morse (1), knew the problem well.

Palmerston's irregulars, employed in illegal dope trafficking, assassinations, and "Fifth Column" subversions against the United States in the period before and during the Civil War, are the linear ancestors of what is now called organized crime.

...followed a chain of command that led through the Scottish Rite of Freemasonry directly to Lord Palmerston and his successors.

The model for the Scottish Rite operation is the ethnic secret society — Jewish, Italian, or Chinese. Closest to hand among Palmerston's agencies was the Order of Zion, a highly specialized dirty tricks operation founded by London-based Hofjuden ("Court Jew") families, whose close ties to the British oligarchy traced back to the founding of the Bank of England, and before that to an alliance with the piratical financiers of post-Renaissance Genoa.


The names of these families will appear and re-appear throughout this report, including the Mocattas and Goldsmids, gold dealers in London before even the Bank of England was there, now the operators of one of the world's most sophisticated money-laundering devices; the Montefiores, now central figures in the modern Most Venerable Order of St. John of Jerusalem; and the de Hirsch family, whose tightly controlled colonization program for Jews in Canada brought the present leaders of organized crime to the New World.

Control over the Order of Zion rested in the British Board of Deputies, founded in 1763 and still in action. One of the board's earliest presidents was Sir Moses Montefiore, described in contemporary accounts as "Queen Victoria's favorite Jew." (2)

When Montefiore took command of the board in 1835, its dirty tricks division, the Order of Zion, was on the verge of launching the covert campaign that would lead to both the Lincoln assassination, and the founding of organized crime, so-called, in the United States. Through the efforts of Montefiore, later Prime Minister Benjamin Disraeli (the Earl of Beaconsfield), and the then nouveau riche Rothschilds, the Order of Zion nursed into being the leadership of the Confederacy.

Their starting point was the 1843 founding of the B'nai B'rith, also called the Constitutional Grand Lodge of the Order of the Sons of the Covenant, as a recognized branch of the Scottish Rite for American Jews. B'nai B'rith's first headquarters were at 450 Grand Street in Manhattan, at the house of Joseph Seligman, the wealthy "dry goods" merchant. (3) Seligman, whose name survives on Wall Street along with such of his contemporaries as August Belmont, Loeb, Schiff, and Lazard, was allied to the cotton-trading British oligarchy.

B'nai B'rith was a straightforward covert intelligence front for the Montefiores and Rothschilds. Its American house organ, the Menorah, could not disguise its relationship to the Rothschilds. It chose to flaunt it:

"The name Rothschild, in all countries is a synonym for honor and generosity, and no name in Europe has a popularity so great and so well merited. The Rothschilds in France occupy a social position even higher than that of the English branch of the family." (4)

The Menorah was also frank on the subject of the B'nai B'rith's relationship to the Scottish Rite Freemasons:

"Their reunions were frequent and several of them being members of then existing secret benevolent societies and especially of the Order of the Free Masons, and Odd Fellows, they finally concluded that a somewhat similar organization, but based upon the Jewish idea, would best obtain their object." (5)

Once in operation, the B'nai B'rith effectively merged its operations with another branch of the Scottish Rite, based in the Midwest and South — the Knights of the Golden Circle, the fore-runner of the Ku Klux Klan, the training ground for the entire Confederate military and political leadership. (6) Its most important American operative was Judah P. Benjamin, a British subject and leader of the B'nai B'rith, whose amazing career included a brief term as Confederate Secretary of War and then Secretary of State, during the closing phases of the Civil War. (7)


Another British subversive agent later worked together with Benjamin to found the Ku Klux Klan. He was Dr. Kuttner Baruch, B'nai B'rith leader and grandfather of Bernard Baruch, a leading Wall Street Anglophile. (8) Their colleagues in that venture included Confederate General Albert Pike, a Grand Commander of the Scottish Rite, and a Jesuit priest. (9) The same group carried out the Lincoln assassination — which raises questions concerning the Defense Department's refusal to release secret files concerning that assassination. Are they afraid to embarrass the now politically powerful B'nai B'rith?

The B'nai B'rith and its Confederate opposite numbers, the Knights of the Golden Circle and the Ku Klux Klan, were only three of the many parallel operations that Palmerston brought to life during the 1860s. In Britain, future Prime Minister Disraeli, the man who evaded debtors' prison through the help of the House of Rothschild, launched the "Young Englanders." (10)


In Italy, the local leader of the Scottish Rite, Mazzini, organized and commanded "Young Italy." (11) Scottish Rite member and Rothschild agent Alexander Herzen initiated a similar group covertly, avoiding the watchful eyes of the Czarist secret police; his best-known protιgι took the name Bakunin. (12) In China, as of the second Opium War, the long-established "Triad" secret societies had already taken the retail distribution franchise for the distribution of British opium imported from India, and had become an uncontrollable, paramilitary arm of British "free trade."

What Palmerston and his colleagues had at their disposal was an International Assassination Bureau, capable of eliminating any chief of state who resisted British policy objectives. Not much different from the Red Brigades of Italy or the Baader-Meinhof terrorists of Germany today, the Scottish Rite's rainbow gathering of secret societies took money from the narcotics traffic and orders from Lord Palmerston.

What must be judged, in the long run, as the most deadly of these organizations was organized on an international footing at the same time that B'nai B'rith appeared in the United States.

Disraeli, Moses Montefiore, and other leading British Hofjuden founded a new masonic-style order called, in the original French, the "Alliance Universelle Israelite." It became known — and feared — under the name of its elite secret arm, the Order of Zion. (13) Most of the Order of Zion's funding was provided through the London and Paris banking houses of Rothschild, Montefiore, and de Hirsch. In crucial respects, the Order of Zion and Palmerston's Scottish Rite of Freemasonry were indistinguishable. In France, for example, the head of both organizations was the same individual, Adolphe Isaac Cremieux. (14)

Order of Zion leader Judah P. Benjamin was the individual who gave the order for Lincoln's assassination, according to the one authoritative historical document in the public domain, the report of the Judge Advocate assigned to investigate the assassination and report to the Military Commission responsible. (15) The report cites the orders of Confederate President Jefferson Davis and Judah Benjamin. According to this document, Confederate secret intelligence had raised a dirty tricks slush fund of $649,000 through the sale of Confederate bonds in Liverpool.


At the time, the headquarters of this outfit, called the Secret Cabinet, were housed in St. Lawrence Hall in Montreal — in the same building occupied by the Commander in Chief of British forces in Canada, General Sir Fenwick Williams. (16) The report names George N. Sandis as the group's money mover; Sandis was an American citizen, formerly an advisor to Democratic presidential candidate Stephen Douglas, and Consul of the United States in Liverpool under the Pierce Administration.

Eight days before Lincoln's death, the chief of the Secret Cabinet — former Interior Secretary in the Buchanan Administration, Jacob Thompson — withdrew $180,000 from the group's account at the Bank of Montreal in Montreal, to set the murder plot in motion. (17) His courier was one John Harrison Suratt, a British agent trained at Jesuit Georgetown College. Neither Thompson nor Benjamin was ever apprehended; both fled to England and remained there under the Crown's protection. (18) This evidence, heard on June 25 and June 26, 1865, ran up against a cover-up effort under the direction of Secretary of War Edward Stanton that compares in audacity with the work of the 1963 Warren Commission.


The relevant raw documentary is not available to researchers. The documents relating to the Lincoln assassination are still locked up in the archives of the Defense Department. Jefferson Davis, who lived comfortably in Montreal after the collapse of the Confederacy, kept his papers in the Bank of Montreal, the same bank that conduited the funds for the assassination itself. If they are still in the vaults of the Bank of Montreal, the bank has not acknowledged this. (19)

These facts concerning the death of President Lincoln are more than a useful case history, illustrating the power of the dope trade's criminal networks. If the leads developed in New Orleans District Attorney Garrison's investigation of the Kennedy assassination were accurate, the two murders were the work of the same operation. All that is necessary is to cross out the names "Secret Cabinet" and "Judah Benjamin," and write in: Permindex and Major Louis Bloomfield (see Part III, Section 3).


From what remains of the official record, there is no question that the death of Abraham Lincoln was traced to British-controlled and British-funded networks by American military intelligence. It must be underscored that much more than the central figure of Lord Palmerston brought these networks into the mainline of the narcotics traffic. Southern cotton, for which the British verged on invading the United States during the Civil War (20), was not merely a facet of the same trading operation that produced the dope trade; for all purposes, it was the dope trade. Opium was the final stage in the demand cycle for British-financed and slave-produced cotton. British firms brought cotton to Liverpool.


From there, it was spun and worked up into cloth in mills in the north of England, employing unskilled child and female labor at extremely low wages. The finished cotton goods were then exported to India, in a process that destroyed the existing cloth industry, causing widespread privation. India paid for its imported cloth (and railway cars to carry the cloth, and other British goods) with the proceeds of Bengali opium exports to China. Without the "final demand" of Chinese opium sales, the entire world structure of British trade would have collapsed.

Palmerston's above-cited remark concerning the future of British trade in opium-consuming China and other parts of the East was, in fact, a matter of hard contingency.

Britain's new instrument of subversion in the United States was controlled elements of Italian and Chinese immigration, combined with the Order of Zion entity that had been in place since 1843. By the turn of the century, the different ethnic networks became so intertwined that, for generic purposes, the name "organized crime" applies to all of them.

The implantation of the ethnic secret societies into the United States is a complex story, but may be centered accurately in a few case histories. One is the way that the family of Sam Bronfman — the man who shipped enough liquor to the United States to double the size of Lake Erie, in the testimony of Lucky Luciano — got to North America. Bronfman's story begins, in fact, in Romania, where the Order of Zion secret organization achieved its first major victory, a coup d'etat that brought King Charles of Romania to the throne in 1887.


In the years following the Civil War, the Order of Zion merged with the much older Cult of Mizraem, a centuries-old covert organization that dated back to the days of Genoese and Hapsburg intrigue and assassination. (21) From the British side, Sir Moses Montefiore, and on the Romanian front itself, American Consul Benjamin Peixotto, aided the local secret society in installing a new monarch. (22) Peixotto held a leadership position in the American B'nai B'rith and was a member of the Order of Zion.

 The Elders of Zion

Romania became, in consequence, a nesting place for the most lurid form of Central European covert operations until the Second World War. The character of the political machine the Order of Zion installed in that country is perhaps best illustrated by the strong support Order of Zion elements gave to the Romanian Green Shirt Nazis, who seized power in Hitler's wake during the 1930s. (23) Romanian Jews show up prominently in American organized crime, as well as in the terrorist activities of the Israeli secret service, the Mossad.

The Order of Zion was simply the Jewish division of the Most Venerable Order of St. John of Jerusalem, the London-centered chivalric order and secret society, whose members swear — and act on — a blood oath. A secret meeting in Paris in 1884 yielded the famous minutes of the Order, published under the title, Protocols of the Elders of Zion. The minutes were intercepted and published by the Russian counterintelligence service, the Okhrana. (24)


Probably, the decision to publish the captured minutes involved retaliation against the Order of Zion's role in fomenting a sweeping destabilization against the government of Russian Prime Minister Count Witte, whose government fell during the so-called 1905 Revolution. Witte had sought an alliance with Germany and France against Britain on a program that included the industrial development of Russia.


The question of the authenticity of the Protocols has been a matter of fierce, even hysterical dispute. The question may be settled with dispatch by a textual comparison between the oaths of the Order of Zion printed in the Protocols, and the blood-curdling oaths sworn by initiates into the fourth Grade of the Knights of Columbus of Mexico, which maintains close ties to the Jesuits and to the Order of St. John of Jerusalem, which reads in part as follows: (25)

I, ________ , in the presence of all-powerful God, the blessed Virgin Mary, the blessed St. John the Baptist . . . by the belly of the Virgin Mary, the womb of God and staff of Jesus Christ, I declare and swear that his holiness the Pope is vice regent of Christ and sole and true head of the universal Catholic Church on earth, and in virtue of the keys to do and undo given to your holiness by my savior Jesus Christ, (you) have the power to depose kings and heretics, princes, states, communities and governments and dismiss them from office without risk. . . .


I promise and declare that I will, when the opportunity presents itself to me, wage war without quarter, secretly or openly, against all the heretics, Protestant and Mason, such as I may be ordered to do, in order to extirpate them from the face of earth, and I will not take into account either age, sex or station, and I will hang, burn, strangle and bury alive those infamous heretics: I will cut open the stomachs and wombs of their women and smash the heads of the babies against the rocks and walls, in order to annihilate the execrable race; that when this cannot be done openly, I will secretly employ the poison cut, strangulation, the sword, dagger or bullet, without consideration for the honor, rank, dignity or authority of the persons, whatever their status in public or private life may be, such as I may be ordered at any time. . . .

If I manifest falsity or weakness in my determination, I consent that my brothers and comrade soldiers in the army of the Pope may cut off my hands, my feet and slit my throat from ear to ear. . . .

I promise to execute and fulfill this oath, in testimony whereof, I take this sacred sacrament of the Eucharist and affirm it even with my name written with the point of this dagger, drenched in my own blood and sealed in the presence of this holy sacrament. Amen. (26)

Romania's Order of Zion stronghold produced, among other criminal elements, one Yechiel Bronfman, who emigrated to Canada in 1889. The circumstances of Bronfman's emigration are noteworthy. His passage was paid by the de Hirsch family fund for settlements in Canada — which conferred benefits with strings attached. De Hirsch political screening of new immigrants was so precise that a significant number of new arrivals were sent back without funds, for unreliability. (27).

The important features of the arrival of the Italian "Mafia" in the United States are inseparable from the story of the Order of Zion. Mazzini, the sponsor of the Mafia in Italy, reported directly to the most prominent of Britain's Hofjuden, Prime Minister Benjamin Disraeli, and received funding from the leading British Hofjuden bankers, Rothschild and Montefiore. (28)


Correspondingly, when Mazzini sent his lieutenants into the United States, the veterans of the "Young Italy" movement moved into channels already carved out by the likes of ex-General Pike and B'nai B'rith. The combination of Hofjuden-controlled crime networks and the Mafia provided the framework for organized crime on a big-business scale.

Mazzini's mafia

The first arrivals of the Italian-speaking mob followed the tracks of the original "dry goods" merchants who figured so prominently in the B'nai B'rith, the grandfathers and fathers of the Our Crowd banking group in New York City. New Orleans, the first base of the Lehmans and Lazards in the United States, also became the receiving station for the Mazzini networks. Most important, the first recorded evidence of organized Mafioso activity in the United States identifies the Mazzini networks with General Pike's guerrilla war against the "Reconstruction'' South.

Nothing depicts this arrangement better than the stories of the first New Orleans godfathers, Joseph Macheca and Charles Matrenga. Protιgιs of Mazzini, they took over the New Orleans franchise on behalf of the Palermo mob, which reported to Mazzini and thence to Disraeli. The chain of command was so well known that the joke made the rounds that the word "mafia" was really an acronym for "Mazzini autorizza furti, incendi, e attentati" — "Mazzini authorizes theft, arson, and kidnapping." (29)


The first of the Mazzini networks drifted in before and during the Civil War.

"The Mafias in New Orleans, New York, and Palermo were separate societies," wrote one leading historian of the period, "but they cooperated closely. A member who was properly sponsored could be transferred from one city to another, from one family to another." (30)

By the close of the Civil War, Disraeli's Mafia was in the hands of one Joseph Macheca. By contemporary accounts, the activities of the Macheca gang were indistinguishable from those of the Klan. In 1868, Macheca organized the New Orleans side of Democratic candidate Seymour's campaign against Ulysses S. Grant. Seymour's funding and political direction came from August Belmont, the Rothschilds' official business agent in the United States.


The campaign, such as it was, was described as follows in the New Orleans Picayune:

This popular and pleasant-mannered gentleman (Macheca) organized and commanded a company of Sicilians, 150 strong, known as the Innocents. Their uniform was a white cape bearing a Maltese Cross (the insignia of the British Royal Family's Order of St. John of Jerusalem — ed.) on the left shoulder. They wore sidearms and when they marched the streets they shot at every Negro that came in sight. They left a trail of a dozen dead Negroes behind them. General James E. Steadman, managing the (Seymour) campaign, forbade them from making further parades and they were disbanded. (31)

One historian of the Mafia notes,

"This matter-of-fact account is the first report of a formal Sicilian organization in New Orleans, and it is likely that from the ranks of these armed Innocents came the nucleus of Macheca's Mafia." (32)

Belmont's presidential candidate ran on a program drafted at the Seligman and associated Our Crowd banking houses in New York: the repeal of Lincoln's Emancipation Proclamation. The same cousins of the British Hofjuden controlled General Pike and his hooded goons, the Ku Klux Klan, whom Macheca's gangsters took such great pains to imitate — along with the conceit of the Maltese Cross. Pike, Macheca, and their paramilitary irregulars unleashed a wave of violence across the South that buried Lincoln's Reconstruction policy not many years after the President himself.

The historical record shows that Macheca's group in New Orleans, which started out by shooting blacks for the copperhead Our Crowd banks in New York, had proved its mettle by the early 1870s. It became the jumping-off point for the organization of the mob throughout the United States. Macheca provided a base for Mazzini's syndicate organizer of the first years of the Mafia, Giuseppe Esposito. A close Mazzini associate, Esposito fled Sicily in the early 1870s, arriving in New Orleans to make contact with Macheca.


Esposito traveled through the United States, pulling together Italian-speaking secret societies and establishing inter-city communications where none had existed before. From Esposito's tour onwards, the Sicilian-speaking secret societies became crime syndicates. Mazzini's representative on the scene had absolute authority over the local godfathers, even over the leader of the New Orleans base organization. Macheca's "Mafia leadership was eclipsed briefly," according to one historian, "from 1879 to 1881, when he temporarily deferred to Giuseppi Esposito." (33)

Macheca died at the hands of a New Orleans mob, which dragged him from a prison cell and lynched him, after he had been arrested for the murder of a policeman. (34) His old lieutenant Matrenga took over the reins. Macheca's death left a deep impression on the syndicates; possibly this is the point where the mob decided to "go legit," its strategy ever since. In order to do so, the Matrenga gang turned back to the Hofjuden.

The vehicle for the New Orleans mob's conversion to "legitimate business" in 1900 was another Romanian Jew, an immigrant from the Romanian province of Bessarabia, whence Yechiel Bronfman had migrated to Canada some ten years earlier. The new immigrant, one Samuel Zemurray, obtained financing from a group of Boston and New York Our Crowd banks, and bought out a portion of the Macheca gang's shipping interests.


A historian comments, "Joe Macheca's shipping line merged with four others to form the great United Fruit Company, which remains one of the largest of all U.S. firms." (35) United Fruit — re-chartered recently as United Brands Company — traditionally brought in Our Crowd bankers for its top management. Nonetheless, the Sicilian mob was remembered with nostalgia. When Charles Matrenga died in 1943, the entire board of United Fruit turned out for the funeral. (36)

From these most prominent among the Jewish and Italian ethnic crime stories of the formative years of the American syndicates, the roots of the narcotics traffic and associated evils are already evident. The Bronfmans, we will document later, founded and bankrolled the modern-day Murder Incorporated, Permindex, the firm that police agencies in the United States and Europe have suspected of organizing the murders of John F. Kennedy, Italian oil magnate Enrico Mattei, and former Italian premier Aldo Moro, as well as the many attempts on the life of Charles de Gaulle. It was in New Orleans that District Attorney Garrison linked the remnants of the old Macheca mob to the events in Dallas in November 1963.

As old Charles Matrenga withdrew into a "legitimate" back-ground, the day-to-day operations of the New Orleans mob fell into the hands of Sylvestro Carolla, who, in turn, passed the godfather's mantel onto Carlos Marcello in the early 1950s. What had begun as a small secret cult, receiving direction from the London center of the Scottish Rite of Freemasonry and Prime Minister Disraeli's Order of Zion, had spread across the American South, the Caribbean, and Central America. It maintained close ties with Meyer Lansky and the British installations in the West Indies.

And, according to sources in the Drug Enforcement Administration, 20 percent of cocaine smuggled into the United States arrives on the ships of United Brands.
The Chinese entry

Opium and morphine, in the early days of the mob, were not illegal drugs; heroin only came into circulation at the turn of the century and was not made illegal as a prescription drug until 1924. But the British dope-runners had a direct hand in the infiltration of narcotics into the United States, through the third wave of crime-tainted immigration, from China.

Not coincidentally, the first large-scale importing of opium into the United States commenced with the "coolie trade," referred to by its British Hong Kong and Shanghai sponsors as the "pig trade." Even before the Civil War, the same British trading companies behind the slave trade into the South were running a fantastic market in Chinese indentured servants into the West Coast. In 1846 alone, 117,000 coolies were brought into the country, feeding an opium trade estimated at nearly 230,000 pounds of gum opium and over 53,000 pounds of prepared (smoking) opium. (37)


Although Lincoln outlawed the coolie trade in 1862, the black marketeering in Chinese (the term "Shanghaied" referred to the merchant company kidnapping — through the Triad Society — of impoverished and often opium-addicted Chinese) continued at an escalating rate through to the end of the century. Often these Chinese "indentureds" would put their entire earnings toward bringing their families over to the U.S. This traffic in Chinese immigrants represented one of the earliest channels of opium into the country, and laid the foundations for the later mass-scale drug trade out of the Chinatowns developed in San Francisco, Vancouver, and other West Coast cities during this period.

The amount of opium coming into the United States during the last quarter of the 19th century is measured by the fact that in 1875, official government statistics estimated that 120,000 Americans — over and above the Chinese immigrant population — were addicted to opium! (38)

Adding to the opium addiction was the fact that British pharmaceutical houses had begun commercial production of morphine in the years leading up to the Civil War and made large quantities available to both armies. The British firms misrepresented the morphine as a "non-addictive" pain killer and even had the audacity to push it as a cure for opium addiction.


The British Brahmins in the U.S.

The nature of the London-centered cycle of international trade from cotton to opium further cultivated a group of British financial allies in the United States. Some of these allies are comprador trading families whose activities span the entire period from the inception of the opium traffic through to the Second World War.

Most important among these groups is the Astor family dynasty, whose founder, John Jacob Astor (1763-1848) made his fortune in Chinese opium sales. One of his biographers reports,

"We see that quicksilver and lead from Gibraltar and opium from Smyrna, as well as some iron and steel from the North of Europe, began in 1816 to take a conspicuous place in the list of Astor's imports into China... Since according to Dr. Kenneth Scott Latourette, quicksilver and opium did not become regular articles of import into China by Americans till about 1816, Astor must have been one of the pioneers of their introduction." (39)

Leveraged into investments in Manhattan real estate, John Jacob Astor's opium earnings formed the basis of one of America's largest family fortunes. Participation in the China opium trade, a de facto monopoly of the East India Company at the time Astor took part in the traffic, was a privilege extended only to Americans the East India Company thought deserving.


Other American firms active in the Canton trade did not touch opium. (40) Possibly, Astor's trading privileges were a British pecuniary reward for services as a British intelligence operative in the United States. Astor provided funds for the escape of his attorney Aaron Burr after Burr murdered Alexander Hamilton; at the time, Burr was a British intelligence agent. Burr's control, and the man to whom he fled after the murder of Hamilton, was East India Company employee Jeremy Bentham. (41)

Apart from the Astor group in New York City, the East India Company developed similar networks in Philadelphia and Boston, among other American cities. The leading British merchant bank Baring Brothers, which remodeled the old East India Company as an instrument for the opium traffic after William Pitt's installation as British Prime Minister in 1783, acquired a group of business partners (and brothers-in-law) in Quaker Philadelphia.


The family the Barings married into was William Bingham's, reportedly the richest in the United States at the turn of the nineteenth century. Barings were prominent throughout the first years of the China traffic, founded the Hong Kong and Shanghai Bank in 1864, and retained their family seat on its directing "London Committee" as of the HongShang's 1977 annual report.

One historian describes how closely the Bingham group aped the British oligarchy:

Bingham was a most enthusiastic admirer of the British financial system which he desired to see copied in America. . . . Immense wealth enabled the Binghams to import fashions, and copy the Duke of Manchester's residence in Philadelphia. . . they gave the first masquerade ball in the city, encouraging what soon became a mania among the American rich — a passion for dressing up as aristocrats.

The Binghams finally achieved their ambitions by uniting two daughters to foreign aristocrats: one to Count de Tilly, and the other to a member of the London banking house of the Barings, who later became Lord Ashburton. (42)

Another Philadelphia family that united itself with Baring Brothers was that of millionaire Stephen Girard, (43) whose interests survived under the family name, in Philadelphia's multibillion dollar Girard Bank and Trust.

Several of the old "Boston Brahmin" families, however, made it into the mainstream of the 19th century opium traffic, alongside the well-remembered British names of Jardine, Matheson, Sassoon, Japhet, and Dent. The Perkins and Forbes families achieved notoriety in the traffic after the East India Company's monopoly expired in 1832, and after the Astors had ceased to be an important factor. William Hathaway Forbes became so prominent an associate of the British trading companies that he joined the board of directors of the Hong Kong and Shanghai Bank in 1866, two years after its founding.

Hathaways, Perkins, and Forbes operated through a joint outlet, Russell and Company, formed around the Perkins family shipping empire, a "business reaching from Rio to Canton." (44) The fortunes of these families, as with the Philadelphia group, began with the slave trade — handed to them when the British dropped the slave trade as unprofitable in 1833. The China clippers of Russell and Company made not only Perkins's fortune, but most of the city of Boston's.


A biographer reports,

"By merging and creating. Russell and Company, he was responsible to a large degree in the establishing of all of Boston's merchant families — Cabots, Lodges, Forbes, Cunninghams, Appletons, Bacons, Russells, Coolidges, Parkmans, Shaws, Codmans, Boystons and Runnewells." (45)

Baring Brothers, the premier merchant bank of the opium traffic from 1783 to the present day, also maintained close contact with the Boston families. John Murray Forbes (1813-98) was U.S. agent for Barings, a post occupied earlier by Philadelphia's Stephen Girard; he was the father of the first American on the HongShang board.

The group's leading banker became, at the close of the nineteenth century, the House of Morgan — which also took its cut in the Eastern opium traffic. Thomas Nelson Perkins, a descendant of the opium-and-slaves shipping magnate who founded Russell and Company, became the Morgan Bank's chief Boston agent, through Perkins's First National Bank of Boston. Morgan and Perkins, among other things, provided the major endowments for Harvard University. (46) Morgan's Far Eastern operations were the officially conducted British opium traffic.


Exemplary is the case of Morgan partner Willard Straight, who spent the years 1901-12 in China as assistant to the notorious Sir Robert Hart, chief of the Imperial Chinese Customs Service, and hence the leading British official in charge of conducting opium traffic. Afterwards he became head of Morgan bank's Far Eastern operations. (47)

The above facts are necessary to round out the historical back- ground to the opium traffic today. What makes them especially interesting is the intricate trail that leads investigators of present-day drug financing back to the same American families and American banks. In Part III, we will blow the cover of Philadelphia's old "Main Line" Quaker families, whose present generation controls not only the leading supply of illicit amphetamines in the United States, but funds a whole array of street-level drug- trafficking operations as well.

Morgan's case deserves special scrutiny from American police and regulatory agencies, for the intimate associations of Morgan Guaranty Trust with the identified leadership of the British dope banks (see Part II, Section 7). Jardine Matheson's current chairman David Newbigging, the most powerful man today in Hong Kong, is a member of Morgan's international advisory board. The chairman of Morgan et Cie., the bank's international division, sits on the Council of the Royal Institute of International Affairs. The chairman of Morgan Grenfell, in which Morgan Guaranty Trust has a 40 percent stake,- Lord Catto of Cairncatto, sits on the "London Committee" of the Hong Kong and Shanghai Bank.

But perhaps the most devastating example of continuity among the corrupted American families involves the descendants of old John Jacob Astor. American citizen Waldorf Astor, his direct descendant, was chairman of the Council of the Royal Institute of International Affairs during the Second World War, while Harvard-trained American citizens of the Institute for Pacific Relations smoothed the transition to People's Republic of China opium production (see Part II, Section 7).

The old Boston families who made their fortunes on the narcotics traffic were the ones whom old Joseph Kennedy strove to imitate when he obtained his British liquor delivery contacts during Prohibition, and the same ones who staffed his son's Administration.

3 - Britain's "Noble Experiment"

In the years 1919 and 1920, two events of critical strategic importance for Britain's opium war against the United States occurred. First, the Royal Institute of International Affairs was founded.

The purpose of this institution had been set forth over 40 years before in the last will and testament of empire-builder Cecil Rhodes. Rhodes had called for the formation of a "secret society" that would oversee the reestablishment of a British empire that would incorporate most of the developing world and recapture the United States (see Part II, Section 7). Toward this objective, Rhodes's circle, including Rudyard Kipling, Lord Milner, and a group of Oxford College graduates known as "Milner's Kindergarten," constituted the Round Table at the turn of the 20th century. In 1919, the same grouping founded the Royal Institute of International Affairs as the central planning and recruitment agency for Britain's "one world empire."

On January 6 of the next year, Britain declared its opium war against the United States. Americans knew it as Prohibition. Prohibition brought the narcotics traffic, the narcotics traffickers, and large-scale organized crime into the United States. Illegal alcohol and illegal narcotics made up two different product lines of the same multinational firm. The British, through their distilleries in Scotland and Canada, and the British, from their opium refineries in Shanghai and Hong Kong, were the suppliers. The British, through their banks in Canada and the Caribbean, were the financiers. Through their political conduits in the United States, the British created the set of political conditions under which the United States might be won back by means other than the failed Balkanization plan of the Civil War period.

Two tracks led to the drug epidemic in the United States, one in the Far East, and the other in the United States and Canada. Against the outcry of the League of Nations and virtually all the civilized world, the British stubbornly fought to maintain opium production in the Far East, expanding the illegal supply of heroin, just as the drug went out of legal circulation in America in 1924. In North America, Canada — which had had its own period of Prohibition — went "wet" one month before the United States went dry.

In interviews with the authors, Drug Enforcement Administration officials have emphasized the similarity of the alcohol and narcotics modus operandi. When the agents of Arnold Rothstein and Meyer Lansky made their first trips to the Far East in the 1920s, they purchased heroin from the British with full legality. What the American gangsters did with the drug was their own business; the British opium merchants were merely engaging in "free enterprise."


When Britain's leading distilling companies sold bulk quantities of liquor to Arnold Rothstein and Joseph Kennedy — for delivery either to the Bahamas or to the three-mile territorial limit of the United States coastal waters — they had no responsibility for what happened to the liquor once it reached American shores. (The identical explanation was offered by an official of the British Bank of the Middle East, which now services the Far East drug traffic through a smugglers' market in gold bullion in Dubai, on the Persian Gulf. "We only sell the gold, old boy," the banker said. "What those fellows do with it once they get it is up to them.")

Which of the American syndicates obtained this month's franchise for drug or liquor distribution was immaterial to the British traffickers. The greater the extent of intergang blood-shed, the less obvious their role would be. In fact, the British distillers could provoke such events at will by withholding needed inventory of bootleg alcohol.

The "Noble Experiment" was aimed at degrading the American people through popular "violation of the law" and association with the crime syndicate controlled by the Our Crowd banks of Wall Street — the Zionist Lobby of its day (see Part III). New York's Our Crowd is an extension of the London Rothschild banking network and British Secret Intelligence into the United States. For example, Sir William Wiseman was the official head of British Secret Intelligence in the United States throughout the World War I period. He became a senior partner in the investment house of Kuhn Loeb immediately on demobilization. Wiseman was a personal protιgι of Canadian Round Table founder Lord Beaverbrook and one of the most prominent public figures in the Zionist movement. (1)

With this lower Manhattan-Canada-centered grouping acting as the political control, the Prohibition project was launched during the early 1910s under the shadow of the United States' entry into World War I. It should shock no one that the creation and rapid growth of an organized crime syndicate in the United States was the filthy business of the Our Crowd banks — employing the cults of Lord Palmerston and Disraeli that conducted the unsuccessful assault against the American republic during the Civil War.

It is a fraud of the highest order that Prohibition represented a mass social protest against the "evils" of alcohol. Like the environmentalist movement and other present day anti-progress cults, the Women's Christian Temperance Union (WCTU) and its Anti-Saloon League offshoots were a small, well-financed and highly organized circle that enjoyed the financial backing of the Astors, the Vanderbilts, the Warburgs, and the Rockefellers. (2)

Then as now, the funding conduits were principally the tax-exempt foundations — specifically the Russell Sage Foundation and the Rockefeller Foundation. John D. Rockefeller I was hood- winked by Lord Beaverbrook colleague and former Canadian Prime Minister MacKenzie King into not only bankrolling the WCTU, but providing it with the services of the foundation's entire staff of private investigators. (3)

Who made up the Temperance Movement? It was run by Jane Addams, who studied the Fabian Society's London settlement house Toynbee Hall experiment and came to the United States to launch a parallel project which later produced the University of Chicago. (4) The "cadre" were drawn almost exclusively from three pools:

1) the settlement house and suffragette networks run by Addams and the Russell Sage Foundation

2) the pro-terrorist synthetic religious cults operated out of Oberlin College in Ohio

3) the Ku Klux Klan in the South

Oberlin College was founded by British "Christian missionaries" in the decades leading up to the Civil War. Like the ancient anti-Christian Manichean cult, Oberlin was organized around the principle that the material world was wholly evil; all students (i.e. initiates) were required to become vegetarians. From Oberlin's student body some of the most violent radical abolitionist terrorists were recruited, trained and deployed and safe housed during the Civil War. (5)

Like its predecessor radical abolitionist movement, the Temperance Movement was founded at Oberlin in the post-Civil War period as a violent cult (known at the time as "Organized Motherlove"). At the height of the Prohibition drive during the 1910s, bands of ax-wielding lesbians — the Susan Saxes and Bernadine Dohrns of their day — received banner headlines for their assaults against saloons throughout the Ohio Valley. Many of these women were drawn from the Manichean cult at Oberlin.

Once launched as a nationwide movement, WCTU founded a national headquarters in Evanston, 111. Nearby Wilmette, 111. (along with London and Tel Aviv) subsequently became the North American headquarters of the British Intelligence- organized Ba'hai terrorist cult. (6)

In the South, parallel "fundamentalist Christian" cultists had been drawn together from the turn of the century under the direction of the Ku Klux Klan.

These three British cults agitated nationally for Prohibition. While the WCTU and Anti-Saloon League staged well-publicized and frequently violent raids against saloons, the more sophisticated Fabian Settlement House social workers of Jane Addams used the unique conjuncture of the recently passed Seventeenth Amendment certifying women's voting rights in national elections and the concentration of much of the adult male population on the war effort to vote up the Eighteenth Amendment making Prohibition the law of the land. The Amendment was fully ratified by 1917; however, the Volstead Act that defined the federal enforcement procedures was not scheduled for implementation until January 6,1920.

The three-year lead time was critical for the establishment of a tightly organized crime syndicate, which was being organized out of Canada and Our Crowd banking circles in New York:

The British oligarchy did much more than supply the gutter elements of the crime syndicates with their stock in trade. To a surprising extent, the Anglophile portion of America's upper crust joined the fun. The case of Joseph Kennedy, who owed his British contracts for liquor wholesaling to the Duke of Devonshire, and later married his daughter into the family, is notorious (see Part III).


In some respects more revealing is the strange case of Robert Maynard Hutchins, the President of the University of Chicago from 1929 to 1950. Hutchins had American citizen- ship, but was so close to the British aristocracy that he became a Knight Commander of Her Majesty's Venerable Order of St. John of Jerusalem, swearing an oath of chivalric fealty to the head of the order, the British monarch.

Under the guise of "social studies research," several well-known University of Chicago postgraduate students received their apprenticeships in the service of the Capone gang:


Mounting the drug invasion

The United States' fourteen-year experiment in Prohibition accomplished precisely what its British framers had intended. Ralph Salerno, an internationally recognized authority and historian on organized crime, a law enforcement consultant and former member of the New York City Police Department's intelligence division, succinctly summarized the effect of Britain's Prohibition gameplan in his book, The Crime Confederation:

The most crucial event in the history of the confederation (organized crime — ed.) was a legal assist called Prohibition. . . . Prohibition helped foster organized crime in several ways. It was the first source of real big money. Until that time, prostitution, gambling, extortion and other activities had not generated much capital even on their largest scale. But illegal liquor was a multibillion dollar industry. It furnished the money that the organization later used to expand into other illegal activities and to penetrate legitimate business.


Prohibition also opened the way to corruption of politicians and policemen on a large scale. It began the syndicate connection with politics and it demoralized some law enforcement groups to the point where they have never really recovered. . . . The manufacture and distribution of illegal liquor here and the importation of foreign-made liquor gave the men who were organizing crime experience in the administration and control of multibillion dollar world businesses with thousands of employees and long payrolls.


Men who had never before managed anything bigger than a family farm or a local gang got on-the-job training that turned them into leaders developing executive qualities. . . . Mass evasion of the Volstead Act also put the average citizen in touch with criminals, resulting in tolerance and eventually admiration and even romantic approval of them. It permanently undermined respect for the law and for the people enforcing it. Ever since Prohibition the man in the street has accepted the idea that cops can be bought. (10)

The combined revenues of the illicit whiskey and drug trade during Prohibition had constituted a multibillion dollar black market booty. While families like the Kennedys and Bronfmans "made out like bandits" in the early 1930s transition to "legitimate" liquor trade, the overall financial structure for maintaining an organized crime infrastructure demanded diversification into other areas of black market activity only marginally developed previously. The market for illicit drugs in the United States — though significantly expanded as the result of the Prohibition experience — was not to become the foundation of a multibillion dollar traffic for several decades.

In the interim, the Our Crowd-British crime syndicate turned to casino gambling and associated enterprises as the immediate area for expansion. The Lansky syndicate took the opportunity of Nevada's 1933 passage of specific regulations legalizing casino operations to turn that no-man's-land into a desert resort to house all the West Coast criminal operations that had previously been run on pleasure boats 12 miles off the coast of Hollywood. Lansky also moved into the Caribbean, preparing the way for the British offshore complex of unregulated banking.

Through the investment of the phenomenal profits derived from the Prohibition into gambling casinos, professional sports stadiums and racetracks, organized crime established the foundations during the 1930s and 1940s for the drug trafficking that would begin in the mid-1950s — once a cultural climate had been created that was conducive to fostering drug addiction.

 Nixon's war on drugs

It is not widely known that President Nixon was a casualty in the war against Britain's drug invasion of the United States. Had Nixon not taken up the most basic interests of the nation in launching a wholesale effort to shut down the drug trafficking — from the top down — it is likely that he would not have been unceremoniously forced out of office by Henry Kissinger, Ted Kennedy, and their British masters.

By 1970 Nixon became profoundly aware that the proliferation of drug abuse among the nation's youth had become a problem of such monumental significance that all his efforts to institute a long-range program of peace-through-development would be meaningless unless combined with a ruthless crackdown on the poison that threatened to wreck the nation's future leadership and its productive sector. Documents are available in the public domain from the Drug Enforcement Administration and other executive agencies showing that Nixon's "War on Drugs" was directed at the top — at the banking institutions, the transportation grids, and only then at the distribution channels delivering the volumes of drugs onto the streets of the country.

At the same time that Nixon generically understood the top-down nature of the problem, he and his assistants scarcely understood that by going after the drug infrastructure they were taking on the entire British oligarchy and the entire underpinnings of the Eurodollar market and the People's Republic of China. Had Nixon understood the drug problem as a London-Peking problem, he would have perhaps been better prepared to deal with the "inside-outside" attack against his Presidency.

In Part II of this report, we will reveal the inner workings of the London-Peking Drug Empire the Nixon Administration ran up against when it declared its War on Drugs.




1. As quoted in Jack Beeching, The Chinese Opium Wars (New York: Harvest Books, 1975), p. 258.
2. Adam Smith, Wealth of Nations, Representative Selections (New York: Bobbs-Merrill, 1961).
3. Richard Morris, The Peacemakers: The Great Powers and American Independence (New York: Harper & Row).
4. Beeching, Chinese Opium Wars, p. 43.
5. In addition to the Chinese Hong merchants who collaborated with the British opium houses and the run-of-the-mill pirates and river rats that the British recruited into their service as the "eyes and ears" in Canton and the interior, the Hakkas, a people living in the southern province of Kwangsi who were under the strong influence of the Heaven and Earth Society (Triads) were particularly important to the British operations. The Triads, devoted to the days of the Ming Dynasty — and who were very similar to the Freemason organizations in Europe and North America — wanted to overthrow the Manchu Dynasty. The Hakkas were used by both the British and their Triad allies as a grassroots bludgeon against the Emperor. The key figure in the joint Anglo-Triad venture was a religious fanatic named Hung Hsui-Ch'uan.

Hung, having suffered public "loss of face" on four occasions — he failed the examinations that would allow him to join the mandarin class and become a government official — suffered a nervous collapse. He was in a trance for 40 days in which he was supposedly born again and then, using a translation of the King James Bible, he created a new religion based on the notion of "The Chosen People." The Hakkas were to be the Chosen People, and the Triad identification of the Manchus as the enemy was fully incorporated into Hung's quasi-Protestant religion.

Hung served as the "prophet," and a Hakkas Triad member, Yang Hsin-Ch'ing, served as the recruiter and military commander of the movement. Yang was in the employ of the British as an opium runner on the Pearl River.

In 1851, Hung and Yang launched a full-scale assault against the Manchu Dynasty — called the Taiping Revolt, or "The Triad War" — which drained China's treasury, shook the government, and demoralized China's pathetic army. The Taiping-Triad forces also played a significant role in the 1911 overthrow of the Manchu Dynasty that led to the republic of China under its president Dr. Sun Yat-sen (also a member of the "Hung Society"), although the organization was outlawed as treasonous and terrorist in 1890.

For further reading on the Hung-Triad Societies see: Lady Queensborough, Occult Theocrasy, Volumes I and II (France: The International League for Historical Research, 1931), pp. 441-42; Beeching, Chinese Opium Wars, pp. 180-205.

6. Beeching, Chinese Opium Wars, p. 80.
7. Ibid., p. 98.
8. Ibid., p. 127.
9. Ibid., p. 95.
10. Ibid., p. 272.
11. Ibid., p. 272.
12. Ibid., p. 264.
13. Karl Marx and Frederick Engels, Civil War in the United States (New York: International Publishing Co.).
14. Brian Ingles, The Forbidden Game: A Social History of Drugs (New York: Charles Scribner's, 1975), chapter 11.
15. Ibid.
16. Ibid.
17. Ibid.
18. Ibid.
19. Ibid.



  1. Samuel Morse, "The Present Attempt to Dissolve the American Union: A British Aristocratic Plot" (New York: John F. Trow, 1862); Samuel Morse, "A Foreign Conspiracy against the Liberties of the United States" (New York: originally published by the New York Observer, 1835); see also the soon-to-be-published book, The First American Intelligence Service (New York: Campaigner Publications). Morse signed all his published articles under the name "Brutus."

  2. C. Bernant, The Cousinhood (New York: Macmillan Company, 1972).

  3. Benjamin Peixotto, ed., The Menorah, official organ of the B'nai B'rith, New York, 1 (Sept. 1886).

  4. Ibid.

  5. Ibid.

  6. Official document recorded by Benn Pittman, The Indianapolis Treason Trial, 1865; Official Report — A Western Conspiracy in the Aid of the Southern Rebellion (Indianapolis: 1865); see also An Authentic Exposition of the Knights of the Golden Circle or a History of Secession (pamphlet), author unknown, believed to be Union counterespionage agent named Jim Pumfrey (Indianapolis: 1861); Mayo Fesler, "Secret Political Societies in the North during the Civil War," Indiana Historical Magazine 3 (Sept. 1918).

  7. Burton Hendrick, Statesman of the Lost Cause, Jefferson Davis and His Cabinet (New York: Literary Guild of America, 1939), pp. 153-181; Max Kohler, Judah Benjamin: Statesman and Jurist (Baltimore, 1905).

  8. Israel Joseph Benjamin, "Three Years in America, 1859-62" (New York: 1863), Vol. I; contains a profile of B'nai B'rith and 44 Jewish organizations.

  9. Albert Pike, Lectures of Arya and Indo-Aryan Deities and Worship, published by the Ancient and Accepted Scottish Rite of Freemasonry of the Southern Jurisdiction of the U.S.A. on orders of the Grand Command of the Supreme Council 33°; see also Queensborough, Theocrasy.

  10. Queensborough, Theocrasy.

  11. Ibid.

  12. Ibid.; see also Merle Curti, "Young America," American Historical Review, 1929.

  13. Menorah, Sept. 1886; see also Queensborough, Theocrasy.

  14. Queensborough, Theocrasy.

  15. John A. Bingham, Special Judge Advocate, "Trial of the Conspiratorsfor the Assassination of President Lincoln Delivered June 2-28, 1865, before the Military Commission of the Court Martial of the Lincoln Con- spirators," War Department Records, Section Monograph 2257, Official Transcript.

  16. Clayton Gray, Conspiracy in Canada (L'Atelier Press, 1957); David Balsiger and Charles Sellin, The Lincoln Conspiracy (Albuquerque: Sun Publishing Co., 1977).

  17. Gray, Conspiracy in Canada.

  18. Ibid.; see also Susan Davis, Authentic History of the Ku Klux Klan, 1865-1877,1924.

  19. Gray, Conspiracy in Canada.

  20. A. R. Turner-Tyrnauer, Lincoln and the Emperors (New York: Harcourt, Brace and World, Inc., 1962).

  21. Queensborough, Theocrasy.

  22. Menorah, Sept., 1886.

  23. The Green Shirts emerged from the networks that the Order of Zion had put in place in Romania and consolidated with the coup to install KingCharles in 1887; see also Paul Goldstein, "The Rothschild Roots of the KKK,'' Executive Intelligence Review 39: 50.

  24. The political error the Okhrana made in its use of the Protocols was to generalize the notion of a Zionist conspiracy to include all of Jewry. The Protocols were then used by British intelligence operatives within the Okhrana to unleash pogroms against Russian Jews in conjunction with and following the "1905 Revolution" destabilization of the Witte government.

  25. The Protocols have been published most recently in Herman Bernstein, The Truth About the Protocols of Zion (New York: Ktav Publishers, 1971).

  26. Sources in Mexico made this oath available to the authors and have confirmed that it is authentic. It should be noted, however, that the Knights of Columbus in the United States is a very different organization from this Mexican branch, and the two should not be confused.

  27. Canadian Jewish Congress report, 1967-68 (see Part III, Section 1).

  28. Edyth Hinkley, Mazzini: The Story of a Great Italian (Port Washing-ton, N.Y.: Kennikat Press, 1924).

  29. Charles William Heckethorn, The Secret Societies of All Ages and Countries, Vol. I and II, 1875 (New York: University Books, Inc., 1965); see also David Leon Chandler, Brothers in Blood (New York: E.P. Dutton Co., Inc., 1975), p. 31.

  30. Chandler, Brothers in Blood, p. 103.

  31. Ibid., p. 75.

  32. Ibid.

  33. Ibid., p. 79.

  34. Ibid., pp. 95, 97.

  35. Ibid., p. 97.

  36. Ibid., p. 98.

  37. Beeching, Chinese Opium Wars, p. 178.

  38. Ibid.

  39. Kenneth Wiggins Porter, John Jacob Astor, Business Man (New York: Russell and Russell, 1966).

  40. Beeching, Chinese Opium Wars.

  41. Porter, John Jacob Astor, p. 604.

  42. Miriam Beard, History of Business, Vol. II (Ann Arbor: University of Michigan Press, 1963), p. 162ff.; see also Joseph Wechsberg, The Merchant Bankers (Boston: Little, Brown, and Company, 1966), 104 ff.

  43. Wechsberg, Merchant Bankers, p. 123.

  44. Beeching, Chinese Opium Wars.

  45. Brett Howard, Boston: A Social History (New York: Hawthorn Books, Inc., 1976).

  46. Ibid.

  47. Ingles, The Forbidden Game.


  1. Who's Who in America and Who's Who in World Jewry.

  2. John Kobler, Ardent Spirits (New York: G. P. Putnam's Sons, 1973).

  3. Ibid.

  4. Jeffrey Steinberg, "Robert M. Hutchins: Shaper of an American oligarchy," The Campaigner, Vol. II, 3-4:73-77.

  5. Queensborough, Occult Theocrasy.

  6. Bruce Wood, "Cult and Terrorist Activities in the Detroit, MichiganArea Since the 1960s," an unpublished manuscript, September, 1976.

  7. Saul Alinsky, Reveille for Radicals (New York: Random House. 1969).

  8. John Kobler, Capone: The Legacy (New York: G. P. Putnam's Sons, 1972).

  9. Hank Messick, Lansky (New York: Berkley Medallion Books, 1971), p. 152.

  10. Ralph Salerno and John S. Tompkins, The Crime Confederation (New York: Doubleday and Company, Inc., 1969). pp. 275,278-79.


How the Drug Empire Works


The basis of this investigation

In the following pages we will take the reader from the opium-growing mountains of the Far East's Golden Triangle, to the offices of opium wholesalers in the expatriate Chinese districts of Bangkok, Rangoon, and Singapore; we will take him through the bonded warehouses, shipping lines and air freight companies of old-line British trading companies who control the Chinese expatriate wholesalers; we will lead him through the maze of financial channels that fund the Far East's opium trade, to the august portals of Hong Kong and Shanghai Banking Corporation and other top British banks who control the financing topdown; we will take him across the Pacific to the ports of entry for heroin into the United States, to the skyscraper offices of the Canadian banks and corporations who finance, ship, and protect the heroin en route to the United States; and, finally, we will guide the reader down the family trees of the Canada-based Zionist financiers, to their contact-points in the world of organized crime and heroin distribution. When this is done, we will have reconstructed the Annual Report of Dope, Incorporated, including balance sheet, board of directors, senior operating officers, table of organization, and subsidiaries.

At the conclusion, the reader will know and understand more about the personnel and operations of illegal drugs — the world's biggest business since the days of opium-pusher Adam Smith — than the law enforcement authorities of the United States and other countries knew until recently. In the files of these agencies, in the minds of solitary investigators, and, to a surprising extent, in the public record itself, the pieces of the puzzle have existed for years.


Fitting them together into a single picture is the task of this investigation. But the puzzle is not a jigsaw game, in which the picture is assembled by fitting the pieces together side-by-side. As a first approximation, it would be better for the reader to imagine a set of clear plastic overlays, each of which contains part of the picture; laid one on top of the other, they complete the puzzle.

The different overlays of this puzzle are these:

  1. The detailed record assembled by American and other investigators of the mechanics of the opium trade from the Golden Triangle down to opium's ports of departure to the rest of the world;  

  2. Pinpointed identification of opium wholesalers, largely in the Chinese expatriate community, including the names of leading bankers;  

  3. A comprehensive profile of British finance in the Far East, revolving around the Hong Kong financial center and its leading bank, the Hong Kong and Shanghai, including the web of British ties to the Chinese expatriate banking community throughout the area;  

  4. An exhaustive grid of the British control over means of laundering dirty money in the hundreds of billions of dollars, including "offshore" banking, gold, and diamonds;  

  5. A grid of the huge quantity of public record material showing the integration of British Far East and dirty money financial] operations worldwide with the top level of British foreign policymaking, centered in the Royal Institute of International Affairs;  

  6. The similar public record of evidence of strategic agreement between Great Britain and the Maoist People's Republic of China, going back to negotiations between British opium-runners and Mao Tse-tung, under the auspices of the Royal Institute of International Affairs;  

  7. Twenty years of official documentation — from American, Japanese, Taiwanese, and Soviet sources — that the People's Re-public of China grows and exports opium not only to earn foreign exchange, but to fund secret intelligence operations, through Chinese expatriates;  

  8. A comprehensive grid of the intimate links between all these elements — British old-line opium-runners, British dirty money operations, Chinese expatriate overseas operations, British-Chinese policy agreement — with the "Canadian" connection to American organized crime;  

  9. The international web of the British-centered "Zionist lobby," and its special function in gold and diamond-related dirty money operations, laundering of dirty money, financing of international terrorism, and financial control of the Canada-U.S. drug channels;  

  10. Lastly, a gridding that demonstrates that the leading controllers of the opium war against the United States are not only connected by interlocking directorates and other business ties but by ties of "blood" that constitute this web under one family.

The resulting picture is comprehensive: the entire mass of detailed, documented evidence fits together into a single picture, stretching from the present day back through the British origins of the opium trade in the time of Adam Smith.

The Hong Kong and Shanghai Bank and related companies finance the opium trade. In this, they are acting as designated agents of the British monarchy, through the Royal Institute of International Affairs. Not only do they control the expatriate Chinese legmen of the opium trade, but they do so as part of an agreement negotiated between Mao Tse-tung and the Royal Institute of International Affairs, by the Hong Kong and Shanghai's leading representatives!

The gold and diamonds side of the dirty money laundering operations, under the immediate control of Britain's Zionist Hofjuden (Court Jews), is part of the same machine. Through the highest circles of British policy, all the important branches of the drug machine — the Chinese connection, the old-line British opium traders, the dirty "offshore" banking sector, and the Zionist Hofjuden — run Canada from the top.

From there the trail leads directly into the American crime syndicate, through the Hofjuden Bronfman family.

The world illegal drug traffic is not only the world's biggest swindle and subversive agency: it is controlled by a single group of evil men whose names and organizational affiliations are all printed below, and whose intimate ties of ownership, family, and political collaboration go back 200 years. We know their names and addresses, and know how to mop them up.


Banking and the World's Biggest Business

Assembled as one picture, the hard evidence available from the Drug Enforcement Administration and other law enforcement bodies leaves only one possible conclusion: The drug "industry" is run as a single integrated world operation, from the opium poppy to the nickel bag of heroin sold on an inner-city street corner. Not only is illegal drug traffic under the control of a single world network, but opiates traffic in particular is without doubt the best-controlled production and distribution system of any commodity in international trade, illegal or legal. De Beers' Central Selling Organization's 85 percent control of world diamond wholesaling — an example not irrelevant to the drug trade — pales by comparison to the orderly marketing arrangements for heroin demonstrated by the hardest figures available.

Investigators are daunted by the fact that the solution to the problem is so damned obvious. Imagine Edgar Allan Poe's fictional purloined letter, photographically enlarged to 8 by 20 feet, and used as wallpaper; then, imagine the French police attempting to find it with magnifying glasses.

When we speak of the drug-related illegal economy — for drugs are the pivot on which most other illegal activity turns — we are talking of a $200 billion per year business, the biggest business in the world. That is net, not gross, annual sales of drugs, plus related illicit payments.

How can such activity avoid sticking out wildly, especially in areas of concentration such as the Far East? Because the British monarchy organized most of the Far East to conform to the drug traffic! How can $200 billion in illegal payments get through the international banking system past the eyes of law enforcement authorities? The answer is: the Anglo-Dutch "offshore" banking system. This and related precious metals and gems trade were designed around illegal money in the first place!

Mere consideration of the obvious — or what will quickly become obvious when the evidence of the public record is assembled below — gives the financial specialist the equivalent of an inner-ear disorder. The financial world, remember, is one in which the stock market will do flips over a measly few hundred million dollars' difference in the weekly reported figures for the American money supply. Although most of the necessary evidence has long been available, both investigators and the public prefer to see world drug traffic and related illegal activity as a montage of movie villains: Far Eastern warlords, free-lance smugglers, jowly gangsters, and corrupt politicians. Such individuals figure into the world drug traffic, but as the arms and legs of a top-down operation, under the immediate control of the British and allied monarchies.

The most striking single fact for this conclusion is that the price series for heroin at retail level in major American cities show virtually total uniformity. Law enforcement records show that, within the acceptable range of 3 to 6 percent purity at the street level, the price of heroin has been constant between widely disparate distribution points during the past ten years.


Arrests of local distribution chains, internecine warfare among drug-traffickers, interdiction of smuggling routes, the virtual elimination of the Turkish opium supply after 1972, the scouring of Asian and European transit points, and local changes in political and growing conditions in the Golden Triangle growing area, all have failed to have any effect on the single world heroin price! The few exceptions prove the rule, and consist mainly of sharp temporary drops in some local retail prices, attributed to occasional free-lance supply through returning Vietnam War veterans and the like. (1)

Where does it go?

Closely related to the striking uniformity of inner-city heroin prices at retail level in the United States is the gigantic discrepancy between known levels of opium production for illegal purposes and consumption by the world's addict population. Fairly reliable statistical data are available for both. Within great margins of fluctuation depending on weather, enforcement, and other conditions, available supply exceeds demand by roughly a factor often.

Approximately 700 tons annually are produced and transported out of the world's largest opium-growing area, the Golden Triangle. (2) Seven hundred tons of raw opium, in the form of balls of opium gum, are the equivalent of about 70 tons of refined heroin. In practice less than half this amount is refined into heroin; the remainder is sold in the form of either opium or morphine base, largely for smoking purposes, and largely to an addict population in the orient itself. However, by all estimates of the American addict population, approximately three tons per year of refined heroin are more than sufficient to meet annual consumption "requirements." About that much again is required to maintain all other heroin addicts in the noncommunist advanced sector.

DEA and other official sources affirm the cited production figures through direct monitoring of opium shipments and other sophisticated intelligence methods. Consumption and sales are obviously limited by the possible size and financial resources of the addict population in the advanced sector. To use a rough example: If the full 30,000 kilograms of annual Golden Triangle heroin production obtained the full street price for heroin, the total retail value would be about $150 billion. But most estimates of annual illegal purchases of retail heroin are under $15 billion.

In short, most of it is never sold, because production capacity is enormous relative to the market's absorption capacity. What happens to the rest of the heroin? Only a small portion of the total comes into the hands of law enforcement agencies, whose capture of a few pounds of heroin is a matter for celebration. We still must account for tens of tons. The law enforcement records indicate that the drug is warehoused in huge stockpiles against contingencies and to prevent oversupply on the market.


For example, during the height of the crackdown on Southeast Asia heroin traffic in 1972 (immediately after U.S. troops withdrew), a single refinery captured by Thai police had on hand a stockpile of 3,000 kilograms, roughly one-tenth of Southeast Asian production. At the time, 21 refineries were known to be operational in the area. (3).


The law enforcement record shows that Dope, Incorporated does its best to avoid mishaps through careful research — on the streets of American cities — which is transmitted back to the poppy fields. Meo tribesmen in the Burmese or Yunnan Province mountains foothills do not plant what they feel like, but what they are told to plant. This facet of the production cycle is well known to law enforcement investigators. If for some reason the market research is off, chaos will ensue, as it did in 1972, when the Golden Triangle yielded a bumper harvest, after wholesalers told poppy-growing peasants to increase their acreage by 50 to 100 percent.

The wholesalers counted on the continuing exponential expansion of heroin consumption among American soldiers in Vietnam. Nixon pulled the rug out from under them by pulling the troops out, leaving the world heroin market in an unprecedented state of oversupply.

Reckless price-cutting and competition for sales outlets in this case might have provoked serious consequences for Dope, Incorporated were it not for "government regulatory intervention." The Thai government stepped in and sold 22 tons of opium to the United States. The opium was burned in a public ceremony attended by giggling Thai officials, thus restoring "equilibrium" to the market. (In any case, the Thais were only repeating the action of the Imperial Chinese in 1839, who purchased and burned more than 3,000 tons of opium to the great relief of oversupplied British traders, who sent special fleets to India to bring additional opium back to get the Imperial Government's attractive price.)

Once world illegal opiates traffic comes under scrutiny as an integrated, centralized "monopoly," the discrepancy between the huge oversupply and relatively restricted demand presents no further difficulties. We are looking at an "industry" based on the same principles as the world diamond cartel controlled by De Beers, or the so-called "club" among leading pharmaceuticals manufacturers.


Diamond production capacity is so large relative to the absorption capacity of the world market that De Beers' Central Selling Organization, running 85 percent of world diamond wholesale trade, limits availability in order to obtain essentially the price it wants. Pharmaceuticals are, ironically, an even better example. Since the knowledge to manufacture most of the commonly used prescription drugs is widespread among the pharmaceuticals companies, and since the costs of production are insignificant compared to the retail prices of most drugs, elaborate legal arrangements are necessary to prevent a price collapse.


Notoriously, the profits of the pharmaceuticals industry owe not to chemists but to patent lawyers.

How big an industry?

Heroin trade is the ideal commodity cartel; its price is more reliably controlled than that of crude oil, and its world volume of sales, at roughly $25 billion for heroin alone and considerably more for smoking-opium and other derivatives, is substantially higher than that of most of the commodities UNCTAD is presently considering for cartelization. A couple of comparisons are in order. At the recent world gold price of $225 per troy ounce, annual world gold mining production (outside the Soviet Union) yields less than $7 billion. During 1977, after an unprecedented price run-up, world diamond output was under $5 billion.

Allowing for the relative ease with which a large dollar value of heroin may be transported — the drug is worth at street level 366 times its weight in gold (4) — the worth of the drug trade is still boggling. It is even more boggling when the retail value in the United States and other OECD countries of non-opiate illegal drugs comes into the picture. For example, the Colombia marijuana crop officially estimated for this year alone carries a retail value of $40 billion. (5) Since marijuana smoking is so widespread in the OECD countries, there probably exists a much larger market in dollar terms than the relatively restricted market among heroin addicts.

Beyond such examples, no accurate data exist. The best that can be stated is that the total world cash flow of illegal drug traffic certainly exceeds $100 billion, and almost certainly does not exceed $200 billion.

The $100 to $200 billion figure includes heroin, opium, morphine, marijuana, cocaine, so-called hallucinogens, and abuse of otherwise-legal prescription drugs. It does not include the proceeds of other drug-related illegal activities, including gambling, theft, prostitution, smuggling, arms traffic, and so forth. It is almost meaningless to assign a total figure to the size of the world's illegal economy. It can only be stated confidently that the illegal economy, whose cornerstone is illegal drug traffic, exceeds the gross national product of most of the OECD countries! That is an extremely conservative projection of the hard data available.

To put the matter another way: all international traffic in controlled substances, including drugs, and also including means of barter for drugs — gold, diamonds, armaments, and so forth — the $200 billion international narcotics trade is bigger than the world oil trade. "DOPEC" is bigger than OPEC. World trade volume is a mere trillion dollars.

Where does the money go?

The question that emerges now is,

"How is it possible that $200 billion and up in dirty money, crisscrossing international borders, can remain outside the control of the law?"

Again, only one possible answer can be admitted: a huge chunk of international banking and related financial operations have been created solely to manage dirty money. More than that, this chunk of international banking enjoys the sovereign protection of more than a few governments.

These conclusions are obvious. If the entire resources of the largest private bank in the world, roughly $70 billion, had no other use but the financing of illegal world drug traffic and related illegal activity, those resources would be insufficient. If the members of the New York Clearinghouse, the richest group of commercial banks in the world, applied their entire $150 billion lending volume to the illegal economy, the volume might just be sufficient.

In the following sections of this report, the Anglo-Dutch banking operations that control illegal drug and related trade are documented in detail. Below, we will demonstrate through several chains of evidence that this is the only possible banking network that could handle the requisite volume of illegal traffic.


The Anglo-Dutch oligarchy's banking operations have the following qualifications :

  1. They have run the drug trade for a century and a half.

  2. They dominate those banking centers closed off to law enforcement agencies.

  3. Almost all such "offshore," unregulated banking centers are under the direct political control of the British and Dutch monarchies and their allies.

  4. They dominate all banking at the heart of the narcotics traffic; the Hong Kong and Shanghai Bank, created in 1864 to finance the drug trade, is exemplary.

  5. They control world trade in gold and diamonds, a necessary aspect of "hard commodity" exchange for drugs.

  6. They subsume — as documented below — the full array of connections to organized crime, the prodrug legislative lobby in the USA, and all other required elements of distribution, protection, and legal support.


Financial specialists, who have lived too long with the smell of the West Indies backwaters to mind it any longer, will choke on the above assertion. The general reader, by contrast, only needs to know a few facts in order to realize that something is wrong. All the offshore international banking operations — including the clean side — are such a speculative whirlpool that virtually the entire deposit base changes hands every week. Hundreds of billions of dollars, including at least a hundred billion in the offshore centers and further hundreds of billions elsewhere, circle the world through teletyped bank transfers.

No banking reserves are kept on any of this, as insurance against sudden withdrawals; in the United States, by contrast, commercial banks must hold 15 percent of their checking account balances and 4 percent of their savings balances on reserve. The "offshore" banks just assume that if they are short of cash, they can borrow what they need on the enormous "interbank" market. This mind-boggling financial procedure involves banks lending funds to each other in order to obtain fractional advantages in interest rates. Perhaps 40 percent of the total market is interbank money. Deposit maturities are so short, and money transfers are so rapid, that $50 billion changes hands every business day through the New York banks' Clearinghouse system alone.

The "offshore" banking markets are precisely what the name implies: either Britain's old island colonies refurbished for international banking, or inland feudal relics like Andorra and Liechtenstein. Federal bank regulators will only stare at their shoes when asked what goes on in these places.

In the Cayman Islands, one of the largest offshore centers, the only government is the official "Tax Haven Commission." Law enforcement officers have absolutely no way of getting hold of bank records in such places. Repeatedly, they have identified the offshore centers as the place to look for dirty money. They have not been able to, because virtually all the centers are under British political protection (see below).

American banks do a land-office business in the offshore centers, precisely because no reserves are needed, and every dollar of deposits can be lent out for interest. Currently American banks have over $35 billion in loans booked through Caribbean offshore islands, more than through their offices in London.

Even clean banking operations have moved offshore because present federal banking regulations virtually force them to. The big movement offshore began under the Kennedy Administration, when Anglophile Treasury officials C. Douglas Dillon and Robert V. Roosa railroaded legislation through Congress that taxed loans made to foreigners by American banks. The tax did not apply to loans made offshore, so that is where the bankers went. By the time the Dillon-Roosa legislation was lifted in 1974, the banks were "hooked" through the difference in reserve requirements. In a recent interview in Euromoney magazine, Citibank's chairman Walter Wriston denounced the Dillon-Roosa taxes as a "pure gift to London." (6)

According to the estimates of the
Bank of International Settlements, the total assets of so-called Group of Ten offshore banking centers, the unregulated islands and enclaves where "bank inspector" is a dirty word, amount to $94.349 billion, or close to $100 billion, as of February 1977.


The figures break down as follows:

The above figures do not show the actual size of the offshore banking centers, because they include only the assets of branches domiciled in the largest ten industrial countries. They do not include such entities as the three large banks in Thailand's capital, Bangkok, which figure prominently in financing Golden Triangle opium production. Nor do they include thousands of smaller, "offshore" finance companies based only in the offshore centers themselves.


Expatriate Chinese banks in the Far East, which have long been known to be a key point of contact with illegal drugs and other contraband traffic in the Far East, also do not show up on these tables; there is no available data on these institutions at all. Furthermore, the above table does include a great deal of legitimate banking business which American and other industrial-country banks bring to the "offshore" market for tax and other reasons. However, the round figure of $100 billion is a useful starting point.

Another set of figures is provided in the Bank of England's quarterly report, although it contains the same unwanted additions and deletions, and is thus relevant; it shows the large volume of interchange between London, which in major respects functions as the world's biggest "offshore" center, with the previously mentioned outposts for illegal money.


Unfortunately the available figures mix in both British banks' dealings and those of American and other banks which have offices in London.


More important than these numbers — which give a meager understanding of the volume of business in the offshore centers and mix in the legitimate business of American and other institutions — is the political control of the unregulated banking centers, With very few exceptions, offshore banking as a whole is under the thumb of the Anglo-Dutch oligarchy.

The British pre-eminence makes the world picture of offshore banking and dirty money more comprehensible. If the world offshore banking sector appears to run as a single operation under British monarchy control, that is because the same group of people who run it also run the opium traffic whose proceeds this banking sector was created to handle.

One index of British muscle is the following breakdown of the offshore banking centers, comparing the number of banks in each center directly attached to the Royal Institute of International Affairs governing bodies with the number of other banks in each center:

London and Switzerland are not normally considered offshore banking centers, although in practice both centers function that way. Although Switzerland has signed a treaty with the United States permitting law enforcement officers to investigate and seize funds relating to illegal narcotics traffic (resulting in one recent $250 million seizure), Swiss banks are still notorious depots for dirty money.


However, the Swiss side of the operation, typified by Lombard Odier and Edmond de Rothschild's Banque Privee in Geneva, and the Zionist-controlled Baseler Handelsbank is more specialized. Their most important activity is conduiting funds for international terrorism. Most recently, European authorities traced the funding of the 1978 Aldo Moro assassination through Swiss channels back to Israel.

London is the largest center for Eurodollar banking under the encouragement of the Bank of England, which permits the foreign branches of U.S. and other banks to hold external accounts in London without reserve requirements, and with minimal inspection. At last count, international banks had $90 billion in assets in London. The Bank of England can do as much or as little as it wants in the way of regulation, under British law.

For self-evident reasons, even the best-protected institutions of the British oligarchy prefer to launder their dirty money through Caribbean, Hong Kong, and similar branch operations, rather than in London itself.

Because the British suppliers of narcotics have ironclad control over offshore bank operations, American organized crime marketers of those narcotics have had a field day in the Cayman Islands and the Bahamas. American drug enforcement authorities know that most of the dirty money arising from the U.S. drug trade and related illegal activities ends up in the Bahamas. There has been, unfortunately, little public heat against the British officials who control the operations.

This level of control reaches the flagrant. For example, the chief of all banking regulation and licensing in the Cayman Islands, a close third behind Hong Kong and Macao in the big league of dirty money, is one Mr. Benbow. Mr. Benbow is a retired official of Britain's National Westminster Bank, which shares two directors, J.A.F. Binny and R.J. Dent, with the Hong Kong and Shanghai Bank.


Benbow got his present job at the recommendation of the British-influenced International Monetary Fund, according to a source at the IMF's Exchange and Stabilization division. Direct British "hands-on" management of the Caribbean offshore operation dates back to the 1940s, when E.D. Sassoon, Ltd. of Hong Kong — which had made its fortune from the opium trade over the preceding century — picked up, moved, and became E.D. Sassoon, Ltd. of the Bahamas.

Virtually the only one of the offshore centers not under official British control is Panama; not coincidentally, Panama is the only offshore center where American banks strongly outnumber British banks. That is not to say that Panama is clean; on the contrary, most of the funds derived from the Colombian trade in marijuana and cocaine are laundered through Panama, through the three large Colombian banks resident there. However, American banks have a measure of maneuvering room that they do not have in the Cayman Islands or the Bahamas, under the snooping eyes of the British authorities.

West German banking sources believe that the British banks behind Drugs, Incorporated want to move in on Panama and close the gap. The West German sources identify a special feature of the drug-ridden Hong Kong and Shanghai Bank's proposed takeover of a controlling share in New York's $20 billion Marine Midland Bank: Marine Midland is the transactions agent for the central bank of Panama. All of the national accounts clear through Marine Midland. Should the Hong Kong and Shanghai succeed in acquiring the American bank, it would exercise a decisive margin of control over the Panama offshore market, and bring British control over the offshore centers full circle.

Longstanding ties between Marine Midland and Panama were reflected in the fact that a former board member of Marine Midland Bank, Coudert Brothers lawyer Sol Linowitz, negotiated the Carter Administration's recent treaty concerning the Panama Canal.



The next sections will concentrate on the Far East offshore banking connection to the drug traffic as a model for the world operation, and follow the trail back to the controlling centers in London. British control over the world dirty money operation is no secret, and the British-Canadian-Caribbean connection to organized crime in the United States is so thoroughly documented that no doubt need remain.

However, it is the Far East that acts as a chokepoint for dirty money, in such volume that it dwarfs legitimate economic activity in the region, and in the British Crown Colony of Hong Kong in particular.

London has seduced and jostled American banking operations into the Caribbean to such an extent that there is a vast amount of legitimate money mixed in with the proceeds of the drug traffic. However, Hong Kong was set up by the British, literally from bare rock, as a center for the drug trade, and remains to this day purely British, and purely a center for the drug trade. In the Far Eastern example we can "prove" that Britain (and its Peking allies) run every phase of international drug traffic.

The laundering cycle

The Drug Enforcement Administration and other law enforcement organizations know how the cycle of dirty money in the United States works. The $50 billion retail proceeds of the total drug traffic in the United States are partly recycled into the drug operation in the United States itself, with large "off-take" by each level of the crime machine. The net profits, in cash, are laundered through hotels, restaurants, gambling casinos, and sports events — the "corporate profile" of the Max Jacobs family and other foot-soldiers of the British drug machine.

After the cash is laundered through these nominally legitimate channels, it is transferred to offshore banking operations or their equivalent. Then, according to Drug Enforcement Administration officials, the funds take several trips around the world over the telex machines of offshore banks, passing through at least a half
dozen, and usually more, different bank accounts and corporate fronts, from the Caymans to Liechtenstein, from Liechtenstein to the Bahamas, from the Bahamas to a "nonresident corporation" in Canada, from Canada to Panama, and so forth.

At various points in the process, the funds will purchase diamonds, gold, paintings, or similar portable valuables. At a further point, the valuables will be translated back into cash, eliminating even the trace of a bank transfer. For this reason, the use of undercover agents, in place even at fairly high levels in known branches of narcotics trafficking, has a poor record of detecting either the source or ultimate destination of narcotics-related funds.

Once laundered, the proceeds of the drug traffic and related illegal activities divide into three channels.

As noted, Hong Kong and related Far East operations are the chokepoint in the entire traffic, where dirty money is a way of life. We will focus on the Far East, the point of origin of world heroin traffic, and work backwards through the maze of Dope, Incorporated fronts and subsidiaries, to arrive at the British-controlled syndicates in the United States.

From Opium to Dirty Money

The starting point for the drug cash flow is the cash size of the opium and heroin traffic in the Far East itself, before the drugs obtain the stupendous price markups available in Western markets.


The price pyramid is known to be the following:

  1. Raw opium, the gum of syrup extracted from opium poppies, is produced in the Golden Triangle, the conjunction of the southern border of the People's Republic of China (Yunnan province), and the northern borders of Thailand, Burma, and Laos. The mountainous terrain, largely above 4,000 feet in elevation, provides ideal growing conditions. Mountain peoples, rather than ethnic Chinese (including those in Yunnan province), grow the opium and collect the gum. The merchant purchasing the gum pays roughly $100 a pound, (1) at collection points such as Lashio or Misai in Burma.  


  2. By the time the merchant, typically a Yunnanese, has brought the gum by mule train to the triborder area, e.g. Tachilek or Chiengrai in Thailand, the price has doubled, to $200 a pound. (2) At this point the opium is either refined into heroin at refineries located in the triborder area itself, or earmarked for the large Far Eastern market for smoking opium and related derivatives.

    Existing data permit the estimate that a division of an average 700-ton crop into 300 tons for heroin refining and 400 tons for opium shipment for Far Eastern smoking purposes is usual. (3)

    The $200 pound price at the triborder area is the price paid to the local agent by a wholesaler based either in Bangkok, Rangoon, or Hong Kong. Any distinction among these cities is meaningless. The business structure of the area is under the control of two principal groups that straddle the Far East. The first is the old British banks and trading companies, including the HongShang, Jardine Matheson, Charterhouse Japhet, Swire's, and the Peninsular & Orient Lines. The second, their satellites, is the overseas Chinese networks, under the joint control of London and Peking.

    The wholesale value of the 700 tons of annual opium product in the Golden Triangle, prepaid in the triborder area, is roughly $280 million. The $280 million figure, compared with the Gross National Product of Thailand, is considerable; it is like $35 billion in terms of the American GNP.

  3. But this wholesale figure is only a small portion of the cash flow of the Far East drug traffic. The next wholesaler, the Bangkok merchant who buys from the first wholesaler, pays about $1 billion for the equivalent of 700 tons of opium in the form of either raw opium or refined heroin. This is roughly four times what the opium was worth at the first wholesale round. The majority of production is retailed locally at large markups (although the markups are much smaller than in the case of heroin retailed in Western countries).

    While no hard estimates are possible, the cash flow in the Far East related to this first phase of opium production alone could not be less than $1 billion. That by itself is 15 percent of the estimated assets of foreign banks in Hong Kong, or 10 percent of estimated bank assets of foreign banks in Singapore, or precisely Thailand's 1977 balance of trade deficit!

    Measured against the size of economic activity in the regions, there is no possible way to chalk these numbers up in the "Errors and Omissions" column. The cash must go through nominally legitimate channels, in such volume that the nominally legitimate channels — like the HongShang — cannot possibly be unwitting as to the origin.

    Even these numbers do not sufficiently reflect the scale of the cash flow derived from crude opium sales alone. It must be added that most of this cash flow is seasonal; virtually all wholesaling must be completed during the two months following the March poppy harvest. Correspondingly, the visible flow of drug-related funds is several times as large during those two months.


  4. Finally, the wholesale and local retail cash figures presented above exclude what is possibly the largest component of Far Eastern narcotics money: the reflow of funds back to the Far East from sales made in the West. The narcotics wholesaler in Bangkok or Rangoon or Hong Kong with direct contacts with the growers and control of refineries has paid about $2,000 a pound for the refined heroin. Between him and the street corner, the same pound of heroin will undergo three markups of 1,000 percent. Its ultimate retail value (for pure heroin) will be close to $5,000,000 per kilogram, according to official DEA figures, or $2.27 million a pound, with a total of $25 billion for Western sales.

    What portion of this markup, and, in what quantity, accrues to the Far East wholesaler?


    There is no possible way to estimate this. According to the record of arrests of heroin smuggling, a substantial portion of such smuggling is conducted directly through expatriate Chinese channels, like the Hong Kong-to-Vancouver route, (4) and the notorious activities of the China Sailors' Union of Hong Kong.


    However, it is this markup that pays the wholesaler's out-of-pocket costs, including the original purchase from the highlands merchant, the refining, the huge quantity (perhaps 300 tons annually) of acetic anhydride used in heroin refining, security, bribes, transportation, warehousing, and so forth.


    Figure 1

    If the annual profit of the Golden Triangle operators is in the range of $5 billion — or a mere one fifth of the annual retail sales of heroin in the West — then the total cash flow in the Far East related to drugs is not $1 billion, as above, but $6 billion. The actual reflow is probably several times that sum. Some of the $5 billion may be banked elsewhere than in the Far East.


    The comparisons to the size of the region's economic activity become all the more grotesque: Thailand's 1976 total exports were only $2 billion. Even the $6 billion figure does not include the huge Far Eastern market for opium and heroin consumption. Added in, the retail volume brings the total close to $10 billion — twice Hong Kong's money supply.

    There is another way to arrive at the same $10 billion figure: the official estimate for bribes paid annually to Hong Kong police is an astonishing $1 billion, more than the annual police budget. From a hard business standpoint, that $1 billion in payoffs is a major part of the overhead cost of both wholesale and retail drug operations in Hong Kong, the area's drug capital. Since the known profit margin in the drug trade is 500 to 1,000 percent, it is fair to state that the $1 billion bribe figure is no more than 10 percent of local drug revenues. If $1 billion is 10 percent of the total, the total is $10 billion.

How the Drug Trade is Financed

The chain of financial control of world opium traffic begins in Hong Kong, with billions of dollars in Hong Kong dollar loans to expatriate Chinese operators in the drug-growing regions. These

expatriates include two of Bangkok's best-known bankers, according to American law enforcement files. Hong Kong also provides essential logistical support, including:

1) Smuggler-sized gold bars, obtainable through Hong Kong and Shanghai Bank subsidiaries
2) Diamonds, available through Hong Kong's Anglo-Israeli controlled diamond monopoly
3) Warehousing facilities, dominated by a subsidiary of the Hong Kong and Shanghai Bank

The Hong Shang

Hong Kong and Shanghai Bank is the semi-official central bank for the Crown Colony, regulating general market conditions, holding excess deposits of the myriad smaller banks, providing rediscount facilities, and so forth. Clearly, the Hong Kong and Shanghai Bank is also the financial hydra unifying the production, transportation, and distribution of Asia's opium.

Not only does it dominate financial activity in Hong Kong, with 50 percent of total banking business on the island, but "bank and government often work closely together," (1) the London Financial Times comments. The Colonial government in Hong Kong makes virtually no statistics on banking activity available.


Commenting on the $8.3 billion figure for Group of Ten bank operations in Hong Kong, the Financial Times notes that,

"The official figures are also just the tip of an almost certainly greater volume of business, which is conducted by international banks with finance company subsidiaries in Hong Kong, or organized from Hong Kong but routed through entirely offshore accounts in such places as Vila (New Hebrides)." (2)

To be precise, there are 213 deposit-taking finance companies in the Colony, as well as 34 local banks and 104 bank representative offices. Over these squats the Hong Shang.

The Chinese middleman

The essence of the bank's drug control is its intimate relationship to scores of expatriate Chinese banking families scattered throughout the Far East. The British and Dutch connection to these families dates back to the first East India Company penetration of the region. The central banking role of the HongShang expresses an agreement that grew out of a century of official opium trade and continues through the present.

First, consider the financial and logistical requirements of the trade. Planning for the March opium harvest begins in September. The Bangkok or Hong Kong drug wholesaler must estimate the size of his market during the next summer, and, after market research is completed, inform his agents in the triborder area. (That market research must come from the United States and other retailers.)


They, in turn, will communicate to the Yunnanese and other merchants who operate in the poppy-growing high-lands to the north what the market will bear for the next harvest. The merchants then inform the Meo peasants what acreage they may plant.

At this point, the wholesaler must consider the following. First, the physical means of payment must be obtained, including American or Soviet armaments, gold in appropriate small-bar or jewelry form, or whatever, and this to the tune of $140 million worth. Golden Triangle peasants can't use American dollars. Thousands of mules and muleteers must be made ready for the treks into the highlands. Bribes must be paid, routes monitored, border conditions observed, smuggling routes secured, contacts opened in the West, and other loose ends secured. The required seed money is in the range of the wholesaler's $2,000 a pound price for refined heroin. (3)

What portion of the investment is made through "internal resources" of the drug wholesalers, and what portion borrowed, is a matter of guesswork. It is known that a very large amount is borrowed seasonally to finance drug wholesaling, largely from expatriate Ch'ao Chou Chinese banking networks. Since the Ch'ao Chou category includes Thailand's most prestigious bankers, who are known to engage in financing drug traffic, very considerable financial resources are at the traffic's disposal. It is a matter of a 200 percent annual rate of interest — agreed and no questions asked.

Known "angels" of the narcotics trade include Chen Pi Chen, a.k.a. Chin Sophonpanich, Chairman of the Board of the Bangkok Bank, with $5 billion in assets; and Udane Tejapaibul, former Chairman of the Board of the Bangkok Metropolitan Bank, with $2.4 billion in assets. Significantly, Sophonpanich, whose name is a Thai pseudonym, is a Ch'ao Chou Chinese expatriate. (4)

Such scandalous relationships are not much of a surprise in the region. At the time of the 1973 Thai coup, the premier's son and chief of the narcotics bureau, Narong Kittikachorn, was found to be a prominent investor in drug wholesaling.

The annual credit line that must be extended to drug wholesalers, assuming they finance half their operations through credit, probably comes to about $150 million. Through pure chance, that is the average annual growth of the Bangkok Bank's "Loans and Advances" during each of the last ten years. Of course, Chin Sophonpanich competes with many of his Ch'ao Chou colleagues for this lucrative business.


Wherever the Ch'ao Chou expatriate banking community has surfaced in leading positions of influence, Peking, British, and opium trade connections are evident. In 1958, the Thai authorities issued a fraud warrant against Bangkok Bank's Sophonpanich. He fled to Peking and remained there until 1965, after which he returned, a deal with the Thai military in hand. According to area sources, Sophonpanich still maintains close contact with the Peking regime.

As one among several Bangkok financiers who finance the drug wholesalers in the volume of $100-200 million per year, Sophonpanich's contacts include several names that have frequently appeared on the "Opium Watch List" of American law enforcement agencies: Ying Tsu-li, General Lo, and the brothers Hutien-Hsiang and Hutien-Fa, leading refiners of heroin in the triborder area.

In addition, area sources report that Sophonpanich has direct links to the so-called Triads, the expatriate Chinese secret societies that do most of the legwork in the opium traffic (see Part I). Yet, Sophonpanich is actually nothing more than a subcontractor of the Hong Kong and Shanghai Bank, as we now demonstrate.

The HongShang-Chinese deal

Bangkok Bank illustrates the way the chain of financing leads back to the HongShang. Its current asset volume is $5 billion, much larger than the savings capacity of the area could justify. Banking sources report that most of its credit-generating capacity comes from rediscounting of the trade paper of the Singapore and Hong Kong financial markets, and mostly with the HongShang itself. Since the HongShang controls 50 percent of Hong Kong deposits and acts as the ultimate rediscount agency for the entire colony and much of the rest of Southeast Asia, the dependency of the Bangkok Bank and other Thai banks on the HongShang is virtually total. Most of the Bangkok Bank's lending volume is subcontracted business, controlled by the HongShang.

The British-Chinese expatriate link goes back as long as the British have been in the Far East. The British organized the systematic colonization of tens of thousands of Chinese expatriates throughout the area, and started them out in the lower levels of the business otherwise conducted by the East India companies and their successors. (5)

Even where Britain displaced early overseas Chinese financial interests from positions they had enjoyed in the precolonial period, they left them in local control or in a junior status in such ureas as opium trading, and often virtually restricted them to those areas. As W.J. Cator notes in his book The Economic Position of the Chinese in the Netherlands Indies (6) and Purcell notes in The Chinese in Malaya, (7) Chinese monopolies of opium and alcohol local distribution continued in many Southeast Asian colonies, under the aegis of the colonial authorities, into the first decades of the 20th century.

Colonial powers divested Chinese merchants of control of many trading monopolies granted by the precolonial local authorities, hut left them in control of gambling and local drug and alcohol distribution because Chinese secret societies were uniquely equipped to handle them. The secret societies, representing branches of societies operating in southern China, theoretically pursued the aim of their founding — the overthrow of the Manchu Ch'ing Dynasty in Peking.


But as time wore on and the regime remained in power, the societies abroad became less interested in the politics of their homeland and more the instruments of overseas economic interests. As anthropologist William Skinner notes in his book Chinese Society in Thailand, An Analytical History, (8) the immigrant societies were usually headed by influential monopoly owners — opium traders, keepers of gambling and prostitution houses — who generally used the societies to further the interests of their monopolies.

In other economic sectors besides opium, it is common knowledge that overseas Chinese business interests were often employed as compradors, middlemen in the service of colonial banking and trading operations, indispensable due to their knowledge of the local market and their language abilities. The close economic relationships that certain segments of the Chinese business community enjoy with particular British banking interests date from that experience. At every point in the postwar political history of the region, the Chinese expatriate financiers have acted as consistent allies of the British and Dutch.


According to standard estimates, Chinese expatriate financiers currently control 60 to 80 percent of the economies of Indonesia, Thailand, and Malaysia.


What the size of expatriate dependency on the Hong Kong market is can only be guessed. However, the existing financial data show that the Hong Kong financial market is enormously oriented to foreign lending, in roughly the same proportion as the American banking system. One-third of all Hong Kong-dollar denominated loans — excluding the so-called Asia-dollar market — are to foreign borrowers. Foreign lending stood at HK $18.47 billion in March 1978, against $39 billion in local loans. (There are about 4.6 Hong Kong dollars to one U.S. dollar.) (9)

Since the borrowers' market for Hong Kong, rather than American, dollars is limited to the areas of the Far East still under British financial sway, the HK $18.47 billion figure of overseas loans reflects the immense financial dependency of Burma, Thailand, and Malaysia on Hong Kong. The business is largely conducted through Chinese expatriate family ties. Most of Hong Kong's 250 locally registered finance companies, in fact, are owned by Chinese expatriates.

The scale of expatriate Chinese operations, centered in Hong Kong and dependent on the Hong Kong and Shanghai Bank, is gigantic; the overseas Chinese community controls 42 percent of the foreign trade of the Southeast Asian countries, compared to 32 percent of Western business, 18 percent of non-Chinese local firms, and only 8 percent of state-controlled trading companies. (10)


As of the most recent figures available, Chinese expatriate investments in the area totaled only slightly less than combined American, Western European, and Japanese investments (although recent Japanese expansion in the area may have shifted the proportion somewhat).

The Hong Kong and Shanghai Bank, self-described as "a monument to British finance in Asia," is in full control of the Hong Kong money market (1), on which such Chinese expatriate institutions (2) as the Bank of Bangkok absolutely depend for rediscounting loans, etc. Opium smugglers and wholesalers (3) in turn depend on the expatriate banks to finance their barter-purchase, refining and transport of opium and heroin from the "Golden Triangle" peasants of Southeast Asia and China's Yunnan Province (4).


From seed-money to dirty-money, the proceeds of the drug trade start and finish with the HongShang (a.k.a. Hong Kong & Shangai Bank).

The above figures only give a partial picture of overseas Chinese financier dominance of Southeast Asian economies, because the expatriate Chinese bourgeoisie is overwhelmingly in such strategic sectors as banking, insurance, shipping, warehousing, and other intermediary activities, rather than manufacturing or agriculture.

According to one of Stanford University's classic China studies, Thompson and Adloff's Minority Problems in Southeast Asia, "Foreign-exchange and other controls (imposed by national governments in the area — ed.) have transformed many of the Chinese into smugglers and black marketeers, and such operations have increased both their wealth and their unpopularity.

Attempts to control the Chinese have almost everywhere run into the bewildering maze of overlapping Chinese organizations which exists in every country of the area, and they have been frustrated by Chinese evasion, ability, and indispensability." (11)

The activities of the corrupted section of the expatriate Chinese community in Southeast Asia have provoked a long series of clashes with national authorities — who have not generally been successful in limiting illegal traffic. The one exception is the British possession of Hong Kong, the center of illegal operations in the area, where the smugglers are members of Hong Kong's high society, e.g., Macao gambling overlord Stanley Ho, who made his career smuggling strategic materials from Hong Kong to China via Macao during the Korean War.



Britain's Gold and Dirty Diamond Operations

One feature of the financing chain of the Far Eastern drug traffic—the Asian gold market—is a tipoff of the British (and especially Hong Kong and Shanghai Bank) control over the entire process. It might seem strange to the general reader, but the gold connection was one of a handful of critical clues that led investigators up the whole chain of evidence that will eventually put the management of the HongShang and a few other long-established institutions behind bars.

Vast quantities of gold are absorbed into the Asian drug trade—an inestimable percentage of the 400 to 600 tons of the metal that pass through the orient in a year, mainly through Hong Kong, and mainly through subsidiaries of the HongShang. The trade could not run without it and other precious, portable, untraceable substances—like diamonds.

First of all, peasants of the Golden Triangle poppy fields do not appreciate secret accounts in the Bahamas. Furthermore, since the end of the Vietnam War, and the end of the widespread traffic in contraband and American arms and American dollars, the U.S. dollar in the form of currency is no longer an acceptable medium of exchange. They must be paid in food—which they do not produce themselves—goods, and gold or the equivalent.

Secondly, the People's Republic of China's share of Golden Triangle production is paid almost entirely in gold, shipped in bulk across the Burmese border. (1) PRC gold income on opium production probably absorbs around one-seventh of all gold traded in the orient (judging from data analyzed more closely in Section 6, The Peking Connection). There could be some double counting here, since Peking also sells gold on the Hong Kong market.

Third, and possibly most important, gold cannot be traced, although any bank transfer ultimately can. One bar of gold looks like any other; changing a bank balance into gold or diamonds, and then changing it back into a bank balance, is like crossing a river to avoid bloodhounds.

Gold is so important to the entire business that the metal's price is pegged to the price of raw opium in the Golden Triangle highlands. The dollar's fall in terms of the gold price from $35 an ounce before 1971 to about $225 recently has also dramatically escalated opium wholesale prices. The escalation of the gold price over the past year has been so steady that all the numbers regarding the size of the opium trade may already be gross underestimates.


One indication of the closeness of the gold-opium relationship is the well-known story that the CIA fieldmen in northern Laos carried both gold and opium, to use as means of payment to the local Me'o population in case of need.

How illegal gold travels

The American public will be shocked at how openly the Hong Kong and Shanghai Bank uses its monopoly in the Far Eastern gold trade to feed smuggling operations. Prior to the official opening of the Hong Kong gold market in 1974, HongShang openly financed the gold markets of Macao, the flagrantly crime-ridden island that plays "offshore" to Hong Kong's own "offshore" operations. Today the Hong Kong market is run topdown by Sharps Pixley Wardley, a 51-percent owned subsidiary of the HongShang. The Hong Kong market's current daily trading volume is in the hundreds of millions of dollars, on a par with London and Zurich.

Apart from Hong Kong, the other route for smuggled gold to the Far East is through the Persian Gulf sheikdom of Dubai. The dominant commercial and gold market force in Dubai is the British Bank of the Middle East, a 100 percent subsidiary of the Hong Kong and Shanghai Bank. A 1972 description from one of Britain's best-known experts, Timothy Green of Consolidated Gold Fields, Ltd., (2) is instructive on how the illegal flow of gold travels:

"It may indeed sound romantic, but it is a fact that both in 1970 and 1971 at least 500 tons of gold—that is to say half of all South Africa's production, or 40 percent of total gold production in the non-communist world—passed through unofficial channels on the way to its ultimate destination."

"Unofficial" channels, as the author proceeds to make clear, means illegal channels. Most of the world's existing gold is held by central banks; prior to 1971, gold was the basis of central bank reserves. With the advent of the new European Monetary System, gold is again becoming an official monetary reserve. Gold dealings among banks, industrial users such as jewelers, and so forth, are also counted as "official" channels.

Apart from the drug traffic and related money-laundering uses, gold smuggling has played a major role in aggravating the payments deficits of Third World countries such as India, where large numbers of private citizens hold gold. However, the Indian government in 1977 opened up direct sales to the Indian population. This largely eliminated India as a haven for gold smuggling by making gold available through official channels. Despite this, judging from the activity of the Hong Kong market, the proportion of gold running into illegal channels has, if anything, increased, and the drug-related proportion of the illegal gold increased as well.


"... these unofficial channels usually start in gold markets such as Beirut (since defunct — ed.), Dubai, Vientiane, Hong Kong and Singapore which I am discussing today. Their chief role — their raison d'etre — is as distribution centers for the smuggling; they are entrepots convenient to nations, which for a variety of reasons, forbid the official import of gold for commercial or hoarding uses ....

"Dubai has become the largest gold market in the world, except for London and Zurich — no mean achievement for a shiekhdom with a population of around 60,000. Both in 1970 and 1971 Dubai had well over 200 tons of gold — indeed in 1970 the equivalent of a quarter of all South African production found its way along this golden pipeline to India and Pakistan (and further East. Since the beginning of official gold sales by the Indian government, and the reopening of the Hong Kong gold market, Dubai's importance has attenuated somewhat — ed.) . . .

"By contrast to Dubai, a gold market that developed very quickly to meet a special short term need was Vientiane in Laos. The market there really grew with the escalation of the war in South Vietnam. And it grew because it was the nearest and cheapest source of gold. . . . This gold which was bought as a hedge against the constant devaluations of the Vietnamese currency and to hide the vast black market profits made from pilfered American arms and equipment, was paid for almost entirely in cash. (Throughout the 1960s and 1970s, pilfered American arms and equipment formed a major part of the barter goods exchanged for opium in the Golden Triangle highlands — ed.).

"Vientiane's short success made some impact on the oldest gold market in the Far East — Hong Kong, or more correctly Hong Kong-Macao, for the two are held together as it were by a golden chain. Hong Kong, as a British Crown Colony, forbids the private holding of gold bullion; only commercial gold of less than 945 purity may be traded. To get around this regulation, gold bullion has for more than twenty-five years made a curious sideways shuffle from Hong Kong to Macao and back again. The gold bullion — in 995 good delivery bars — that comes into Hong Kong by air from Europe and Australia ... is transferred in Macao, where it is melted down into Chinese 1.5 and 10 tael bars. It then returns, stealthily, to Hong Kong. This traffic has been presided over for may years by the Wong Hong Hon Company which negotiated a series of two-year contracts with the Portuguese authorities in Macao for exclusive rights for the gold traffic. The traffic was financed by the Hong Kong and Shanghai Bank," (emphasis added)

That is, in the testimony of Britain's leading gold expert, the HongShang financed illegal gold trade in Hong Kong itself, prior to the reopening of the Hong Kong gold market, after which the HongShang subsidiary Sharps Pixley Wardley took over the legal trade.


Digging into the back archives, it is clear that Consolidated Gold Fields' 40 percent figure for smuggled gold in 1972 represents, if anything, a moderation of past trends. Earlier figures are much higher. For example, British author Paul Ferris in The City (3) claimed that in 1951 only 17 percent of all world gold production went through official channels; Ferris's report was based on interviews with the London gold pool. "What happens to the gold when it disappears into the economic undergrowth of the East is of no concern to the London bullion dealers," Ferris claimed, but as we will demonstrate, the London bullion dealers know precisely what happens to the gold in the Far East. The London bullion market is merely a subsidiary of Dope, Incorporated.

In the July 22, 1952 issue of The Reporter, an article under the byline of H.R. Reinhart, the then Far East correspondent of the Neue Zuercher Zeitung, estimated Asian gold smuggling at $150 million in that year. At today's gold prices, the figure would be $1 billion for the same quantity of gold. The account bears impressive credentials, since 1) the Reporter editor at the time was Harlan Cleveland, now a senior official of the Aspen Institute, and part of the present drug machine in the U.S.; and 2) the Neue Zuercher Zeitung, Switzerland's top daily paper, is linked through European aristocratic ties directly to the British monarchy. (4)

Reinhart identified a "Golden Loop, the circuitous path that leads from North Africa to the coast of Red China and back again as far west as India." The center of gold smuggling was the Portuguese-controlled island of Macao, where gold smuggling is legal, and "anyone who dares call a smuggler a smuggler can be sued for libel." Then the gold is smuggled into Hong Kong, and thence to the rest of Asia.

A mere 3 percent of the smuggled gold is seized by Hong Kong authorities, Reinhart noted, even though customs officials receive a 20 percent commission on all seizures; presumably, bribes to customs officials are more substantial.

Standard Western and Soviet sources estimate the smugglers' commission at 30-50 percent in such transactions. Soviet economist M.A. Andreyev reports:

"According to a Chinese businessman in Singapore, smuggling yields a profit of up to 100 percent on invested capital, which is several times higher than the profit received in the basic branches of the island's economy. In Hong Kong the commission paid to smugglers amounts to from 30 to 50 percent of the cost of the smuggled commodities." (5)

However, if the bribes paid to Hong Kong customs officials are substantial enough to overshadow the 20 percent kickback on seized contraband gold, the bribes must also be in the order of 30 to 50 percent. The point is that the gold trade itself would not be profitable, unless it were only a bridge transaction in a much more profitable operation — e.g., narcotics traffic! That is the case.

But as Reinhart reported,

"British justice, as dispensed by the magistrates' court in Hong Kong, extends even the benefit of the doubt to a suspected smuggler caught with the goods."

That should not be a surprise at this point; as noted before, it was a matter of public record for a quarter century that Britain's Hong Kong and Shanghai Bank itself financed the gold smuggling!


One further crucial point — whose full importance will only emerge in the following sections — is that the People's Republic of China has been in on the illegal gold market since the 1949 Maoist takeover.

Gold flown into Macao, as noted above, was (before Hong Kong opened up its gold markets in 1949) resmelted into bars of less than 95 percent purity, whose trading the Hong Kong authorities hypocritically endorsed. The resmelting, Reinhart reported, was the business of the Kan Kuam Tsing Company in Macao. "On the Hong Kong exchange," the Swiss journalist added, "the buyer is not unlikely from the People's Republic of China." Since the PRC buyer wants metal of monetary-reserve purity, above 95 percent, he takes the gold back to the Kan Kuam Tsing Company, and reconverts the gold back to a higher purity level. Reinhart identified the firm Pao San and Co. as a regular vehicle for Peking gold purchases during the early 1950s. (6)


According to Reinhart, the PRC entered the Hong Kong gold market in 1950. Last July's announcement that 13 Communist-owned banks in Hong Kong would be permitted to trade directly in the Hong Kong gold market thus only extends an agreement that has been in force since the founding of the PRC.

One big gold pool

Apart from a relatively insignificant flow of gold into Hong Kong from mines in Australia and the Philippines — insignificant compared to the 300 tons of gold traded in Hong Kong during 1977 and the 600 tons traded during 1978 (projected) — Hong Kong depends entirely on the London gold pool for its supplies.

Figure 3

Above map is based on one appearing in the 1977 annual report of Consolidated Gold Fields, Ltd.

The world total of gold in metric tons was only approximately 1,500.

Of this, 390 metric tons was distributed from Europe through Dubai and 287mt through China, primarily by British-controlled agencies, most of it ending up in Hong Kong.

Another 18mt is directly exported to Hong Kong, for a total of 695mt.

The vast proportion of this flow is "unofficial," and is put to use in drug-related dirty-money laundering. (Cf. Figure 5.)

Why do London's gold pool operators tolerate this situation? Because the London gold pool is the same operation as the Hong Kong and Shanghai Bank, controlled by the same London families whose drug-running activities go back 150 years.

There are two major South African gold producers, Anglo-American and Consolidated Gold Fields (whose gold specialist was quoted above); there is one major South African diamond producer, De Beers, largely owned by Anglo-American; and five major London gold pool firms, who meet every day in the trading room of N.M. Rothschilds at New Court, St. Swithin Street, London, to set the world gold "fixing." Examining these firms individually, we discover such a manifold of connections that it is meaningless to speak of the London and Hong Kong gold markets as anything but branch offices of the same operation.

Hong Kong and Shanghai's own gold-trading outlet is Sharps Pixley Wardley, of which they own 51 percent. One of the five London gold pool firms, Sharps Pixley, owns the remaining 49 percent. But Sharps Pixley itself is a fully owned subsidiary of the London merchant bank Kleinwort Benson whose deputy chairman is Sir Mark Turner, the chairman of Rio Tinto Zinc.

Rio Tinto Zinc itself was founded a century ago with the opium-trading profits of Jardine Matheson, by a member of the Matheson family; the Mathesons are still large shareholders in the HongShang. The Matheson family's heirs, the Keswick family, still have their traditional seat on the HongShang board. Sir Mark Turner spent World War II at Britain's Ministry of Economic Warfare, which also employed Sir John Henry Keswick, and another HongShang board member, John Kidston Swire.

Hong Kong's second largest bank, the Standard and Chartered Bank, owns a majority share of another member of the London gold pool, Mocatta Metals. Standard and Chartered's predecessor, the Standard Bank, was founded a century ago by Cecil Rhodes, of whom we will have much to say later in Section 7.

Standard and Chartered is not only a close collaborator of the HongShang in such matters as the transfer of Red Chinese opium money (see Section 6 below) — but is heavily interlocked since the days of the official British opium trade.

Figure 4.

British Gold and Diamond Syndicate

One of Standard and Chartered's directors is the current Lord Inchcape, of Inchcape and Co. and the Peninsular and Orient Steam Navigation, the latter dominating ocean freight in the Far East. Both companies are heavily represented on the HongShang board of directors. Inchcape's father wrote the notorious 1923 Inchcape Report recommending continued British sponsorship of the opium traffic — despite the outrage of the rest of the League of Nations — in order to "protect the revenues" of then-British colonies in the Far East.

This example also indicates why the London gold pool's dirty money operations are a worldwide, not merely a Far Eastern, problem. Mocatta Metals, a subsidiary of Standard and Chartered's Mocatta and Goldsmid, operates one of New York's biggest dirty money laundering operations.

Mocatta Metal's current chairman, Dr. Henry Jarecki, has been under investigation for years for illegal activities, although no indictment has yet been handed down. According to European intelligence sources, Jarecki's dirty money operation helps fund the activities of the Mossad, Israel's foreign secret intelligence service, in New York City, including assassination teams.

Jarecki is no small fry: he is a frequent gold columnist for British financial publications such as Euromoney, and rated a lengthy profile in the September 1978 issue of Fortune magazine. Nonetheless, he is eminently suited for the role of bag-man for Israeli intelligence hit squads. Jarecki began running drugs as a small-time pusher on the University of Michigan campus in 1950-51. In 1952, he spent six months in jail for suspected espionage in East Berlin. According to published sources, approximately half of Jarecki's present staff of 28 gold traders started out in the same Harvard Psychology Department that featured LSD-pushers Dr. Timothy Leary and "Baba Ram Dass" in the early 1960s. (7)

Midland Bank stands behind both Standard and Chartered and Mocatta and Goldsmid, with a 20 percent ownership of Standard and Chartered; it also wholly owns another London gold pool bank, Samuel Montagu. Sir Mark Turner is a director of both Midland Bank and Samuel Montagu. The Montagu family, heavily intermarried with the Rothschilds, Montefiores, and Samuels, is the cream of Britain's Court Jews. One of their protιgιs is HongShang board member Philip de Zulueta.

N.M. Rothschild and Sons, which opened up operations in Hong Kong in 1975 to take advantage of the newly liberalized gold trading laws, and Johnson Matthey, the remaining members of the London gold pool, are also interlocked several times over with both the HongShang and the major South African gold producers, Consolidated Gold Fields and Anglo-American who control between them 90 percent of South Africa's gold output. (For further details see Section 7 and 8.)

The diamond black market

Second in importance in the money-laundering process is the world diamonds market, worth $5 billion annually at wholesale value, whose single presiding manager is Sir Harry Oppenheimer of De Beers Corporation. Oppenheimer is also the chairman of the larger South African gold producers, Anglo-American. The Anglo-American and De Beers complex runs the Hong Kong side of the money-laundering diamonds operation on two levels — wholesale and retail. De Beers runs 85 percent of the wholesale diamonds market; through his intimate Israeli connections, Oppenheimer also runs the Hong Kong diamond market.


There are two points of special relevance for diamonds to the international heroin traffic. The first is that, in value relative to size and weight, diamonds are the closest approximation to heroin as a store of value for furtive use. Secondly, the De Beers-controlled international diamond cartel operates according to a pyramidal structure identical to that of the world heroin trade.

The use of expatriate ethnic networks for the dirtier side of the operations is also homologous, except that in the case of diamonds, Jews take the place of Ch'ao Chou Chinese. Not coincidentally, there is almost as little publicly available information on international diamonds trade as on the heroin traffic.

South Africa's largest producer, De Beers, was the 1888 creation of Rothschild legman Cecil Rhodes; in 1929, the company underwent reorganization by Sir Ernest Oppenheimer, of the Anglo-American family. De Beers controls the Central Selling Organization (CSO), which handles 85 percent of international diamond trade.

At ten "sights" each year, 300 clients purchase stones from the CSO. The list of these select clients is secret. Following their purchase by the secret list of clients, the diamonds are sent to cutting centers for further preparation. The two dominant cutting centers are Antwerp and Ashqelon, in Israel. Antwerp's diamond cutting and related trade is financed by the Banque Bruxelles-Lambert, controlled by the Lambert family, the Belgian cousins of the Rothschilds. Israel's (and also New York's) diamond business is financed by Bank Leumi. (8)

Within the individual centers, dealers trade among themselves on such exchanges as the New York Diamond Dealers Club, the Ramat Gan in Tel Aviv, and the Antwerp Diamond Bourse. No written records are kept of any transactions on these exchanges; the agreements are sealed with a handshake. No aspects of this trade are available for scrutiny by law enforcement agencies, even under American law, before the diamonds reach the jewelry store level.

Hong Kong's own substantial wholesale diamond market is the virtual monopoly of the Union Bank of Israel; this bank is wholly owned by Israel's largest finance house, Bank Leumi. Bank Leumi, in turn, is under the control of Barclays Bank, on whose board sits Harry Oppenheimer and the Oppenheimer family itself. Bank Leumi's own chairman is Ernst Israel Japhet, of the Charterhouse Japhet family whose fortune derived from the official British opium trade during the nineteenth century!

Ten times a year, representatives from the Ramat Gan, Tel Aviv's diamond exchange, go with Union Bank financing to the De Beers Central Selling Organization "sights" in London, and purchase one-third of the world diamond output.

Like the Peking-British-controlled Ch'ao Chou Chinese networks in the Far East, Britain's Zionist financiers are a cult unto themselves, with their own family networks, cults, and language. New York's diamond market consists, at the lower levels, mainly of members of the extremist Hasidic sects resident in the area. This exotic feature of the diamond traffic achieved public notoriety after several unexplained thefts and murders occurred in the diamond trade during 1977.

Although there is an apparent division of labor between the Hofjuden precious metals and precious stones channels of the world dirty money operation, the various firms involved are so closely intermarried, interlocked, and interowned with the major dirty money banks, that the working of the dirty money apparatus is totally integrated.

A case in point is Canada, the dumping ground for all aspects of Dope, Incorporated that feed into the United States. The Bank of Nova Scotia, for example, is both the major gold dealer (and banker for the second largest gold dealer, Noranda Mines), and the major dirty money operator in the Caribbean.

The Nova Scotia is notorious for bribing its way into new branch offices in the Caribbean, violating local currency laws, running flight capital against currency restrictions, "investing" in local businesses known to be intelligence fronts, and so forth. Nova Scotia's branch network in the Caribbean is the largest of any bank in the world, save Barclays which has a similar pedigree. Gold is a specially useful medium for the special case of the Caribbean, where official restrictions make some bank transfers difficult. Conveniently, Nova Scotia leads the Toronto gold market.

The other leading gold market operator in Toronto is Noranda Mines: its chairman Powis is a member of the board of directors of the Bank of Nova Scotia. Powis is also a member of the board of Sun Life Assurance, the Rothschilds' insurance company.


Organized Crime


We have now taken the reader through the production and wholesaling phase of Dope, Incorporated. We have introduced the Far East clearinghouse bank, the Hong Kong & Shanghai Bank and he gold and diamond houses that with HongShang feed the black market with invisible forms of payment. In the following pages we will concentrate on the distribution side of Dope, Incorporated's business cycle.


We will first enter the Canadian board rooms where the Keswicks, the Inchcapes and their representatives brush shoulders with the wholesalers of the drug trade — the Zionist Hofjuden middlemen — whose assigned task is to ensure swift and secure delivery of that "most valuable source of revenue" to Britain's retail distributors: the mob.


The Bronfman family of Canada is our leading case, since they are the top middlemen for the U.S. market which, in turn, is the richest in the world. Beneath the respectable veneer of the Bronfmans' corporate financial empire we will uncover Dope, Incorporated subsidiaries that control the criminal underworld of North America. We will look closely at Meyer Lansky, the Marcello family, and other "Mafia" figures and discover that like China's Green Gang, the mob is a secret army, a fifth column controlled by Britain against the United States.

We will trace the drug money to the gambling casinos and other "legitimate" enterprises that are the syndicate's indispensable storefront cover for the drug trade. From these respectable enterprises we will trace the drug money into the halls of the state assemblies, city councils, congressional offices, and into the pockets of America's contemporary Benedict Arnolds and Aaron Burrs, among whom we will find Edward Kennedy, Jacob Javits, Henry "Scoop" Jackson, and other leading lights of the Zionist Lobby. We will find tainted heroin money being funneled into Zionist organizations and from Zionist fronts back into political machines for the dual purpose of buying protection for the drug trade and shaping U.S. policy.

We will then take a grand tour through the Anglo-Dutch offshore banking centers, watching money being laundered through Basel, Liechtenstein, Tel Aviv, and the Bahamas; tracing it carefully as it changes ownership from the mob, to the Bronfmans, to British banks, to the Israeli Mossad — finally ending up in dummy corporations to finance international terrorism and a privately owned worldwide assassination bureau.

By the time we finish, the reader will have a view of organized crime that tears to shreds all the fairy tales of the drugstores novels and Grade-B Hollywood productions. The image of gangsters and thieves lurking in the dark underworld will dissipate before the fact that we are dealing with the most highly integrated, top-down political machinery in the world — one that enjoys the logistical support of a $200 billion per annum international cartel and the "protection" of every political entity Britain has created through these vast "invisible earnings."

The cutouts

The police investigator has a problem in trying to track down the source of the drug trade: he invariably proceeds from the bottom up and gets lost along the way long before he reaches the level of command that counts. Every year, local police arrest thousands of street corner and schoolyard pushers, yet it is a rare occasion when any of these arrests leads to the arrest of higher up syndicate figures who ply the street trade in the first place. And these local syndicate warlords are themselves usually several steps removed from the "Mr. Bigs."

As Part II of this report demonstrated, at the top, British banking — through HongShang — controls the production and wholesaling side of Dope, Incorporated. This "out-front" activity in the Far East is protected by the legal technicality that the area is off-limits to U.S. investigative agencies. (As one experienced

U.S. foreign service officer put it, "It would be easier for a white Anglo-Saxon Protestant to penetrate the Politburo of the Chinese Communist Party than it would be to gain access to the Hong Kong or Swiss bank accounts of the drug traders.") At the retail, distribution end, there is no parallel way of directly linking the British oligarchy to the drug traffic — at least not with the ordinary tools of the police trade.

One of the ABCs of any covert operation is the time-tested practice of securing middlemen — or, to use the professional expression, "cutouts" — that effectively conceal the identities of the stage managers who run the show from behind the lace and velvet curtains. From the top all the way down to the street level, Dope, Incorporated is run through layer upon layer of such cutouts.

Even in China, where the British Crown brazenly pursued its opium policy, it operated through the corrupted Soong family which carried out the day-to-day business operations for Jardine Matheson.

In the West, the prime cutout for Dope, Incorporated is the Zionist Lobby. This cutout begins at the top with the cohesive grouping of Hofjuden ("Court Jews") who serve the British monarchy as loyal, wholly owned servants. These families, whom we will meet by name, have a centuries-long tradition of attaching themselves to the predominant noble houses of Europe, providing indispensable services as tax-farmers and errand boys for the types of missions that the aristocrats would prefer to plan but not get caught in carrying out.

Many of these Hofjuden families migrated from Amsterdam to Britain after the "Glorious Revolution" (1688), which brought the Dutch House of Orange onto the British throne in alliance with the most bucolic, feudalist landed gentry of the Isles. That Anglo-Dutch merger of the late 17th century turned Britain into the most powerful center of the European oligarchical faction — a status it has maintained for three centuries. For these Hofjuden families, the relocation to Britain marked no shift in allegiance; they have functioned as servants for the oligarchical system, not for specific houses.


Several of the Hofjuden families who converged on London during the 17th and 18th centuries had served the Genoese bankers in their takeover of Holland, had participated in the Dutch East India Company's first expeditions in opium trade, and had collaborated over the centuries with the British Jesuits against European humanist forces.

The Hofjuden should not be confused with the Jewish people. In much the same way that one would not condemn an entire nation for the crimes committed by its most deranged citizens, one cannot condemn the entire Jewish people for the centuries of crime committed by the Hofjuden. The only relationship the Hofjuden have had to Jewry is that of persecutors and tormentors.


As the clandestine operations bureau for the oligarchy, they quickly learned that they could augment their capabilities tremendously by subjecting Jews to waves of persecutions and then recruiting terrorized Jews into Zionist organizations that had as their ostensible aim the "survival" of Jewry! In street parlance, the Hofjuden have run a six-century-long protection-extortion racket against the Jewish people — to the overall effect of building up a sizable "Zionist" network at the disposal of British Secret Intelligence. This traditional relationship to Jewry was carried to its lawful conclusion in the 20th century when the Rothschilds, Warburgs, Oppenheimers, Schroeders, and other Hofjuden became the leading financial backers of Adolf Hitler.

One of the greatest benefits that the Hofjuden gained by their complicity in Hitler's genocide of the East European population was that they could henceforth hide behind the memory of the awesome fate of millions of Jews and conduct the filthiest sorts of operations — from drug-running to terrorism to genocide against Arab and related populations — without being exposed for these crimes against humanity. Whenever any critic attempted to expose these crimes, he was quickly assaulted as a "Nazi," a"fascist," or an "anti-Semite."


It is neither unrelated nor coincidental that these Zionist Hofjuden were delegated the role of cutouts between the inner circles of the British nobility and the filthiest gutters of organized crime. Even within the Hofjuden, we encounter two levels: one is the centuries-old families (the Hofjuden "elite") who rub shoulders with and are intermarried with the nobility; and the second, the "initiates" — "chosen" by the Hofjuden elite to be the drug-runners, the bootleggers, the murderers, and extortionists who themselves hope that by slavishly serving the British oligarchy they will be placed among the ranks of the Zionist "respectables." Within the first category, we find such "respectable houses" as these:

The Montefiores trace their origin as "special operations" experts for the European oligarchy to the 13th century in Spain, when they ran errands as tax farmers and Inquisitors for their masters, the Genoese. The Montefiores later moved to Holland to help found the Dutch East India Company and the Bank of Holland. After the Stuart Restoration of the mid-17th century, the Montefiores moved to England where they helped establish the Bank of England and the British East India Company. Under Sir Moses Montefiore, the family collaborated with Lord Palmerston and Prime Minister Disraeli in the founding of the present-day Zionist "movement."

The Goldsmids and Mocattas have been the leading bullion merchants for the royal family of England since the Stuart Restoration, predating the founding of the Bank of England. As we have seen, both families conduct a significant portion of the black marketeering in precious metals for the Hong Kong drug traffic. The Oppenheimers control a large portion of the diamond and gold mining in South Africa and are interlocked with the HongShang Bank to provide yet another means of exchange for drug transactions.

The Canadian de Hirsch family bankrolled much of the Jewish migration from Eastern Europe to Canada and is still a bankroller of Zionist organizations.

The Sassoons were the first Hofjuden family to concentrate their resources primarily in opium production. Known as the "Rothschilds of the East," they settled in India at the beginning of the 18th century. The Sassoons relocated in 1949 to the Caribbean where they established themselves on the ground floor of casino gambling and unregulated offshore banking.

The Rothschilds began their fortune in Hesse-Cassel, Germany by supplying Hessian mercenaries to the Hanoverian King George III of Britain against the American colonies. They are "johnny-come-latelys" to the Hofjuden circle, having only seriously gained a place in the oligarchical court with the Treaty of Vienna in 1815. From that point, however, the Rothschilds have expended considerable resources toward the subversion of the American republic; they maintain an "investment" presence in Dope, Incorporated.

Immediately below the Hofjuden elite are those "initiate" families selected and sponsored to run the criminal underworld and its "legitimate" front organizations. Into this category falls the powerful Bronfman family of Canada, the Hong Kong of North America. By all accounts one of the richest families in the world, the Bronfmans are a sterling example of a family handpicked and raised out of the gutter to become some of the best paid crooks in the world.


A Bronfman illegal loan of $350,000 to the Campaign to Re-Elect Hugh Carey as Governor of New York recently caused a public outcry, but as the story we now tell shows, the Bronfmans themselves are owned and operated by the British banking elite of Dope, Incorporated.

The Bronfman Gang

The Bronfman family is best known to Americans through its ownership of Seagram, the biggest liquor company in North America. The family's holdings stretch from whiskey, banking, mining, real estate, and — although somewhat less publicized — narcotics. Today they are regarded as respectable and outstanding "philanthropists" whose name is attached to everything important in Canada — and Israel — be it government, business, or "cultural" affairs. This was not always the public profile of the Bronfman family.


Less than 50 years ago, they were known to be the biggest boot-loggers in North America and were referred to by the less prestigious title "the Bronfman gang." The Bronfmans have always been beholden to the Hofjuden elite. The first member of the family to come to North America was Yechiel Bronfman, a grist mill owner from Bessarabia, Romania, who later anglicized his name to Ekiel. Yechiel emigrated to Canada in 1889 under the sponsorship of the Moses Montefiore Jewish Colonialization Committee. (1)


This enterprise had been initiated at an 1872 meeting between Baron Maurice de Hirsch, Baron Alfred de Rothschild, and other Zionists that established a Jewish Colonialization Association to bring selected Russian and Eastern European Jews to agricultural settlements ("kibbutzim") in the Canadian provinces of Manitoba and Saskatchewan. (2)


The same period marked the transfer of the Warburg, Kuhn, Loeb, and related Our Crowd migration from Germany and Britain into lower Manhattan. In 1912 William Sebag Montefiore himself arrived in Montreal where he spent the remainder of his life (d. 1950). Lord Harold Sebag Montefiore, current head of the Jerusalem Foundation (the Zionist wing of the Most Venerable Order of St. John of Jerusalem) was sent to Canada for his early education. In the same period, Baron de Hirsch established the De Hirsch Foundation in Canada as the umbrella for all Canadian Jewish "philanthropic" activities and the Montefiores created a club (named after the family) to service the resident Zionist elites. The Rothschilds, too, planted a branch of their family on Canadian soil.

Meanwhile, in Saskatchewan, the Bronfman family found little interest in eking a living out of the plains of midwestern Canada. The strenuously Orthodox Jewish family first turned to selling wood, then to horse trading, and then most successfully to the hotel business (and prostitution). (3)

In Yiddish Bronfman means "liquorman," and the hotel business put the Bronfmans in a good position to take advantage of the 1915 advent of Canadian prohibition. Bronfman hotels became "boozeriums." Prohibition — enacted on orders from the Privy Council as the prelude to the 1920s U.S. Prohibition and birth of organized crime — catapulted the Bronfmans into the multimillionaire bracket and a status as the untouchable kingpins of crime in North America.

During Canada's four dry years from 1915 to 1919, the Bronfmans established their contacts with U.S. criminal figures for illegally importing liquor into Canada. In 1916, the Bronfmans established their first link with the opium trade proper. Samuel and Abe Bronfman, two of Ekiel's four sons, collaborated with the Hudson's Bay Company — in which the Keswick family of Jardine Matheson had controlling interest — to buy the Canadian Pure Drug Company. In this way the Bronfmans rushed into the loophole in the War Measures Act that permitted the distribution by pharmacists of alcohol for "medicinal" purposes.


When prohibition in Canada ended in 1919 and Prohibition in the United States began, the Bronfmans simply turned from whiskey importing to whiskey exporting. After it was all over, in May 1936 the Bronfmans agreed to pay $1.5 million to settle their account with the U.S. Treasury; the sum amounted to an admission that half the liquor that came into the United States during Prohibition was from the "liquormans." (4)


The "Seagram Chickencock" the family poured across the border was pure poison — a mixture of pure alcohol, sulfuric acid, caramel, water, and aged rye whiskey that paralyzed its victim. Between 1920 and 1930, 34,000 Americans died from alcohol poisoning. Their control of liquor flow into Prohibition USA gave the Bronfmans literally life-and-death control over American crime. Refusing to play ball with the Bronfman gang usually spelled death, and independently minded gang bosses were often known to be executed by their lieutenants on the Bronfmans' behalf.


One of the buyers best liked by the gang was New York City beer baron Arthur Flegenheimer, a.k.a. Dutch Schultz, who succeeded in wiping out his competition including the notorious killer Legs Diamond. Schultz himself was later rubbed out when he took it into his head to murder the reforming New York District Attorney Thomas Dewey. (We will meet up with Mr. Dewey later in regard to the Mary Carter Paint Company.) (5) In the first years of Prohibition, Ekiel's four boys ran all bootlegging from the prairie states of Canada to major distribution sites south like Chicago. To secure the shipment lines, Harry set up a dummy firm, Transcanada Transport Company.


Transcanada was a protective cover for the Canadian Pacific Railway owned by respectable gentlemen back in London, which ran the whiskey across the border. (6) The Bronfmans also bought up stretches of barren farmland along the border and even built an underground pipeline to pump their "chickencock" into the United States. During these early years, the Bronfmans were scarcely under the protective wing of their Zionist sponsors. Thus, for example, in 1932 Bronfman brother-in-law Paul Matoff was executed gangland-style by the Chicago mob in a dispute over profit splitting. A scandal ensued, public hearings were convened, and the Bronfman crimes came spilling out into the light of day. The Bronfmans received a mild reprimand from the Canadian government and relocated their operations to Montreal.

1922 also marks the year that the Bronfmans procured their own distillery, hauled with workmen included from Kentucky to Montreal.

Since 1920 the Bronfmans had been importing British whiskey from the Distillery Company of London (DCL), which controlled more than half the world market in scotch whiskey. Owned by the higher echelons of the British nobility including Field Marshal Haig, Lord Dewar, Lord Woolavington, and others, the dispensation of distribution rights was a decision made by HM the King.


In 1926, upon the request of Samuel Bronfman, the DCL agreed to go 50-50 in the Bronfmans' distillery and the Distillery Corporation Limited was formed as a holding company with Bronfman and Seagram distilleries. Headquarters were established at the Bronfmans' corporate castle in Montreal, but it was the Distillery Company of London's William Ross who was installed as president with Sam Bronfman as vice-president. The British elite had made a decision to go with the Bronfman option.

Despite the massive infusion of capital and the newly gained legitimacy the link-up with DCL afforded them, the smell of Bronfman smuggling both into and out of Canada and their wholesale bribery of Canadian customs a la Hong Kong had gotten too strong. In 1928 the Royal Commission on Customs recommended the immediate prosecution of Harry Bronfman on charges of attempted bribery. Nothing happened, but shortly thereafter the Bronfmans created the Atlas Shipping Company and moved their smuggling operations to the French islands of St. Pierre and Miquelon, 15 miles off the Newfoundland coast.

With licenses in Bermuda, Saint John, New Brunswick, and Belize, British Honduras, the Atlas Shipping Company was one of the first ties laid down in the dirty money-drug underground railway between Canada and the Caribbean. (7)

A little ditty popular during the time indicates the amusement with which the British viewed the entire operation:

Four and twenty Yanks Feeling very dry, Went across the border To get a drink of rye. When the rye was opened, The Yanks began to sing: "God bless America, But God save the King."

Organized crime comes of age

With Prohibition, crime became a bigtime business. It was no longer based on small-scale prostitution, loan sharking, or petty protection rackets. Now it was centralized around the marketing of one precious and outlawed commodity whose supply was controlled from London and from the British colony of Canada. Crime was reorganized from top to bottom into an integrated wholesale and retail distribution chain with well-defined marketing districts, quotas, and uniform pricing. Crime became syndicated.


Hundreds of movies spewed out of Hollywood about the "Roaring Twenties" have glamorized the truth: with Prohibition, Britain — through its Bronfman Gang cutout — had created a nationally syndicated crime cancer. Within a decade of the Roaring Twenties, the Bronfman syndicate would be peddling heroin, cocaine, and every other available poisonous drug through the same wholesaling, transporting, and retailing system that bootlegged booze.


Bronfman's counterpart in the United States was one Arnold Rothstein. Just as Bronfman made it into the big-time under the auspices of the Hofjuden elite, so Arnie Rothstein was sponsored by Our Crowd Zionist investment bankers who arrived in New York as the Montefiores were setting up business in Canada.

Arnold Rothstein — the godfather of organized crime — was the son of a wealthy Our Crowd dry goods merchant.

At the turn of the century, the Russell Sage Foundation had issued a well-publicized field study of loan sharking in New York City. (8) The report's wide publicity resulted in the bankrupting, jailing, or takeover of the petty gangsters by Rothstein, who emerged as a powerful Tammany Hall figure with a fabled loan sharking business estimated at several million dollars.

Region wide combines were formed up and down the East Coast for smooth distribution. The Reinfeld Syndicate — named after the Newark, New Jersey bootlegger and accused murderer Joseph Reinfeld — functioned as the middleman between the British liquor distilleries and the "Rum Rows" of Boston and New York. Its controlling shareholders were the four Bronfman brothers, Allan, Sam, Edgar, and Charles. The U.S. leg was handled by Reinfeld and Abner "Longie" Zwillman, later the boss of Atlantic City, and Rothstein's gangs in New York. (9)

In 1927, the Big Seven combine consolidated the entire East Coast distribution system. Its organizer was John Torrio — a dapper little gentleman who without benefit of family, racket, or turf had gained notoriety for eliminating any local crime bosses who stood in the way of national syndication. Torrio was a Bronfman man who had murdered his own uncle to prove it.

Brought into Chicago in 1910 by his uncle, racketeer "Big Jim" Colosimo, Torrio smelled the wind on the eve of Prohibition and demanded that his uncle start making the right contacts to get into the lucrative business of bootlegging. When "Big Jim" refused, Torrio had him murdered and took over the Chicago mob as the distribution point for the Bronfman liquor. (10)

In 1925, Torrio suddenly left Chicago heading first for Havana and then landing in Italy. Returning to the United States in 1927 after he miraculously "escaped" Mussolini's purges of the Mafia, Torrio came back with one goal: to build a nationally) organized crime syndicate.

While the mad killers and punks like Dutch Schultz, Legs Diamond, and Al Capone made the headlines every day and provided good material for gangster movies, John Torrio quietly continued the work that Arnold Rothstein (assassinated in 1928) had begun, now with the aid of Rothstein's successor Meyer Lansky. Torrio could do what Lansky and the Bronfmans were prohibited from doing for reasons of ethnicity: discipline the scores of family local crime chieftains and "moustache petes" into one centralized business that could penetrate every sector of the economy. Known as the "assassin who never carries a gun," Torrio presented himself as the elder statesman of organized crime and commanded respect from the Mafia locals. "Cooperation is good for business" was his slogan.

The Big Seven had been Torrio's first step. The cooperative of East Coast bootleggers controlled from the top down to the local levels all prices, membership, centralized distribution points, corruption, and protection.

By 1928 Torrio was able to call a Cleveland meeting to establish a nationwide crime syndicate. (11) The gathering was unique in that it had succeeded in bringing together into one room all the crime bosses of every major organized city. There were three items on the agenda. First, how to use the huge profits of Prohibition and invest them in legitimate business that would permit a steadily increasing take for the syndicate. Second, how to deal with the Italian question. The ritual vendetta murders of the Mafioso families were good for the newspapers, said Torrio, but bad for business. Immediately after the meeting the Castellammarese gang wars broke out in New York as the test case for Torrio's syndicate. Under the auspices of Lansky and Torrio, Lucky Luciano succeeded in wiping out all recalcitrant godfathers.


During the last night of the war — the infamous "Night of the Sicilian Vespers" — over 40 people were gunned down. (12) With cartelization came the need for more long-lasting regulation — gangland style. In the early 1930s Murder, Incorporated was formed as a regulatory commission of sorts to police any overzealous "free enterprise" advocates who might try to buck the syndicate. A special assassination bureau was set up by Meyer Lansky and Benjamin "Bugs" Siegel. The "Bugs and Meyer Gang" had been distinguished by the fact that they owed allegiance to no one (except maybe Arnold Rothstein); they had originally been used to protect Bronfman liquor shipments across the border against "freelance" hijackers. (13)

By 1932 Torrio was strong enough to pull together another meeting of the syndicate, this time in Atlantic City, where a National Commission — the board of directors of organized crime — was officially formed. Aside from the leading Italian mafiosi who had survived the transition, Meyer Lansky, now regarded as the financial and enforcement wizard of the syndicate, and Atlantic City's Zwillman were in attendance as honored guests.

Thus, for the British, Prohibition was a roaring success. What had begun as a three-way contract between Britain (the supplier), Bronfman (the cutout), and Rothstein (the distributor) had become within the space of a decade a nationally organized crime syndicate — a private, secret army under British banking and political control.

The Rothstein-Hong Kong connection

To pick up the story of the modern-day Dope, Incorporated, let us return to Cleveland and John Torrio's first 1928 meeting of the syndicate. The third item on the agenda was what to do after Prohibition. The commodity, Torrio proposed, that would replace liquor as the black-market, big-profit taker was narcotics.

When Prohibition began in 1920 Arnold Rothstein had personally gone to Great Britain to establish the liquor pipeline with the British distilleries. Less known but more important is that at the same time he had dispatched his underling Jacob "Yasha" Katzenberg to Shanghai to begin negotiations for a dope pipeline from the Far East into the East Coast of the United States. (14) (The West Coast had been sewn up in the previous century with a pipeline from Shanghai straight into the Pacific Chinese coolie communities.)

It was projected that the same networks established to bootleg liquor could just as easily smuggle and retail narcotics. By 1926, U.S. narcotics agent-on-the-scene in the Far East, Ralph Oyler, wrote back to his boss Levi Nutt, chief of the U.S. Narcotics Division, that the opium market had expanded so tremendously that Britain was "even taking shipments of crude opium from the Near East to add to her gigantic supply of Asian opium" in order to meet market demand. The traditional opium families of Kes-wick, Sassoon, and Inchcape were preparing for the future. (15)

One year after Oyler's report, the 1927 Shanghai massacre put an end to all challenges to the rule of opium. The Shanghai uprising had been an attempt by the nationalist factions within the Kuomintang and Communist Party to destroy the opium dealers, such as the Soong family, who had seized control over the government and had carved up China into drug-running "warlord" satrapies. The massacre was carried out by the Green Gang Syndicate, acting on orders and funding from the Extraterritorial International Settlements on Shanghai headed by Lord William Johnston Keswick.


The British enclave harbored the Green Gang criminals at the time of the massacre, and the British-dominated Municipal Council (headed again by Lord Keswick) turned over trade union leaders and others to Green Gang criminals who executed them. (16) Had the Shanghai massacre occurred during the previous century, it would have been known as the Third Opium War; the consequence of the slaughter was yet another dramatic increase in British opium control over China.

The two principal Green Gang leaders involved in the massacre were Tu Yueh-sheng, "whose factories flooded the American market with narcotics" after the coup, and Huang Chin-jung, who was Arnold Rothstein's contact man. British-dominated post-1927 Shanghai was to become for the next 14 years the premier drug depot for the world.

This shift East in the production of the opium cycle has been documented by Jonathan Marshall in the Bulletin of Concerned Asian Scholars:

By the late 1920s, China was a net exporter of opium, and within a few years it replaced the Near East as the world's opium smuggling capital. By 1931, China produced seven-eighths of the world's narcotics. Chinese opium flooded the world markets through Hong Kong, Shanghai and Macao. ... By the mid-1980s, Chinese heroin dominated the American market.

As documented by Marshall, Lord Keswick and the other controllers of the opium trade imposed the Green Gang dope merchants in power in China, making the production and distribution of opium the backbone of the Chinese economy. The consequences were predictable: unparalleled genocide against the Chinese population.

In early July, 1932, T.V. Soong, who had resigned (as Finance Minister — ed.) the month before after failing to raise enough money for the communist suppression campaign, hinted that he would return to office if a new source of revenue — such as opium — could be found. He picked up the support of the influential H.G.W. Woodhead, who, probably reflecting the sentiment of the British business community (i.e., Keswick, the HongShang, and Standard and Chartered — ed.) argued that only such a monopoly could solve China's financial crisis. An opium monopoly was a small price to pay to protect the stability of China's business climate... (Due to the forced cultivation of opium — ed.) millions of acres of land were taken out of food production. In food-short China, this reduced the margin of peasant survival... the most notorious case of famine brought on by over cultivation of opium occurred in Shaanxl province between 1928 and 1933. It took as many as six million lives in four provinces, wiping out perhaps a third of the entire population of Shaanxl province. (17)

Let us now stand back and review — in light of this history — the jigsaw puzzle pieces that fall into place with Yasha Katzenberg's trip to Shanghai and the sealing of an opium pact.

First, Arnold Rothstein, Yasha Katzenberg's employer, was a product of the Rothschild "dry goods" empire that included the Seligman, Wannamaker, and Gimbel families. During Prohibition, according to the Bronfmans' own testimony, Rothstein, Meyer Lansky, and Lucky Luciano were the Bronfmans' main distributors. As Prohibition came to a close Bronfman associates traveled to Shanghai and Hong Kong to streamline and expand the drug trade into the United States, negotiating with the foremost Chinese drug-runners who were not only encouraged but pressured by the British "business community" to pull together an opium cartel.


The man dictating the opium policy to China in this period, the man who sired the T.V. Soong opium monopoly, was Sir William Johnston Keswick of Jardine Matheson and the Hong Kong and Shanghai Bank. From the period of the Shanghai massacre to 1942 when he was interned by the Japanese, Keswick directed the international Settlements of Shanghai — the period of gross expansion of Shanghai heroin into the United States. The same Sie William Keswick was until very recently the director of the Hudson's Bay Company of Canada, the same company, it will be recalled, that collaborated with Sam and Abe in 1916 to found the Pure Drug Company for illegal distribution of whiskey into Canada.


Working for Hudson's Bay along with Keswick is Sir Eric Drake, who not only sits on the board of several Bronfman-run banks and companies, but is also an employee of the Inchcape family and presently the deputy chairman of the Inchcapes' Peninsular & Orient Steamship Company. The current chairman of the board is the son of the Lord Inchcape who in 1923 called for the expansion of "that most valuable source of revenue" — the opium trade.


Sir Eric Drake is also a member of the board of Canadian Pacific, which plays a most vital role in the transshipment of drugs through Canada into the United States, just as they did with alcohol during the Prohibition. Along with Lord Trevelyan, who heads up the HongShang's "gold-for-dope" exchange from his position at the British Bank of the Middle East, and Lord Inchcape, Sir Eric Drake sits on the board of British Petroleum, as does Sir William Johnston Keswick. Sitting on the board of the Bank of Montreal along with Charles Bronfman and two Seagram directors are J. Bartlett Morgan, William Arbuckle, and F.S. Burbridge, who in turn sit on the boards of Hudson's Bay, Canadian Pacific, and a host of other banks and corporations in which the drug families of the HonkShang nexus play a policy-making role.

We are not charging "guilt by association" but rather making note of the fact that the series of "legitimate" enterprises the Bronfmans moved into toward the close of Prohibition are indistinguishable from and intermeshed with companies controlled by Keswick, Inchcape, and other leading opium traders. During the same period, these gentlemen openly supervised the drug trade into the United States.


This association not only continues to this day but is the mainstay of the Bronfman empire.

Going legit ain't necessarily kosher

With the repeal of Prohibition and with the Shanghai opium deal in operation, the Bronfmans, like so many of their partners across the border, "went legit." Organized crime sunk its millions in legitimate businesses that both acted as cover for illegal activities and set up the laundry networks for dirty money. The new phase of respectability signaled that the most successful big-time whiskey bootleggers were switching to big-time narcotics.

In the early days, the Bronfmans had to run all the risks of the smuggler's profession. They had to dodge the law, stay one step ahead of the desperadoes on the other side of the border, and whenever things went wrong, face the humiliation of public expo sure and scandal. As a result, the family acquired a considerable reputation.

Looking expectantly toward the fast increase in drug trade in America, the British could not afford to leave their leading cutout in such an exposed and precarious position. Nor could they simply dispose of the Bronfmans after Prohibition. The family had become irreplaceable due to its in-depth control over the syndicate. Yet, they would be a liability if they continued to work as openly with their distributors in narcotics trafficking as they did running Prohibition.

The problem was resolved by bringing the Bronfmans into the lower rungs of the Hofjuden caste. Almost overnight, the Rothschilds, Montefiores, de Hirsches, et al. took "Mr. Sam," the crime czar of North America, and transformed him into a rising star of the Canadian Zionist movement.

One post followed after another. He became head of the Canadian Jewish Committee, replacing Lyon Cohen, the son of Lazarus Cohen, the founder of the Jewish Colonialization Association and the official agent of the de Hirsch family interests. After World War II, Mr. Sam established the National Conference of Israeli and Jewish Rehabilitation, using his considerable smuggling skills to run guns to the Haganah. Similar posts were awarded to the other Bronfmans.


Allan Bronfman was named president of the Zionist Organization of Canada, a member of the board of trustees of the Federation of Jewish Philanthropists and of the national council of the Canadian Jewish Congress. Abe Bronfman was posted to the Joint Distribution Committee and also to the national council of the Canadian Jewish Congress. _ Finally, in 1969 the Bronfmans were given the highest reward issued by Her Majesty. Sam was made a Knight of Grace of the Most Venerable Order of St. John of Jerusalem — Her Majesty's official chivalric order.


His brother Allan and his son Charles were appointed to the highest rank, Knight of Justice of the Order. These appointments are emphatically not ceremonial, but are only bestowed on those who have carried out the most dangerous and fruitful missions for the British Crown. The Bronfmans' time had truly come. Sam's children were welcomed into the Hofjuden elite by intermarriage.


Minda married Baron Alain de Gunzberg, himself an extension of the Rothschild family tree. De Gunzberg sits on the board of Seagram, is managing director of the Banque Louis Dreyfuss, and controls the Seligman-Louis Hirsch investment house which has close Rothschild ties. Edgar Bronfman's first marriage was to Ann Loeb, bringing him instantly into a command position within the Wall Street house of Loeb, Rhoades, and Co. While taking over the Seagram main branch in New York, Edgar's marriage clinched the tie to Our Crowd that had begun during Prohibition. His second marriage, to Lady Caroline Townshend, as we have seen, was unsuccessful. Phyllis Bronfman married Jean Lambert of the Belgian banking and mining interests.

Yet, despite their mountains of wealth, despite their hard-won entry into the realms of good breeding, it would be a mistake to think the Bronfmans were a power in their own right. When it comes to the question of control, they are treated as if the money were not their own.

Take, for example, the case of "Trizec," the holding company through which the Bronfman brothers ostensibly run their various corporations, including Seagram. Since it was formed in 1960, the Bronfmans have never held a majority position within Trizec! Trizec is run by Eagle Star Ltd. of London, a holding company whose directors have been described by one author as "the most notable of the British aristocrats." (18)


Evelyn de Rothschild, the earls and dukes who control Lloyds of London and other banking and insurance firms, and leading lights of British intelligence such as Sir Kenneth Strong and Sir Kenneth Keith all converge on the board of Eagle Star. (See Part II, Section 8.) This extraordinary company in turn owns English Property Corp. Ltd. — whose principal individual shareholder Laurie Marsh has gained notoriety in Britain as the "Prince of Pornography" for his ownership of the majority of pornographic movie theaters, massage parlors, and "red light district" real estate in London. (19) English Property Corp. Ltd. owns majority holdings in Trizec.

Neither are the brains behind the Bronfman empire situated between the ears of members of the Bronfman family. The source lies elsewhere — in the family's law firm of Phillips, Bloomfield, Vineberg, and Goodman (now Phillips and Vineberg).

The personage of family arbiter and attorney Lazarus Phillips, in particular, was a constant sore to Mr. Sam. Born into the upper crust of the Zionist elite, Lazarus Phillips succeeded in gaining all the yeckus — publicly recognized respect — that Mr. Sam could never seem to win. Phillips was a holder of the Order of the British Empire, a senator in the Canadian Congress, a member of the board of directors of the Royal Bank of Canada, invited into the exclusive Mount Royal Club as a member, and was a powerbroker for the Liberal Party.


But without Phillips the Bronfman family empire could not survive. It is likely that through him the Bronfmans received the input of cash that allowed them to proceed steadily from boot legging to the legitimate big-time. Certainly it was Phillips who unfroze enough funds under export control from the grip of the Bank of Canada to finance Seagram's wartime expansion into the United States. As the final judge in all family matters — legal and otherwise — Phillips has sat on the board of Seagram since 1940 and on every other company and philanthropic front nominally run by Mr. Sam.


He is still the co-director of Trizec and the other major Bronfman holding company Edper (named after Edgar and Peter Bronfman). Phillips is also the expert who managed to get the Bronfmans off every legal hook they ever got caught on. (20)


Philip F. Vineberg is part of the Vineberg family of Abraham Moses Vineberg, chairman of the Moses Vineberg Investments firm and the de Hirsch Institute. Cochairman of all the Bronfman holding companies, Vineberg runs the Canadian Israeli Bond Drives and the Canadian Council of Christians and Jews. He is also a member of the Hofjuden elite's Montefiore Club. Major Louis Mortimer Bloomfield, also of the firm Phillips, Vineberg, and Bloomfield, is however, without a doubt the most colorful of the Bronfman brains-behind-the-scenes and this may explain why his name was left out of Peter Newman's 1978 book The Bronfman Dynasty (rumored to have been commissioned by the Bronfmans themselves).


In addition to his position up to the late 1960s as a Bronfman family lawyer, Bloomfield remains a close banking associate. The Major's Zionist activities are numerous: he is involved in a nest of corporations including the Israeli Continental Company, he is chairman of the Canadian Histadrut Campaign, and a former president of the Israeli Maritime League. He also holds the post of Consul-General in Liberia, under whose flag vast quantities of opium and narcotics are shipped. He is a high-ranking member of the Most Venerable Order of St. John of Jerusalem and runs its subsidiary Canadian Red Cross Ambulance Corporation.

Major Bloomfield also runs Britain's International Assassination Bureau, an entity we will soon examine in detail.

Are they really clean?

The answer, of course, is no. Since the days they sent their "chickencock" across the border to their claim as the world's finest whiskey blenders, the Bronfmans' ties to North America's crime syndicate have never been broken but merely undergone corporate reorganization. In Section 3 on the Bronfman company of Permindex, we will analyze their criminal activities in length At this point a few examples will suffice.

Take the case of Bronfman family intimate Murray Koffler. A leader of the Jerusalem Foundation in Canada, Koffler was the subject of a major scandal in 1976 when his business associates, Starkman stores, were busted by Canadian police after its pharmacists were caught manufacturing illegal amphetamines and funneling them into the black market. (21)

Charles Bronfman's sister Phyllis Lambert was the subject of a simultaneous scandal for her involvement in Heritage Canada, a government funded "social service" program that got caught conduiting drugs onto Canadian college campuses. (22)

In 1975 the Bronfmans again made the front pages when Edgar Bronfman's eldest son, Samuel II, was reported kidnapped. The case revealed the kidnapper to be Sam II's homosexual lover. When the police found them, Sam's kidnappers pleaded that the Bronfman youth had blackmailed them into the hoax as a way of extorting money from his father. The jury agreed; the two abductors were declared innocent of kidnapping, but found guilty of the lesser charge of extortion. The press also aired the kidnappers' pleas that their lives were now in danger for having sung about Sam II.

Since he took over the reins of Seagram's New York branch in the 1950s, Sam II's father, Edgar, has built the Seagram distilleries network into a multinational global empire. The Bronfmans, for example, have entered into a most profitable business partnership with the Cuban rum Bacardi family. After Fidel Castro took over the island in 1959, the Bacardis switched their base of operations to Puerto Rico and Miami, taking along with them a small army of anti-Castro Cuban exiles.


The Bacardis, headed by Manuel Cutilla Bacardi, have been pinpointed by law enforcement agencies as the funders and political controllers of entire networks of Cuban exiles. The "gusanos," as they are called, are not only involved in terrorism (Orlando Bosch's September 1976 bombing of a Cubana airlines plane killed over 70 people). Drug runners in the Bacardi-Cuban exile networks, Jose Medardo Alvero-Cruz and Antonio Cruz Vasquez, have been recently arrested for drug trafficking in the Caribbean and Mexico. (23)


Seagram has also staked a conglomerate empire in Mexico. Bronfman's contact is former Mexican President Miguel Aleman, who owns and operates Acapulco. Today Aleman is demanding the revival of casino gambling in Mexico; in the 1930s nationalist President Lazaro Cardenas threw the casinos, and with them Meyer Lansky, out of the country.

In short, wherever Seagram branches appear on the map, they are thoroughly intermeshed with narcotics runners, gambling, and crime. One the public record, the Bronfmans' gutter connections are most visible in the case of Mitchell Bronfman. The son of Knight of Justice Allan Bronfman, Mitchell is reportedly never without the automatic strapped to his shoulder and his stiletto strapped on his left calf. He is on record with the Montreal Police, the Quabec Provincial Justice Ministry, and the Royal Canadian Mounted Police as a kingpin of organized crime in Montreal. (24)


A 1972 report by the Montreal Crime Commission names one Willie Obront as the head of the syndicate in the area and describes the relationship between Obront and Mitchell Bronfman as "almost a brotherly relationship." (25)

This relationship extends into illegal activities in which they have mutually or jointly indulged... the special kinds of favors they did for each other and the resulting advantages of each in the fields of loan gambling, illegal betting, securities, tax evasionruption. (26)

Everything was on a strictly "friendly basis," claims Mitchell.

Obront first came to the attention of the authorities after two of his Quebec nightclubs used as hangouts for Montreal's underworld were raided. It was revealed that Mitchell's friend was one of Montreal's top movers of dirty money from narcotics, prostitution, and loan sharking.

Together with Willie, Mitchell Bronfman is a minority partner in the Pagoda North, a Miami restaurant that has been identified by U.S. and Canadian law enforcement agencies as the headquarters for a continent wide illegal bookmaking syndicate run by Vito Genovese.

Willie Obront was convicted in 1976 of "tax evasion" and put behind bars. Mitchell Bronfman narrowly averted the same fate.

Another one of Mitchell Bronfman's business partners is Sidney Rosen, who was also arrested and convicted in 1975 for looting 35 Canadian and American companies of $7 million through an asset-stripping clearinghouse called Value Trend Holding Company. Value Trend in turn laundered these stolen assets, along with other dirty revenues from illegal gambling, extortion and narcotics, through Corporate Bank and Trust Company of Freeport, Grand Bahamas and Flendon Ltd., of the same address. Both companies are jointly owned by Rosen and Mitchell Bronfman through another holding company called the "Milton Group." When Rosen went off to jail (again leaving Mitchell Bronfman scot free), the $7 million passed unscathed into offshore accounts in Barclays Bank in Freeport. (27)

But the two major corporations that Mitchell operates out of are the mysterious "Securex" and "Execaire Aviation." The former was disbanded in 1977 by Ouebec Provincial Justice Minister Delard. While the Official Secrets Act has kept the reasons behind this hidden, it can be stated with reasonable certainty that Mitchell Bronfman and the company were discovered to be up to their necks in the wave of FLQ (Front pour la Liberation du Quebec) terrorism that had plagued the province since 1970 — not to mention the narcotics trade.

The two directors of Securex at the time of its banning were Donald McCleary and Gilles Brunet, formerly RCMP sergeants in charge of the G-4 (Secret Service Division) of the Mounties. Both were fired from the Service in 1972 when it was discovered that they were close associates of Mitchell Bronfman. (28) McCleary and Brunet were in charge of the counter terror efforts in 1970 when the FLQ kidnapped a provincial official and a British government officer, an affair which led to the declaration of a state of emergency. The emergency period was used as a pretext to go after the French Canadian networks that had been built up by de Gaulle in conjunction with the Vatican to liberate Quebec from British colonial status.

In point of fact, the FLQ was itself funded by Bronfman family networks as an extension of earlier efforts to assassinate French President de Gaulle (the story will be told below). The Bronfmans' FLQ option was the North American version of the British Special Air Service's control over both the Provisional Wing of the Irish Republican Army and the British Army's counter terror efforts.


Securex advertises itself as a security "consulting firm specializing in anti-terrorism, anti-kidnapping, and guerrilla warfare training." (29) All things considered, it would have to be regarded as both a semi-official covert branch of British intelligence in Canada and as a bridge to the criminal underworld. Its affiliated Execaire Aviation emerges as yet another scarcely concealed front for crime.


Execaire is the largest private charter airline service in Canada specializing in jet service for business executives... and narcotics. Is Mitchell Bronfman just the black sheep in the Bronfman family? It is unlikely. Cemp, the Bronfman family trust, signed a guarantee for part of Execaire's line of credit at the Bank of Montreal.

Nevertheless, the high publicity the Bronfmans have received over the years for such exploits as Mitchell's has prevented the family from receiving that degree of respectability they have always coveted. In the 1950s Mr. Sam looked across the fence at the status of his friend Senator Jacob Javits and decided that he would buy the ultimate title to confer respectability to his name: he sought to become a Senator of the Canadian Congress. All told, he spent $1.2 million in bribes. The Liberals took his money but wouldn't give him a seat. The Bronfman name was still too dirty to be permitted in the ranks of Canadian politics.

In this regard, the Kennedy family fared much better.


The Kennedys - Organized Crime in the Government

There are some facts in the mind of the American public that hint at the reality behind the "Kennedy look": Ted's Chappaquiddick disaster, Judith Exner Campbell's revelations that Chicago mobster Sam Giancana had given her to Jack, and the well-known stories of Papa Joe's bootlegging days. The suspicions are there but Americans aren't really sure what the Kennedys are; after all, if they're so dirty, how do they stay so clean?


Dope, Incorporated supplies the answer.


The Kennedys are clean because, beginning with Papa Joe, they were flea-dipped, scrubbed, and polished by the British to be the respectable front for organized crime. Whether or not a Kennedy crosses the British Crown in terms of policy — as Jack Kennedy did in 1963 — does not alter the fundamental content of the political machine that gives the Kennedy dynasty its power. The Kennedy machine is organized crime in government. If Ted Kennedy becomes President in 1980, whom will he owe debts to? The same people who pay for him now. At the top of the list of contributors to Kennedy's 1976 senatorial campaign released by the Federal Elections Commission is one Joseph Linsey. (1)


A Massachusetts bootlegger who maintains connections to Meyer Lansky from the 1930s, Linsey sits on the board of International Airport Hotel Systems Inc., a Miami-based company whose board also includes Lansky. Hotel Systems is also connected to Resorts International, a firm we will soon hear more of. FBI wiretaps showed recently that Linsey also has dealings with Raymond Patriarcha, the titular godfather of New England narcotics trafficking. (2)


Patriarcha is a partner of the Jacobs family (whom we will also encounter later) in several business ventures, including a multimillion dollar a year slot machine company in St. Louis. Although sentenced to jail for murder, Patriarcha was released over four years ago when doctors "discovered he was suffering from a case of terminal cancer" from which he presumably still suffers.

Among the business enterprises of Kennedy financier Joseph Linsey are two liquor distributing firms, Crown and Whitehall, and a dogracing track in Tauton, Massachusetts. Whitehall's chief "salesman" Mike Rocco was described by the McClellan Committee hearings on organized crime, in which both John and Robert Kennedy participated, as a "collection man for the mob." (3) Linsey's chief political lobbyist, Hirsch Freed, is a senior partner in the law firm of Brown, Rudnick, Freed, Gesmar and sits on the board of the Combined Jewish Philanthropies of Boston. Freed and all of his law partners are generous donors to the Kennedy campaign fund. (4)

It is the character of Kennedy's friends rather than his own low personal standard of morality that explains why as a leader of the powerful Senate Judiciary Committee he has come forward as the leading sponsor of federal legalization of marijuana and why he has given his approval to decriminalization of heroin "for experimental purposes." The job of the Kennedy dynasty is to usher in British dope and the criminals who distribute it — through the front door.

The rise to power

Papa Joe Kennedy did not have to struggle like the Bronfmans did to make their name and money in the world of crime — he was born into it. Joe's father P. J. Kennedy was one of the shanty town mobsters of late 19th century Boston.

P. J. began his rise to fortune as a tavern keeper who bought his way into the corrupt Democratic Party machine (a machine that, like the Jacob Astor-Aaron Burr power system in New York, had its roots in opium trafficking). Once he had obtained a seat on the ward's Democratic Committee at the age of 26, P. J. gave up his tavern and went into the more lucrative wholesale liquor business. Two years later in 1886 he began the first of five consecutive terms in the Massachusetts State Legislature. By 1896, he was part of the triumvirate of Kennedy-Donovan-Corbett, known as the Board of Strategy, which controlled the Democratic organization in Boston. But it was common knowledge that the secret to P. J. Kennedy's political success was his control of the local crime ring, the "McGuire Gang." (5)

Joe Kennedy's mother sadly recognized that with her husband, her social pretensions could never be realized for herself. Kennedy's public image was so filthy that he could not even Qualify for entry into the "High Irish" social circles of Boston, let along the Brahmin elite centered around the opium smuggling Perkins family. She set her hopes on her children. It was Joe Kennedy's marriage into the Fitzgerald family (over the vehement protests of his father-in-law, Boston's High Irish Mayor "Honey" Fitzgerald) that launched the Kennedy family into high society.

Nevertheless, when Joe Kennedy went to Harvard he was snubbed and ridiculed by his Brahmin classmates, who never missed a chance to remind him of his family's seedy history. Joseph bitterly referred time and again to his rejection by the exclusive "final clubs," Harvard's most desired status symbol. (6) After World War I, Kennedy was employed by Galen Stone, a partner in the prestigious Hayden, Stone and Co., a Boston Hat street investment house with ties to the Rothschilds.


While there, he made his first contacts with the British aristocracy. Kennedy got wind that one of Hayden, Stone's clients, the British company of Robertson-Cole Pictures, was in the throes of a credit squeeze. The ambitious Irishman went to London to seek the purchase of the company's U.S. distribution affiliate, the Film Booking Company. He was turned down flat. Within a month, however, Lord Inverforth arrived in Boston to take Kennedy up on the offer.


Through a subsequent merger With Ideal Films Ltd. Kennedy founded what was described at the time as the "first genuinely reciprocal exchange of production and distribution facilities between British and American companies." (7) Kennedy's joint ventures with the British soon produced RKO studios, ushering in British financial and cultural domination of Hollywood.

Kennedy's film ventures were also noteworthy for another reason. Lord Inverforth later showed up during World War II working closely with British Secret Intelligence Services chief William Stephenson ("Intrepid"). (8) The Robertson-Cole deal was Kennedy's first contact with Britain's aristocratic high command.

In 1929, Kennedy joined with Blair and Co., a firm operated by Elisha Walker, later of Kuhn, Loeb, and Jacques Monnet, to bid for control of A. P. Giannini's Transamerican Co., the controlling company for the Bank of America. The attempt failed, but Kennedy gained another invaluable contact. Jacques Monnet had come to North America to represent his family's liquor business, Monnet et Cie., in dealings with the Hudson's Bay Company.


In the period that Kennedy was working with Blair and Co., Monnet was traveling to Shanghai on a financial mission for the League of Nations. Since the delegation came on the invitation of notorious opium dealer T.V. Soong, and given Monnet's associations with the Hudson's Bay, it is likely that more was on the agenda than the financing of Chinese railroads.

Papa Joe also had business liaisons with the seamier side of the illegal distribution market. During his own bootlegging days in Prohibition, Kennedy entered into a coalition with Newark's Reinfeld Syndicate, which it will be recalled was 50 percent owned by the Bronfman gang. Joe retained his business dealings with the syndicate thugs all the way until 1946. At that time, in preparation for the launching of his sons' political careers, Joe sold his liquor company, Somerset Importers Ltd., for $8 million to the "Renfield Importers" — a revised version of the Reinfeld Syndicate. (9)

As the end of Prohibition approached, Kennedy again turned to London where Winston Churchill personally approved the grant to Joe of the British distillers' franchise for the American market. Through Kennedy's Somerset Importers Ltd. and Renfield Importers, Kennedy marketed Dewar's scotch, Gordon's gin, Ron Rico rum, and Haig and Haig. (10)

But as Papa Joe made clear early in the game, he was not in it for the money. His goal was to build a political dynasty, and his wife produced nine children in succession to get it going. Churchill's nod of approval and the cash flow accompanying it signaled that the British were ready to take advantage of Joe Kennedy's political ambitions.

Kennedy acknowledged the deal by placing his accumulated fortune in the hands of one of the inner circle of London finance: Lazard Brothers Ltd. Andre Meyer, head of the U.S. branch of that house, became the manager of the Kennedy Estates. Lazard Brothers Ltd. is owned by Viscount Cowdray (Weetman John Churchill Pearson), cousin of Winston Churchill.

In 1933, Kennedy was appointed by President Franklin Roosevelt to head the new Securities Exchange Commission. Kennedy's earlier association with the London banking circles had put him in the inside track to conduct a flurry of stock speculation on the eve of the 1929 stock market crash and walk away from it all with a pocket full of cash. When the SEC was created to regulate the market, Roosevelt returned Kennedy's 1932 favor of swinging the Boston Democratic machine behind the FDR candidacy at the 1932 nominating convention.

In 1936, FDR appointed Kennedy U.S. ambassador to Great Britain, a post Kennedy wanted more than life itself. As Joe's official biographer explained, "The old American aristocracy, with its Anglophilic leanings—the aristocrats that had rejected Kennedy at Harvard—regarded the post as the nation's highest social office." (11) Kennedy had at last succeeded in giving the Boston Brahmins a kick in the teeth. Once in London, the Royal Family further obliged the funny Irishman by posing with his family in full regalia for the newspapers.

Kennedy quickly attached himself to the most pro-Nazi British aristocrats centered around Lady Astor's Cliveden Set where Round Table figures such as Lazard Brothers' Lord Robert Brand, the Marquess of Lothian, Fabian George Bernard Shaw, and the opium-trading Sassoon family congregated to dictate Britain's appeasement policy for the British Foreign Office.

Kennedy's antics in Britain soon got back to President Roosevelt who, by the outbreak of World War II, had developed a fairly accurate view of Britain's imperial designs. Kennedy's notoriety as a Nazi supporter — like his father's earlier underworld career — could not be covered over by even the most sympathetic biographer.


Thus, David E. Koskoff in his commissioned biography of Joe Kennedy reported the following:

Kennedy had become intensely Anglophilic: "Indeed there are unfortunate signs that Kennedy is going by way of Page." They reported that he was one of the prime exhibits of Cliveden . . . that he was a partisan of England and should be watched carefully. . . . .

From the beginning of the Ambassador's career to the end, the spectre of Walter Hines Page haunted Joseph Kennedy. From his position as Ambassador to England, Anglophile Page had literally conspired with the British to bring America into World War I. . . . Kennedy always resented the fact that his name was always linked with Page. . . . Even Roosevelt said before the outbreak of war, "He's more British than Walter Hines Page." (12)

Kennedy's unswerving loyalty to the British monarchy was rewarded; his daughter, Kathleen Kennedy, the sister of John, Robert, and Edward, married William Cavendish, the Marquess of Hartington. Hartington was the son and heir to the 10th Duke of Devonshire and his wife, Lady Mary Alice Cecil (daughter of the 4th Marquess of Salisbury), the Dutchess of Devonshire.

In the hierarchy of the British nobility, the dukes are the highest rank of royalty, taking second place only to the monarchy itself. The Duke of Devonshire is at the center of the interlocking families of the Cecils, Salisburys, and Macmillans who have run British politics since the Glorious Revolution.

Joseph Kennedy repeated the theme many times: "If Kathleen and her husband were living, I'd be the father of the Duchess of Devonshire (first Lady-in-Waiting to the Queen) and the father in-law of the head of all the Masons in the world." (13) Later, his son John would marry Jacqueline Bouvier, whose sister Lee Radziwill married Prince Stanislaus Radziwill, a member of the Polish nobility who traces his titles back over 500 years.


The Radziwill family, which resides in England, established the Order of St. John of Jerusalem in Poland in 1610 and was instrumental in transplanting the Order into the United States in the early 20th century. While serving as ambassador in Britain, Joseph Kennedy was made an initiate in His Majesty's Most Venrable Order of St. John of Jerusalem.


Despite Joseph Kennedy's eventual unceremonious recall from the Court of St. James at the beginning of World War II, the elder Kennedy had succeeded brilliantly in restoring his tarnished reputation. During his sojourn in Britain, he turned over his sons to the British Round Table for a "proper" education. Joseph Kennedy, Jr. and John F. Kennedy were trained at the London School of Economics, an institution founded by the Fabian Society dedicated to training and recruiting foreign cadre as future British agents within government, business, media, and educational posts in their respective countries.


The Kennedy brothers were trained by Fabian Society Executive member Harold Laski. At Harvard, on the Kennedys' return to the United States, further tutoring for son John was secured from Sir John Wheeler Bennett, the founder and head of the research division of the Royal Institute of International Affairs. Wheeler-Bennett denies that he was the writer of Kennedy's Harvard master's thesis, later published in book form as Why England Slept — an apologia for the Cliveden Set's and his father's sympathies for Hitler. (14) There is little doubt that Wheeler-Bennett was aware that he had been entrusted with the training of Britain's future political kingpins in the United States. As he recalls:

I was invited one evening to dine informally at the American embassy. We were a small party, not more than ten, as I recall, and the three eldest Kennedy sons sat in a row on the far side of the table to myself... "I'll tell you about these boys," said the Ambassador to me in his rasping nasal voice, as if they weren't there at all. "There's young Joe, he's going to be President of the United States. And there's Jack, he's going to be a university president; and there's Bobby (tapping his nose in a cunning manner), he's the lawyer." (15)

Why the British killed Kennedy

When John F. Kennedy became President of the United States in 1960, it is reported that Andre Meyer of Lazard Brothers Ltd. went around Europe introducing himself as "the real President." Whether the story is true or not, it is the case that the Court of St. James had at least temporarily seized control of the Oval Office. So had organized crime. The Kennedy machine moved into the Justice Department, specifically Robert Kennedy's Organized Crime Strike Force.


The Organized Crime Drive, as it was called. was a highly irregular unit, even according to its nominal chief, Ed Silberling. The section was in fact run by non-lawyer Walter Sheridan, a former FBI man who had worked as Chief of the Counterintelligence Section, Special Operations Division, Office of Security, and the National Security Agency. It was Sheridan who had the ear of Robert Kennedy, often as much as three times a day. (16)

According to Victor Navasky's Kennedy Justice, the Sheridan crew,

"had free access to the files of the McClellan Committee. It was in touch with grand juries throughout the country. It had an undercover air of mystery about it. Its modus operandi was cloak and dagger... Its relations with the FBI were highly irregular in that it received little or no cooperation from the top, yet Sheridan, an ex-FBI man, had a degree of line cooperation in the field that was, in some respects, unparalleled. He actually coordinated FBI agents with his own men — told them where to go when, and they went.


"Unlike every other unit of the Justice Department, which is organized around subject areas of responsibility," reports Navasky, "the Sheridan unit's raison d'etre seemed to be not a subject area but a target: Jimmy Hoffa." (17)

If Kennedy himself was obsessed with getting Hoffa, the machine behind him found the campaign a convenient ruse for three reasons. First, it badly damaged the biggest and strongest trade union in the country, which had consistently used its power to press for industrial growth. Second, the publicity it engendered was a good diversion. And third, it was a good cover for going after local Mafiosi who might object to a tightened drug syndicate and the rise of the new black mafia to service the cities. The fanfare around the Valachi revelations served the same purpose.

A look at the ensuing careers of the Kennedy crime fighters underlines the point.

While Sheridan's "Terrible Twenty" burned the small fry, Meyer Lansky and Max Jacobs went untouched. Lansky's biographer, Hank Messick, could even report that,

"Lansky could deplore the loss of Newport and Hot Springs, but the attack on LaCosa Nostra caused him no loss of sleep. Instead, from 1960 to1965, he succeeded in keeping his name completely out of the newspapers. That five-year period was for Lansky one of the most active, and profitable, eras he had known." (18)


Meanwhile, in the White House John Kennedy was being advised by the higher echelons of the same network that had invaded the Justice Department. Almost simultaneously with Kennedy's inauguration, Harold Macmillan moved into 10 Downing Street. Macmillan was himself part of the extended Devonshire family into which Kennedy's sister Kathleen had married. His Canada-based pulp and paper company, MacMillan Bloedel, as noted, was a component of the British Columbia drug-smuggling apparat. (19)

Macmillan's newly appointed ambassador to the United States, David Ormsby-Gore (later Lord Harlech), was also a distant inlaw of the President through the Cecil family. Ormsby-Gore had been a close friend of JFK's since their days together at the London School of Economics. The British ambassador had daily access to the President. He was the fourth member of Kennedy's inner policy-making core, "ExComm," along with Robert Kennedy and the Anglophile National Security advisor McGeorge Bundy (also a Harvard protιgι of the Round Table's William Yandell Elliott). During the Cuban Missile Crisis, documents show that Ormsby-Gore and Macmillan made most of the minute-to-minute decisions at the point that the United States was on the brink of nuclear war.

Best estimates have it that up through the winter of 1962-63, British directives to the White House, transmitted through Ormsby-Gore, were carried out with only minor points of difference. That special relationship began to show signs of deterioration during early 1963. Policy differences between the Kennedy and the Macmillan governments began to surface, as the U.S. President took a series of initiatives toward detente with the Soviet Union and Cuba. (20)

The diaries of Macmillan testify that Kennedy had to be intensely arm twisted at the famous Nassau summit in spring 1963 before he would agree to turn over the Polaris missile program to the British. (21) That move precipitated French President Charles de Gaulle's vehement denunciation of the Anglo-American violation of the Atlantic Charter, followed by France's withdrawal from NATO.


A combination of factors was operating on Kennedy. Foremost among them was Papa Joe. Individuals, interviewed by the authors, who knew Joe Kennedy intimately during the 1920s report that he cherished a deep hatred for the British and the Anglophile society of Boston that had humiliated him; however, the same individuals report, Kennedy had made a decision that if he was going to make it, he would have to prove his usefulness to the British. With John Kennedy's accession to the Presidency, Joe Kennedy's dream of using the British to build a sufficient power base for himself was a reality.


No astute political observer during the 1960s could ignore the possibility of a "Kennedy dynasty" installed in the White House for several uninterrupted decades. During the spring and summer months of 1963, JFK began reversing previous policies. Plans were being prepared to devolve U.S. presence in Southeast Asia. Detente discussions were opened up with the Soviet Union; in the weeks prior to his assassination, Kennedy even sent a secret emissary to Havana to open up talks with Fidel Castro. The Kennedys were showing signs of bucking the machine that had put them in power.


The British had him killed.


To use the language of a Grade-B movie, "Kennedy tried to double-cross the syndicate and he got iced." It is reported by Kennedy biographer Koskoff that upon JFK's death, Lord Beaverbrook (whom we shall encounter in regard to the International Assassination Bureau) sent a scarcely veiled warning to Joe Kennedy:

Perhaps he (Joe Kennedy—ed.) was a little comforted by the kind note that his dear friend Lord Beaverbrook sent to Rose: "May Joe find solace. . . in the assurance that Bobby will repeat Jack's career." (22)

When Robert Kennedy refused to back off from the track of his brother's assassins and began to prepare his own campaign for the Presidency, he too was assassinated on British orders.

Playing by the rules of the game is Ted Kennedy's insurance policy.


That's what makes him the foremost proponent of dope decriminalization; that's what makes him today's frontrunner for organized crime; that's what makes him the collaborator of the assassins of his brothers.


Creating the Market

The British Origins of the Counterculture

The acts or gestures that accompany the incantations constitute the rite (of Isis). In these dances, the beating of drums and the rhythm of music and repetitive movements were helped by hallucinatory substances like hashish or mescal; these were consumed as adjuvants to create the trance and the hallucinations that were taken to be the visitation of the god. The drugs were sacred, and their knowledge was limited to the initiated; their preparation and their gathering were surrounded with . . . secrecy. . , . In some cases, like the harvesting of the mandrake, they remained secret until the Middle Ages.

Possibly because they gave the illusion of satisfied desires, and allowed the innermost feelings to escape, these rites acquired during their execution a frenzied character that is conspicuous in certain spells: "Retreat! Re is piercing thy head, slashing thy face, dividing they head, crushing it in his hands; thy bones are shattered, thy limbs are cut to pieces." The House of Life: Magic and Medical Science in Ancient Egypt, by Paul Ghalioungui (1)

If this description of pagan cult ceremonies dating back to the Egyptian Isis priesthood of the third millennium B.C. reads like a journalistic account of a "hippy be-in" circa 1969 A.D., it should. The counterculture that was foisted on the 1960s adolescent population is not merely analogous to the ancient Cult of Isis. It is a literal resurrection of the Isis cult — down to the popularization of the Isis cross as the counterculture's most frequently used symbol.

As we shall show here, the drug-rock counterculture was the result of Britain's 30-year Opium War against the United States, which included not only chemical and psychological warfare but the hideous military project called the Vietnam War.

The British fostered the creation of the bestial rock and drug cult for the same reason that their colonial policy enforced backwardness throughout the empire and for the same reason that the pharaohs of ancient Egypt and the Ptolemaic priests of the first century A.D. Egypt fostered the practice. As long as a population is organized around superstition, magic, hallucinogenic drugs, and animal-like pursuit of immediate sensory gratification ("if it feels good, do it"), it will remain incapable of acting on behalf of its own interests. It was for this reason that the oligarchies of ancient Egypt organized themselves into priesthoods and created dozens of apparently contending pagan cults, all characterized by the same bestialist outlook.

True religion, as opposed to the worship of magically endowed cult-gods, addresses man's capacity for reason, his "Godliness." Unlike the lower beasts, the human species is uniquely capable of creative thought — the ability to break out of the bounds of sense certainty, develop new scientific knowledge, and socially apply that knowledge through technological innovations that uplift the material and cultural condition of man. Historically such true religion has been associated with the development of urban centers where science, culture, and commerce could flourish. Its sworn enemy has been the oligarchy and its priesthoods and cults which on countless occasions have mobilized to sack the cities, murder the city-builders, and bring on the "dark ages" of plague and ignorance.

The gentlemen at the Royal Institute of International Affairs responsible for charting Britain's global drug trafficking recognized that no mass-scale drug epidemic could be produced in the United States until the American people's fundamental commitment to scientific and technological progress had first been significantly undermined. The drug-rock counterculture was no mere "sociological phenomenon."

In his City of God, the great humanist St. Augustine described the degeneration into cultism that brought on the destruction of Rome, in terms that have direct bearing on the post-1963 degeneration of the United States:

The stage plays, those exhibitions of depravity and unbounded license, were not introduced in Rome by men's vices, but by the command of your gods. Far more justifiably might you have paid divine honors to your Scipio than worship gods such as those, for they were not more virtuous than their high priest.

Are your minds bereft of reason? You are not merely mistaken; this is madness. Here are people in the east bewailing Rome's humiliation, and great states in remote regions of the earth holding public mourning and lamentation — and you Romans are searching for theaters, pouring into them, filling them, behaving more irresponsibly than ever before. It is this spiritual disease, degeneration, decline into immorality and indecency that Scipio feared when he opposed the erection of theaters. He saw how easily ease and plenty would soften and ruin you. He did not wish you to be free from fear.

He did not think that the republic could be happy while walls were standing, yet morals were collapsing. But, you were more attached to the seductions of foul spirits than to the wisdom of men with foresight. That is why you take no blame for the evil you do, but blame Christianity for the evil you suffer. Depraved by prosperity, and unchastened by adversity, you desire, in your security, not the peace of the State, but liberty for license. (2)

The high priesthood

The "case officer" for Britain's Opium War was Aldous Huxley, the grandson of Thomas H. Huxley, a founder of the Rhodes Round Table group and a lifelong collaborator of Arnold Toynbee. Toynbee himself sat on the RIIA council for nearly 50 years, headed the Research Division of British intelligence throughout World War II, and served as wartime briefing officer to Prime Minister Winston Churchill.

Toynbee's "theory" of history, expounded in his 20-volume history of Western civilization, was that its determining feature has always been the rise and decline of grand imperial dynasties. At the very point that these dynasties — the "thousand year Reich" of the Egyptian pharaohs, the Roman Empire, and the British Empire — succeed in imposing their rule over the entire face of the earth, they tend to decline. Toynbee argued that this decline could be abated if the ruling oligarchy (like that of the British Round Table) would devote itself to the recruitment and training of an ever-expanding priesthood devoted to the principles of imperial rule. (3)

Trained at Toynbee's Oxford, Aldous Huxley was one of the initiates in the "Children of the Sun," a dionysian cult comprised of the children of Britain's Round Table elite. (4) Among the other initiates were T.S. Eliot, W. H. Auden, Sir Oswald Moseley, and D. H. Lawrence, Huxley's homosexual lover. It was Huxley, furthermore, who would launch the legal battle in the 1950s to have Lawrence's pornographic novel Lady Chatterley's Lover allowed into the United States on the ground that it was a misunderstood "work of art." (5)

Aldous Huxley, along with his brother Julian, was tutored at Oxford by H. G. Wells, the head of British foreign intelligence during World War I. Wells's writings (Time Machine, etc.), along with those of his protιgιs Aldous Huxley (Brave New World) and George Orwell (1984, Animal Farm), were written as "mass appeal" organizing documents on behalf of Britain's "en-lightened" world order. Only in the United States are these "science fiction classics" taught in grade school as attacks against fascism. (A contemporary British intelligence operative turned-author, Anthony Burgess, wrote Clockwork Orange in the Wells-Orwell-Huxley tradition as a pornographic celebration of the drug-rock counterculture.)

Under Wells's tutelage Huxley was first introduced to Aleister Crowley (see Part II, Section 9). Crowley was a product of the cultist circle that developed in Britain from the 1860s under the guiding influence of Edward Bulwer-Lytton — who, it will be recalled, was the colonial minister under Lord Palmerston during the Second Opium War. In 1886, Crowley, William Butler Yeats, and several other Bulwer-Lytton protιgιs formed the IsisUrania Temple of Hermetic Students of the Golden Dawn. This Isis Cult was organized around the 1877 manuscript Isis Unveiled by Madame Helena Blavatsky, in which the Russian occultist called for the British aristocracy to organize itself into an Isis Priesthood. (6)

Crowley in turn initiated Aldous Huxley into the Isis-Golden Dawn Temple and introduced him to psychedelic drugs in 1929. (7)

In 1937, Huxley moved to the United States, where he remained throughout the period of World War II. Through a Los Angeles contact, Jacob Zeitlin, Huxley and pederast Christopher Isherwood were employed as script writers for MGM, Warner Brothers, and Walt Disney studios. As we have seen, Hollywood was already dominated by organized crime elements bankrolled and controlled through London. Joseph Kennedy was the front man for a British consortium that created RKO studios, and "Bugs" Siegel, the West Coast boss of the Lansky syndicate, was heavily involved in Warner Brothers and MGM.


Huxley was instrumental in founding a nest of Isis cults in southern California and in a San Francisco suburb called Ojai — which consisted exclusively of several hundred deranged worshippers of Isis and other cult gods. (8) Isherwood, during the California period, translated and propagated a number of ancient Zen Buddhist documents, inspiring Zen-mystical cults along the way. (9)


In effect, Huxley and Isherwood (joined soon afterwards by Thomas Mann and his daughter Elisabeth Mann Borghese) laid the foundation during the late 1930s and the 1940s for the later LSD culture by recruiting a core of "initiates" into the Isis cults that Huxley's mentors Bulwer-Lytton, Blavatsky, and Crowley, had constituted while stationed in India.

LSD: "visitation from the gods"

The next phase in the war involved the introduction of LSD for which Aldous Huxley was the designated Crown agent.

Lycergic acid diethylamide, or LSD, was developed in 1943 by Albert Hoffman, a chemist at Sandoz A.G. — a Swiss pharmaceutical house owned by S. G. Warburg. While precise documentation is unavailable as to the auspices under which the LSD research was commissioned, it can be safely assumed that British intelligence and its subsidiary U.S. Office of Strategic Services were directly involved. Allen Dulles, the director of the

U.S. Central Intelligence Agency in 1952 when that agency began its covert LSD experiment, MK-ULTRA, was the OSS station chief in Berne, Switzerland throughout the early Sandoz research. One of his OSS assistants was James Warburg, of the same Warburg family, who was instrumental in the 1963 founding of the Institute for Policy Studies, and worked with both Huxley and Robert Hutchins. (10)

In 1952, Aldous Huxley returned to the United States from Britain, accompanied by Dr. Humphrey Osmond, the Huxleys' private physician. Osmond had been part of a discussion group Huxley had organized at the National Hospital, Queens Square, London. Along with another seminar participant, J. R. Smythies, Osmond wrote Schizophrenia: A New Approach, in which he asserted that mescaline — a derivative of peyote mushrooms used in ancient Egyptian and Indian pagan rites — produced a psychotic state identical in all clinical respects to schizophrenia. On this basis, Osmond and Smythies advocated experimentation with hallucinogenic drugs as a means of developing a "cure" for mental disorders.

Osmond was brought in by Allen Dulles to play a prominent role in MK-ULTRA. At the same time, Osmond, Huxley, and the University of Chicago's Robert Hutchins held a series of secret planning sessions in 1952-53 for a second, private LSD-mescaline project under the Ford Foundation funding. (11) Hutchins, it will be recalled, was the program director of the Ford Foundation during this period. His LSD proposal incited such rage in Henry Ford II that Hutchins was fired from the foundation the following year.

It was also in 1953 that Osmond gave Huxley a supply of mescaline for his personal consumption. The next year, Huxley wrote The Doors of Perception, the first public manifesto of the psychedelic drug cult, which claimed that hallucinogenic drugs "expand consciousness."

Although, through the sane intervention of Henry Ford, the Ford Foundation rejected the Hutchins-Huxley proposal for private foundation sponsorship of LSD, it appears that the project was not dropped. Beginning in 1962, the RAND Corporation of Santa Monica California began a four-year experiment in LSD, peyote, and marijuana. The RAND Corporation was established simultaneously with the reorganization of the Ford Foundation during 1949-50. RAND was an outgrowth of the wartime Strategic Bombing Survey, a "cost analysis" study of the psychological effects of random bombings of German population centers. It is well known that RAND has been responsible for conduiting such patently insane policies as "limited thermonuclear war" and the "insanity doctrine" into the U.S. Pentagon — most notably through RAND's James Schlesinger.

According to the 1962 RAND Abstract, W. H. McGlothlin conducted a preparatory study on "The Long lasting Effects of LSD on Certain Attitudes in Normals: An Experimental Proposal." The following year, McGlothlin conducted a year-long experiment on 30 human guinea pigs, called "Short-Term Effects of LSD on Anxiety, Attitudes and Performance." The study incredibly concluded that LSD improved emotional attitudes and resolved anxiety problems. (12)



Huxley expanded his own LSD-mescaline project in California by recruiting several individuals who had been initially drawn into the cult circles he helped establish during his 1937-45 stay. The two most prominent individuals were Alan Watts and Dr. Gregory Bateson (the former husband of Dame Margaret Mead).

Watts became a self-styled "guru" of a nationwide Zen Buddhist cult built around a series of his well-publicized books. Bateson, an anthropologist with the OSS, became the director of a hallucinogenic drug experimental clinic at the Palo Alto Veterans Administration Hospital. Under Bateson's auspices, the initiating "cadre" of the LSD cult — the hippies — were programmed. (13)

Watts at the same time founded the Pacifica Foundation, which sponsored two radio stations — WKBW in San Francisco and WBAI-FM in New York City. The Pacifica stations were among the first to push the "Liverpool Sound" — the British-imported hard rock twanging of the Rolling Stones, the Beatles, and the Animals. They would later pioneer "acid rock" and eventually the avowedly fascist-psychotic "punk rock."

During the fall of 1960, Huxley was appointed Visiting Professor at the Massachusetts Institute of Technology in Boston. Around his stay in that city, Huxley created a circle at Harvard parallel to his West Coast LSD team. The Harvard group included Huxley, Osmond, and Watts (brought in from California), Timothy Leary, and Richard Alpert.

The ostensible topic of the Harvard seminar was "Religion and its Significance in the Modern Age." The seminar was actually a planning session for the "acid rock" counterculture. Huxley established contact during this Harvard period with the president of Sandoz, which at the time was working on a CIA contract to produce large quantities of LSD and psilocybin (another synthetic hallucinogenic drug) for MK-ULTRA, the CIA's official chemical warfare experiment. According to recently released CIA documents, Allen Dulles, purchased over 100 million doses of LSD — almost all of which flooded the streets of the U.S. during the late 1960s. During the same period Leary began privately purchasing large quantities of LSD from Sandoz as well. (14)

From the discussions of the Harvard seminar, Leary put together the book The Psychedelic Experience, based on the ancient cultist Tibetan Book of the Dead. It popularized Osmond's previously coined mind expanding."

Back in California, Gregory Bateson had maintained the Huxley operation out of the Palo Alto VA hospital. Through LSD experimentation on patients already hospitalized for psychological problems, Bateson established a core of "initiates" into the "psychedelic" Isis Cult. Foremost among his Palo Alto recruits was Ken Kesey. In 1959, Bateson administered the first dose of LSD to Kesey. By 1962, Kesey had completed a novel, One Flew Over the Cuckoo's Nest, which popularized the notion that society is a prison and the only truly "free" people are the insane. (15)


Kesey subsequently organized a circle of LSD initiates called "The Merry Pranksters." They toured the country disseminating LSD (often without forewarning the receiving parties), building up local distribution connections, and establishing the pretext for a high volume of publicity on behalf of the still miniscule "counterculture." By 1967, the Kesey cult had disseminated such quantities of LSD that a sizable drug population had emerged, centered in the Haight-Ashbury district of San Francisco. Here Huxley collaborator Bateson set up a "free clinic."


Among the founders of the "free clinic" were: Dr. David Smith — now a "medical advisor" for the National Organization for the Reform of Marijuana Laws (NORML), an entity we shall discuss in Part V; Dr. Ernest Dernberg — an active-duty military officer, probably on assignment through MK-ULTRA; Roger Smith — a street gang organizer trained by Saul Alinsky. During the Free Clinic period, Roger Smith was the parole officer (and probable controller) of the cultist mass murderer Charles Manson; Dr. Peter Bourne — formerly President Carter's special assistant on drug abuse. Bourne did his psychiatric residency at the clinic. He had previously conducted a profiling study of GI heroin addicts in Vietnam.

The Free Clinic paralleled a project at the Tavistock Institute, the psychological warfare agency for British Secret Intelligence Service. Tavistock, founded as a clinic in London in the 1920s, had become the Psychiatric Division of the British Army during World War II under its director, Dr. John Rawlings Rees. (16)

During the 1960s, the Tavistock Clinic fostered the notion that no criteria for sanity exist and that psychedelic "mindexpanding" drugs are valuable tools of psychoanalysis. In 1967, Tavistock sponsored a Conference on the Dialectics of Liberation, chaired by Tavistock psychoanalyst Dr. R. D. Laing, himself a popularized author and advocate of drug use. That conference drew a number of people who would soon play a prominent role in fostering terrorism; Angela Davis and Stokely Carmichael were two prominent American delegates. (17)

Thus, by 1963, Huxley had recruited his core of "initiates." As the general reader is well aware, all of them — Leary, Osmond, Watts, Kesey, Alpert — were highly publicized promoters of the early LSD counterculture. By 1967, with the cult of "Flower People" in Haight-Ashbury and the emergence of the antiwar movement, the United States was ready for the inundation of LSD, hashish, and marijuana that hit American college campuses in the late 1960s.

"The beating of drums ..."

In 1963, the Beatles arrived in the United States, and with their decisive airing on the Ed Sullivan Show, the "British sound" took off in the USA. For their achievement, the four rocksters were awarded the Order of the British Empire by Her Majesty the Queen. The Beatles and the Animals, Rolling Stones, and homicidal punk rock maniacs who followed were, of course, no more a spontaneous outpouring of alienated youth than was the acid culture they accompanied.

The social theory of rock was elaborated by British agent and musicologist Theodor Adorno, who came to the United States in 1939 to head the Princeton University Radio Research Project (18)


Adorno writes:

In an imaginary but psychologically emotion-laden domain, the listener who remembers a hit song will turn into the song's ideal subject, into the person for whom the song ideally speaks. At the same time, as one of many who identify with that fictitious subject, that musical I, he will feel his isolation ease as he himself feels integrated into the community of "fans." In whistling such a song he bows to a ritual of socialization, although beyond this unarticulated subjective stirring of the moment his isolation continues unchanged ....

The comparison with addiction is inescapable. Addicted conduct generally has a social component: it is one possible reaction to the atomization which, as sociologists have noticed, parallels the compression of the social network. Addiction to music on the part of a number of entertainment listeners would be a similar phenomenon (emphasis added). (19)

The Hit Parade is organized precisely on the same principles used by Egypt's Isis priesthood and for the same purpose: the recruitment of youth to the dionysiac counterculture.

In a report prepared for the University of Michigan's Institute of Social Research, Paul Hirsch described the product of Adorno's Radio Research Project. (20) According to Hirsch, the establishment of postwar radio's Hit Parade "transformed the mass medium into an agency of sub-cultural programming." Radio networks were converted into round-the-clock recycling machines that repeated the top 40 "hits." Hirsch documents how all popular culture — movies, music, books, and fashion — is now run on the same program of pre-selection.


Today's mass culture operates like the opium trade: the supply determines the demand.

The Vietnam war and the antiwar trap

But without the Vietnam War and the British Secret Intelligence Services' "antiwar" movement, the Isis Cult would have been contained to a fringe phenomenon — no bigger than the beatnik cult of the 1950s that was an outgrowth of the early Huxley ventures in California. The Vietnam war created the climate of moral despair that opened the educated elite of America's youth — the first 20th-century generation raised in a climate free from depression and war — to drugs.

The reader has already been shown that the Kennedy Administration installed in the White House by the 1960 elections was sponsored by the British Round Table (see Part III). Under Kennedy, American involvement in Vietnam — which had been vetoed by the Eisenhower Administration — was initiated on a limited scale. Under Lyndon Johnson, American military presence in Vietnam began in earnest. Johnson's principal Vietnam advisor was not even American. He was a British officer, Sir Robert Thompson, whose entire career had been spent conducting counterinsurgency warfare in Southeast Asia.


Playing on the President's "yahoo" anticommunist profile, Thompson convinced President Johnson that communist insurgency had to be stopped at all costs and that a strong U.S. military presence in South Vietnam was necessary for that containment. Johnson, a military and foreign policy incompetent whose other chief Vietnam advisor, National Security Council Director Walt Rostow, held the Cross of the Order of the British Empire, was dragged by the nose into Vietnam by the British.

The British, to put it simply, had two reasons for manipulating the United States into Vietnam. The first was to foster a "limited war" confrontation in Southeast Asia between the United States and the Soviet Union (through its North Vietnamese "surrogate") that would both refuel the Cold War and effectively undercut the influence of both powers in the region. The second and equally significant reason was to demoralize the American people to such a degree that the sense of national pride and confidence in the future progress of the republic would be forever shattered.

Just as Aldous Huxley began the counterculture subversion of the United States 30 years before its consequences became evident to the public, Lord Bertrand Russell began laying the foundations for the antiwar movement of the 1960s before the 1930s expired. Lord Russell and Aldous Huxley co-founded the Peace Pledge Union in 1937 — just before both went to the United States for the duration of World War II. (21)

Russell's antiwar zeal, it should be noted, was a patent fraud. During World War II, Lord Russell opposed British and American warfare against the Nazis because he was a peripheral member of the pro-Nazi Cliveden Set. In 1947, when the United States was in possession of the atomic bomb and Russia was not, Russell loudly advocated that the United States preemptively commence World War III — against the Soviet Union. His 1950s "Ban the Bomb" about-face was fundamentally an anti-technology movement against the peace-through-development potentials represented by President Eisenhower's "Atoms for Peace" initiative to the Soviets; Eisenhower's 1954 proposal to the United Nations was predicated on the development of thermonuclear fusion power and concomitant city-building projects throughout the underdeveloped sector.

From the mid-1950s on, Russell's principal assignment was to build an international antiwar and anti-American movement. Coincident with the escalation of U.S. involvement in Vietnam under British manipulation, Russell upgraded the old Peace Pledge Union (which had been used in West Germany throughout the postwar period to promote an anti-capitalist "new left" wing of the Social Democratic Party, recruiting several future members of the Baader-Meinhof terrorist gang in the process) into the Bertrand Russell Peace Foundation.

In the United States, New York's Our Crowd banks provided several hundred thousand dollars to establish the Institute for Policy Studies (IPS), as effectively the U.S. branch of the Russell Peace Foundation. Among the founding trustees of the IPS was James Warburg, directly representing the family's interests.

IPS drew its most active operatives from a variety of British dominated institutions. IPS founding director Marcus Raskin was a member of the Kennedy Administration's National Security Council and also a fellow of the National Training Labs, a U.S. subsidiary of the Tavistock Institute founded by Dr. Kurt Lewin.

IPS in turn financed and ran the Students for a Democratic Society (SDS) — the student antiwar movement — up through and beyond its splintering into a number of terrorist and Maoist gangs in the late 1960s. (22) If one were to take the time to trace the pedigrees of all of the leaders of the antiwar movement in the United States, an almost unbroken pattern of either IPS or direct Russell Foundation control would emerge. This is not to say that the majority of antiwar protesters were paid, certified British agents. On the contrary, the overwhelming majority of antiwar protesters went into SDS on the basis of outrage at the developments in Vietnam and subsequently got trapped.


Once caught in the environment defined by Russell and the Tavistock Institute's wartime psychological warfare experts, their sense of values and their creative potential were snatched up in a cloud of hashish smoke.

The LSD connection

Who provided the drugs that swamped the antiwar movement and the college campuses of the United States in the late 1960s? The organized crime infrastructure — which had set up the Peking Connection for the opium trade in 1928 — provided the same services in the 1960s and 1970s it had provided during Prohibition. This was also the same network Huxley had established contact with in Hollywood during the 1930s.

The LSD Connection begins with one William "Billy" Mellon Hitchcock. Hitchcock was a graduate of the University of Vienna and a scion of the millionaire Mellon banking family of Pittsburgh. (Andrew Mellon of the same family had been the Treasury Secretary throughout Prohibition.) In 1963, when Timothy Leary was thrown out of Harvard, Hitchcock rented a 55-room mansion in Millbrook, New York where the entire Leary Huxley circle of initiates was housed until its later move back to California. (23)

Hitchcock was also a broker for the Lansky syndicate and for the Fiduciary Trust Co., Nassau, Grand Bahamas — a wholly owned subsidiary of Investors Overseas Services. He was formally employed by Delafield and Delafield Investments where he worked on buying and selling vast quantities of stock in the Mary Carter Paint Co. — soon to become Resorts International.

In 1967, Dr. Richard Alpert put Hitchcock in contact with Augustus Owsley Stanley III. As Owsley's agent, Hitchcock retained the law firm of Rabinowitz, Boudin and Standard (24) to conduct a feasibility study of several Caribbean countries to determine the best location for the production and distribution of LSD and hashish.

During this period, Hitchcock joined Leary and his circle in California. Leary had established an LSD cult called the Brother hood of Eternal Love and several front companies, including Mystics Art World, Inc. of Laguna Beach, California. These California-based entities ran lucrative trafficking in Mexican marijuana and LSD brought in from Switzerland and Britain. The British connection had been established directly by Hitchcock, who contracted the Charles Bruce chemical firm to import large quantities of the chemical components of LSD. With financing from both Hitchcock and George Grant Hoag, the heir to the J.C. Penney dry goods fortune, the Brotherhood of Eternal Love set up LSD and hashish production-marketing operations in Costa Rica in 1968. (25)

Toward the end of 1968, Hitchcock expanded the LSD-hashish production operations in the Caribbean with funds provided by the Fiduciary Trust Co. (IOS). In conjunction with J. Vontobel and Co. of Zurich, Hitchcock founded a corporation called 4-Star Anstalt in Liechtenstein. This company, employing "investment funds" (i.e., drug receipts) from Fiduciary Trust, bought up large tracts of land in the Grand Bahamas as well as large quantities of ergotamine tartrate, the basic chemical used in the production of LSD. (26)

Hitchcock's personal hand in the LSD connection abruptly ended several years later. Hitchcock had been working closely with Johann F. Parravacini of the Parravacini Bank Ltd. in Berne, Switzerland. From 1968, they had together funded even further expansion of the Caribbean-California LSD-hashish ventures. In the early 1970s, as the result of a Securities and Exchange Commission investigation, both Hitchcock and Parravacini were indicted and convicted of a $40 million stock fraud. Parravacini had registered a $40 million sale to Hitchcock for which Hitchcock had not put down a penny of cash or collateral. This was one of the rare instances in which federal investigators succeeded in getting inside the $200 billion drug fund as it was making its way around the "offshore" banking system.

Another channel for laundering dirty drug money — a channel yet to be compromised by federal investigative agencies — is important to note here. This is the use of tax-exempt foundations to finance terrorism and environmentalism. One immediately relevant case makes the point.

In 1957, the University of Chicago's Robert M. Hutchins established the Center for the Study of Democratic Institutions (CSDI) in Santa Barbara, California. Knight Commander Hutchins drew in Aldous Huxley, Elisabeth Mann Borghese, and some Rhodes Scholars who had originally been brought into the University of Chicago during the 1930s and 1940s.

The CSDI was originally funded (1957-61) through a several million-dollar fund that Hutchins managed to set up before his untimely departure from the Ford Foundation. From 1961 on, the Center was principally financed by organized crime. The two funding conduits were the Fund of Funds, a tax-exempt front for Bernie Cornfeld's IOS, and the Parvin Foundation, a parallel front for the Parvin-Dohrman Co. of Nevada. IOS and Parvin Dohrman held controlling interests in the Desert Inn, the Aladdin, and the Dunes — all Las Vegas casinos associated with the Lansky syndicate. IOS, as already documented, was a conduiting vehicle for LSD, hashish, and marijuana distribution throughout the 1960s. (27)


In 1967 alone, IOS channeled between $3-4 million to the center. Wherever there is dope, there is Dope, Inc.



  1. Paul Ghalioungui, The House of Life: Magic and Medical Science in Ancient Egypt (New York: Schram Enterprises Ltd., 1974).

  2. Saint Augustine, The City of God (New York: Oxford University Press, 1963).

  3. Arnold Toynbee, A Study of History (New York: Oxford University Press, 1935).

  4. Martin Green, Children of the Sun: A Narrative of Decadence in England After 1918 (New York: Basic Books, Inc., 1976).

  5. See Ronald William Clark, The Huxleys (New York: McGraw-Hill, 1968).

  6. Helena P. Blavatsky, Isis Unveiled, A Master Key to the Mysteries of Ancient and Modern Science and Theology (Los Angeles: Theosophy Co., 1931).

  7. Francis King, Sexuality, Magic and Perversion (New York: Citadel, 1974), p. 118.

  8. Sybille Bedford, Aldous Huxley: A Biography (New York: Alfred A. Knopf and Harper & Row, 1974).

  9. Ibid.

  10. Institute for Policy Studies, "The First Ten Years, 1963-1973," Washington, D.C., 1974.

  11. Humphrey Osmond, Understanding Understanding (New York: Harper & Row, 1974).

  12. RAND Catalogue of Documents.

  13. Gregory Bateson, Steps to the Ecology of the Mind (New York: Chandler, 1972).

  14. Ralph Metzner, The Ecstatic Adventure (New York: Macmillan, 1968).

  15. See Ronald William Clark, The Huxleys (New York: McGraw-Hill, 1968).

  16. Michael Minnicino, "Low Intensity Operations: The Reesian Theory of War," The Campaigner (April, 1974).

  17. R.D. Laing et al., The Dialectics of Liberation (London: Tavistock Press, 1967).

  18. Theodor Adorno was a leading professor at the Frankfurt School of Social Research in Germany, founded by the British Fabian Society. A collaborator of twelve-tone formalist and British intelligence operative, Arnold Schonberg, Adorno was brough into the United States in 1939 to head up the Princeton Radio Research Project. The explicit aim of this project, as stated in Adorno's Introduction to the Sociology of Music, was to program a mass "musical" culture that would steadily degrade its consumers. Punk rock is, in the most direct sense, the ultimate result of Adorno's work.

  19. Theodor Adorno, Introduction to the Sociology of Music (New York: Seabury Press, 1976).

  20. Paul Hirsch, "The Structure of the Popular Music Industry: The Filtering Process by Which Records are Pre-selected for Public Consumption," Institute for Social Research's Survey Research Center Monograph, 1969.

  21. Ronald W. Clark, The Life of Bertrand Russell (New York: Alfred A. Knopf, 1976), p. 457.

  22. Illinois Crime Commission Report, 1969. The Institute for Policy Studies (IPS) was established in 1963 by Marcus Raskin, a former National Security Advisor under NSC Director McGeorge Bundy, and Richard Barnet, a former State Department Advisor on Arms Control and Disarmament. Among the Board of Trustees of IPS were Thurmond Arnold, James Warburg, Philip Stern, and Hans Morgenthau, with seed money from the Ford Foundation (later to be headed by McGeorge Bundy). IPS has functioned as the "New Left" think tank and control center for local community control, community mental health centers and direct terrorist organizations, In its report "The First Ten Years," the Institute lists among its lecturers and fellows members of the Weathermen group, known associates of the Japanese Red Army, the Puerto Rican terrorist Armed Forces of National Liberation (FALN), and the Black Liberation Army. See also Carter and the Party of International Terrorism, Special Report by the U.S. Labor Party, August, 1976.

  23. Mary Jo Warth, "The Story of Acid Profiteers," Village Voice, August 22,1974.

  24. Ibid.

  25. Ibid.

  26. Ibid.

  27. Hutchinson, Vesco.


The Drug Lobby

The Criminals Come Out in the Open

In California, laws are now before the state legislature that would decriminalize all drug use on the grounds that this would free law enforcement and judicial agencies to deal with "more serious crime." The sponsor of that bill is State Representative Willie Brown, a paid lobbyist for Resorts International.

That's the tip-off to the real nature of the Drug Lobby. Britain's secret army of organized crime is now out in the open demanding the expansion of its dope market.

Since 1973, when Watergate finished off Nixon's attempt to shut down the drug trade, the Drug Lobby has succeeded in decriminalizing marijuana in nine states. In every case, the result has been an immediate outbreak of drug abuse of epidemic proportions. According to Dr. Peter Bensinger, Director of the Drug Enforcement Administration, the decriminalization of marijuana in the state of Maine additionally opened the coastal area as a major smuggling center for marijuana, cocaine, and heroin.

By the open admission of the Drug Lobbyists, legalized proliferation of marijuana is just the foot-in-the-door for eventual legal cocaine and heroin proliferation. Dr. Peter Bourne, who until 1978 was President Carter's special advisor on drug abuse, making him the highest ranking federal drug enforcement officer, has appeared on nationwide television to advocate national legalization of cocaine.

A systematic campaign to legalize heroin use has been underway since 1977. A bill was placed before the state legislature of Ohio and narrowly defeated in committee in 1977 removing heroin from the list of Category I drugs (those drugs outlawed for even medical use). New Mexico and Florida — both states identified by the DEA as major distribution points for heroin — have bills presently pending that would, like the Ohio bill, legalize the use of heroin under medical supervision in cases of terminal illness and for "experimental purposes." When a similar bill was briefly enacted in New York (in 1919, coincident with Prohibition) , the widely documented consequences were an immediate jump in heroin addiction, far in excess of the number of "officially registered" patients.

At present, two Zionist Lobby sponsored bills are before the U.S. Congress that would nationally legalize marijuana: the Javits-Koch bill and the Kennedy-authored S.1437 which thoroughly overhauls the Federal Criminal Codes on a British "common law" basis.

Kennedy's drug-death Cult

The U.S. Drug lobby is run out front by the Most Venerable Military and Hospitaller Order of St. John of Jerusalem.

In the 11th century, the Knights-Hospitallers had organized hospices as a "death cult" where the sick were administered hallucinogenic drugs instead of medical treatment. The hospices became known as the dissemination point for drugs and lethal poisons, often targeted at the Knights' humanist adversaries.

In 1967, the Order of St. John resurrected the 11th century hospice movement at St. Christopher's Hospice in London. Here, "patients" are administered a "pain-killer" called the Brompton Mixture. It consists of heroin, cocaine, alcohol, tranquilizers, and chloroform water. It is administered every three hours — until the patient dies. (1)

In 1977, the Order of St. John launched a hospice movement in the United States. It advocates the decriminalization of heroin and cocaine — on the "humanitarian" grounds that everyone has the human right to die as he or she sees fit.

To propagate the hospice movement here, the Order founded the National Committee on the Treatment of Intractable Pain (NCTIP). Its honorary chairman is Lady Mary Ward, a British specialist in the hospice movement who founded Hospice, Inc. in Connecticut as the first operating "death clinic" in the U.S. The director of the NCTIP is another British national, Arthur Trebach. A professor at the Center for the Administration of Justice at the American University in Washington, D.C., Trebach is also the Director of the Institute on Drugs, Crime and Justice in Britain. For the past five years, Trebach has sponsored hundreds of U.S. medical students, professional physicians, and others for special indoctrination sessions at the Imperial College of Science and Technology, University of London. The theme of the session is the "success" of Britain's policy of legalizing heroin in curbing the illegal drug problem. (2)

In the United States, the Hospice, Inc. is financed by the Kaiser Foundation, which includes on its board Kingman Brewster, current U.S. Ambassador to the Court of St. James and also a member of the Order of St. John. The Kaiser Foundation's participation in Britain's Opium War dates back to at least 1958, when Dr. Timothy Leary conducted his first experiments with LSD at the Foundation's Kaiser Experimental Hospital in San Francisco.

The other institution currently involved in financing the hospice project is the Joseph and Rose Kennedy Institute for the Study of Human Reproduction and Bioethics at Georgetown University. (3)

In October, 1978, the first annual National Hospice Organizing Meeting took place in Washington, D.C.; the two keynote speakers were Senator Edward Kennedy, now chairman of the Senate Judiciary Committee and a ranking member of the Senate Public Health Committee, and Secretary of Health, Education and Welfare Joseph Califano.

The Order of St. John also maintains significant influence on the board of directors of the Ford Foundation, the world's largest tax exempt funding conduit for dionysian cults. On the board are John Loudon, a Commander in the Knights of St. John, the chairman of Royal Dutch Shell, and the present President of the World Wildlife Fund (the funding conduit for the terrorist component of the environmentalist movement worldwide) (4) and Eugene Black, another Knight and former director of the World Bank. The foundation's current policy thrust was charted during the 1951-54 period when its associate director and policy formulator was Knights Commander Robert M. Hutchins, whom we met earlier as a controller of the Capone mob.

The Ford Foundation gives multimillion dollar annual grants directly to the Royal Institute of International Affairs; it is also the principal funder of the Drug Lobby in the U.S. In 1972, the Foundation established the Drug Abuse Council with a $1 million war chest which has been refilled every year since. (5)

As its first public act, the Drug Abuse Council issued a widely circulated report advocating the decriminalization of marijuana, a tenfold increase in methadone (synthetic heroin) clinics, and the British system of legalized government-sponsored heroin addiction. Following the release of that report, the Kaiser Foundation and the Commonwealth Fund established a matching fund that more than doubled the annual revenues available to the Drug Abuse Council to push drug legalization.

Jacob Javits and organized crime

From this level down, the so-called "liberal" drug decriminalization lobby is thoroughly interlocked with organized crime, by those forces whose monetary interest lies in the expansion of the drug market.

The interlock is keyed around the Zionist Lobby, and more precisely around the person of Senator Jacob Javits (R-N.Y.). It has been reported by several knowledgeable sources that Senator Javits gets his orders several times a week at private planning briefing sessions at a number of exclusive New York City apartments. Among those present are Arthur Ross of London's International Institute for Strategic Studies and a subagent of Rio Tinto Zinc's Mark Turner, Rio Tinto Zinc's Sam Harris, Nahum Bernstein of the Jerusalem Foundation, and Warburg, Pincus's Henry Simon Bloch. This, in turn, is the same circle that maintains ownership of the Bronfman family.

Startling evidence of this Bronfman-Javits relationship surfaced in 1977 when bribery and extortion were employed to pass a marijuana decriminalization bill through the New York State Legislature and to subsequently cover up the findings of a legislative investigating committee that showed a 300 percent jump in adolescent marijuana abuse in the state following decrim. As the sponsor since 1968 of legislation to federally decriminalize marijuana, Javits (along with cosponsor Edward Koch, now Mayor of New York City) was the most outspoken organizer for the New York State marijuana legalization bill.

During the 1977 legislative session, the bill was defeated. In an unprecedented move pushed by the senior U.S. Senator, Governor Carey personally conducted a pressure campaign on behalf of a reintroduced version of the same bill, which passed by one vote in June, 1977. The decisive vote was cast by a severely ill hospitalized member of the legislature who was helicoptered back and forth from his sickbed by state police on personal orders from the Governor.

These extraordinary measures were perhaps clarified several weeks later when Edgar Bronfman made a personal "loan" to Carey of $350,000 to pay off the Governor's outstanding 1974 campaign debts. The loan was in violation of state and federal campaign financing laws.

Like the Bronfman family itself, Javits's direct connections to organized crime and drug trafficking run deep. According to affidavits on file from the Internal Revenue Service and the Securities and Exchange Commission, Javits functions as a listening post and conduit of classified government information for the Lansky syndicate.

In one recently publicized incident, Javits provided Lansky and other crime figures with information on IRS moves to secretly shut down a multibillion dollar tax loophole that enabled mob investors in the domestic coal industry to claim 500 percent tax write-offs on their investments. Through Javits's "tip" Lansky and Co. made a huge, final move to take over the independent coal operators 24 hours before the new codes went into effect. Another crime figure implicated in the coal industry killing was Richard L. Herring, a Georgia-based intermediary of Robert Vesco. In ad dition to his involvement in the creation of the offshore Caribbean "dirty money" apparatus through Investors Overseas Services, Vesco is a known collaborator of Lansky's in running the Caribbean Silver Triangle drug traffic in heroin, cocaine, and marijuana. (6)

Javits's links to Lansky and Vesco surfaced in yet another context in October, 1978. After a several ton marijuana bust off the coast of Massachusetts, the defendants were represented in court by James Lawson, the head of the state chapter of the National Organization for the Reform of Marijuana Laws (NORML). NORML is the principal public lobby for the decriminalization of marijuana and addictive drugs in the U.S. Sitting on its Advisory Board is Sen. Jacob Javits. Evidence surfaced in the course of the trial that the front money for the captured marijuana shipment had been provided by Meyer Lansky and Robert Vesco. (7)

Should there be any lingering doubt in the reader's mind that Javits is a witting conspirator in the campaign to poison the country through drugs, the following should be considered. From 1940 to 1942 Javits was the Assistant to the Chief of Chemical Warfare, Office of Strategic Services. From 1954 to 1956, as New York State Attorney General, Javits administered a clandestine experiment on the effects of LSD in conjunction with the Central Intelligence Agency. At least one active duty military officer died as the result of being given an unsolicited dose of LSD — an incident which Javits covered up and which only came to light through recent Freedom of Information Act disclosures. (8)

Javits is, of course, the unofficial public head of the Zionist Lobby in the United States. He is the National Chairman of the Anti-Defamation League of B'nai B'rith, and a board member of the American Jewish Committee, the Zionist Organization of America, and the Amer-Israel Cultural Foundation.

Kennedy's NORML

Next to Jacob Javits, the most outspoken drug lobbyist in Washington, D.C. is Senator Edward Kennedy, the sponsor of the other pending marijuana decriminalization bill. As the new chairman of the Senate Judiciary Committee, Kennedy has necessarily steered away from Javits's open lobbying posture on behalf of drugs in order to maintain a modicum of credibility among the powerful law enforcement lobby. Yet the Kennedy family is directly represented on NORML's advisory board by ex-brother-in-law Peter Lawford.

Like Javits, Kennedy too is up to his neck in Lansky-Vesco offshore criminal activities. At the top of Kennedy's 1976 campaign contributors list is Joseph Linsey, a leading Zionist Lobby "philanthropist," who is also known as the kingpin of organized crime in New England. Linsey is a business partner of Meyer Lansky in the International Airport Hotel Distributing, Inc.

The Kennedy fortunes are even more directly linked to Lansky through the already documented Resorts International-Intertel interface. Nowhere is this interface more evident than in New Jersey, where a combination of Justice Department "water-gating specialists" teamed with a $1 million Resorts International lobbying and payoff campaign to legalize casino gambling.

New Jersey Governor Brendan Byrne, who was recruited out of the Essex County Prosecutor's office by the Kennedy Justice hands and installed in the Governor's mansion, is a nationally prominent spokesman for drug decriminalization. As Chairman of the Law Enforcement Assistance Administration (LEAA) National Advisory Committee on Criminal Justice Standards and Goals, Byrne commissioned a series of studies supporting decriminalization of marijuana and casino gambling.

NORML, the clearinghouse organization for the various local dionysian cults and Zionist Lobby "liberal" legislators, is itself a thinly veiled cover through which the poisoning influence of organized crime is extended into the high schools and neighborhoods of the country. NORML is virtually indistinguishable from the drug cult-pornographic magazine High Times, which boasts a several hundred thousand circulation predominantly among high school age drug users.


The magazine features dozens of pages of advertisements for drug paraphernalia, instructions on the production and use of legal and illicit drugs, and pornographic photographs and interviews with various "high priests" of the drugrock cult. Through the revenues of High Times, through an average of $100,000 per year in tax exempt grants from the Playboy Foundation, and through "frequent anonymous contributions from drug dealers," NORML is financed. (9)

The Advisory Board of NORML includes (in addition to Javits and Peter Lawford): Max Palevsky, chairman of the board of the Xerox Corporation; Hugh Hefner, owner of Playboy Enterprises, Inc.; William F. Buckley Jr.; Burton Joseph, Director of the Playboy Foundation; Canon Walter D. Dennis of the Cathedral of St. John the Divine in New York City, the " temple and headquarters" of the Order of St. John of Jerusalem in the United States; and Stewart Mott, heir to the General Motors fortune.

NORML's general counsels Michael Kennedy and Gerald Lefcourt, are also connected to terrorism through their defense of the Puerto Rican FALN (Armed Forces for National Liberation) and Weather underground leader Mark Rudd.



  1. Karen Steinherz and Marie Mendez, "The Hospice Movement -Taking the Pain Out of Genocide," New Solidarity, Vol. IX, No. 62, October 6, 1978. See also Sandol Stoddard, The Hospice Movement (Briarcliff Manor, New York: Stein & Day, 1978).

  2. Seminar listings for the Fifth Institute on Drugs, Crime and Justice in Britain, held in London in July 1978. The Institute has held five such annual conferences at the Imperial College of the University of London, bringing American university students and American public health officials to study drug abuse in Britain and the "British Model" of treatment.

  3. Steinherz and Mendez, op. cit.

  4. Who's Who in America (Chicago: Marquis, 1974); Annual Reports of the World Wildlife Fund of America, 1976 and 1977; see also, The Foundation Directory, 5th Edition (New York: The Foundation Center).

  5. Ford Foundation Annual Reports, 1972-78, and The Drug Abuse Council Annual Reports, 1972-77.

  6. NBC-TV News broadcast transcript, "Coal Fraud," Reporters Ross and Silverman, September, 1978.

  7. Federal District Court Records of the First Circuit Court, Boston, Massachusetts. Additional information was provided on drug charges by New England-based officials of the Drug Enforcement Administration in September, 1978.

  8. In 1976, following Congressional hearings into the intelligences community, the files pertaining to the Central Intelligence Agency's MKULTRA, BLUEBIRD and ARTICHOKE programs were released to the public. The FOIA documents reveal extensive details of the CIA and Army's experiments with mind control techniques including LSD. In 1977, Renee J. Roberts, the daughter of Harold Bauer who died as the result of a dosage of a hallucinogenic drug administered to him at the New York State Psychiatric Institute as part of an Army-contracted experiment, began a civil damages suit against offiicials responsible for failing to investigate the circumstances of her father's death. Sen. Jacob Javits is a defendant in that suit, stemming from his position as New York State Attorney General at the time of Bauer's death.

  9. Interview with Keith Stroup, Playboy Magazine, 1978; see also issues of NORML Newsletter describing anonymous contributions.


On October 18,1978, the authors of this book met in Washington, D.C., with eight officials of the Federal Reserve Board of Governors, including Mr. John E. Ryan, director of Banking Supervision and Regulation, and Mr. Robert Mannion, director of the Board of Governors' legal department. Present were two lawyers for the Hong Kong and Shanghai Bank, including the HongShang's chief legal counsel in the United States, Mr. Steuart

L. Pittman. At this meeting, the authors presented evidence incriminating the HongShang in the international narcotics traffic and argued that the Federal Reserve should block HongShang's proposed acquisition of 51 percent of the shares of the $20 billion Marine Midland Bank of New York. On October 25, a similar meeting was held with officials of the New York State Banking Authority, including New York State Deputy Superintendent of Banking William Heany.

Also, portions of the manuscript have circulated in photostat form for several weeks prior to publication through the State Department, Treasury Department, Drug Enforcement Administration, and related enforcement and regulatory agencies.

In public meetings and radio and television appearances in a dozen cities in the United States, the authors have outlined the contents of this book before a broad and diverse audience. Through these various channels, word has gotten out.

Most readers will have asked themselves the question that the authors have been asked often in the course of this report's preparation: "How will the powerful men who stand behind the narcotics traffic react to this exposure?" The answer is already evident, at least in part. On November 11, European collaborators of the U.S. Labor Party team conducted a public meeting in Paris to present the results of the investigation. The meeting was attacked by 20 hooded and armed members of the fascist organization, Betar. French police were on guard and prevented injuries to members of the audience, but one policeman was injured by the assault. The French authorities believe that the attack was ordered by the Mossad, Israel's foreign secret service. The Betar was founded in the 1930s by Yakob Jabotinsky, a Polish Zionist who modeled himself on Benito Mussolini, and who was the mentor of present Israeli Prime Minister Menachem Begin. Undoubtedly, the decision to launch an attack against not only the collaborators of the authors, but the French police — who know well how to deal with such matters — indicates a great fear in the perpetrators of the narcotics traffic.

What this report has intersected, however, goes far beyond the petty thuggery of the Mossad. Discreetly, officials of the HongShang warned the authors shortly after the cited meetings in Washington what would happen to the United States if they persisted: "You know, of course," an official said, "that the British government has made representations to the American authorities on behalf of the HongShang, which is after all a British bank. American banks have had pretty much a free run of it all in London, and we British rather feel that we should have the same privileges here. If the American authorities give us any trouble, the Bank of England will start exhuming skeletons from the closets of the American banks."

In fact, the British had already surfaced an undercover agent in New York's Citibank in mid-July, a junior official named David Edwards, who sued the bank for $14 million and made numerous allegations of illegal money transfer operations. Recently, after the HongShang official made the statement quoted above, the Edwards case has taken a new turn. On November 5, Katharin Graham's Washington Post added major new expose material to Edwards's original allegations, citing its own sources inside Citibank. The authors have learned that Katharin Graham is personally directing Edwards's appearances before one Senate and three House of Representatives committees.

Coming at a time when the British banks are making a massed bid to acquire American banking assets, the inside-outside job against Citibank is ominous. Apart from the HongShang's cited plan to acquire Marine Midland, the Canadian Bank of Montreal wants to buy out 81 retail branches of New York's Bankers Trust; Standard and Chartered Bank wants to buy up the $3 billion Union Bank of Caliornia; and buy-out attempts or branch office openings are in the works involving Barclays Bank, National Westminster Bank, Bank Leumi, Bank Hapoalim, and other financial institutions implicated in the world narcotics traffic. An invasion is on against the already weakened American monetary system, and the evidence suggests that the British dope-runners are deliberately seeking to destabilize American banks to further this invasion.

Apart from the dirty tricks operations aimed at American banks, numerous other attempts will emerge from the dope-traffickers to cushion themselves from the impact of this report. Lower-level operatives, expendable portions of the network may be sacrificed, the way that assassins like Lee Harvey Oswald or Sirhan Sirhan were sacrificed by their masters.

But the enemy cannot recoup what it has lost. The $200 billion dope trade cannot be hidden; it can only be protected through misdirection. The web of lies now hangs in tatters. If the American public forces its legislators and law enforcement officials to act, Dope, Inc.'s defense will no longer avail. The first blood has already been drawn from a group of gentlemen who have been long accustomed to working at a distance from the combat zone. The terms of the battle have been redrawn to make an American victory possible.

- Konstandinos Kalimtgis
- David Goldman
- Jeffrey Steinberg
New York City

November 17,1978