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ANNOUNCEMENT: AFIO LUNCHEON 13 September 1999 - Fort Myer, Virginia - 10:30 a.m. - 2 pm. Two insiders discuss US intelligence operations in the Middle East/Iraq and in Tibet.

MAKE YOUR RESERVATION NOW - See Section IV Bulletin Board below.

SECTION I CURRENT INTELLIGENCE

KOSOVO - Brigadier General John Craddock, USA, reported on 14 July that US forces were occasionally coming under hostile fire, but that he did not believe it was a coordinated effort. He blamed "UCK (KLA) rogue splinter elements" or criminals- "a bad lot out there -- Albanian, Kosovar Albanian." Whatever the case, he said, they've got weapons. He further stated " We are pretty active. We are out and about day and night on the beat, if you will, on the street, just trying to make sure that we keep the peace. And I think that we are moving into areas where we're threatening their livelihood, and what we are doing is we're drawing that fire." In London, General Sir Michael Rose, former Commander of UN troops in Bosnia, dismissed the NATO bombing campaign as a tragic failure. Rose said that British politicians and NATO were running a propaganda campaign to persuade people that the air war met its objective. In the UK as well as in continental Europe and the US there are deep differences of opinion on many levels concerning the unilateral war on Yugoslavia, including the efficacy of airpower alone versus the need for ground forces or combined arms. The NATO air war strategy is said to have made the Yugoslav anti-guerilla campaign worse and expanded the humanitarian tragedy in Kosovo while doing next to nothing to interfere with it. The bombings were said to have been the trigger for much of the ethnic cleansing as well as many of the refugees.

In Washington, the Chairman of the House Permanent Select Committee on Intelligence, the Hon. Porter Goss, recently stated that, although there was no doubt that brutal actions and massacres took place, many of the figures used by the Administration and NATO in describing the wartime plight of Albanians in Kosovo now appear to be greatly exaggerated. "Yes, there were atrocities. But no, they don't measure up to the advance billing." For example, "600,000 Albanians were not trapped within Kosovo lacking shelter, short of food, afraid to go home or buried in mass graves" (President Clinton). Though thousands hid in Kosovo during the Yugoslav anti-KLA insurgent operations, they are found to be healthy.

Kosovo's livestock, wheat and other crops are growing, not slaughtered wholesale or torched as reported earlier. Also, most of the "missing men," the 100,000 young Albanians who were reported to have all been killed, can be found at home -- but without jobs, sometimes engaged, along with KLA elements, in terrorism against Serb and Gypsy minorities as well as moderate Muslims in the province.

The KLA is receiving mixed signals. One report quoted KLA members as saying US soldiers had encouraged them to hide their arms rather than to turn them in; -- and they have heard Administration spokesmen saying that their acts of murder were understandable. But the KLA is also giving out some threatening signals. Pleurat Sedju, the rebel's diplomatic representativie in London, said there will be trouble if the UN doesn't let the KLA's self-proclaimed government operate in Kosovo. "You will find that the war can start again." Hardline rebel leader Rrustem Mustafa, said the KLA is currently forming an army in spite of the disarmament agreement. There is obviously a potential for danger to US and NATO forces, as indicated by Brigadier General Craddock, unless our intelligence is pervasive, our use of force firm and effective, and our policies clear-eyed and wise.

(Sources: DOD News Bfg 14Jul99,http://www.defenslink.mil/news/#briefings ; (Reuters 13 Jul99www.abcnews.go.com/wire/world/reuters19990713-2688.hmtl) (courtesy C. Griffith) ; (Komarov in USA Today 1 July 99, p. 1A), (Balt Sun 8Jul99 p. 15A) (WTimes 11 Jul99, p. C11) (RoyJ)

IRAN CHEMICAL WEAPONS ASSESSMENT - The US Intelligence Community has reportedly completed an assessment of Iran's growing chemical weapons capability, including all aspects of production, stockpiles and delivery systems. The stockpiles include large supplies of nerve, blood and blister agents - similar to many other nations - but there is high level concern about growing delivery capabilities. A special White House National Security Council task force has been created to monitor developments. Special attention is focused on the new Shahab-3 medium range missile, which was test-fired last year, and can be outfitted with poison gas warheads. Although Iran's primary hostility is focused on its arch-enemy Iraq, the range of the Shahab-3 puts US forces and friendly nations at least at nominal risk. (Gertz and Scarborough in Wash Times 2 July99, p. A-7) (RoyJ)

JAPAN SECURITY POLICY ASSESSMENT - In recent months Japan's Government has authorized the building of a national space reconnaissance intelligence capability; approved a law allowing police to tap phones; initiated the process of revising the country's pacifist constitution; and allowed its warships to fire shots in anger - at North Korean special operations ("spy") boats - for the first time since World War II.

The CIA's National Intelligence Council convened 20 experts on May 11 to analyze the changes in Japan's posture. They concluded that Japan seems to be on a two-track approach of maintaining its alliance with the US while simultaneously hedging its bets by "pursuing greater autonomy or independence." Some experts believed that the US and Japan " may be drifting apart in the security realm." (Ch.Sc.Monitor, 8Jul99, p.1 (Cameron Barr) (RoyJ)

CHECHNYA SITREP - Three years after being driven from Czechnya, Russia is stepping up its campaign against soaring violence and crime in the northern Caucasus, including preemptive strikes against Czechen gunmen and digging a 68 mile trench along a portion of the Czechen border. The goverment said it had to act after years of attacks on Russian military posts and other targets in the Northern Causcasus region and hundreds of kidnappings by Czechen gangs seeking ransoms. In some of the heaviest fighting since the 1994-1996 war, Russian forces, backed by helicopter gunships and artillery have battled large groups of gunmen on the Czechen border in recent weeks. Most of the attacks are blamed on Czechen warlords who do not recognize the authority of Czechnya's government and want to see Russian rule ended throughout the Caucasus.

The northern Caucasus region is an intricate web of tribal, ethnic and religious animosities reaching back for many centuries (like the Balkans) . Moscow's hold on the region has been slipping because of its economic and military weakness. Russia's new tough line in the Caucasus coincides with the recent appointment of Prime Minister Sergei Stepashin, a former police official who favors strong law enforcement. (WtTmes p. A6, 10 Jul99) (RoyJ)

WEAPONS LABS ESPIONAGE REPORT - The PFIAB (President's Foreign Intelligence Advisory Board) recently published its findings on the Chinese espionage imbroglio in a report entitled "Science at Its Best, Security at its Worst." The report was written by former senator Warren B. Rudman (R-NH) along with Ms. Ann Z. Caracristi, (former Deputy Director of NSA and distinguished AFIO Board member), and Dr. Sidney D. Drell, deputy director of Standord University's Linear Accelerator Center.

Among the findings: "At one end of the spectrum is the view that the Chinese have acquired very little classified information and can do little with it. One the other end is the view that the Chinese have nearly duplicated the W-88 warhead. After reviewing the available intelligence and interviewing the major participants in many of these studies, we conclude that none of these extreme views holds water."

The report questions why the FBI and DOE counterintelligence focused all their energy on one nuclear physicist at the lab, Wen Ho Lee, without hard evidence. "Despite the disclosure of information concerning seven warheads, despite the potential that the source or sources of these disclosures were other than the bomb designers at the national weapons labs, and despite the potential that the disclosures occurred as early as 1982, only one investigation was initiated." The report goes on to lambast the DOE for "organizational disarray, managerial neglect and a culture of arrogance" that had "conspired to create an espiuonage scandal waiting to happen. " The Rudman panel concluded with two alternatives - turning the nuclear complex into a semi-autonomous agency inside DOE, or stripping thje department of responsibllity for nuclear weapons.

Restructuring is being pursued. Senator Bob Kerrey, Vice Chairman of the Senate's intelligence panel, stated that what is driving the restructuring is the need to enhance security amid the managerial complexity of the nuclear weapons programs. The labs are run by companies and universities. Management oversight of the Los Alamos National Labs, for example, is provided by the University of California. The labs work on nuclear weapons but also on other (non-weapon) projects. The labs report to regional authorities as well as the Department of Energy. Political patronage and protection play a role. There are other considerations. If the three main laboratories are to focus only on nuclear weapons, it could endanger the other work that the labs now do, and could put at risk their ($100 million) non-military funding and support for pure science -- and that could loosen their connection to universities. In turn that could harm recruitment of scientists and in the end hurt defense programs.

Complicated as restructuring may be, the espionage scandal may in the end provide a much-needed fresh look at not only security, but at the entire management and culture of the US nuclear weapons production and control arrangement. (WashP 20Jun99 p.A3 (W Pincus) , WPst 7 July99 p. A18, and (V. Loeb) WPost 7Jul99, P. A17) (RoyJ)

SECTION II CONTEXT AND PRECEDENT

ORGANIZED CRIME REPORT - The 1999 UN Human Development Report indicates that the world's organized criminals, taken together, have a greater economic output that all but three of the world's national economies. The UN Report estimates that crime syndicates gross about $1.6 trillion each year. (The UK, in comparison, has a GDP just over $1.28 trillion). The biggest enterprise is drugs - a bigger global industry than auto manufacturing. The illegal drug trade alone is worth about $400 Billion - supplying 200 million customers - and amounting to 8% of world trade.

According to the report, globalization and advances in telecommunications have created great new opportunities for the most enterprising criminals. The principal criminal groups are now reaching well beyond their home grounds. The Chinese triads are in the restaurant trade in London; the Sicilian mafia is selling heroin in New York - as do the Albanian (and Kosovar) clans in Europe; the Japanese Yakuza are financing pornography in the Netherlands. Other crime gangs, such as the Medelin and Cali cartels in Colombia, the Juarez, Tijuana and Gulf cartels of Mexico, and the Cosa Nostra in the US, are all exporting their criminal activities. They are also developing strategic alliances linked in a global network, according to the report. The precipitous removal of currency controls and the reduction of trade barriers have provided the perfect conditions for money laundering and stolen goods smuggling. (WTimes, p. A11, based on London Observer (Anthony Browne) 6 Jul99) (RoyJ)

SECTION III - BOOKS.

UNDERCOVER TALES OF WORLD WAR II, by William B. Breuer, JohnWiley & Sons, Inc., Publisher, NY 1999. This is a compendium of vignettes describing "the dangerous, high-stakes realm of espionage and intelligence, where "the most successful operations are the ones we have never heard about."

This is the author's thirty-first book, following the format of his successful 1997 "Unexplained Mysteries of World War II." Intelligence officers, both current and former, will enjoy the numerous examples of successful disinformation ploys, from the feeding of false information to the use of illusion to hide the Suez Canal from General Erwin Rommel, the Desert Fox. Veterans of the Office of Strategic Services (OSS) will linger over the exploits of former comrades-in-arms. Those who lived during the years of World War II will find between the covers reminders of people both pleasant and sad. The story on "The FBI Undercover in South America" reminds us of both the successes -- 887 Germnan spies were identified, 24 secret radio stations located and 30 transmitters detected -- - but also, of those who died in the process. Four FBI men were killed ( including Dennis Haberfeld, a 1942 FBI school classmate of our reviewer, Ray Wannal). Dennis died only three months after completing his training, a reminder of the sacrifices made by so many young men and women during World War II in vital undercover operations, so skilfully portrayed in this attention-capturing book. (Reviewed by Raymond Wannal, former Assistant Dir FBI) (RoyJ)

SECTION IV -- BULLETIN BOARD

AFIO SEPTEMBER LUNCHEON, Monday 1030 - 14:00 hrs, 13 September, Fort Myer, Va. -- - Two outstanding speakers: At 11 a.m., Rick Francona, retired intelligence officer, mideast expert and former attache in Damascus, Arab linguist, point man for US covert assistance to Iraq during the Iraq-Iran war, interpreter for General Schwartzkopf during the Gulf War, will speak on intelligence and policy issues concerning Iraq's transition from ally to adversary. His book " Ally to Adversary: An Eyewitness Account of Iraq's Fall from Grace,"(May 99) will be available for sale and autographing.

Lunch 12:00 - 13:00

At 1 pm, Kenneth Knaus, who spent four decades as an operations officer in CIA, will speak on his participation in the planning, directing and execution of America's covert attempts to aid Tibetan resistance. His book "Orphans of the Cold War: The United states, China and the Tragedy of Modern Tibet,"(May 99) will be available for sale and autographing. This luncheon occasion again promises to be an exceptionally interesting event. Introduce AFIO to a guest -- members and their guests $26, others welcome at $29. Send check to AFIO, 6723 Whittier Ave, Ste 303A, McLean, VA 22101-4533.

REQUEST FOR ASSISTANCE - Reporter for The Jerusalem Post seeks information about the fate of Charles Jordan, the executive director of the American Jewish Joint Distribution Committee, who died by drowning under mysterious circumstances in Prague in over thirty years ago, in August 1967, at the age of 59. Assistance is requested from former intelligence or foreign service officers who may recall anything about this event or who would have useful advice on how to pursue this story. The key dates are 1967, when Charlie Jordan died, and 1974, when a book by a Czech defector briefly revived interest in this case. Contacthenry@jpost.co.il

AMSTERDAM CONFERENCE -- THE IMPORTANCVE OF SIGINT IN WESTERN EUROPE DURING THE COLD WAR The Netherlands Intelligence Studies Association (NISA) is sponsoring a one-day historical conference with particular emphasis on SIGINT, in Amsterdam, Netherlands, on Saturday, November 27th. The program includes Matthew Aid (former NSA); Richard Aldrich (UK, Univ. of Nottingham), Erich Schmidt-Eenboom (Germany Inst. Friedenspolitik), Alf Jacobson (Norway NRK), Dr. Cees Wiebes (Neth. WKC (NSA)), Wies Platje (Neth/Indonesia/ NISA), and a roundtable discussion and reception. Atttendance is limited to 100. Submit your registration as soon as possible. Places will be attributed on a first registered-first served basis. The conference rate is US $ 80 including lunch and drinks at the reception. Send letter to the honorary secretary of the NISA, Dr. Cees Wiebes, P.O. Box 18 210, 1001 ZC Amsterdam, The Netherlands, or E-mail:WIEBES@PSCW.UVA.NL

EMPLOYMENT EXCHANGE

INTERNATIONAL FIRM HAS OVERSEAS TECHNOLOGY MANAGEMENT OPPORTUNITY -- Firm based in desirable Western European location (Ireland), specializing in counter-money laundering and asset recovery, seeks individual for the position of Information Technology manager. Previous US Government clearances considered a plus. Position supports financial investigators in deconstructing complex offshore asset holding and concealing devices. Salary (with tax exempt aspects for US citizens) , bonuses, options, insurance, negotiable. Moving costs and expenses included. Interested individuals contact AFIO afio@afio.com, and reference File E-14.

FORMER SPECIAL WARFARE AND INTELLIGENCE OFFICER seeks position. Served in the CIA as a NOC as well as a declared CIA Intelligence Officer with the Domestic Collection Division. Experienced helicopter pilot with combat experience in Vietnam. Completed the CIA DDO/CT course and the SOG Paramilitary course as well as the U.S. Army Military Intelligence Officers Advanced Course. Degrees in Business Administration and Aeronautical Science. Potential employers contact AFIO afio@afio.com Ref File# J-120

MEMBERSHIP DRIVE -- - AFIO member Samuel Castorani, who sponsored new member JoAnn Kayani, #1010 on the WIN list, will receive a book. Our thanks and appreciation him and to all who are sponsoring new members, and to the new members themselves! We are aiming for 1,100 WIN recipients by the end of August, but can do it only with your help. Every Member sponsor a New Member in 1999!

AFIO SPEAKERS BUREAU - Contact Chairman Chuck Slack of the AFIO Speakers Bureau (chuckslack@aol.com)

EVERY MEMBER SPONSOR A NEW MEMBER IN 1999! How? Let us know to whom we can send a membership application. If a gift, you may fill out the membership application, and we will send the recipient a membership along with a card announcing your gift.

If you need membership brochures to hand out, let us know. You know where to find us -- email afio@afio.com, or tel 703 790 0320 - - or AFIO, 6723 Whittier Ave, Ste 303A, McLean, VA 22101-4533 (Mrs Gretchen Campbell)