PANAMA GUNRUNNING

TUESDAY, JULY 10, 1979

HOUSE OF REPRESENTATIVES,

COMMITTEE ON MERCHANT MARINE AND FISHERIES,

Washington, D.C.

The committee met, pursuant to notice, at 11:47 a.m., in room 1334, Longworth House Office Building, Hon. John M. Murphy, chairman of the committee, presiding.

Present: Representatives Murphy, de la Garza, Breaux, Bowen, Hubbard, Oberstar, Bonior, Wyatt, Lowry, Hutto, and Carney.

Staff present: Carl L. Perian, chief of staff; Lawrence O'Brien, chief counsel; Jack E. Sands, minority counsel; Terrence Modglin, professional staff member; Frances Still, chief clerk; Taddy McAllister, clerk; and Susan Baffa, press secretary.

The CHAIRMAN. The committee will come to order.

The full committee is meeting today to consider the matter of possible testimony before the Panama Canal Subcommittee by Mr. Antonio Alvarez, on a subject of some sensitivity.

Mr. Alvarez is charged in the U.S. District Court for the Southern District of Florida, in Case No. 79-174 CR JLK, in a four count indictment alleging that he violated title 18, sections 922(a)(1); title 18, United States Code, section 923 and title 18, United States Code, section 371. These violations concern alleged illegal transaction in firearms and other miscellaneous firearms violations.

In effect, Mr. Alvarez has been indicted as an alleged participant in the illegal smuggling of arms from the United States through Panama to irregular military groups in Latin America. You will further recall that these transactions were the subject of 2 days of hearings by the Panama Canal Subcommittee on June 6 and 7. On June 11, 1979, Mr. Alvarez and his attorney met with certain committee staff members and myself, offering to testify in public session regarding activities by the Panamanian Government of which he purports to have direct knowledge. These were largely matters involving intelligence operations and other undertakings beyond the borders of the Republic of Panama, and he implied that they involved joint efforts with other Latin American countries. Mr. Alvarez, through counsel, indicated that he could only testify if he was offered immunity, that is, if his testimony could not be used against him in subsequent criminal proceedings.

Under the terms of section 6002 and 6005 of title 18 of the United States Code, a congressional committee can offer so-called use immunity to an individual under the conditions specified in the statute. Specifically, if an individual indicates that if he is subpenaed, then he will claim the protection of the fifth amendment, the chairman of the committee may, by means of a Federal district

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court order, immunize the witness so his testimony before the committee may not be used against him. In effect, the committee can compel the testimony of the witness.

By a letter dated June 20, 1979, David Goodhart, Esq., has indicated to me that Mr. Alvarez will seek the protection of the fifth amendment saying in part:

Other than his name and address, Mr. Alvarez must respectfully decline to answer any and all other questions and invoke his privilege against incrimination. What is it that Mr. Alvarez can tell the subcomitteee and what is its relevance?

Since he has not yet been offered immunity, his conversations with committee counsel and myself has been circumscribed since anything he says to anyone could ultimately be used against him, and, conceivably, those to whom he spoke could be called as witnesses in the case. Nonetheless, during some 2 hours of conversation with Mr. Alvarez, conducted in the presence of his attorney, I concluded that he does have broad personal experience in intelligence operations in the service of several governments including the United States.

On occasion, he worked simultaneously for several governments and in his various capacities, he has had close personal knowledge of past operations and future plans of those governments. In an open session, this is about all that can be said, and if the committee desires to go into closed session, some further specifics as to what he has to offer by way of testimony can be provided.

At this point, I should add that unlike the floor debate on the Panama Canal legislation, H.R. 111, there is no need to close this session for national security reasons. However, the individual rights and liberties of Mr. Alvarez and several other American citizens could be jeopardized by an open discussion of specifics. Furthermore, allegations on his part as quoted here in public session could affect our relationship with several foreign governments. At the start of our June hearings on alleged gun smuggling by the Government of Panama, there were some who ridiculed the undertaking as a farfetched attempt to undermine Panama Canal implementing legislation. As I said on the floor of the House, soon thereafter, I believed then, as I believe now, that full disclosure of all the facts regarding the activities of the Government of Panama, however unpleasant, argue compellingly for passage of the legislation which will guarantee stability in Panama during the next few decades.

Subsequent to our June hearings, the Chicago Tribune on June 27 published an article based on a May 2, 1979 memo issued by the Central Intelligence Agency more than 1 month before our hearings. As a result of our June hearings, CIA sent copies of the 10page document to the State Department and other Government officials outlining Cuba's role in aiding the Sandinista rebels using Panama as the intermediary. Both Cuban and Panamanian help has been in the form of providing guns, ammunition, heavy weapons, military training of the rebels, and the actual introduction into Nicaragua of government supported Panamanian nationals in the form of a Panamanian brigade. The arms and ammunition, according to the CIA report, were ferried aboard Panamanian Air

Force planes to airfields in Costa Rica and subsequently smuggled to the guerrillas. Despite denials from the administration witnesses of any knowledge of the above, it is now apparent that they would aware of specific shipments from Cuba by way of Panamanian military aircraft to Sandinista guerrillas in Nicaragua during the last week of September and November 5-11, 1978.

Further, they were aware that the Cubans were involved in the recent reactivation of a Panamanian-Costa Rican resupply route to the FSLN. Members of the FSLN general staff reportedly stated in a meeting on April 13, that their inventory included an undisclosed number of antitank rockets of Soviet and French manufacture that Cuba had provided by way of Panama. Although the general staff members did not specify when Cuba supplied arms, other information indicates that Panama delivered arms to FSLN forces in Costa Rica about the time of the meeting. Also among the arms Panama delivered in mid-April were mortar rounds that were apparently of Chinese origin. Other sources have reported that this type of armament had previously been provided by Cuba, probably by way of Panama. These are the weapons that were displayed in this hearing room on June 6 and 7.

Some 6 weeks have elapsed since the subcommittee hearings and it now seems that there have been substantial corroboration of allegations made before the Subcommittee on the Panama Canal. Mr. Antonio Alvarez feels there is even more to disclose and that it is in the interest of the U.S. Congress to learn of past and present Panamanian intelligence operations, including operations in the United States, and possible future plans of the Panamanian government in such operations and activities.

During the Vietnam war, our country was divided, a nation against itself. It was argued, often convincingly, that the people have a right to know of military or intelligence activities which have a bearing on our national interests. I believe the people have a right to the same full and frank disclosure of matters pertaining to the Panama Canal, and the public policy issue here clearly involves our national interest.

A vote to offer Mr. Alvarez immunity to testify does not guarantee that he will ultimately testify. This is a statutory procedure which will permit committee counsel, once a court order is issued, to discuss Mr. Alvarez' allegations in detail. To be frank, his contentions may not stand up under close examination. We will not waste subcommittee or full-committee's time with an individual who may be seeking to enhance his own defense. I carry no brief for Mr. Alvarez and his criminal trial, and that trial will proceed regardless of what this committee does. Nonetheless, I believe it is useful to take the first step toward providing immunity so that we can complete the detailed hearing record in this matter. Consequently, I will offer a motion and seek a two-thirds vote of the committee so that staff can proceed under the statute toward that objective.

Mr. OBERSTAR. Mr. Chairman?

The CHAIRMAN. The gentleman from Minnesota.

Mr. OBERSTAR. Mr. Chairman, and my colleagues on the committee, this morning I was quite concerned about this proceeding knowing little of its background, having no indication of adminis

tration position and being skeptical of whether we ought to proceed with it, I asked the Justice Department this morning whether the administration had a position and whether the the Attorney General himself had an opinion.

The Attorney General said that he had just returned from Russia and was not familiar with the proceeding at hand. He did refer me to the Chief of the Criminal Division with whom I discussed the matter.

My understanding, based on that discussion, is that the Justice Department would be concerned about issuance of limited protection, the kind the committee seeks here under this subpena, early in an investigation, but not at the stage at which the Alvarez case now rests. The case is ready to go to trial. They feel they have all the information they need to obtain a conviction. There would be some question, however, early in an investigation regarding information provided to the committee under immunity of the type sought here. The Justice Department would feel they would have difficulty proving the case rested on information not related to the grant of immunity.

In this case, they feel there is no information that Mr. Alvarez could provide to the committee that would, in any way, affect the trial which is imminent.

The second concern the Justice Department would have in a matter of this kind would be related to pretrial publicity. However, since the trial is scheduled for Miami and the committee hearing is in Washington, they feel there is very likely to be little, if any, pretrial publicity affect upon the Alvarez case. They also feel the interests of the Government would be protected by the 10-day notice required by the committee to give the Attorney General and also the protection provided in law for the Attorney General to request a 20-day delay to review the matter further. If something did turn up that they feel would have an impact on the trial, they could then ask the committee to modify its proceeding.

So, from that standpoint, I would have no objection and would vote in favor of the grant of limited immunity. I have another reservation, however. H.R. 111 has passed the House and is pending in the Senate. Our hearing with Mr. Alvarez would have little constructive impact upon that legislation.

However, in the interest of providing full information, if Mr. Alvarez does have information, it ought to be provided to the public, and this is the proper forum to do that, I say we should go ahead. But I do ask if this hearing is appropriate in view of the prior House passage of H.R. 111.

The CHAIRMAN. I do not link Alvarez to the passage of implementation legislation. I think I have made it very clear both in the closed session on the floor of the House, and in the open debate, that probably the intelligence information that this committee received enhanced the passage of implementation legislation.

I think it is the responsibility of this committee, to ascertain the facts as they have already been brought to some members of this committee of the activities in Panama vis-a-vis the long term, 20year operation of the waterway, and what effect the orientation of Panama and their activities will have.

I do not think this issue is going to effect the coming HouseSenate conference on the legislation. I certainly do not intend to link it to the conference. I think we are far behind schedule, at least behind the schedule that I had originally set on this legislation.

Now, as far as Alvarez is concerned, I am going to yield to our committee counsel to brief the committee on what activities the committee has taken already with the Justice Department so that the Attorney General will be fully apprised as well as the Criminal Division in this area.

Mr. BOWEN. Mr. Chairman?

The CHAIRMAN. Mr. Bowen?

Mr. BOWEN. I would just like to commend the chairman for his concern to get at the truth of this matter and find out the scope and the extent of the smuggling of arms that has been going on in Nicarauga, and particularly, I want to commend the chairman for reiterating the position which he just pointed out that, as he states in his prepared statement, full disclosure of all the facts regarding the activities of the Government of Panama have at present argued compellingly for passage of legislation now before the Congress to guarantee stability in Panama during the next two decades.

Mr. Chairman, I and many other Members of the House have made the point very clear that the deeper the involvement that Panama might have in the activities of Nicaragua the far greater the case is for the passage of this legislation so that we can assure that the United States will administer this canal for the remainder of the century. And I do want to commend the chairman for his leadership in this regard.

The CHAIRMAN. If my colleague would yield, I might state that Nicaragua was important, but this activity we are talking about is not limited to Nicaragua and activities in just one country, and I appreciate the sentiments that you just expressed as far as the objectivity and intent of this committee, and myself personally are, in this regard.

And if we could hear from counsel-the gentleman from Florida. Mr. HUTTO. Mr. Chairman, I also would like to associate myself with the remarks that you made, and I would like to ask one question. Do you have a projected date on which Mr. Alvarez would appear to testify or any time frame?

The CHAIRMAN. Counsel will go into that, what we have done with the Justice Department.

Mr. O'BRIEN. So far as the timing is concerned, Mr. Hutto, if a vote occurs today, there is a 10-day notice requirement, as Mr. Oberstar indicated, to the Justice Department and then they have a further 20-day stay that they can elect, and that would, in effect, give us a 30-day delay, and since we have an August recess, the earliest possible testimony for this gentleman would be in September.

Insofar as the Criminal Division is concerned, I met on June 12, at the direction of the chairman, with the special assistant to the Director of the Criminal Division and the Chief of the Litigation Section of the Division, and we explored this in detail.

And the gist of what they said was that there is a separation of powers issue here, a constitutional issue. Immunity on one hand