Counterfeit Lies

by Oliver North

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  For Betsy, “The wife of my youth . . .”

  [Proverbs 5:18–19]

  ACKNOWLEDGMENTS

  JERUSALEM, ISRAEL, 2014

  This is a story about those of us who have had to confront the ultimate moral quandary: doing what’s right when everything around us seems wrong. For some that’s a once-in-a-lifetime event. For others it’s an everyday occurrence.

  In this ancient capital the prospect of Iran acquiring nuclear weapons is a very real existential threat. Here the phrase “Never again!” isn’t a political slogan. It’s a way of life. That’s why the scenario at the heart of this story is so frightening—and why those who shared it with me must remain nameless. For their trust, I am grateful.

  There are others who helped make this book possible who can be thanked and named. Foremost among them, my mate and muse—to whom this work is dedicated. Thank you, Betsy, for being my most fervent advocate and best friend.

  My gratitude to FOX News chairman Roger Ailes, senior vice president Bill Shine, and general counsel Dianne Brandi for making it possible for me to travel the globe in the company of real heroes akin to those in this work of fiction.

  Bob Hamer—true friend, fellow Marine, and real “UC”—has “been there, done that.” He and his lovely wife, Debbie, are the reason this story resonates with authenticity. Thankfully, Gary and Kim Terashita reminded us that they are Peter Newman’s best friends.

  Robert Barnett and Michael O’Connor—the Williams & Connolly QRF (quick reaction force)—somehow managed to elicit the agreement of “all concerned parties” so we could tell this story without endangering other relationships or ourselves any more than usual. But it really took the help of Marsha Fishbaugh—my loyal assistant for more than a quarter of a century—and her husband, Dave, a fellow Vietnam War vet—to help us meet our deadline for this work.

  Thankfully, Louise Burke, Mitchell Ivers, and their team at Simon & Schuster were ready, willing, and able to ensure we could “get it done.” Natasha Simons, Mary McCue, Kevin Smith, Al Madocs, George Turianski, and Aline Pace became “secret agents” to help get this book into your hands.

  Duane Ward and his team at Premiere Centre and Sheena Tahilramani have once again stepped into the breach to introduce this story to the widest possible audience at just the right time—without interfering with Josh & Emily’s wedding plans.

  And perhaps best of all, every person who buys this book helps support the work of Freedom Alliance, an organization devoted to serving real American Heroes and their family members. A brief description of how Freedom Alliance helps and honors those who have sacrificed so much for all of us is on pages 325–26.

  Oliver North

  Jerusalem, Israel

  4 February 2014

  PROLOGUE

  INTERNAL USE ONLY

  THIS IS CERTIFIED AS THE TRANSCRIBED ORAL PSYCHOLOGICAL INTERVIEW WITH FBI SPECIAL AGENT JAMES JACOB “JAKE” KRUSE AND IS HEREBY SUBMITTED UNDER SEAL IN ACCORD WITH FBI DIR. 32014.12 AND HIPAA REG. 7319.

  PREPARED BY MICHAEL R. TWILLIGER, PHD, UNDERCOVER EMPLOYEE SAFEGUARD UNIT, NATIONAL COVERT OPERATIONS SECTION, CRIMINAL INVESTIGATIVE DIVISION, FBI

  Q. Special Agent Kruse, I understand you do not want to be here.

  A. That’s right.

  Q. And that you’ve objected to this evaluation.

  A. It doesn’t really do me any good to object. Look, I’m tired and was looking forward to a few days off before I picked up another assignment. I spent all day yesterday with OPR and I was ordered back here today. I took a red-eye and I’m here. Let’s get this over with so I can catch an afternoon flight back to L.A.

  Q. I see by your file you were benched from undercover work seven years ago for a three-month period because of an adverse psychological evaluation.

  A. That’s correct. I was fairly new to the undercover program, and the psychologist and I didn’t hit it off. She decided I needed a few months of desk duty. I objected and she won. I’ve learned since then. I know your evaluation will determine whether I can go back on the street, so all I’m asking you to do is check off the “approved” box and send me on my way.

  Q. But you understand given what happened in Los Angeles, this is mandatory?

  A. It’s mandatory every six months or when ordered by an administrator due to special circumstances. This one’s necessary because lots of bad people got killed.

  Q. Would you please give me a brief description about how all this got started?

  A. Sure. Every undercover case is different, but this one started out as a straightforward UC operation. Our target was an Asian organized-crime ring—of which there are dozens in L.A. Every ethnic group on the West Coast has one or two; different players, same sheet music. To the extent any undercover operation—the kind of thing the press calls a “sting”—is routine, this one should have been. It wasn’t quite the simple example you find in an FBI Academy textbook—“a one-off”—you know, nab a criminal violating a single federal law. But we didn’t expect it to take us in the directions it did. Typically, the UC meets a target dealing contraband, negotiates for the product, and when the delivery is made, the cuffs come out. Connect the dots—A to B to jail for the bad guy. In this one, the UC was targeting an organization rather than an individual.

  Q. When you say “the UC” you mean . . .

  A. The undercover agent. How long have you been at this?

  Q. I’m new to the unit. You’re only my second evaluation.

  A. That’s not very comforting.

  Q. So you were the “UC” in this operation. Do you often refer to yourself in the third person?

  A. Yeah. I was the UC. I really hadn’t thought about this “third person” stuff. Does it bother you?

  Q. Not really. Just wondering. People who refer to themselves in the third person—using terms like “he” or “they”—sometimes have disconnected from reality. Tell me what you think went right and what went wrong on this operation.

  A. Every operation is a crapshoot. There are no guarantees of success. An experienced undercover agent can often negotiate the crooked trail and take the investigation in directions never dreamed of in the initial planning stages. But those journeys aren’t always easy to navigate and are seldom welcomed by management. Each detour requires a new level in the approval process.

  Q. Do you feel frustrated by what you call the “detours” in the “approval process”?

  A. Look, I’m a big boy. I’ve been doing UC work for the past eight years and before I joined the Bureau I was a Marine. I understand the chain of command. And I know in Washington, Congress demands that whenever an operation diverts from its original approved path more administrators are going to get involved. That’s what happened here.

  Q. Why did you leave the Marine Corps and join the FBI?

  A. I had the privilege of serving under a really great leader during the invasion of Iraq in 2003. After I was wounded he came to see me in the field hospital. . . .

  Q. What was your job in Iraq?

  A. I was a rifle company commander in the Third Marine Regiment. My regimental commander, a guy everybody admired, visited me in the hospital. He wanted me to stay in the Marines but he understood. I had lost a lot of men over there and the Bureau seemed like a better fit.

  Q. Why?

  A. Because in the Bureau I wouldn’t be responsible for the lives an
d safety of hundreds of other people like I had been in Iraq. That takes a toll, watching the men you command die, makes you question whether you could have done something differently . . . then, writing letters home to their loved ones . . . Death is never easy when you know the people doing the dying.

  Q. How about when you don’t know the people doing the dying? How do you feel when you kill others . . . criminals . . . enemies?

  A. To be quite honest, it doesn’t bother me a whole lot. Maybe that’s not healthy, I don’t know, but in every case where I’ve killed people, it was either me or them. I don’t spend a lot of time thinking about who they were before they tried to kill me or what they might have been if they had chosen a different line of work. The Marines never asked me “touchy-feely” questions about killing enemy combatants, but the Bureau gets all sensitive about it.

  Q. So what’s easier for you to deal with: the FBI structure or the Marines?

  A. It’s not a matter of easier or even better but as an undercover agent it’s usually just me. I answer to myself unless the operation changes. Then I deal with the bureaucracy. A UC gets approval to buy illegal drugs but guns show up . . . a new approval’s needed ASAP. You’re authorized to buy stolen cars and your targets now want to launder money . . . new approvals. If the investigation implicates a judge, a politician, a member of the incumbent administration—expect FBI HQ and DOJ to go ballistic and demand lots of new approvals, which can take weeks, even months—while the UC’s butt is on the line.

  Q. Did you ever talk about these frustrations with your wife, Katie?

  A. Let’s come to an understanding real quickly. We’re not going to talk about my wife.

  Q. Okay. So what happened on this investigation? Did the FBI “approval process,” as you call it, cause so many people to get killed?

  A. We knew going in it would take more than L.A. Field Office approval to authorize the operation. Because it involved smuggling goods across the Mexican border, we had a “sensitive” circumstance from Jump Street. But we were trying to contain the violations to the L.A. Division just to avoid more Headquarters or DOJ involvement. Nobody in Washington gave a damn about counterfeit jeans and cigarettes. It seemed pretty simple at the time.

  Q. So what changed? Why do you think HQ and DOJ got involved? Do you think it was personal?

  A. Personal? Only so far as what they did could have gotten me—and some real innocents—killed. Look, this isn’t my first rodeo. In an operation a few years ago, we were targeting a Chinese national we knew to be the biggest importer of counterfeit cigarettes on the West Coast. I took possession of a forty-foot container of counterfeit Marlboros, about ten million cigarettes. Our guy wanted them delivered to a Russian Mafia crew operating out of Allentown, Pennsylvania. I personally delivered the container to their warehouse, which the FBI didn’t even know existed, and I watched Russian thugs affix counterfeit New York tax stamps to packs of fake cigarettes destined for New York City. It all went smoothly and I returned to L.A.

  The Chinese kingpin now knew I could deliver the goods—and he ordered five more containers from his pals in Beijing. But then some genius at Headquarters, concerned this whole thing could disrupt our “relationship” with the Chinese communists, suddenly declared the operation to be “sensitive”—requiring Headquarters and DOJ authorization.

  I was ordered to “cease and desist” all undercover operations until DOJ approval paperwork arrived . . . a process that usually takes weeks. I sent an email to the L.A. SAC reminding him that I was “dealing with Chinese and Russian crime bosses who routinely ‘off’ people in L.A. but had, to date, never killed any Bureau humps in Washington.” It took a month for the approval to come down. Meanwhile, I had to tap-dance because these guys would have killed me if they had figured out what was going on.

  The SAC never offered a solution to my problem of blowing off meetings with the Chinese, but he did call me in for counseling and placed a notation in my personnel file that I had been admonished to use more professional language when communicating with Headquarters.

  Q. I notice you’re gripping both arms of the chair. Does it distress you to discuss Bureau hierarchy?

  A. It’s a coping mechanism. I’m okay. Next question.

  Q. So have you always questioned authority?

  A. No. Remember, I told you I was a Marine. I know how to follow orders. I also know the difference between a real leader and a politically motivated, butt-kissing, flagpole-hugging bureaucrat.

  Q. And can you give me an example of a good leader?

  A. Sure, Peter Newman. He was my regimental commander when we liberated Iraq from Saddam in 2003. He was the one who came to see me in the hospital after I was wounded. He’s the kind of leader who knows how to accomplish the mission and take care of his men. Everyone who served with him knew he always cared more about us than he did about himself. Whether he was commanding a regular Marine unit or conducting special operations, as he did later on, we all loved him for it.

  Q. Interesting term, “loved.” Would you describe one of those special operations so I have a context?

  A. Sure, but then I’ll have to kill you. You’re not cleared for it. . . . Just joking, Doc.

  Q. I’ll take your word for it, Agent Kruse. But tell me, is this the same Peter Newman you called in the midst of this operation?

  A. Yep.

  Q. And did the two of you talk about Gabe Chong?

  A. Yeah.

  Q. Did you have authorization to talk to someone outside the government about this operation?

  A. No.

  Q. So how did you contact each other? As you undoubtedly know, none of the cell phones provided to you by the FBI for this operation have any record of the calls between you and this Peter Newman. . . .

  A. I have already answered that question for the slugs from OPR. . . . But if it makes any difference to you, I still have a personal cell phone. . . .

  Q. And according to NSA, that phone is registered in the name of your wife. . . .

  A. I’ve already told you, we’re not going to talk about Katie and I’ve told OPR all they need to know about how General Newman and I communicated during this operation.

  Q. Let me rephrase the question. Do you think it was wise to call this General Newman?

  A. Look, Gabe and I were both Marines. We both served with Peter Newman, just not at the same time. After the Marines, I went to the FBI and Gabe joined the Agency. General Newman retired from the Marines in 2011, but we’ve stayed in touch. Last December he became the CEO of a company called Centurion Solutions Group. CSG has contracts with all kinds of government agencies—including the Bureau and the CIA. I’m pretty sure his security clearances are far above yours and mine. So, yeah, I think it was wise to talk to him, don’t you?

  Q. Do you feel that Peter Newman or you are responsible in any way for what happened to Gabe?

  A. Responsible? Sure, I’m responsible because I was inside the operation. Gabe had my back. I should have had his. General Newman may be a civilian now but he’s very aware how the Iranians and North Koreans are working on nuclear weapons and ICBMs. He knows how counterfeit U.S. currency is being used to pay for R&D, the research and development, and the nuclear enrichment Pyongyang is doing for the ayatollahs in Tehran. The general tried to get the power brokers in D.C. to pay attention but the potentates on the Potomac wanted their “deal” with Iran to work—and nothing else mattered. Gabe’s blood is on the hands of the clowns here in Washington—they betrayed us all.

  Q. And how does that make you feel?

  A. How does it make me feel? Like I want to puke. I really think we’re done here. Do me a favor, put this in the report: “The agent conducted himself in a professional manner. He has not overadapted nor is he attached to his undercover persona. Neither is he detached from reality nor displaying an exaggerated sense of importance. He is adequately coping and not in need of withdrawal support.” I’ve been through enough of these to know the verbiage. Check off the box cl
earing me to go back to UC work. Let me catch my plane and you and I can get together for my next session on the couch.

  INTERVIEW TERMINATED WHEN SUBJECT SPECIAL AGENT ABRUPTLY DEPARTED.

  PSYCHOLOGICAL EVALUATION: SEALED

  SIGNED ____________________

  MICHAEL R. TWILLIGER, PHD, UNDERCOVER EMPLOYEE SAFEGUARD UNIT, NATIONAL COVERT OPERATIONS SECTION, CRIMINAL INVESTIGATIVE DIVISION, FBI

  CHAPTER ONE

  DAY 1

  MONDAY, APRIL 28

  “TEN DAYS PRIOR TO SPECIAL AGENT JAKE KRUSE’S MOST RECENT PSYCHOLOGICAL EVALUATION”

  The sounds of mariachi music blasting from the run-down bar just north of the Otay Mesa border crossing were met by the rumblings of the Cummins diesel engine. The two men in the cab of the 2009 International 9200i weren’t going to surprise anyone if stealth were important. Only the darkness provided a modicum of cover for the evening’s criminal endeavor. Pulling off the pockmarked blacktop road, the driver slowly made his way past a half-dozen trailers parked in the dirt lot.

  “There it is,” said Jake Kruse with a late-night attitude as he pulled in front of the burnt-orange twenty-footer. The indefinable graffiti spray-painted on most of the side panels matched the description his border contact had provided. He threw the big rig in reverse and backed toward the trailer, stopping a few feet from the tongue hitch. Shutting down the engine, he and Tommy Hwan jumped out of the cab and headed to the back of the cargo container.