Air America

Flying High with the CIA


Sightings from The Catbird Seat

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November 8, 2003


Aviator headed up clandestine venture

By Jim Warren, Lexington Herald-Leader

Even Kentuckians who are familiar with the state's military history and its many war heroes probably never have heard of Hugh Grundy.

But the Washington County native played a major, though behind-the-scenes, role in one of the most debated periods of American history. Grundy, now 87, was president of Air America, ostensibly a private airline, but in fact a CIA-front operation that flew secret intelligence missions and carried food, ammunition, supplies and even livestock for anti-Communist fighters in Laos, Vietnam and other parts of Southeast Asia from the early 1950s to the early 1970s.

"Air America was the largest of a network of aviation companies that this giant CIA air complex ran under a holding company called Pacific Corp.," says William Leary, the E. Merton Coulter professor of history at the University of Georgia. "It was all classified. And Hugh Grundy basically was the operational head of the entire complex."

The arrangement allowed the U.S. government to secretly do things that it couldn't do openly because of political concerns. For example, the operation flew ammunition and supplies to French forces surrounded at-Dienbienphu in 1954, at a time when the United States officially was staying out of Vietnam.

Later, after the United States entered the war, Air America pilots, such as Lexington's Lee Howell, flew into tiny jungle airstrips, often under fire, to deliver cargo and pick up wounded.

One of the war's most famous photographs shows an Air America helicopter plucking refugees from a Saigon rooftop during the collapse of South Vietnam in 1975.

In recognition of Grundy's service, the Aviation Museum of Kentucky is inducting him tonight into the Kentucky Aviation Hall of Fame. Three other aviation pioneers with Kentucky ties also are being inducted at Blue Grass Airport.

Hired by CAT in China

Grundy earned his pilot's license in Louisville around 1930, beginning an aviation career that would take him around the world.

By 1941, he was in Africa, helping develop a commercial air route for Pan American Airways. After serving as an Air Force major during World War II, Grundy went to work for a Pan-Am affiliate in China. Soon after, however, he was hired as chief engineer for CAT, a civilian airline in China launched by Gen. Claire Chennault, creator of the famous Flying Tigers.

The U.S. government had been contracting with CAT for several years to fly classified missions in China, then being overrun by the Communists. The CIA secretly bought the airline outright in 1950, just about the time Grundy came on board.

"Very few people in the company knew that the CIA owned it," Grundy recalled. "I didn't know myself until I was formally briefed on it about 1953."

Shortly after that, Grundy was named president of the company and suggested a name change to avoid confusion with a similarly named operation. The new name was Air America.

A balancing act

Most of Air America's operations involved straightforward commercial flying, moving cargo and passengers. But revenue from that supported the classified missions that no one talked about.

"It was designed not to cost the CIA anything, so it had to be a profit-making operation," said Leary, who has studied Air America's history. "On the other hand, it wasn't supposed to make enough money to be competition for other American airlines. So, running it was a balancing act.

"The CIA wanted somebody who could run it without drawing attention. And Grundy played that role magnificently."

Working out of offices in Taiwan, Grundy directed an operation that, over the years, involved up to 700 pilots and 10,000 employees. But it was so secret that Grundy's wife, Frankie, never knew the true nature of his work until the CIA openly honored him for his service in 2001.

"I had a boss in Washington who was a CIA person, but also an airline person," Grundy said. "He gave us directions as to what he wanted done, and we tried to carry them out."

But if directing Air America was tough, flying for it was a death-defying adventure.

Pilots loved adventure, pay

Flying slow, unarmed planes, Air America pilots battled long hours, dismal weather conditions and intense enemy fire, landing in spots that barely qualified as landing strips.

"We had one strip in Laos that was about 700 feet long, with a dog-leg in the middle," Grundy said. "It was on the side of a mountain, so part of it was supported by bamboo poles. It's hard to imagine if you never saw it."

Nevertheless, the company attracted a rousing gang of former military fliers, crop dusters and stunt pilots who loved the adventure and the good pay Air America provided. They wore colorful nicknames like Squeaky, Willie Lump Lump and Earthquake McGoon.

"You had a sense of adventure and patriotism, and it was the best flying you would ever do," says Lee "Woo How" Howell of Lexington, an Air America pilot from about 1962 to 1971. "But it was hazardous. We bent up an awful lot of airplanes over there."

Nearly 300 Air America pilots were killed.

The operation ended after South Vietnam collapsed. Grundy returned to the United States and worked in Miami until retiring and returning to Washington County in 1984. Today, he minimizes his contribution.

"I had a lot of good people working with me; the credit goes to them," he said.

The saga of Air America inspired a 1990 movie of the same name, staring Mel Gibson and Robert Downey Jr. But Grundy, like most Air America veterans, didn't think much of it.

"I saw it," he said, "and it was terrible."


Date Posted: 05:39:36 10/14/06 Sat

Author: One Hawaiian Catbird


Intelligence / Personalities / General

Read about Rewald, John Peyton, and the hit man, after the judges dies.....Rewald is soon released from prison from a 80 year sentence. He had a bad back he "hurt" in prison even though he played pro ball in the big leagues?

Don't forget, this Bishop, Dillingham, Rewald, Wong business was formed in 1978 shortly after the first Hawaiian Constitution was formed with the 1978 Convention which elected Ariyoshi as their leader with the creation of the Office of Hawaiian Affairs and his bodyguard with Hawaii Protective Agency and political DLNR Board member, wanna be CIA - Hawaiian Vice agent, Larry Mehau.

Judge Martin Pence is the key political judge from Hilo and the Big Island, involved the earlier sugar labor strike wars. The Illicano Filipino labors were later brought in to undermine the Unions which supported to the Democrats and the Hawaiian labor force with Marcos and the Hawaii officials deceptively bringing in cheaper labor forces with the Filipino economy in ruins from the Marcos corruptions allowing vast migration visas to other places.

The State of Hawaii officials: (Inouye, Ariyoshi, Waihee, Cayetano, Abercrombie, Akaka, and the Hawaii Legislature members, et al) starting in the 1960s and into the 1980s.

Judge Pence is the Democratic mole and political judge for present Supreme Court Judge, Moon, who clerked under his tutoring. Judge Pence is originally from the Kansas working farms and was sympathetic to the Hawaiian Sugar Labors and anti Big Corporations like the Big Five use to dominate the Hawaiian Islands which is identified with the Republican Party.....

ck this out at....

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Date Posted: 23:30:19 11/05/06 Sun
Author: Brian Tamanaha
In reply to: One Hawaiian Catbird 's message,
"RON REWALD AND THE CIA" on 05:39:36 10/14/06 Sat

October 18, 2006

A True Story of Lies by the CIA, and Abuse of Power by Federal Prosecutors Who Will Do Whatever it Takes

By Brian Tamanaha

The Bush Administration and the Republican Congress have spewed out a constant stream of exhortations about the need for secrecy, for allowing the CIA to do its job, and for trusting federal prosecutors. In this time of heightened concern about terrorism, it is not easy to appreciate the dangers of giving in to the demands of the Bush Administration (as just occurred with the Military Commissions Act). Opponents are painted as liberals or civil libertarians who exaggerate the potential danger with alarmist assertions and abstract concerns about abuses unlikely to ever happen.

The following cautionary tale will help make the risks more concrete. It is about a young federal public defender handling a case, United States v. Rewald, which involved the CIA and several hundred documents containing classified information.

One day, about a month into the trial, following a grueling cross-examination by the defense attorney of a witness from the CIA, which clearly harmed the government’s case, the federal prosecutors asked the judge for a closed hearing. In the closed hearing, with only the lawyers and the judge present, the lead prosecutor, from the U.S. Department of Justice, requested that the judge hold the defense attorney in criminal contempt for asking questions of the CIA witnesses that elicited prohibited classified information in open court.

Despite the protestations to the contrary of the public defender, Federal District Judge Harold Fong immediately agreed with the prosecutor. At that very moment, he ordered that the public defender would be put on trial for three counts of criminal contempt 30 days after the completion of the ongoing trial.

Judge Fong also ruled that the public defender would be entitled to representation by counsel, which signaled that the judge contemplated that the lawyer could be sentenced to a year or more in prison if found guilty. The ongoing trial was recessed for the remainder of the afternoon, but it resumed the next day as if nothing had happened.

I am able to recount the details of this event because the assistant federal public defender was me, handling the case in the mid-1980s. To recap the hard-to-believe basics of the situation: in the middle of a trial, I was charged with three criminal offenses on the grounds that the questions I asked in open court prompted the witnesses to disclose classified information. At the time of these supposed offenses, the prosecutors objected neither to the questions nor the answers, and neither they nor the judge gave any indication of a problem until the moment the charges were lodged against me.

So there I was, still handling the ongoing trial, but now also facing my own trial to begin 30 days after the current trial was over. Despite my compromised position, I was not allowed by the judge to withdraw as defense counsel, and our request for a mistrial in the ongoing case was denied. I continued to examine witnesses from the CIA, but now with pending criminal charges hanging over my head, and a real prospect of more to come.

You might think this could never happen in the U.S. legal system, but this bizarre story is true (doubters: check out U.S. v. Rewald), and played out in a federal court in Hawaii. After I relate a few other details of the case, the relevance to our present situation will be evident.

Rewald was running a Ponzi scheme. He set up an investment firm with a few initial investors, and sent out regular statements indicating unusually high earnings, which prompted additional investors to send money. Ultimately, he took in about $20 million dollars. Unfortunately for the investors, a significant proportion of the money was not actually invested.

When the story broke, Rewald claimed that he set up the entire arrangement at the request of the CIA, to provide a cover operation to fund its activities in the Far East. [Please hold the snickering skepticism for a moment.].

The CIA admitted that they had a relationship with Rewald, but claimed that it was minimal. Rewald was merely a “phone drop.” He had a separate phone on his desk; a few CIA agents in the field carried a business card with that number, and Rewald’s only job for the CIA was to confirm to any inquirers that the person worked for him. Although a number of former and then current CIA agents received money from Rewald, CIA officials claimed that they too were duped by Rewald, and never would have used him as a phone drop had they known about his criminal activities.

The scheme fell apart when a curious IRS agent happened to observe kids (Rewald's) being dropped off at school every morning in a limousine driven by a chauffeur. After a bit of preliminary checking, the IRS opened an investigation into the tax situation of Rewald and his firm.

When he was informed by the IRS of the investigation, Rewald immediately notified his contact in the CIA and asked what he should do. The CIA then provided Rewald with three different stories to give the IRS investigators, and instructed him to pick one.

To repeat: they provided Rewald with entirely false, concocted stories with the understanding that he would then give one of them to another federal agency in the middle of a criminal investigation.

All of this sounds shocking enough, but there is an even more chilling point. In the course of cross-examination, I confronted a CIA official with the document the agency sent setting out the alternative stories for Rewald to tell the IRS. The official admitted that none of the stories were in fact true. However, he insisted that they were not “lies.” He said that they were “creative stories.” When I asked him to tell me the difference between “lies” and “creative stories,” given that both are untrue, he said (I paraphrase):

“Untruths are not ‘lies,’ but 'creative stories,' when they are made up in the interest of protecting the country. And the CIA is protecting the country.”

This was the testimony of a high ranking CIA official, under oath, in federal district court. This kind of mindset, needless to say, can justify almost anything.

Now consider a bit of information about the prosecutors. The lead prosecutor in the Rewald case was Theodore Greenburg of the Department of Justice. His second was John Peyton, an Assistant United States Attorney in Hawaii. Curiously, prior to joining the U.S. Attorney’s Office in Hawaii, John Peyton was the Chief of Litigation in the CIA. Peyton claimed that his transfer to Hawaii soon after the inception of the investigation into Rewald’s activities was a pure coincidence, and had nothing to do with the involvement of the CIA in Rewald’s activities. Judge Fong denied our request to remove AUSA Peyton from the case, finding that he had no reason to question Peyton’s claim, although he also refused our request to order Peyton to produce the personnel records connected to his transfer.

Ted Greenburg was lead counsel for the Justice Department in a number of cases involving the CIA, including United States v. Wilson, which he prosecuted in the early 1980s. Wilson claimed in his defense that he was working for the CIA. At his trial, the CIA submitted an affidavit denying that he was working for them at the time.

Two decades later, the CIA finally admitted that the affidavit was false. Wilson was indeed working for them. It turns out, furthermore, that the prosecutors in the case knew that the affidavit was false, but used it at trial anyway. In 2003, after he had spent almost 20 years in prison, Federal District Judge Lynn Hughes vacated Wilson’s conviction (289 F. Supp. 2d 801), observing:

In the course of American justice, one would have to work hard to conceive of a more fundamentally unfair process with a consequently unreliable result than the fabrication of false data by the government, under oath by a government official, presented knowingly by the prosecutor in the courtroom with the express approval of his superiors in Washington. (p. 816)

The court’s opinion identifies Ted Greenburg as the prosecutor who knowingly used the false affidavit. But he was not alone: “The court has identified about two dozen government lawyers who actively participated in the original non-disclosure to the defense, the false rebuttal testimony, and the refusal to correct it.” (p. 811).

The relevance of this story for today should be obvious, and I will not belabor it. The CIA will lie (or tell “creative stories”)—so don’t believe what you read about CIA investigators stopping their harsh interrogations out of concern for liability—and lawyers in the Justice Department will do whatever it takes to win a case. [Of course, there are many superb lawyers in the Justice Department with integrity--Marty Lederman of Balkinization was one of them.].

A thread that runs through this story is that the government actors involved were not necessarily bad people—they were simply doing what they thought was necessary to defend their country, and they used this end to justify their extreme conduct. That’s the problem. When combined with power and with an unwavering conviction in the correctness of one’s conduct, this mindset—which the Bush Administration oozes—can lead to terrible abuses.

Those many people who think that the MCA is nothing to be concerned about—“nothing bad will happen to good Americans, or to innocent people”—are being naïve.

This post has gone on far too long, so I will quickly wrap up the story I began with. Rewald was convicted on mail fraud and tax charges and sent to prison.

Thirty days after the trial ended, three lawyers from the Justice Department (including Ted Greenburg) flew back to try me on three counts of criminal contempt. Judge Fong recused himself at our request, and Federal District Judge Marilyn Hall Patel came from San Francisco to preside over my case.

I prepared a motion to dismiss the charges on the grounds that I had not in fact asked questions that elicited unapproved classified information; indeed, in one instance the testimony identified by the prosecutors as inappropriate had actually come following a question interjected by Judge Fong. On the morning of my trial, while I sat at the table as a defendant, Judge Patel dismissed the charges against me with prejudice.

Thank you Judge Patel.

Posted 2:07 PM by Brian Tamanaha

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Date Posted: 23:43:35 11/05/06 Sun
Author: Gray Fox


In reply to: Brian Tamanaha 's message, "Re: RON REWALD AND THE CIA" on 23:30:19 11/05/06 Sun


The high CIA officer that the young and inexperienced attorney, Brian Tomahana, was making references to was Jack Kindschi, the Hawaii Station Chief that replaced CIA Station Officer, Eugene J. Welch, in the late 1970s with the created plans being implemented for Bishop, Baldwin, Rewald, Dillingham and Wong in conjunction with stolen Asian Dictatorship laundered proceeds {Marcos Regime} and Asian exiled Political leaders {Lon Nol, et al} supported by the U.S. Government using the Asian front Nugan Hand Bank in Australia.

This also includes a special entitlement MULTIBILLION DOLLAR a year, tax free, underground and laundered Hawaiian diversified agriculture industry in Hawaii during the same time period with the controversial 1983 Iran - Contra scandal {William Casey, George H. Bush, William Colby, Richard Secord, and Ollie North } with later links to the Mena Arkansas Airport allegations with the CIA and Barry Seal {Air America veteran}.

If you research and confirm the Jack Kindschi CIA investigation on the mainland, reported for him to be breaking down and crying after losing his elderly mother's invested assets with the Hawaiian hui investors {reported to be over One Hundred Thousand dollars} which can be documented and found in the New York Times archive story, related to the 1984 Peter Jennings report on ABC World News Tonight.

Question: Was all this public illusions and deceptions involving another bogus CIA venture in the domestic United States of America an Illegal fact, or was this misleading CIA public information which can be attributed to the Hawaiian political cover up and obstructive pattern by the Hawaiian hui government investors linked to the future Broken Trust Legacy associates with Goldman Sachs in Hawaii and Wall Street?

This also includes the former Hawaii Governor, John Waihee, given a "F" rating by nonpartisan think tanks during his Administrations, who is presently under more elusive and ambiguous State "investigations" with Political cover up damage control, for more missing proceeds {reported between $9 Million dollars to $20,000 Million dollars} from another Bankrupted Company in Hawaii {Right Star Management Company}.

This government fiasco also includes the convicted Washington DC AIPAC lobbyist, Jack Abramoff, and his political counterpart associates with the Dept of Interior, the Dept of Treasury {IRS}, The "non profit" Nature Conservancy, the "non profit" Goldman Sachs investors, and the CIA in the remote South Pacific {Private Hawaiian atoll, Palmyra Island - $46,000,000} with laundered Russian underground proceeds in the Tens of Millions {Oil or Drug cartels?} being invested in collusion with the Hawaiian hui investors, aka, Bishop Estate Trust, aka, Kamehameha Schools and the State of Hawaii officials.

The Jack Abramoff stonewalled "investigations" has linked the Honorable Hawaii AIPAC Governor to $4,000; the Honorable Hawaii U.S. Senator, Daniel Inouye to $6,000; the Honorable Hawaii House of Representative, Neil Abercrombie to $2,000; the Department of Interior under the Honorable Gale Norton and Stephen Griles to $50,000 {Norton's Environmental group}; the Honorable Native American Indian Congressman, Tom Cole {undisclosed}; the Honorable Whitehouse counsel, Ben Ginsberg via Patton Boggs with $400,000 political bribery fees from the Office of Hawaiian Affairs {Oswald Stender}; the Honorable Whitehouse counsel, David Feith via Cox and Zell {undisclosed}; and the Honorable former Hawaiian Governor, John Waihee {undisclosed} via Verner, Lippfert, Bernhard, McPherson, Hand, Waihee, and Nip.


"Social Equality and Political Justice for All?"

The Hawaii Delegates to Congress, presently on the Ethics Committee in Washington DC, with close political affiliations to Asian Dictatorships and stolen government assets; the Armed Forces Committee, while advocating a racial profiling Separatist Hawaiian Nation within a Sovereign Nation; and the Bureau of Indian Affairs.....with no documented Native American Indian tribes or Nations in the Hawaiian Islands which deprives the other States in the Union that have legitimate Native American Indians for any proper representation?

The young Hawaii attorney, Brian Tamanaha, didn't apply to the Hawaii State Bar and wasn't a member until a year or more after the Rewald "Kangaroo" Trail in Hawaii. Future Whitewater prosecutor, Kenneth Starr, denied Mr. Rewald's motion for a rehearing in 1990.

After Judge Fong dies in 1995, Mr. Rewald, a formerly physically fit water skier at a high level and NFL journeyman running back with several NFL teams {Cleveland, Baltimore, Kansas City}, was soon released a month later from a Federal Correction Facility due to a "back injury" while in prison. He supposedly lives in the Los Angeles area in a "rat infested" apartment with his family and life in ruins on $150 disability a month pension.

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"Knowledge will forever govern IGNORANCE," James Madison

SECRECY....THE FIRST REFUGE OF INCOMPETENTS? The House Committee on Government Operations Report



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Meanwhile, you can peruse more secret buzzards by flying to....

The Antechamber

50 Years of Drug Smuggling by the CIA

Drugs, Guns and the CIA

The CIA and Drugs

The Carlyle Group: Birds that Drink from Cesspools

A Connecticut Yankee in King Kamehameha’s Court

The Secret Nests: The CIA

The Strange Saga of BCCI

Buzzards of Paradise

Dirty Gold in Goldman Sachs

Nests in The Pentagon

Paradise Paved

Songs of the Drug Vultures

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The Eagle Hooded: The 9-11 Coverup

Part I - Part II - Part III

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The Story of Enron

Hawaiian Airlines

The Great Nest Egg Robberies

PanAm: More flying with the bankruptcy buzzards

Parrots in the Newsroom

Predators in Paradise

The Puna Connection

Yakuza Doodle Dandies


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Last Update January 2, 2010, by The Catbird