Pubdate: Mon, 12 Jul 2004
Source: Guardian, The (UK)
Copyright: 2004 Guardian Newspapers Limited
Contact:  http://www.guardian.co.uk/guardian/
Details: http://www.mapinc.org/media/175
Author: Sylvia Jones and James Oliver, The Guardian

DRUGS STING PUT INNOCENT LIVES AT RISK

Murder Threat Failed To Halt Customs Operation

Senior customs officials approved a cocaine sting operation by a team of 
elite drugs investigators despite warnings that arrests in this country 
would lead to the murder of at least one hostage in South America.

A Guardian investigation has established that the operation, codenamed 
Begonia, went ahead in the face of strong objections from experienced 
investigators who refused to take part if there was any possibility that 
innocent people would be killed.

In a document seen by the Guardian, one officer warned senior officials at 
Britain's oldest and most powerful law enforcement agency that Customs' own 
informant had provided a hostage to the drug suppliers to guarantee the 
shipment. Pressing ahead with the operation, the officer warned, would 
"ultimately bring disgrace" on Customs "and permanently cast doubts on our 
fairness and honesty". He concluded: "I am reluctant to take any part in 
this operation as I am unwilling to be party to murder of innocent people."

But concerns over the legality and morality of the sting from him and other 
officers were apparently ignored and Begonia went ahead. The operation was 
led by one of Customs' most senior and highly regarded officers who posed 
as the head of a fictitious import company using the codename "Peter Hesketh".

Operation Begonia is one of several operations involving class A drugs 
under investigation by West Midlands police, the Guardian has learned. 
Customs is also the subject of two other police investigations which are 
taking place amid concern over the conduct of prosecutions.

An inquiry by Scotland Yard concerns allegations surrounding the conduct of 
a string of prosecutions for duty evasion. A third investigation by Thames 
Valley police relates to separate allegations of corruption involving 
Customs. No charges have yet been brought.

Two Colombians were entrapped in the Begonia sting in late 1993 and 
convicted of smuggling ?37m of cocaine. They served prison sentences before 
being deported to Colombia. Francisco Antonio Lopero-Soto, 37, was 
sentenced to nine years. Gerardo Baron Borja, 49, received 11 years. 
Defence lawyers claimed at their trial that associates of the two men had 
been murdered after the seizures of the drugs. Death certificates of three 
men murdered in Colombia were produced in court, but for legal reasons 
these allegations were never investigated or fully explored.

An identical sting in 1991 raised similar concerns about the actions of 
Customs.

At least one senior officer at the time urged his bosses to take high-level 
legal advice and claimed that the "star" informant used to set up both 
deals was acting as an agent provocateur. The informant, the officer 
warned, was out of control and "running us", and had portrayed himself as 
the buyer of the cocaine deal which would be financed solely by Customs

Under Home Office guidelines informants must never initiate drug deals 
themselves and are meant to play only a minor role in an existing conspiracy.

In a document seen by the Guardian, the senior officer warned line managers 
that as it was Customs actually buying the drugs and arranging the 
importation into this country, it would only result in the arrest of 
low-level intermediaries.

He advised that if the proposed $7m (?4.2m) sting went ahead, the seizure 
should be made in South America, where there was more chance of arresting 
senior cartel members.

Although this operation - known as Begonia 1 - fell through, the plan was 
resurrected two years later and put into action using the same informant.

But when preparations for Begonia 2 went ahead, the same Customs 
investigator refused to take part in the operation, and told his superiors 
that the proposed sting would bring disgrace on Customs and severely damage 
its reputation for fairness and honesty.

"You are well aware of my reservations about the conduct of this 
operation," he wrote, adding: "It is inevitable that the defence and the 
media will discover the truth of the matter."

The officer went on: "At the conclusion of the briefing on October 27 1993 
you stated that the informant had provided a hostage to the supply 
organisation in South America who would be killed if anything went wrong 
with the importa tion. As we in the Division [Customs] together with the 
informant are the importer and the only end-users of this cocaine, we 
ultimately will be responsible for the death of this hostage and probably 
his family as well."

He said: "I would like [an] assurance that the chief investigation officer 
and crown counsel have been consulted as to their willingness to continue 
with this operation in the light of this most recent revelation."

Sources say such a strongly worded memo to a senior line manager is highly 
unusual in Customs. Senior managers accepted that the hostage remained at 
risk, but nevertheless gave the operation the green light. A number of 
concerned officers from the squad - nicknamed the Manchester A-Team - 
refused to take part in the operation.

The suppliers were the Cali cartel, who controlled the global illegal 
cocaine market. It is generally known that the relatives and associates of 
minions involved in deals were seen as "guarantors", who would be killed if 
the deal went wrong.

The Manchester A-Team put together plans to lure the Colombians into 
Britain by offering a deal to import large amounts of cocaine.

Begonia 2 officers set up a false company and "borrowed" a bank. A former 
bank manager turned customs officer slipped into his old role at the plush 
offices of a NatWest branch in Manchester to help bamboozle the Colombian 
drug dealers.

He had a set of bogus accounts for a fictitious import-export company 
called Southern Latitude Holdings Ltd, showing millions of pounds going in 
and out of the business and ?14m in assets. The company purported to have 
warehouses all over the north, complete with polished brass nameplates in 
lifts.

The Bank of England was persuaded to help this plan, agreeing to loan the 
investigators ?1m in cash as "flash money" to impress the smugglers. 
Bundles of high denomination notes were stuffed into safety deposit boxes 
in the bank strongroom.

It was a high-risk strategy by the team leader "Peter Hesketh" who as well 
as handling the informant, was also the pivotal undercover officer.

It was the perfect sting. When the Colombian dealers saw the cash they were 
suitably impressed and agreed to smuggle record amounts of cocaine to the UK.

According to a television drama documentary called Undercover Customs, 
produced with the help of Customs, the operation could not have got off the 
ground without the help of "Steve", the key informant handled by "Hesketh".

"Steve" regularly travelled abroad and had made several trips to South 
America working for both Customs and the US Drugs Enforcement Agency.

He offered the cartel a direct route to smuggle 250kg (551lb) of almost 
pure cocaine into Britain, followed by the same amount every 10 days for a 
year. If it had been a genuine smuggling plan it would have more than 
doubled the amount of cocaine on the streets of the UK.

Without the intervention of "Steve", none of this shipment of cocaine would 
have come to Britain, documents seen by the Guardian reveal.

Customs paid him ?100,000 for his work on Begonia. According to sources 
close to the operation, this "star" fixer boasted that he wanted to be the 
first millionaire informant.

The documents reveal that as far back as 1991 he was threatening to travel 
to South America to set up deals - "with or without" Customs approval.

One officer warned in a detailed report: "It is apparent that 'Steve' has 
held himself out to the suppliers as a potential purchaser of the 250 kilos 
of cocaine and there is as yet no UK-based distribution network. The 
statement 'the arrangements for this 250 kilos consignment is well 
advanced' again appears to indicate that we have insufficient control over 
'Steve'."

He said the only explanation of the proposed funding of the drug deal was 
that Customs "is purchasing 250 kilos of cocaine from South America based 
suppliers and 'Steve' has represented himself as the spokesman for the 
purchases in the UK".

He concluded: "At best I believe we can only hope to arrest three 
'trustees' of this organisation who appear to have been entrapped by 
'Steve' into coming to the UK in relation to an importation arranged and 
financed by this Division [Customs].

"It may be prudent to seek crown counsel's advice on the various issues 
raised by this importation before proceeding further, particularly that of 
'Steve's' involvement as agent provocateur."

For Customs, Operation Begonia appeared to have been a huge success with 
the judge commending "the courage, resourcefulness, intelligence and 
persistence of the Customs & Excise officers involved in this investigation".

According to sources close to the original investigation, the operation 
reflected a new strategy to secure large seizures of drugs coming into 
Britain. "The idea was to invite importations, to create a market for 
Customs to milk. Where there was no activity and work, Customs would create 
the work," said one source, who spoke on condition of anonymity.

In a statement, a Customs spokeswoman told the Guardian: "The investigation 
and prosecution known as Operation Begonia, which took place in the period 
1991 to 1995, are part of an ongoing inquiry by West Midlands police. As 
such, you would not expect Customs to comment further. In fact, it would be 
entirely inappropriate and may be prejudicial for anyone to do so. Customs 
are cooperating fully with the police in their investigation."
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