Critics have long accused the CIA of using drug traffickers to raise cash for Ronald Reagan’s 1980s war against the Nicaraguan Sandinista government. Now, recently released FBI documents show that a former top agency official met throughout that period with Ronald J. Lister, an ex–Laguna Beach police detective who claimed to be the link between the South American cocaine trade, the Nicaraguan contras and the CIA.

The documents — released in response to the Weekly’s 1997 Freedom of Information request — concern Lister and William Earl Nelson, a vice president for security for the Irvine-based construction giant Fluor Corp. Nelson’s previous job: deputy director of operations for the CIA. The heavily redacted memos do not substantiate claims that the CIA was involved in drug dealing, but elaborate on troubling relationships first exposed in “Dark Alliance,” a 1996 investigative report by Gary Webb, then a reporter at the San Jose Mercury News.

How Lister and Nelson met isn’t clear, because of government censors. But the documents do show that Nelson told FBI agents he met with Lister three to four times a year until 1985 and discussed various business ventures, including one in Central America.

Citing U.S. national security, FBI censors blocked out the details of that project. But independent sources suggest the deal probably involved Lister’s security company, Newport Beach–based Pyramid International Security Consultants Inc. Lister founded Pyramid in 1979, a year before he quit the Laguna Beach Police Department as a burglary detective, and just months after he first met Nelson.

By all accounts, Lister was involved in some highly unusual “business” activity in Central America. According to a 1998 U.S. Justice Department Office of the Inspector General (OIG) report, the FBI investigated Pyramid five times between 1983 and 1986. “In September 1983, Lister’s company, Pyramid International Security Consultants, was listed as the subject of a neutrality violation investigation involving the sale of weapons to El Salvador and the loan of money from Saudi Arabia to the Salvadoran government,” the OIG report states. “Lister was also alleged to be attempting to sell arms to several other countries.”

In a 1996 interview with Mercury News reporter Webb, former Pyramid employee Christopher Moore (another ex–Laguna Beach cop) claimed Lister told him he had “a big CIA contact” at an Orange County company and that both Pyramid and its employees would be protected while in El Salvador.

“I can’t remember his name, but Ron was always running off to meetings with him, supposedly,” Moore told Webb. “Ron said the guy was the former deputy director of operations or something, real high up there. All I know is that this supposed contact of his was working at the Fluor Corp., because I had to call Ron out there a couple of times.”

Moore said he traveled to El Salvador on Lister’s behalf and met face to face with Roberto D’Aubuisson, a Hitler-admiring former Salvadoran army intelligence officer, leader of the right-wing ARENA party, and architect of El Salvador’s paramilitary death squads.

“That was probably the highlight of my life at that point,” Moore told Webb. “There I was, a reserve police officer who’d only been in the country for a couple of days, and I was sitting in this office in downtown San Salvador across the desk from the man who ran the death squads. He had a gun lying on top of his desk and had these filing cabinets pushed up to the windows of the office so nobody could shoot through them.”

The timing of Moore’s trip to El Salvador coincides with a 1982 Pyramid contract proposal to provide security to the Salvadoran Ministry of Defense; narcotics detectives found the paperwork in a 1986 raid on Lister’s home. On its cover page, the Pyramid contract lists a Richard E. Wilker as the firm’s “technical director.”

Wilker is identified in corporate paperwork as an employee of another Newport Beach company, Intersect Inc. His current whereabouts are unknown, but the firm’s vice president, former CIA agent John Vandewerker, said Wilker had traveled to El Salvador with Lister, and that either Lister or Wilker had helped him apply for a job with Nelson at Fluor Corp.

During his FBI interrogation, Nelson claimed Lister had also applied for a job with Fluor. “He was never offered a job,” states the FBI memo. The next sentence was â censored by the FBI, but the memo continues, “Nelson thought Fluor might be able to use his [Lister’s] company” — an apparent reference to Pyramid. “Nelson said [Lister] started traveling overseas, Lebanon and Central America, and he always had some scheme that never materialized.”

By 1985, according to voluminous law-enforcement records, Lister, along with Nicaraguan exiles Norwin Meneses and Danilo Blandon, had established a lucrative cocaine network throughout California. Lister kept Blandon well-stocked with surveillance gear and high-tech weapons: police scanners, Mack 10s, Uzis, even grenade launchers. Blandon said he passed the equipment on to his South-Central L.A. connection, “Freeway” Ricky Ross. Using Lister’s gear to avoid police detection, Ross emerged as the region’s most notorious crack-cocaine trafficker.


The 1998 OIG report cites an FBI memo from the same era concerning an informant who overheard Lister bragging over drinks that he worked for Oliver North, who directed the Reagan administration’s secret contra arms-supply network.

OIG investigators produced no evidence to support or contradict that claim. But an “Operation Homeport” code sheet found among North’s notes, which is available on microfiche at any public libary, shows that, perhaps coincidentally, he typed the word “Lister” as the code word for “advisers” — on a list that includes code words for everything from “missiles” and “grenades” to “Lebanon” and “hostages.”

Even as the FBI investigated Lister for his mysterious Iran-contra–era arms deals — an investigation that apparently led the FBI straight to Nelson — narcotics agents were zeroing in on the Blandon-Lister-Ross network. A separate FBI memo from that time shows that the FBI was particularly interested in Lister’s 1984 purchase of his Mission Viejo home — for $374,000 in cash.

The FBI memo released to the Weekly also shows that while the bureau was investigating Lister, Nelson had been coaching him on his upcoming grand-jury testimony. “He [Lister] then told of his meeting with the FBI and that he had been subpoenaed before the grand jury in San Francisco,” the FBI memo states. “He told Nelson he was terrified. Nelson said go . . . [Lister] admitted being stupid and that he had done a dumb thing. Nelson said [Lister] left and then called back after his grand-jury appearance and said he really did well.” The FBI memo makes no mention of Lister’s drug dealing, but shows that Nelson told his FBI interrogators that during a March 1985 meeting with Lister, the former Laguna cop begged him for help.

“I did a dumb thing because of greed,” Lister told Nelson. What Lister meant is unclear — the next seven lines of the FBI memo are blacked out on national-security grounds. But Nelson’s response is intact: He told the FBI he informed Lister there was no way the CIA could help him.

Inexplicably — that is, assuming Lister never had any connection to the CIA — Nelson made telephone calls to at least one other former CIA agent on Lister’s behalf. “Nelson told [Lister] no one could help him, including the CIA,” the memo states. “Nelson told [Lister] he had discussed his problem with another retired CIA agent and that no one could help him until he cleared himself with the FBI. Nelson said he told [Lister] he no longer cared to continue their relationship and he has not heard from him since.”

Nelson retired from Fluor in 1985. Lister continued dealing cocaine until 1989, when he began working as a DEA informant. Two years later, he was sentenced to 97 months in prison. Lister appealed, asserting that as a government witness, he had testified before two federal grand juries about a “major Central American cartel” and his “activities in Central America concerning certain key figures from Nicaragua alleged to have been involved in the Iran-contra scandal.”

It’s not clear what happened to the notes Lister says he gave investigators or to his testimony, but he clearly put on quite a show. According to the 1998 U.S. Justice Department OIG report, “An FBI special agent was convinced that Lister [and] Blandon . . . were connected to the CIA.”

After completing a drug-treatment program, he walked out of prison in 1996, three years early. His whereabouts are unknown, and he has refused repeated requests to share his story with the press. Nelson, Lister’s “big CIA contact” at Fluor Corp. in Irvine, died six years ago in Corona del Mar. Fluor officials refused to comment for this story but have denied that Fluor had any business in Central America during the 1980s.

Tom Crispell, of the CIA’s public-affairs office, said the agency has already denied any involvement with Lister. “This individual [Nelson] had been retired from the agency for a number of years, and we’re not in a position to comment on his private life or conversations he had in his private life,” Crispell remarked.

Gary Webb, who left the Mercury News shortly after the editor ran a front-page critique of the “Dark Alliance” series, finds the FBI memos curious. “Now we know that Lister was meeting with Nelson, and that the grand-jury investigation was somehow tied into this,” said Webb. “What we don’t know is how Lister even knew Nelson, why Nelson would continue to meet with [a so-called] bullshit artist, and why anyone would even consider helping Lister once he cleared himself with the FBI.”


The documents are also mute on perhaps the most disturbing mystery of all: What kind of “business” relationship could Nelson, a retired CIA deputy director, possibly have had with Lister, a drug-dealing, gun-running “security consultant,” and D’Aubuisson, the leader of El Salvador’s death squads?

LA Weekly