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<plonk> now! Grabbe, X, re. Foster, NSA, BCCI, etc.
---------- Forwarded message ----------
Date: Fri, 28 Jul 1995 15:49:28 -0400 (EDT)
From: [email protected]
To: [email protected]
Subject: Part X: Allegations re Vince Foster, the NSA, and Bank Spying
-----BEGIN PGP SIGNED MESSAGE-----
Allegations Regarding Vince Foster, the NSA, and
Banking Transactions Spying, Part X
by J. Orlin Grabbe
********************************************************************* *
* I received a call from Mr. Stephen Ganis, counsel to the House *
* Committee on Banking and Financial Services, who assures me that *
* he did NOT provide Jim Norman's article to Mr. Charles O. Morgan, *
* attorney for Alltel Information Services, but rather called Mr. *
* Morgan *after* the *Media Bypass* article had appeared, to get *
* Morgan's side of things. Mr. Morgan was apparently not aware *
* that the article had been published, and that was the only *
* information he received from Mr. Ganis. Mr. Ganis assures me *
* that his group is NOT passing any information to Alltel, but is *
* in fact carefully keeping all sources and information confidential. * *
***********************************************************************
What do nuclear weapons, money laundering, covert operations,
money management, clandestine payments of payola and kickbacks, and the
systematic monitoring of bank loans and bank wire transfers have in common?
The answer begins with BCCI: the Bank of Credit and Commerce
International. BCCI connects the Israeli bomb to the Pakistani bomb to
suppliers of banking software like Systematics, and to a very dead money
launderer named Vince Foster.
Don't misunderstand the latter statement: I believe we should all
have the right to "launder" money. The money-laundering laws are a
frightening, Big-Brotherly intrusion into financial privacy (see J. Orlin
Grabbe, "The End of Ordinary Money, Part II: Money Laundering, Electronic
Cash, and Cryptological Anonymity").
But why is there one standard of legislated "morality" that applies,
say, to a LEADING OFFICIAL OF THE FEDERAL RESERVE SYSTEM, and another
standard that applies to everyone else?
In 1972 Pakistani banks were nationalized by President Bhutto. One
of these banks was United Bank, whose president was Agha Hasan Abedi.
Abedi subsequently joined with Sheik Zayad, ruler of Abu Dhabi and patron
of the PLO, to found BCCI. To prevent nationalization, BCCI was chartered
in Luxembourg. In 1975 it split into two entities, one remaining in
Luxembourg and the other established in the Cayman Islands. The Cayman
Islands part became a "bank within a bank." While the legal registration
was in Luxembourg and the Cayman Islands, the actual operational head-
quarters was moved to London.
In 1976 John Heimann, New York superintendent of banking, turned down
BCCI's attempt to buy Chelsea National Bank in New York. (Shareholders in
the bank included former Mayor Robert Wagner and the Finley, Kumble law
firm.) The actual purchase attempt was made by one of the Gokal brothers
of shipping fame, Abbas Gokal, using a loan from his sister. Banking
experience was to be provided by BCCI, but Heimann refused to approve the
purchase, despite several meetings with Abedi. Abedi realized that BCCI
would not be able to enter the U.S. market under its own name.
Abedi's attention was then brought to bear on Financial General, a
Washington D.C.-based bank with headquarters a block from the White House.
The bank had been acquired in April 1977 by an investor group lead by
William Middendorf II, who was Secretary of the Navy under Nixon and Ford.
One member of the investor group was Jackson Stephens. Stephens then send
salemen from his Little Rock firm *Systematics* to talk to Middendorf
about providing banking software for Financial General, but they were firmly
rejected. Stephens decided to wrest control of the bank from Middendorf.
Jackson Stephens is a billionaire from Little Rock who owns the
controlling interest in Worthen National Bank as well as in Stephens Inc.,
one of the largest privately owned investment banks outside Wall Street.
In November 1977, he introduced BCCI-founder Abedi to Bert Lance, Carter's
Director of the Office of Management and Budget, whom Stephens had met
through Jimmy Carter, his old roommate from Naval Academy days. (Lance and
Stephens, two Southern Baptists, had hit it off.) Lance also knew the
people at Financial General, for it was Financial General that had sold
to Lance controlling interest in the National Bank of Georgia in 1975.
Abedi in turn introduced Lance to Stanford-and-Harvard-(and Colorado
School of Mines)-educated Ghaith Pharaon. Pharaon proceeded to acquire the
stock of Bert Lance's National Bank of Georgia, a deal consummated on January
5, 1978, a day after Lance's $3.4 million loan from the First National Bank
of Chicago was repaid by BCCI London. Pharaon was apparently acting on
behalf of Abedi in the acquisition, at least in part.
By then Lance had left the Carter administration, and he and Jackson
Stephens joined together to help BCCI take over Financial General. A
Financial General lawsuit filed on February 17 named "Bert Lance, Bank of
Credit & Commerce International, Agha Hasan Abedi, Eugene J. Metzger,
Jackson Stephens, Stephens Inc., Systematics Inc. and John Does numbers 1
through 25." Systematics was represented by C.J. Giroir, Webster Hubbell,
and Hillary Rodham Clinton of the Rose Law Firm of Little Rock:
"The suit was ultimately settled, but intriguingly, briefs for
Systematics, a Stephens property, were submitted by a trio of
lawyers including C.J. Giroir and Webster L. Hubbell and signed
by Hillary Rodham" ("Who is Jack Ryan?" *The Wall Street Journal*,
August 1, 1994).
This BCCI-Lance-Stephens-Systematics-Hubbell-Clinton connection will
continue to reappear in our story.
Edwin McAmis, an attorney for Financial General, deposed Lance in
connection with the stockholder civil suit, and turned up a mysterious loan:
"The loan could have been for as much as $3.4 million . . . and
came from London's Bank of Credit & Commerce International, on
whose behalf Lance had approached Financial General with a bid
for control. . . . Lance said he used it last January to pay off
his celebrated $3.4 million loan from the First National Bank of
Chicago . . . The latest loan, he said was arranged by Agha Hassan
Abedi, an energetic Pakistani who heads B.C.C.I.
"Collateral? None.
"Documents? Well, no, though Lance's lawyer, Robert Altman,
says some are being drawn up now."
(quoted from "Another 'Loan' for Lance," *Time*, April 3, 1978.)
Bert Lance had approached Financial General on behalf of BCCI London
with a bid for control of the bank. Lance was also was responsible for
introducing BCCI founder Abedi to Jimmy Carter, and for bringing Clark
Clifford in on the take-over attempt. Ghaith Pharaon was another investor
in the deal.
Also involved in the successful BCCI takeover were Clark Clifford
(the former Defense Secretary under Johnson and lawyer for BCCI), Robert
Altman (attorney for Bert Lance and Clifford's partner), and Kamal Adham
(the former head of Saudi Arabian intelligence who was King Faisal's most
trusted advisor, and whose half-sister Iffat was King Faisal's favorite
wife). Kamal Adham and Ghaith Pharaon had built the Hyatt hotel in Riyad,
and Adham had originally introduced Pharaon to Abedi.
Adham and Pharaon (along with Faisal al-Fulaij and Abdullah Darwaish)
owned KIFCO, the Kuwaiti International Finance Company (James Ring Adams &
Douglas Frantz, *A Full Service Bank: How BCCI Stole Billions Around the
World*, Pocket Books, 1992, p. 52).
In a lawsuit filed March 18, 1978, the Securities and Exchange
Commission charged Lance with violations of federal security laws, and
BCCI's application to purchase Financial General Bankshares was denied.
Abedi then formed a new takeover vehicle, Credit and Commerce American
Holdings (CCAH), based in the Netherlands Antilles. The largest investor
in CCAH was Kamal Adham, who put up $13 million of his own money On October
19, 1978, CCAH filed for approval with the Federal Reserve to purchase
Financial General. This application was dismissed on February 16, 1979,
due to opposition from Financial General's Maryland subsidiary, but a new
application was submitted later.
The Federal Reserve finally approved the purchase in on April 19,
1982, and BCCI renamed the bank "First American" three months later. Clark
Clifford was made chairman and Robert Altman president. The head of Bank
Supervision at the Federal Reserve when BCCI's purchase was approved was
Jack Ryan, who later became head of the Resolution Trust Corporation, in
which role he denied Rep. Leach's requests for documents related to Madison
Guaranty, the Whitewater thrift.
What was the point of BCCI's takeover of First American?
" 'They wanted an important stake across the street from the White House,'
says one Washington banking executive, adding, 'Some people might think it
is important to know about the outstanding loans and balances of Government
officials'" (*Time*).
Abedi used his new-found connections to Jimmy Carter to publicize
BCCI to heads of state around the world. Abedi made his personal 727 jet
available to Carter, and accompanied the former President to Thailand,
Tibet, Hong Kong, and the Soviet Union, among other places. Carter
introduced Abedi to many heads of state, from Den Xiaoping in China to
James Callahan in the U.K. Abedi donated a half million dollars to
establish the Carter presidential library, and a public policy institute
at Emory university.
In the meantime BCCI founder Abedi was committed to the development
of an *Islamic atomic bomb*, even donating 500 million rupees for the
creation of Pakistan's Gulam Ishaq Research Institute for nuclear
development.
BCCI was in some sense seen by Abedi as the financial competitor to
the "committee of 30" that worked on behalf of Israel. (According to Israeli
correspondents Tzadok Yehezkeli and Danny Sadeh: "Israel solicits money
from wealthy Jews from all over the world for financing its nuclear
weaponry programs. This fundraising drive is directed by a committee
comprised of 30 Jewish millionaires" [review of book *Critical Mass* in
*Yediot Ahronot*, January 30, 1994].)
But while BCCI founder Abedi had intended BCCI to finance the
development of a Pakistani nuclear bomb, this effort was compromised at
the start by the presence of Kamal Adham, who through CCAH was the
controlling power behind First American, and who had asked Clark Clifford
to head up the bank. For Adham was both a CIA and a Mossad asset. Adham,
in addition to being Faisal's most trusted advisor and the former head of
Saudi intelligence, had attended CIA training school with the head of the
Mossad.
"Kamal Adham, who was the CIA's principal liason for the
entire Middle East from the mid-1960's through 1979, was
the lead frontman for BCCI in its takeover of First American,
was an important nominee shareholder in BCCI, and remains one
of the key players in the entire BCCI affair" (Senator John
Kerry and Senator Hank Brown, *The BCCI Affair: a Report to
the Committee on Foreign Relations, United States Senate*,
December 1992).
Perhaps that is why Pakistani's efforts to develop their own
nuclear bomb met with repeated compromises, such as the following:
"In 1983 a Dutch court convicted Dr. Abdul Qader Khan, head
of Pakistan's nuclear program, on charges of stealing the
blueprints for a uranium enrichment factory. . . . Kahn's
lawyer was paid by BCCI.
"In 1984, three Pakistani nationals were indicted in Houston
for attempting to buy and ship to Pakistan, high-speed
switches designed to trigger nuclear weapons. The trio
offered to pay in gold supplied by BCCI.
"In 1987 two Americans, Rita and Arnold Mandel, together with
Hong Kong businessman Leung Yu Hung, were indicted by the
U.S. Attorney in Sacramento, California, on charges of illegal
importations of $1 billion worth of oscilloscopes and computer
equipment for Pakistan's nuclear program. . . . BCCI facilitated
[some of the shipments]"
"In 1987 in Philadelphia, Ashad Pervez, a Pakistani-born
Canadian, was indicted for conspiring to export restricted
specialty steel and metal used to enhance nuclear explosions.
... He . . . paid high prices with money delivered to the
Toronto BCCI branch from BCCI London" (Rachel Ehrenfeld,
*Evil Money*, HarperCollins, 1992).
BCCI became a important conduit for CIA intelligence, and also
a ready target for the tenacles of the NSA. When Norman Bailey at the
National Security Council urged NSA to "follow the money" as part of the
"wars" on terrorism and drugs, the NSA had BCCI as one obvious banking
target. The CIA was there also to assist in the monitoring of BCCI-related
money flows of other intelligence and criminal enterprises. For BCCI had
become a giant laundry machine, and the CIA made use of BCCI for their own
covert money transfers.
One example involves Manuel Noriega, who was recruited by the
U.S. Defense Intelligence Agency in 1959, who went on the CIA payroll in
1967, and who became head of Panamanian military intelligence in 1968,
where he was in a strategic position to supply both information and drugs
to the United States, and later on arms to the contras in an operation
based in Panama, Mexico, and Mena, Arkansas. CIA money was paid to
Noriega through the Panamanian branch of BCCI. The CIA and U.S. Army
only acknowledge paying Noreiga $322,226 between 1955 and 1986 (*The
New York Times*, January 19, 1991). Be that as it may, Noriega
deposited $33 million in his account (under the name of the Panamanian
Defense Forces) at the Panamanian branch of BCCI. The head of this branch
was the son of a former director of intelligence in Pakistan.
The CIA also used BCCI branches in Pakistan to launder payments
to the Afghan rebels, and Pakistani officials used the same bank to
launder heroin profits. The finance minister of Pakistan, Sarti Asis,
confirms that the bank did launder CIA contributions to the Afghan
rebels, but claims it was "not even handling 1 percent of total drug
money" (*Financial Times*, July 25, 1991).
The amount the CIA recalls paying Noriega is too small. Noriega
had much earlier gotten into trouble with the State Department because of
his drug dealing. But this changed when his support was needed in
the negotiations for a new Panama Canal Treaty.
"By 1976, Noriega was fully forgiven. CIA Director George
Bush arranged to pay Noriega $110,000 a year for his services,
put the Panamanian up as a houseguest of his deputy CIA
director, and helped to prevent an embarrassing prosecution
of several American soldiers who had delivered highly
classified U.S. intelligence secrets to Noriega's men.
. . .
"If Carter needed friends in Panama to smooth the way for
a canal treaty, Reagan (who strongly opposed that treaty)
needed them to support the Contra cause. . . . CIA payments
to Noriega resumed when Reagan took office in 1981, starting
at $185,000 a year. At their peak, in 1985, Noriega
collected $200,000 from the Agency. The CIA deposited the
money in Noriega's account at the Bank of Credit and Commerce
International, two of whose units later pleaded guilty to
laundering drug money. CIA Director William Casey frequently
met with Noriega alone in Washington" (Peter Dale Scott and
Jonathan Marshall, *Cocaine Politics: Drugs, Armies, and the
CIA in Central America*, University of California Press, 1991).
That Noriega was necessarily used as an NSA asset also follows from
the fact that Panama served as the listening post to much of South America.
The Bush-Noriega-BCCI-Mena connection continued. Barry Seal, who
flew money, drugs, and arms out of Mena, Arkansas, acquired his job through
George Bush. After Seal was indicted in Ft.Lauderdale, Florida, in 1983 for
a shipment of 200,000 Quaaludes, he tried in vain to make a deal with the
DEA. He found a more sympathetic audience in the Vice President:
". . . in March 1984, while out of jail on an appeal bond, 'Seal flew his
Lear jet to Washington and telephones Vice President Bush's office'; and he
spoke on the street to staff members of the vice president's South Florida
Task Force" (Scott and Marshall).
How did Jackson Stephens react to all this activity in his back
yard? Well, among other things, Stephens and his Worthen National Bank
invested in Harken Energy, a Texas company in which George Bush, Jr., was
a board member. "The money Stephens invested came through the Swiss BCCI
subsidiary" (Rachel Ehrenfeld).
What about Bill Clinton, Governor of Arkansas? Ex-CIA agent
Cord Meyer has privately confided to a friend of mine (to whom Meyer has
no reason to lie) that he recruited Clinton through the London station
while Clinton was a student in England. This Clinton was hardly ignorant
of CIA activity or devoid of CIA contact.
In 1987 First American bought the National Bank of Georgia, formerly
acquired from Bert Lance by Pharaon. Another BCCI-First American connection
was Robert Gray, a First American director, and head of the Washington
office of the public relations firm Hill & Knowlton. Gray represented
BCCI and did favors for Caspar Weinberger, among others.
"In October 1988, three days after the Bank of Credit and
Commerce International (BCCI) was indicted by a federal
grand jury for conspiring with the Medellin Cartel to
launder $32,000,000 in illicit drug profits, the bank hired
H&K [Hill and Knowlton] to manage the scandal. Robert Gray
also served on the board of directors of First American
Bank, the Washington D.C. bank run by Clark Clifford (now
facing federal charges) and owned by BCCI. Gray was close
to, and helped in various ways, top Reagan officials. When
Secretary of Defense Caspar Weinberger's son needed a job,
Gray hired him for $2,000 a month" ("Hill & Knowlton,
Robert Gray, and the CIA," by Johan Carlisle, *Covert Action
Quarterly*, #44, Spring 1993).
It was also Hill & Knowlton, you will recall, who later brought us
the staged melodrama in the House Human Rights Caucus. The production
starred the tearful "Nayirah"--in fact daugher of the Kuwaiti Ambassador to
the U.S. She told of Iraqi soldiers taking babies out of incubators and
leaving them on the cold floor to die. (Someone later alleged that her
follow-up story about Iraqi soldiers roasting Belgian babies, using bayonets
as spits, had to be dropped when it was discovered that there were in fact
no Belgians in the Middle East.) George Bush was to repeat this concocted
story a dozen times in the next few days, in the process of whipping up war
fever against his old business associate, Saddam Hussein.
BCCI was closed down by the Bank of England, acting in conjunction
with others, on July 5, 1991. When BCCI closed, many of its money-management,
money-laundering, and monetary-intelligence duties were transferred to
FinCEN, a newly created unit of the U.S. Treasury.
The Mena connections to Clinton and Bush have now, through Jackson
Stephens, been extended to Robert Dole. Jackson Stephens (along with Tyson)
has recently thrown his support behind the Dole campaign. In this regard it
is perhaps useful to note that:
"On November 27, 1987, an Arkansas State Police detective
received a call from a reporter for information about an
investigation into an aircraft maintenance firm named Rich
Mountain Aviation. Located at a small airport in the little
town of Mena, which stands virtually alone in the far west
of Arkansas near the Oklahoma border, Rich Mountain was at
the center of secret operations including cocaine smuggling
in the name of national security. The reporter was seeking
confirmation that the drug network operating out of Rich
Mountain was part of Lt. Colonel Oliver North's network.
He believed this group was smuggling cocaine into the US
through Mena and using the profits to support the Contras
as well as themselves.
"Arkansas State Police Detective Russell Welch . . . was
called by an Arkansas sheriff six weeks later who related
that he had information indicating that US Senator Robert
Dole was concerned about the Rich Mountain investigation.
In particular, the sheriff's informant stated that Dole was
worried that the investigation might in some way harm
George Bush" (Alan A Block, "Drugs, Law, and the State,"
Hong Kong University Press, 1992).
By contrast to Pakistan's ultimately inept attempt at nuclear
weapon construction, Israel's nuclear warfare system had thrived. Parts
of this system included the national military command center, the Bor,
located beneath Tel Aviv; the subterranean strategic air command post on
the edge of the Negev at Nevatim Air Base; the nuclear fuel reactor at
Dimona; the nuclear weapons laboratories at Nahal Soreq; the missile test
range at Yavne; the underground factory at Be'er Yaakov where the
Jericho long-range missiles are manufactured; the nuclear weapons
design lab (Division 20) and missile design development lab (Division
48) and weapons assembly plant at Rafael; the nuclear weapons bunkers in
the Negev at Tel Nof Air Base; and the Jericho missiles in bunkers west
of Zekharyeh in the Judean hills.
"By marrying atomic bombs first to long-range aircraft in the
Black Squadrons and ultimately to intercontinental ballistic missiles,
Israel become the first Third World country to post a strategic threat to
a superpower. That development was not lost on the Kremlin. Following
the test in September 1989 of an advanced Jericho-2 ballistic missile,
whose range covered the oil fields at Baku and could possibly reach the
port of Odessa as well, a Soviet Foreign Ministry spokesman said that
'Israel is known to possess a technological basis necessary for the creation
of nuclear weapons. The availability of delivery systems makes Israel
a source of danger, far exceeding the boundaries of the Middle East
region'" (William E. Burrows and Robert Windrem, *Critical Mass*, Simon
& Schuster, 1994).
Where did the money to pay for all this come from? In the beginning
it was a simple matter of collecting donations. "In 1960, a Committee of
Thirty (Jewish millionaires) was asked to quietly raise funds for the nuclear
weapons project. It collected $40 million for the construction of the
reactor and the adjoining, fabulously expensive, underground plutonium
separation plant at Dimona" (Burrows and Windrem).
But life did not stay this simple. For example, the BCCI-Bush-
Noriega-Mena connection to drug smuggling was matched by an similar Israeli
connection to arms and drug dealing and money laundering. Anything went in
the holy crusade to built the bomb and the associated missile delivery
systems. Just as the pension funds controlled by Robert Maxwell were
looted to pay for Mossad operations in Europe (Victor Ostrovsky,
*The Other Side of Deception*, HarperCollins, 1994, p. 203), so were
American S&Ls in effect looted (or burdened with debt) by the financial
machinations of the "Committee of Thirty" to help generate the vast
funds needed to maintain and expand Israel's defense industry. Some of
these funds found their way into offshore accounts held by U.S. politicians
and defense personnel as bribes, kickbacks, "campaign" contributions,
and payment for stolen secrets.
That, for example, Noreiga was a Mossad, as well as CIA, asset
follows from the fact his closest confidant and advisor was Michael Harari,
formerly number three man in the Mossad, who specialized in assassination.
Harari had fouled-up a case and had the wrong man killed, and was transferred
to Mexico where he became station chief for Latin America. After allegedly
retiring, Harari went to Panama as a security advisor to Noreiga, where
he trained UESAT, Noriega's elite personnal bodyguards. During the U.S.
invasion of Panama, the U.S. helped Harari escape back to Israel.
On the Central and Latin American money-laundering side, Scott
and Marshall relate, in a long footnote:
"One of the most intriguing reports of an Israeli-Colombian
drug connection was the story in *Hadashot* that the Cali
cartel 'employs Israelis, especially in transferring funds
from drug sales in the U.S. to the bank accounts of the heads
of the cartel in Colombia and Panama. They are also assisted
by banking services in Israel' (September 1, 1989). The
newspaper alleged that the Cali cartel is run by Colombian
Jews; actually, they are only involved in its money-laundering
operations. Jews who emigrated from Europe in the 1930s
established banking and money-channels exploited by the drug
entrepreneurs in the 1970s and 1980s (interview with a federal
agent, November 15, 1989). One of the chief Cali money
launderers was Isaac Kattan, a drug associate of both Alberto
Sicilia-Falcon and Juan Ramon Matta Ballesteros (Mills,
*Underground Empire*, 168; Kerry report, 286-88). Kattan
boasted that he invested his millions in Israel bonds
(*Newsweek*, July 20, 1981). Kattan had connections to
Nicaraguans through the cocaine-trafficking Espinosa brothers
(*New York Times*, February 28, 1981) and the Popular Bank
and Trust, owned by a prominent Nicaraguan exile and used as
a conduit for Contra and State Department humanitarian funds
(*Miami Herald*, June 14, 1987; *Village Voice*, July 1, 1986).
In 1988, federal authorities broke up a nationwide money-
laundering ring serving the Cali cartel. It was run by two
Israelis who won the cooperation of a network of Hassidic
Jews and a former Israeli Air Force captain by claiming
they were moving the money on behalf of Mossad to finance
'anti-Communist guerrillas in Central America,' presumably
the Contras. (Ibid; *Kol Ha'ir*, April 14, 1989; *Northern
California Jewish Bulletin*, January 13, 1989; United Press
International, March 17, 1989.)
Nuclear weapons. Money laundering. This juxtaposition leads
us back to BCCI and a body in Virginia. The death of investigative reporter
Danny Casolaro was, like that of Vince Foster, alleged to be "suicide" in
the face of all contrary evidence. Three days before his murder at the
hands of hut-dwelling wackos, Casolaro showed a friend some checks drawn
on BCCI:
"Ben Mason [an old friend] arrived at Casolaro's about
3:30 P.M. 'I was really hungry and anxious to go get
something to eat,' he recalled, 'but he was taking his
time, as usual. He took me downstairs, pulled out a box,
and showed me some pages. Five separate pages, spread
them out on the floor. The first had something to do
with some arms deals. I remember the name Khashoggi.
It was about Iran-Contra.'
"The second and third pages were photocopies of checks,
made out for $1 million and $4 million; they were
photocopies of checks drawn on BCCI . . . accounts
held by Adnon Khashoggi, the international arms merchant
and factotum for the House of Saud, and by Manucher
Ghorbanifar, the arms dealer and Iran-Contra middleman."
(James Ridgeway and Doug Vaughan, "The Last Days of Danny
Casolaro, *The Village Voice*, October 15, 1991).
[To be continued]
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