MYSTERY OF 'ISRAELI SPIES' IN AMERICA: THE ECSTASY FACTOR DRUGS ENTER STORY
OF 120 PHONY 'ART STUDENTS'

Was Affair Linked To Investigation Of Global Trafficking Controlled By
Israelis?

Six months after a flurry of reports that US authorities had rounded up and
quietly deported some 120 young Israelis, most of them posing as "art
students" while apparently spying on US government agencies before and
after Sept. 11, their activities remain shrouded in mystery.

There has been speculation they were part of an espionage operation by
Israel against its strategic ally, but it has never been explained what the
purpose of that supposed mission might have been or whether it was related
in some way to the suicide attacks in which more than 3,000 people perished.

US authorities insist there was no spying involved, that the young Israeli
men and women were deported because of visa problems, even though a
security report by the US Drug Enforcement Administration (DEA) in June
2001, leaked to the media in December 2001, concluded that they were
involved in "organized intelligence-gathering activity."

The mainstream US media has been uncharacteristically silent on this
bizarre episode, as it has been in earlier instances when there were
suspicions that Israeli intelligence agencies were engaged in clandestine
operations in the US. This is even more unsettling since several government
agencies have said unequivocally over the years that Israel "aggressively"
conducts such operations in America.

But suspicion that the young Israeli "art students" were indeed involved in
espionage has not dissipated. And it's not hard to see why. Some of them
were serving in the military - one was identified as the son of a two-star
general - at the time they were first detected by US security authorities
in at least 42 cities and towns across the country in January 2001, or had
been assigned to intelligence branches during their military service.

Most failed polygraph tests when questioned about their activities. All
said they were students at the Bezalel Academy of Arts in Jerusalem or the
"University of Jerusalem" (presumably the Hebrew University of Jerusalem,
which is known as the Hebrew University), but no record of the identities
they admitted to were enrolled at either institution, now or in the past.

Some dogged and independent US journalists have not been deterred by the
bland denials issued by the Justice Department, the Federal Bureau of
Investigation and other government agencies and have continued to
investigate this puzzling and increasingly sinister affair. While they
suspect a government cover-up to avoid an espionage scandal that could
damage relations with Israel (and antagonize the powerful pro-Israel
lobby), they have also postulated some alternative theories as to what it
was all about.

Christopher Ketcham, a freelance journalist based in New York, reported in
a lengthy online article this month that one scenario is that the whole
affair was linked to a major DEA investigation into a global
drug-trafficking operation controlled by Israelis. Whether or not that
theory has any validity is open to question and Ketcham, who quotes several
DEA and US intelligence sources in his article, expresses some skepticism
about what he calls "the art student/drug dealer conspiracy."

But this is worth examining because it leads from the expanding activities
of Israel's crime syndicates in the US to a trail of clandestine operations
by serving or former Israeli military men in Latin America in the 1970s and
1980s with right-wing paramilitary forces and the drug cartels with whom
they shared an enmity toward left-wing guerrilla organizations. Some of
these operations were carried out on behalf of the Central Intelligence
Agency. Viewed through this prism, Ketcham's "art student/drug dealer
conspiracy" starts to intersect with the murky world of espionage, covert
arms deals and terrorism.

One of the primary targets of the "art students," according to the DEA
report, was the DEA itself and individual agents. Several of the "students"
were found seeking access to buildings housing DEA and other federal
agencies. The group apparently had links to an Israeli electronics company
in the US that deals with government departments, including providing
wiretapping equipment to the FBI.

At the time, the DEA was investigating the activities of an Israeli
organized crime syndicate that controls the multibillion-dollar trade in
"ecstasy," an amphetamine derivative that is sold in pill form. The US is a
major market and in 2000 the Customs Service seized some 7 million ecstasy
tablets.

In May 2001, the Israeli mastermind of this operation, Oded Tuito, was
arrested by Spanish police in Castelldefels outside Barcelona. His capture
triggered a plethora of extradition requests from around the world,
including the Unioted States, and on Aug. 15, 2001, a federal grand jury in
Los Angeles indicted him and 11 alleged associates for running an
international drug trafficking ring that smuggled an estimated 100,000
pills a month into that city.

He has been indicted on similar charges in New York and Pittsburgh. Two
other Israelis, identified as Michel Elkaiam and Simon Itach, believed to
be Tuito's top lieutenants, were also arrested in Barcelona later.

In November, police in Britain, Germany, Israel, Australia and the
Netherlands arrested 17 people, including two other Israelis held in
Amsterdam, who were believed to be key figures in the ring. In other swoops
around the same time, 1.6 million ecstasy pills weighing 400 kilograms were
seized in Lubeck, Germany, hidden in a shipment of dried flowers bound for
Australia, where another Israeli was arrested. Another 40 kilograms were
intercepted in London and 4 kilograms in the the Dutch city of Haarlem.

But these successes barely dented a criminal enterprise, largely controlled
by Israeli syndicates, involving what Interpol says is now the world's most
popular illegal drug. Officials estimate that more than 500 million ecstasy
pills are consumed every year.

One DEA official called Tuito "the most notorious ecstasy trafficker known
to law enforcement authorities in Europe, Israel and the US." He cornered
the market a couple of years ago by buying up the entire output of pills
manufactured in clandestine laboratories in the Netherlands, the main
producer. The dozens of Dutch labs are believed to supply 80 percent of the
world market. According to DEA officials, Tuito bought the pills at 50
cents apiece and sold them at $28.

The flamboyant Tuito allegedly stamped his pills with the Star of David and
a Tweety Bird logo, apparently because it amused him that it sounded so
much like his own name.

US authorities believe Tuito has been seeking to form alliances with US
crime families, but in an equally sinister development the United Nations
Narcotics Control Board reported in February that Colombian drug cartels
were now shipping cocaine to Europe to exchange it for ecstasy which was
smuggled into the US through Latin America.

Israel has a long history of involvement with the Colombian and other
cartels in Latin America. Former Israeli Army and intelligence officers
supplied the drug barons with weapons and trained their private armies,
including special assassination squads, throughout the 1980s.

One of the more notorious of these Israelis, a lieutenant colonel in the
army reserve named Yair Klein, was convicted by an Israeli court in 1991
for illegally exporting arms to the Colombian cartels. He was fined
$40,000. In 1998, Klein, a balding ex-paratrooper, was indicted in Bogota
on charges of training Colombian paramilitaries in terrorist tactics in the
1987-89. He was allegedly one of four Israelis hired by Gonzalo Rodriguez
Gacha, one of the Medellin cartel's most violent bosses, who was later
assassinated.

Klein turned up in war-torn Sierra Leone running guns to rebels. He was
arrested there in January 1999 and freed 16 months later. His current
whereabouts are unknown, but Israeli arms dealers are still working with
Colombian paramilitaries.

On May 7, Nicaraguan and Panamanian authorities launched an investigation
into how 3,000 AK-47 assault rifles and 5 million rounds of ammunition
shipped from Nicaragua by two Israeli-owned arms companies to Colombia on
Nov. 10, 2001, and wound up in the hands of the United Defense Forces of
Colombia, a group the US government has branded as terrorist.

There's another bizarre twist to this tale. According to US law enforcement
officials, Tuito, who used such diverse couriers as New York strippers and
Spanish grandmothers to smuggle pills to the US, also employed a group of
young ultra-Orthodox Hassidic Jews from New York on the premise that their
obvious religious aura would get them through customs inspections without
trouble.

In the 1980s, with Israelis deeply involved in Latin America's political
turmoil, US and British investigations found that New York's Hassidic
community was being used to launder as much as $200 million a year in drug
cartel profits. One such operation was linked to David Marcus Katz, who
controlled much of Israel's arms dealings in Central America from his base
in Mexico City throughout the 1970s and 1980s.

A 1992 report by Yediot Ahronot, based in part on FBI documentation, said
Israeli intelligence organizations were directing a US-based money
laundering network, including those run by Hassidic Jews, and using some of
the profits to finance clandestine operations.

So, all this may shed some light on this puzzling episode that the US
government insists was "blown way out of proportion." Ketcham says he was
told by the CIA: "We've just closed the book on it. And I recommend that
you do the same." The mystery of the Israeli "art students" who weren't
really students at all remains unsolved, but it seems there are people in
the DEA and FBI who are not prepared to leave it at that. Watch this space.