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$134Billion Suitcase Bomb

E.P. Heidner
June 22, 2009

For two decades, U.S. security forces worried endlessly about the surfacing of the
infamous ‘suitcase nuclear weapons’ built by the Soviet Union. In June 2009, a suitcase
carrying a weapon of mass destruction - $134 billion of bearer bonds – was confiscated
as it was being smuggled into Switzerland. Without any additional reported facts –
which seems to be where this story will end-up - the source and destination of the $134
billion in bearer bonds will probably remain a mystery. There are however, adequate
clues in the initial reports to provide insight for speculation:
1. An extremely powerful organization is making a major commitment to a financial
strategy with global implications. Given the value of the bonds in question, this
strategy is certainly being backed with a nod and wink by a central bank or
treasury somewhere. The bonds are designated as intergovernmental, and
somewhere in the process, a U.S. central bank or Treasury official would have
been required to support the scam, if it indeed it was a scam. Any one organizing
a scam of this magnitude would have considered and planned for verification of
the bonds – meaning someone in the U.S. Treasury is involved in this. Otherwise,
one has to question why anyone would create such perfect and expensive
forgeries with such a fatal flaw in execution of the plan.
2. The Italian police were “trailing” the holders of the bonds, suggesting a long term
investigation was behind the arrests. Discovering these bonds was not an
accident, and there is a lot more information to be had but is not being released.
3. The Italian police or press referenced a ‘bond scam’ being run by the ‘Mafia’ with
the Venezuelan Central bank, accusations for which the bank has denied any
involvement. The Venezuelan Central bank would not be the bank validating the
legitimacy of the bonds, but as explained below, would be the initial target.
4. The two carriers with Japanese passports displayed the behavior of typical low
level, dispensable resources who were allowed to be released from incarceration,
and subsequently disappeared. (Odd, since a $134 billion of bonds illegally
deployed can do more damage than a small nuclear weapon, and even a phony
nuclear device will keep you in prison for a long time.) Whoever is behind the
trafficking has a lot of ‘influence’ with multiple government agencies
5. Significant press coverage has been totally stifled, considering the potential risk
for global devastation this ‘suitcase bomb’ had. The five corporations that control
most of the western media are all tightly linked in a network that supports U.S.
covert operations.1 The Mafia does not have that level of influence. – the U.S.
and Israeli governments do.

Can the bonds be real?

There is a lot of speculation on the internet that these bonds are not forgeries, given that
neither the Italians nor German officials thought they were forgeries, but there are those
nagging facts that say it is impossible for them to be real, unless they were issued
covertly. The U.S. Treasury has denied the bonds are real. There are a lot of bloggers
that want to discount the possibility that these bonds are real, simply on the basis of
“there is no official record of these existing.” So what pieces of data do we have that
suggest that the U.S. government has covertly issued bonds in that order of magnitude in
the past? At this point of course, it all depends on who you chose to believe, the officials
of the U.S. government, or independent historians and researchers.

1. Start with the impeccably documented research of Sterling and Peggy Seagrave,
Gold Warriors, who have documented how the Imperial Treasury of Japan was
confiscated by U.S. bankers and President Truman in the aftermath of World War
II, and subsequently the balance was taken from Ferdinand Marcos in 1985 by
Reagan, Bush and Kissinger. Estimates vary, but at one point, we have estimates
that can put the value of that treasury easily over $200 billion. Under international
law, confiscation was illegal, so there are not a lot of U.S. officials stepping up to
admit this.2
2. Then move the story line to Mrs. V.K. Durham, wife of widely reported CIA
covert fund manager Russell Hermann, who claims in sworn testimony, and
provides actual documents of the transfers, that Greenspan and Bush with the
assistance of Goldman Sachs, generated around $240 billion in covert bonds in
1991. Documents show the bonds were sent to Israel, where they were converted
to yen and deutschemarks.3
3. Following on Mrs. Durham’s claims, the reader must research the status of the
deutschemark in 1991. From 1990 to 1991, the Bundesbank increased it’s
currency printing costs from DM190 million to DM331 million while increasing
the interest rates to reduce money supply, The German monetary policy failed
inexplicably in this timeframe4, unless one considers $120 billion in
deutschemarks created covertly by Greenspan, Bush, Rubin and Friedman.
3. Move the story line to Andrei Kozlov, First Deputy Head of Russia’s Central
Bank, who was heading an investigation into the loss and reported the theft at 400
billion rubles from the Central Bank in 1991. (Not to be confused with a similar
scam run out of Chechnya in 1992 on a much smaller order of magnitude.) These
rubles were stolen by someone putting hard currency securities in remote
Chechen banks as collateral for Russian loans and then making the collateral
notes disappear from the remote banks at the same time the funds were being
withdrawn. At official exchange rates at the time, 400 billion rubles was about
$240 billion.5
4. Turn then to the highly respected consultant to the CIA, Claire Sterling who
unabashedly points out that the collapse of Russia in 1991 was directly managed
by intelligence agencies.
“The fact that scarcely anyone outside Russia has heard of the Great Ruble Scam may be
explained partly by its seemingly unbelievable details, but partly, too, by Western reluctance
to touch exquisitely sensitive political nerves. Western governments rejoicing in the collapse
of the evil empire wanted to assume, and to all appearances did assume, that all the evils in an
emerging democracy emanated from politicians identified with the fallen communist state.
Not one was prepared to acknowledge indelicate evidence to the contrary. The ability of three
or four characters to mount such a planet wide operation, their extraordinary impact on what
was still a world superpower, and their singular immunity from beginning to end suggest the
guiding hand of not just one, but several intelligence agencies.” 6

5. Look at the widely unreported claims that in the 1990s, the US covertly
introduced hundreds of tonnes of gold into the market on at least four occasions,
representing somewhere between $120-140 billion in bonds.7 The two lawsuits
that could have opened this story were shut down prematurely – the FBI records
related to the Reginald Howe lawsuit were destroyed on 9/11, and a similar suit
by Donald W. Doyle of Blanchard in which Barrick Gold was a primary
defendant was settled out-of-court in 2006 and sealed under agreement.
6. General Earl Cock’s ‘deathbed’ deposition in April 2000 describes Citibank’s and
John Reed’s central involvement in Project Hammer in the last quarter of 1991 as
being funded with $223 billion dollars, of mostly CIA moneys. Cocke also
references the use of baby bonds to collaterize these funds, which are 10 year
bonds. Cocke describes the source of these funds as “accounts, participants or
players” with the accounts converting to bank ownership upon the death of the
controlling party, and then to the government. This matches exactly what Sterling
and Peggy Seagrave claim happens to the gold accounts
opened by agents of the US.8

These historical facts have been summarized here to illustrate that the U.S. Government
does indeed have and move massive, massive amounts of currency around covertly
because the objectives of these financial manipulations run counter to U.S. law, and the
origins of these funds are illegal. No nation will admit criminality until the statute of
limitations runs out. The next question requiring an answer then is: Why would covert
pro-U.S. forces be running these bonds? While the hypothesis of the bonds being used to
claim TARP funds is interesting, the strategy of substituting one form of worthless U.S.
debt for another does not seem plausible. On the other hand, there is a rich history of
that links the plot to Venezuela, as the original press reports did.

Bonds and Venezuelan Oil

The international movement of major blocks of capital has at least twice before been
associated with the takeover of large oil interests. The great success of the 1991 covert
bond issuance was the transfer of ownership of Russian oil and gas interests to western
investors cloaked behind holding companies and offshore banks.9 In 1998, the collapse of
the Russian market (which drove the LTCM financial crisis) was again engineered in an
effort to force the Russians into a debt for equity swap for the Baltic Oil pipeline. The
1998 gambit failed, and the Russians simply defaulted on their debt rather than turn over
control of the pipeline, and shortly thereafter, U.S.-Russian relations began an ongoing
deterioration. One can look at additional covert financial programs where governments
were unhinged by engineered financial crises: Chile in the 1980s and Mexico in the
1990s - where previously ‘nationalized companies’ were returned to private investors in
debt for equity swaps.10 The beneficiaries of this were privileged western investors who
took over restructured operations that were rebuilt with taxpayer dollars from Russia,
Chile and Mexico – and did so for pennies on the dollars. This history is relevant
because a similar scenario is unfolding in Venezuela today, where an array of unknown
western based investors are converting U.S. debt into Venezuelan debt in an illegal
market with the expectation that a crushing debt load will drive Hugo Chavez out of
office, and force Venezuela to swap equity in its primary valuable asset – state-oil
company Petroleos de Venezuela SA, or PdVSA - to satisfy its growing debt.

Key to understanding this strategy is that the exchange market where this is occurring is
ambiguously legal for some purposes, and more often than not illegal for most purposes.
Currency exchange for Venezuelan ‘bolivars’ is tightly regulated by the Chavez
government to prevent capital flight and tax avoidance, and for Venezuelans to get
dollars through the official channels for purposes that do not align with Chavez’s vision
of social investment is very expensive. As a result, dollars are in high demand, and are
procured through an officially sanctioned back-door. The Venezuelan government has
created a safety valve process (permuta) in which Venezuelan denominated bonds can be
swapped for dollar denominated bonds at an uncontrolled rate in a market, and that
exchange consist of hundreds of small ‘cambios’ that collect demand and funnel them
through large money aggregators. A lot of this demand – but not all -is illegal under
Venezuelan law. Hence, the bonds brought to the exchange for Venezuelan debt are
being laundered under less than stringent governance, making bonds like those
confiscated in Italy more likely to be accepted in these swaps. Chavez is gambling that
the US dollar will be devalued, and western investors are betting Chavez’s hold on
political power will be disrupted before the dollars collapses.

The largest permuta laundry appears to have been headed up by a former regulatory
officer of the U.S. Federal Reserve (Atlanta), in charge of several Latin American
countries, through Florida-based Rosemont P. Corporation, also known as Rosemont
Money Services. He has recently been indicted for money-laundering, but the ‘parallel
market’ (the newest euphemism for ‘black market’) continues, albeit at a more
constrained pace.

Rosemont was indicted for accepting $900,000 of drug money to move through the
permuta process, but there are preliminary indicators that the DEA indictment will not
stick, and the indictment was meant more to disable a major player in the exchange
mechanism than to cripple any particular drug cartel. Disrupting the exchange
mechanism impedes the flow of capital to the Chavez government. This impediment
creates inabilities for the Chavez regime to compensate foreign contractors, forcing them
to turn off support for the state oil industry, which in turn reduces oil production and thus
state revenues. Seven of nine off-shore oil rigs have been shut down in this manner, and
the remaining two will probably be shut down in the near future. As the economy is
destabilized with less oil revenue, there is increased likelihood of another coup attempt.
Investors have seen this scenario before, in Chile in the 1980s and Mexico in the 1990s,
where government takeovers by the upper classes ousted democracies inclined to support
the interests of broader constituencies, by causing mass unrest through economic
destabilization. In the wake of those upper class takeovers, the nationalized assets were
exchanged for nation’s foreign debt, usually at prices that significantly enriched foreign
investors at indigenous taxpayer expense.
The appearance of massively large blocks of U.S. bonds in the permuta - whether
counterfeit or not – suggests a single player is attempting to dominate this market.

“"No one truly understands what the source of the dollars is in these transactions. Most of the
money is coming from offshore accounts," said Brian Stoeckert, who runs an anti-money
laundering consulting firm.”11

By shutting down the big players in the permuta exchange, and bringing in new,
controlled exchange players, covert operatives can start aggregating Venezuelan debt
with virtually no risk by using bonds whose authenticity can be denied if necessary, or
argued as real if necessary. International debt settlement happens behind locked doors,
and no one ever gets to find out what the settlement terms are.12 Most of the funds and
individuals who were behind the 1991 takeover of Russian oil are still around, and
represent the most likely candidates for running this scenario again.13 This scenario is
classic U.S. covert policy: disrupt the economy and force the democratic government into
debt; drive the debt to unmanageable proportions, and then cut off funding and call in the
loans. The ensuing economic disruptions result in a takeover and force the government
into bankruptcy proceedings. Western investors take over the key national assets for
pennies on the dollar. This strategy is tried, tested and trusted.

Who then, might one ask, replaces the Rosemont P Corporation. Fortunately, J Aron, the
subsidiary of Goldman Sachs that deals with its foreign exchange business is in an
enviable position. Because of its oil and coffee trading business, J Aron has numerous
contacts in Venezuela. Because of Rule 35 of the Commodity Futures Trading Act, these
bond swap trades fall into the category of unregulated business.14 Goldman Sachs clearly
has the connections to the U.S. Treasury. It was Rubin and Friedman of Goldman Sachs
in 1991 who facilitated the Bush/Greenspan issuance of covert bonds.15 While plausible,
this is –of course –only speculation.

Notes
1
See Who Controls the Media? Professor John Lye, October 8, 2004, also National Organization of
Women, also see Chapter 13, THE SEPTEMBER 11 COMMISSION REPORT Final Report of the
Investigation Into the Murders of Nicholas Berg, Eugene Armstrong and Jack Hensley, EP Heidner,
2008
2
see Gold Warriors: America’s Secret Recovery of Yamashita’s Gold, Sterling and Peggy Seagrave,
Verso, 2005, p. 358. Most cursory reviews of this amount forget that 280,000 tonnes is less than 140
years of annual production. When one considers that treasuries and personal fortunes of South East
Asia and China were plundered over 50 years by the Japanese army, this number should not be
inconceivable.
3
V.K. Durham presents substantial photographic evidence of these crimes on her website, and it can
also be located at Tom Flocco’s website as well. see http://www.theantechamber.net/; also conduct a
search engine query on “VK Durham”
4
David Marsh, The Bundesbank: The Bank the Rules Europe, 1992, Mandarin Paperbacks, pp 24 and
85.
5
“The West is not very highly concerned with the threat of cyber terrorism,” Regnum News Agency,
December 15, 2006, http://www.regnum.ru/english/749825.html.
6
Thieves World, Claire Sterling, Simon and Schuster, 1994, p.202
7
see footnote 25 in Collateral Damage (Part 2): The Subprime Crisis and the Terrorist Attacks on
September 11, 2001, E.P. Heidner, 2008.
8
Brigadier General Erle Cocke’s deposition in US District Court, Southern District of New York, April
13, 2000, April 13, 2000, (as provided in photostat version in Guyatt’s Project Hammer Files)
9
Collateral Damage: U.S. Covert Operations and the Terrorist Attacks on September 11, 2001, E.P
Heidner, 2008
10
see The Blood Bankers, James S Henry, 2003, Chapter 7; Banking on Dictatorship
11
US Money Laundering Case Halts Venezuela Forex Trading , Darcy Crowe, Dow Jones Newswires,
MARCH 27, 2009; http://online.wsj.com/article/BT-CO-20090327-714177.html
12
The writer challenges the reader to try to find a summary of how the international debt crisis was
resolved in 1990.
13
the names of the investors are found in Collateral Damage: U.S. Covert Operations and the Terrorist
Attacks on September 11, 2001
14
Title 17--Commodity and Securities Exchanges , CHAPTER I--COMMODITY FUTURES TRADING
COMMISSION, PART 35--EXEMPTION OF SWAP AGREEMENTS
http://edocket.access.gpo.gov/cfr_2006/aprqtr/pdf/17cfr35.2.pdf
15
Collateral Damage (Part 2): The Subprime Crisis and the Terrorist Attacks on September 11, 2001,
E.P. Heidner, 2008.