Crack Cop

The Federal Bureau of Investigation has always denied that former Laguna Beach cop, international arms merchant and convicted drug dealer Ronald J. Lister ever worked for the CIA or other U.S. intelligence agencies. But the FBI also insists that revealing the details of Lister's various Iran-contra-era arms deals would compromise U.S. national security.

It's a claim that adds to the mystery surrounding Lister, who says he smuggled coke into California to raise cash for the CIA-backed Nicaraguan contras.

Was Lister a spook? You decide: the FBI's most recent release included more than 50 pages that were heavily censored for unspecified “national security” reasons. The agency also withheld five pages concerning Pyramid International Security Consultants, Lister's Newport Beach-based company, which had offices in El Salvador and pitched “security work” to Salvadoran military officials, including death squad founder Roberto D'Aubuisson. The FBI said those documents “belonged to another government agency” but refused to identify that agency.

Through its lawyers, the Weekly has appealed the government's refusal to hand over uncensored copies of these documents.

According to a 1998 U.S. Justice Department Office of the Inspector General report, the FBI investigated Lister five times in the mid-1980s. One of those investigations involved the alleged sale of missiles to Iran. Another investigation involved the illegal transfer of weapons between Saudi Arabia and El Salvador. In yet a third probe, Lister testified for the FBI about a covert arms pipeline allegedly directed by Iran-contra co-conspirators Richard Secord and Oliver North. The FBI says it dropped those investigations because it could find no evidence Lister ever worked for North or the CIA (see Nick Schou's “Crack Cop,” July 13, 2001).

The newly released documents are mostly secret cables between the FBI's Panama office and the director's office in Washington, D.C., but they also include cables sent to the director's office from FBI stations in LA, San Francisco and Italy.

Most of the cables are so heavily redacted that they add little to what's already known about Lister's unlikely rise from Laguna cop to international drugs and weapons smuggler. A June 6, 1983, letter from FBI headquarters to its legal attach in Rome titled, “Pyramid, Technology Transfer, Neutrality Matters,” is stamped “SECRET” and is completely censored to protect U.S. national security. Also deleted in its entirety on national-security grounds is a three-page memo from Sept. 13 of that year titled “Pyramid, Neutrality Matters.”

Other cables are more helpful. On March 18, 1983, FBI officials in Panama told the director's office in Washington, D.C., that “the U.S. Embassy in San Salvador, El Salvador, was the original source of information regarding Subject's presence in that country.” The next few lines are deleted, but the memo continues, “Subject was described as 'full of hot air' and as a small-time operator. Subject's activities in El Salvador do not appear to constitute a violation of U.S. law. Original rumor-type information that came to attention of economic section representative possibly was result of subject's bizarre behavior and appearance.”

Lister's “bizarre behavior” has been the subject of intense debate ever since it was first reported six years ago by Gary Webb, then a reporter for the San Jose Mercury News. Webb's controversial Dark Alliance series described an October 1986 early morning police raid on Lister's Mission Viejo home. Still wearing his bathrobe, Lister told police he worked for the CIA and threatened to call his contact in Langley, Virginia. Police found surveillance equipment, military contracts and other high-tech gear in his home, but no drugs, so Lister remained free.

Three years later, police arrested Lister for dealing drugs in San Diego. After a few months in jail, he became a federal informant. Prosecutors later revoked his plea-bargain agreement, saying he had traveled to Mexico to meet with Colombian cartel figures. In 1991, a jury convicted him of cocaine trafficking. He appealed his sentence, claiming that he had testified before two federal grand juries about his involvement in a “major Central American cartel” that included certain “key figures alleged to have been involved in the Iran-contra scandal.”

After completing a drug-treatment program, Lister walked out of federal prison in 1996, three years early. Hounded by creditors and unwilling to speak with the press, he has maintained a low profile in recent years. One of those creditors provided us with his cell phone number, but he failed to respond to several calls seeking his comment for this story.

He left his last known job for Ready Welder Corp., a San Pedro-based manufacturer of mobile welding equipment, four years ago. Ted Holstein, the company's owner, said he fired Lister after a year because he failed to sell a single unit.

“I didn't have much patience for the guy,” Holstein said. “After I fired him, I got a bill from Bank of America saying Lister had posed as an executive with our company and had charged $16,000 to our credit card.” Holstein said he never pressed charges because the bank said he didn't have to pay the bill.

Another former Ready Welder employee described Lister as a “shady” character. “Nobody knew where he lived,” he said. “I got the impression that maybe he carried a gun, maybe he was hiding from people. . . . He always seemed to be looking over his shoulder. . . . His favorite thing was to say that he used to deal drugs down in Central America for the CIA and the contras.”