CNG: LPNAPOLI: CEG 1/8
UNIT: DC/WI/2
EXT: 6110
DATE: 2 APRIL 1965
TO: SAN JOSE
FROM: DIRECTOR
CON: C/WH L
INFO: 400P, C/C1, 00P, DC/WH/C 5 C/F, 2, VA, FILE
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MESSAGE FORM /8
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TO: PRIORITY SJOS
INFO:
CITE DIR: 98465
REF: SJOS 7492 (IN 34957)*
RYBA
1. KUBARK IN NO RPT NO WAY INVOLVED IN ERQUIAGA/MANUEL RAY ARMS DEAL. AS WE UNDERSTAND SITUATION, RAY ACTED INDEPENDENTLY TO SECURE COSTA RICAN BACKING FOR ARMS ORDER. SHORTLY AFTER AGREEING TO HELP RAY ORLICH TOLD CHIEF PBSWING THAT COSTA RICA NO LONGER INTERESTED IN DEAL AND WAS WITHDRAWING SPONSORSHIP OF ORDER. WITHOUT OFFICIAL GOVT UNDERWRITING ODACID WILL NOT ISSUE EXPORT LICENSE.
2. PRELIMINARY CHECK BY HQS SHOWS CLEARLY THERE CONSIDERABLE INTEREST IN ERQUIAGA COMPANY BY CALIFORNIA AUTHORITIES WHO ALLEGE COMPANY ENGAGED IN MANUFACTURE OF ARMS FOR "PRIVATE ARMIES IN CALIFORNIA". ALSO, KUBARK HAS NO CLEARED CONTACTS OR READY ACCESS TO OFFICIALS OF COMPANY.
3. HQS RECALLS ALREADY RATHER EMBARRASSING POSITION CHIEF PBSWING AND ODYOKE NOW IN AS RESULT CR CONGRESSIONAL ATTACK.
4. IN VIEW ABOVE CIRCUMSTANCES HQS WILL TAKE NO RPT NO ACTION THIS TIME TO INTERCEDE WITH COMPANY TO PREVENT LETTER SURFACING. WHILE WE SYMPATHIZE WITH HUMAP-9'S POSITION WE CANNOT MOVE IN
(CONTINUED)
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