Former Customs Agent Indicates Clinton Complicit in Narcotics Trafficking

Interview by Bill O'Reilly of William Gately

Transcription and Notes by Jon Roland

FoxNews, May 8, 2000
Bill O'Reilly reporting from Los Angeles, California

O'Reilly: In the Impact Segment tonight we continue our investigation into the problems between Mexico and the United States. In 1998 U.S. Customs Agent Bill Gately was in charge of Operation Casablanca, an investigation that proved some of the biggest banks in Mexico were laundering drug profits. This of course was embarrassing to the Mexican government, and to the Clinton administration, which has continued to insist that Mexico is a staunch ally in fighting drug trafficking across the U.S. border. Mr. Gately, who recently retired, wanted to continue his investigation, because he had developed information that the Mexican Defense Minister, Gen. Enrique Cervantes, was allegedly involved with drug money. But U.S. Customs Chief Ray Kelly ordered Gately to stop his investigation cold. William Gately joins us now. [View pans to Gately.] So you were on Sixty Minutes about a month ago, I guess, with the story. We've investigated, so I don't have a lot of questions, you know, that this isn't happening, because we know it is, that the Mexican government is very embedded in corruption, and taking money from the drug cartels. But the Defense Minister? Do you believe he is involved with the drug trafficking?

Gately: I don't see where it is such a big surprise. First, this wasn't the first time that the Defense Minister's name came up in this investigation, as potentially corrupt. In fact, his drug czar, Gen. Gutierrez Rebollo, was arrested by the Mexican government. ...

O'Reilly: Right, and he was Barry McCaffrey's, our drug czar's, big pal, and [it was] very embarrassing to drug czar McCaffrey, when he was arrested. Now the bottom line on this, and you correct me if I'm wrong, Mr. Gately, is that the Clinton administration wants to engage Mexico economically, with NAFTA, with all kinds of mutual trade benefits, and they don't want to tee off the Mexican authorities, so they're willing to look the other way on the drug problem. Am I wrong?

Gately: They are looking the other way. With the fallout from [Operation] Casablanca, the President of the United States, through his Attorney-General, signed an agreement with the Mexican government, that there would be no more deep cover penetrations into criminal activity in Mexico ...

O'Reilly: Is that right? I didn't know that...

Gately: ... without, without first telling the Mexicans we were doing it.

O'Reilly: So Operation Casablanca was an undercover — you were running it — the Mexican government had no idea you were running it — and now we can't do that any more! President Clinton has told President Zedillo we're not going to do that any more.

Gately: Not only that but we have a document that has the power of a treaty, that says that it's the law of the land, [that] we will not do it any more.[1]

O'Reilly: But my question is, why is President Clinton playing into the hands of the Mexican government, when time after time after time it has been proven the Mexican authorities are corrupt?

Gately: Because they choose economics, and what I consider a flawed foreign policy, over righteous law enforcement, which is to engage the people who are really running the drug trade in Mexico. Those are the banks, and the politicians.

O'Reilly: You think it goes up to President Zedillo?

Gately: Well, it went up to President Salinas, why not Zedillo?[2]

O'Reilly: Well, it didn't. You didn't get Salinas. You got his brother.

Gately: You didn't get him, but in fact his bank accounts were full of drug money.

O'Reilly: How do you know that?

Gately: Because $180 million were transferred into those accounts, so ...

O'Reilly: But that was his brother. I didn't think that it was the President — Salinas — was it?

Gately: This is the way it works in Mexico.

O'Reilly: But let's get with Salinas first. Because I want to be clear on this. I never heard that President Salinas — ex-President Salinas — of Mexico had $180 million in his bank account. Is that absolutely true?

Gately: That's a fact, those accounts were filled with drug money. Those accounts.

O'Reilly: You're saying it. I didn't know that. I knew his brother did, and they got his brother.

Gately: Yeah.

O'Reilly: But Salinas [is] living in Ireland now, he's over in Ireland.

Gately: This is true, this is true, but this is the way it works in Mexico: No one at the lower level can take money unless the person above him also takes it. It's the culture of mordita.[3]

O'Reilly: Why would Zedillo, the President of Mexico, have to necessarily be taking money from the drug cartel? I mean, he could get elected, as he has, and he's going to stand down soon, and he could be clean while his defense minister, he could be dirty. Why would Zedillo have to be dirty?

Gately: Because that's the way it works. It goes up, the money goes up.

O'Reilly: And you believe they're all tainted by it.

Gately: They're all tainted by it. Every financial institution in their country was tainted by it. There's no end to who's involved because everyone must be involved for it to operate in the way that it does.[3]

O'Reilly: Now when you say this to — you never talked to Janet Reno, did you?

Gately: Did I ever talk to her, no. We don't have discussions.

O'Reilly: But you did talk to Ray Kelly, the Customs Commissioner?

Gately: Yes.

O'Reilly: But you never talked to Reno, who's Kelly's boss?

Gately: No, she's not.

O'Reilly: Customs is not [in] the Department of Justice?

Gately: Robert Rubin was Kelly's boss, and I did talk to him.

O'Reilly: In the Department of Treasury.

Gately: The Department of Treasury.

O'Reilly: Okay, my mistake. So you did talk to Rubin. What did Rubin say?

Gately: Rubin said, "Go for it!" But for Robert Rubin, hearing the situation at the time in Operation Casablanca, they'd have shut it down a lot sooner.

O'Reilly: All right, so Rubin was on board with you trying to get the top guys in Mexico.

Gately: It was Rubin's decision not to tell the White House, not to tell the National Security Advisor, not to tell the State Department. Those were all his decisions, and I heard him make them. Because if you had, the case would have been over.

O'Reilly: Did Rubin tell you that?

Gately: No, I was present briefing him, and the subject came up, "Well, Mr. Secretary, when do we brief, when do we brief, when do we bring this information, or brief the State Department, when do we brief the National Security Advisor, when do we brief the White House?" And he said, "We don't. And we don't brief Mexico."

O'Reilly: Did he say why he wouldn't brief the White House?

Gately: He didn't have to. It was clear to everyone in the room, if you did, that it was no longer a secret.[4]

O'Reilly: And then Rubin left, and Kelly shut down the operation. The Customs Commissioner, Ray Kelly.[5]

Gately: Well, he wasn't Customs Commissioner at the time. He was the Undersecretary to Robert Rubin. Now, I don't know what kind of discussion Mr. Rubin had with Mr. Kelly when I left the room. I just know what Mr. Rubin said when I was in the room, and that was that this operation goes on, and we do not brief these people, not until, and his words were, "We don't tell the Mexicans until the last one's in the paddy wagon."

O'Reilly: Right. That's for sure. But President Clinton not knowing about this, because he would put a halt to it. And then, subsequently, you were told, "Knock it off! No more!"

Gately: That's right.

O'Reilly: All right. Mr. Gately, thanks very much for coming in. We're going to continue the story. We hope you come back.


1. It could only be an executive agreement, which has the force and reach of an executive order. Constitutionally, it is binding only on executive branch employees under the chain of command leading to the President, and endures only as long as that president remains in office. Such an agreement or order can have no legal authority over civilians or officials in other branches or levels of government.

2. Why not Clinton?

3. This is the way it works in the United States and other countries as well.

4. It would seem that Rubin and the others present regarded those offices as having been compromised by the narcotics trade, much like those in Mexico.

5. This seems likely to be why Rubin left, or was forced to leave. It indicates the President is covering up the narcotics trade because he is benefiting from it.

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