C 0 5 8 8 3 3 0 8 IED U S Department of State Case No M-2015-14753 Doc No C05883308 Date 09 30 2015 RELEASE IN FULL - o • T acl cr d • • 10011A U'r u„ k- 461 g °eCk OX Department of State PAGE 01 OF 02 SANTIA 00324 00 OF 84 152258Z AMON INRD-01 INFO LOG-00 ADS-08 CCO-80 1544 FERNANDEr- OWN OBSERVATION OF THE MEETING RO ROOM AND MOVEMENT AND SUBSEQUENT REACTION OF PARTICIPANTS KEY STATEMENTS INCLUDE AS-01 INRD-01 1 082 W 257256 1615062 65 10 38 0 I52129Z JAN 87 ZFF4 FM AMEMBASSY SANTIAGO TO AMEMBASSY BUENOS AIRES NIACT IMMEDIATE INFO SECSTATE WASHOC NIACT IMMEDIATE 9666 rp-P-S-T-0-R-E-4- SANTIAGO 00324 ROGER CHANNEL BUENOS AIRES - EYES ONLY FOR DEPUTY ASSISTANT A G RICHARD 1 4846-9111M1-ENTIRE TEXT 2 FOLLOWING ARE HIGHLIGHTS OF U S TEAM'S TE TEN HOUR INTERVIEW WITH FERNANDEZ LARIOS PER YOUR REQUEST WE HAVE SUMMARIZED FERNANDEZ ACCOUNT OF INVOLVEMENT OF KEY PLAYERS IN ASSASSINATION AND COVER-UP ESPINOZA - FERNANDEZ IMPLICATES ESPINOZA IN THE ASSASSINATION BY STATING THAT ESPINOZA WAS THE SOURCE OF ORDERS TO FERNANDEZ AND TOWNLEY TO GO TO THE U S FERNANDEZ WITNESSED A CLANDESTINE MEETING BETWEEN ESPINOZA AND TOWNLEY PRIOR TO THE TRIP AT WHICH FERNANDEZ WAS ASAEO 10 4A T OUTSIDE ME DIRECTLY IMPLICATES ESPINOZA IN THE COVER-UP RELATING NUMEROUS CONVERSATIONS AT WHICH BOTH ESPINOZA AND FERNANDEZ WERE PRESENT TO DEVELOP AND REFINE COVER STORIES • CONTRERAS- FERNANDEZ IMPLICATES CONTRERAS IN ORDERING THE ASSASSINATION BY STATING THAT FERNANDEZ REPORTED BACK TO CONTRERAS FOLLOWING HIS TRIP TO THE U S AND SUBSEQUENTLY BY REPEATING STATEMENTS OF ESPINOZA RELATING A CONVERSATION BETWEEN CONTRERAS AND OROZCO IN WHICH CONTRERAS HAD ACKNOWLEDGED ORDERING THE CRIME SEE BELOW HE FULLY IMPLICATES CONTRERAS IN THE COVER-UP RELATING NUMEROUS CONVERSATIONS IN WHICH CONTRERAS INSTRUCTED FERNANDEZ AND OTHER PARTICIPANTS ON COVER STORIES LILLIAN WALKER - FERNANDEZ CANNOT IDENTIFY HER BUT DOES HAVE A FEW ADDITIONAL DETAILS HE ASSERTS SHE WAS NOT A DINA AGENT WAS UNAWARE OF PURPOSE OF TRIP TO U S AND AT NO TIME ASSISTED HIM IN SURVEILLANCE OROZCO - FERNANDEZ FULLY IMPLICATES OROZCO IN THE COVERUP OROZCO APPARENTLY PURSUED AN HONEST INVESTIGATION AT THE OUTSET AND WAS PREPARED TO CARRY OUT AN ALLEGED DEAL WITH U S PROSECUTORS INVOLVING LONG PRISON TERMS FOR CONTRERAS AND ESPINOZA AND A SHORT TERM FOR FERNANDEZ OROZCO HATED CONTRERAS AND THIS ADDED TO HIS VIGOR IN PURSUING INVESTIGATION OROZCO HAD TRUTHFUL THFUL DECLARATIONS FROM BOTH ESPINOZA AND FERNANDEZ HE GOT TRUTH ORALLY FROM CONTRERAS BUT WHEN CONTRERAS IMPLICATED PINOCHET SEE BELOW OROZCO REVERSED FIELD AND BECAME A MAJOR ARCHITECT OF THE COVER- On poJ -- ESPINOZA TOLD FERNANDEZ THAT CONTRERAS HAD RELATED THE FOLLOWING DURING CONTRERAS MEETING WITH OROACO HE WAS CONFRONTED BY TRUTHFUL DECLARATIONS OF ESPINOZA AND FERNANDEZ AND ASKED TO MAKE HIS OWN DECLARATION HE BEGAN TO DO SO CONTRERAS ACKNOWLEDGED HE HAD GIVEN THEE ORDER TO ESPA ESPINOZA FILE COPY SECSTATE - EYES ONLY ARA DAS GELBARD INCOMING TELEGRAM _ Ir f • WHEN ASKED WHY HE STATED BECAUSE HE CONTRERAS HAD RECEIVED AN ORDER WHEN ASKED FROM WHOM HE ADVISED OROZCO TO ASK THE CHIEF SINCE CONTRERAS REPORTED DIRECTLY TO PINOCHET THE REFERENCE TO THE CHIEF IS REASONABLY CLEAR OROZCO SAID YOU CAN'T DECLARE THIS AND LEFT THE BUILDING WHEN OROZCO RETURNED HE TOLD FERNANDEZ HE WAS FREE TO GO AND THIS WOULD HAVE A BEAUTIFUL-ENDING THEREAFTER OROZCO PARTICIPATED FULLY k IN COVER-UP FERNANDEZ SAYS HE IS NOT SURE WHETHER OROZCg CONSULTED PINOCHET OR GCD BUT HIGHElf AUTHORITY CLEARLY WAS INVOLVED IN CAUSING HIM TO REVERSE THE COURSE OF HIS INVESTIGATION -- FERNANDEZ HAS TWICE MET WITH PINOCHET TO REQUEST PERMISSION TO RESIGN FROM THE ARMY PINOCHET ORDERED THAT HE BE ON LEAVE SINCE HE FELT UNABLE TO PERFORM HIS DUTIES AS A SOLDIER BUT REFUSED TO ALLOW HIM TO SEPARATE FROM THE ARMY'S JURISDICTION V -- WHEN FERNANDEZ WAS INCARCERATED DURING THE EXTRADITION PROCZECINSS PI T 301E7 MET WITH HIM T1 GENERAL SINCLAIR'S OFFICE SINCLAR WAS NOW CONDUCTING THE ARMY INVESTIGATION PINOCHET SAID HE HEARD FERNANDEZ WANTED TO GO TO THE U S TO FACE THE CHARGES FERNANDEZ SAID NO IT WAS NOT A QUESTION OF 'WANTING ' HE WAS GOING TO THE U S PINOCHET WAS UPSET THAT FERNANDEZ HAD DEVELOPED THIS ATTITUDE TOLD HIM THAT HE HAD TO BE A GOOD SOLDIER TO CONTINUE THE STRUGGLE AND THIS PROBLEM WOULD HAVE A HAPPY END PINOCHET ASSURED FERNANDEZ HE WOULD ORDER THAT FERNANDEZ BEIREATED WELL IN DETENTION WHEN SINCLAIR ASKED PINOCHET WHAT HE HAD BEEN DISCUSSING WITH FERNANDEZ PINOCHET SAID DON'T WORRY I AM JUST TRY ING TO RESOLVE FERNANDEZ PROBLEMS TEAM CONCLUSION WE ARE UNANIMOUS IN FINDING FERNANDEZ CREDIBLE WHILE CERTAIN POINTS REMAIN UNEXPLAINED STORY HUNG TOGETHER THROUGH TEN HOURS OF INTENSE SCRUTINY WHAT HE HAS TO OFFER AS A WITNESS IS OF SUBSTANTIAL IMPACT FROM BOTH A LAW ENFORCEMENT AND FOREIGN POLICY STANDPOINT HE IS NOT IN OUR JUDGMENT A WILLING PARTICIPANT IN TERRORISM AS WE HAD PREVIOUSLY ASSUMED ME HIM TO BE HE IS A WILLING AND CONVINCING WITNESS TO AN ORCHESTRATED COVER-UP OF TERRORIST INCIDENTS BY THIS GOVERNMENT HE IS FULLY AWARE THAT IF HE FAILS ANY FURTHER TESTS-0F HIS CREDIBILITY E G POLYGRAPH ON ANT P ANY SIGNIFICOINT INCLUDING INVOLVEMENT IN OTHER VIOLENT ACTS ANY AGRE AGREEMENT WOULD BE VOID AND HE W OULD BE IN SERIOUS JEOPARDY UNDER THESE CIRCUMSTANCES WE HAVE MUCH TO GAIN IN OUR FIGHT AGAINST TERRORISM AND LITTLE TO LOSE UP • PINOCHET- FERNANDEZ HAS HAD SEVERAL CONVERSATIONS WITH PINOCHET FOLLOWING MURDER AND DURING COVER-UP HE ALSO RELATED A STORY TOLD HIM BY ESPINOZA CONCERNING CONTRERAS' ACCOUNT OF CONTRERAS' MEETING WITICOROZCO IN WHICH PINOCHET WAS IMPLICATED AS ORDERING THE ASSASSINATION THIS STORY IS TO A DEGREE CORROBORATED BY • WE FULLY APPRECIATE NEED FOR CAREFUL REVIEW OF OTHER WITNESS ACCOUNTS TO AVOID POSSIBILITY THAT WE FIND HE HAS BEEN INVOLVED IN SERIOUS CRIMES THAT WE ARE UNABLE TO PROSECUTE AT THE SAME TIME WE CANNOT EMPHASIZE ENOUGH OUR CONCERN FOR SECURITY AS KNOWLEDGE OF OUR MEETING INEVITABLY SPREADS BOTH HERE AND IN WASHINGTON THE POTENTIAL FOR A LEAK INCREASES UNCLASSIFIED U S Department of State Case No M-2015-14753 Doc No C05883308 Date 09 30 2015 J C 0 5 8 8 3 3 0 8 IED U S Department of State Case No M-2015-14753 Doc No C05883308 Date 09 30 2015 I L id L L 1 E Iiepartizent o f T PAGE 02 INCOMING to to TELEGRAM Li OF-02 WITH ALL THAT IMPLIES FOR HIS SAFETY OUR JUDGMENT IS THAT IF WE WANT HIM AT ALL WE NEED TO GET HIM OUT OF HERE WITHOUT DELAY ACTION PLAN OUTLINED BELOW IS DESIGNED TO ACCOMMODATE THOSE CONFLICTING U S OBJECTIVES 3 TO PUT FERNANDEZ INTO WITNESS SECURITY PROGRAM BOTH BEFORE AND AFTER ANY PERIOD OF INCARCERATION WE PROPOSE THE FOLLOWING NEXT STEPS 4 IF FERNANDEZ INCARCERATED PROVIDE SECURE FACILITY -- TEAM WOULD ADVISE AXEL OF ITS RECOMMENDATIONS CONCERNING PARIMETERS OF PLEA AGREEMENT SET FORTH BELOW WE WOULD EMPHASIZE THAT THESE ARE NOT APPROVED TERMS BUT ONLY TEAM RECOMMENDATION 5 NO DEPORTATION 2 TO MAKE KNOWN TO THE COURT THE NATURE AND EXTENT OF FERNANDEZ' COOPERATION 6 NO OBJECTION TO PERMANENT RESIDENT STATUS OTHER CONDITIONS AXEL WOULD CONSULT HIS CLIENT ON BASIS OF TEAM RECOMMENDATION FRIDAY MID-DAY -- TEAM AND AXEL WOULD DEPART FOR BA FRIDAY AFTERNOON TO ENGAGE DETAILED NEGOTIATION OF PLEA AGREEMENT WITH YOU F EMBASSY BUENOS AIRES JUDGES CNI • ACTIVITES ERE INCLUDE SURVEILLANCE OF U S OFFICIALS SUCH A MEETING COULD OCCUR IN RIO OR OTHER PLACE YOU JUDGE ACCEPTABL Et -- UPON COMPLETION OF NEGOTIA NS AXEL WOULD NOTIFY CLIENT BY PRE-ARRANGED SIGNA 0 HE WOULD LEAVE FOR 0 RIO WITHOUT DELAY WE ANTICI ATE THAT HE WOULD BUY TICKET TO RIO WHETHER WITH OUR MONEY OR HIS AND TRAVEL ON HIS CHILEAN 1 0 CARNET JUST AS ANY TOURIST C -- IN RIO WE WOULD PUT HIM UP IN A SAFE PLACE PENDING POL1GRAPh EXAMhATION AND CFOS CHECK N S STATEMENTS WITH OTHER WITNESS STATEMENT -- IF WE CONTINUED TO JUDGE HIM TO BE CREDIBLE WE WOULD PAROLE HIM INTO U S IF WE FOUND SIGNIFICANT DECEPTIONS WHICH COULD NOT BE RECTIFIED E G INVOLVEMENT IN VIOLENT ACTIVITIES OVER WHICH WE NAVE NO JURISDICTION WE WOULD WASH OUR HANDS OF HIM IF HE PROVED DECEPTIVE ON MATTERS OVER WHICH WE HAVE JURISDICTION E G PRIOR KNOWLEDGE OF PURPOSE OF HIS SURVEILLANCE OF LETELIER WE WOULD RENEGOTIATE PLEA AGREEMENT WITH ULTIC THREAT OF WASHING OUR HANDS IF HE REFUSED OUR TERMS ETHER HE THEN REMAINED IN BRAZIL OR RETURNED TOE WOULD THEN BE UP TO HIM AND BRAZILIAN AUTHORITI S FOLLOWING IS TEAM'S RECOMMENDATIONS FOR P TERS OF PLEA AGREEMENT FERNANDEZ WILL BE REQUIRED TO I PLEAD TO A CHARGE OF 1001 REGARDING FALSE STATEMENTS TO AUSA PROPPER AND LEGAL ATTACHE SCHERRER 2 FULLY COOPERATE WITH USG BEFORE AND AFTER PLEA INCLUDING INTERVIEWS GRAND JURY COURT TESTIMONY AND ANY USG HEARINGS - AS REQUIRED BY USG 3 BE POLYGRAPH ON ALL'ASPECTS OF HIS PROFFER BEFORE AND AFTER HIS PLEA - AS REQUIRED BY USG 4 TO COOPERATE WITH FOREIGN GOVERNMENT INVESTIGATIONS IF USG SO DECIDED 5 RELINQUISH ALL INTERESTS OR COMPENSATION IN MEDIA EFFORTS BASED UPON LETELIER KILLING BY EXECUTION OF ASSIGNMENT TO USG I IF FERNANDEZ FAILS POLYGRAPH AT ANY POINT AGREEMENT NULL AND VOID USG CAN PROSECUTE FOR ALL LETELIER VIOLATIONS USG CAN PROSECUTE FALSE STATEMENTS OBSTRUCTION PERJURY USG CAN SEEK TO DEPORT 2 AGREEMENT DOES NOT COVER FALSE ISTATEMENTS PERJURY OR OBSTRUCTION OCCURRING AFTER AGREEMENT EXECUTED 3 FERNANDEZ WILL WAIVE SPEEDY TRIAL REGARDING ANY DELAY IN PLEA OR SENTENCING 4 NO CONDITIONS OTHER THAN THOSE CONTAINED HEREIN WE PROPOSE TO RESERVE SUBJECT TO AXEL RAISING IT THE QUESTION OF AGREEING NOT TO COOPERATE WITH EXTRADITION OF FERNANDEZ TO ANOTHER COUNTRY ACTION REQUESTED THAT YOU APPROVE PROPOSED COURSE OF ACTION AND MAKE NECESSARY ARRANGEMENTS FOR LOGISTICS AND POLOGRAPH IN CONSULTATION WITH WASHINGTON AGENCIES A AMBASSADOR'S COMMENT I HAVE REVIEWED THIS MESSAGE AS WELL AS DISCUSSED THE TEAM'S FINDINGS WITH THEM WASHINGTON OFFICIALS WILL RECALL MY STRONG INTEREST IN PURSUING THE LETELIER ASSASSINATION CASE FROM THE TIME OF MY CONSULTATIONS IN WASHINGTON PRIOR TO MY DEPARTURE FOR CHILE IN THE FALL OF 1985 AND THE CONSEQUENT AGREEMENT FOR ME TO TRY TO LEARN IF FERNANDEZ WAS STILL INTERESTED IN BEING A WITNESS MY CONVICTION PUT IN ITS SIMPLEST TERMS IS THAT THE U S NEEDS TO DEMONSTRATE THAT WE DO NOT FORGET TERRORIST ACTIONS AND THIS IS ONE WHICH TOOK PLACE ON OUR OWN SOIL IN OUR OWN CAPITAL AND THAT MORE THAN TEN YEARS LATER WE ARE STILL PREPARED TO CARRY OUT OUR COMMITMENTS THUS I COMPLETELY ENDORSE THE TEAM'S PROPOSAL IN TERMS OF NEXT STEPS THAT SHOULD BE TAKEN PARTICULARLY IN TERMS OF FERNANDEZ' SECURITY AS SECRETARY SHULTZ POINTED OUT AT THE MID-NOVEMBER NSC MEETING AT WHICH THE ATTORNEY GENERAL AND I WERE ALSO PRESENT PINOCHET'S REGIME IS A RUTHLESS ONE THE TEAM'S RECOMMENDATIONS THAT WE ACT FAST ENABLES US TO SEE THAT HE LEAVES CHILE AND STILL GIVE US A CHANCE TO TAKE FURTHER PRECAUTIONS WE NEED TO BEFORE HE WOULD ENTER THE UNITED STATES CONSEQUENTLY I URGE THE FASTEST POSSIBLE FAVORABLE DECISION IN WASHINGTON BARNES Roger Channel Designation Removed by Authority of 1NR C Memo of Sept 20 1994 USG WILL PROMISE I TO BRING NO OTHER CHARGES REGARDING LETELIER CASE EP 24 2015 UNCLASSIFIED U S Department of State Case No M-2015-14753 Doc No C05883308 Date 09 30 2015