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Around the World

Mexico opposes plan to punish businesses

The legislation, approved by the Senate in July, would require the Clinton administration to publish an annual list of major international drug traffickers, their front companies and other business associates. It would bar the listed companies and individuals from doing business in the United States, cut off their access to American banks and freeze their U.S. assets. It also would subject U.S. companies that work with the listed companies to civil and criminal penalties.

Administration officials say that, after initially opposing the legislation, they are working with members of Congress to fashion a version that the House and President Clinton can support.

Some of Mexico's biggest companies are leading a fierce lobbying effort to defeat the proposal.

And the Mexican government fears that it is just the sort of unilateral action that, like the annual U.S. certification of other nations' cooperation in the drug war, could roil tensions between the two countries.

"It can become a nightmare for innocent people and for the spirit of cooperation itself," Mexico's ambassador to the United States, Jesus Reyes Heroles, said in an interview. "It's a whole process that can undermine the spirit of cooperation that we have, and that is still developing. That relationship needs to be nurtured. It's not solid as a rock."

Although the sanctions would be global in scope, only the Mexican government has opposed them aggressively.

Reyes Heroles has met with Sen. Paul Coverdell (R-Ga.) who introduced the legislation, and administration officials to lobby for detailed amendments. In a July letter to the White House drug policy director, Gen. Barry R. McCaffrey, he requested the administration's help in blocking passage.

The legislation, offered as an amendment to an intelligence funding bill, would expand to other countries sanctions first imposed on Colombian businesses and narcotics traffickers in 1995. The original sanctions focused on businesses with links to the four main leaders of Colombia's Cali drug cartel on grounds that they presented an "unusual and extraordinary threat to national security." (The same legal authority was used to stop Americans from doing business with the Panamanian leadership of Gen. Manuel A. Noriega and to freeze Iranian assets after Americans were taken hostage in Tehran.)

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Since 1995, the Treasury Department has compiled a list of more than 400 companies, relatives and associates linked

to the Colombian traffickers. Following public disclosure, a number of the companies have gone out of business,

administration officials say. Others have been forced to reorganize their holdings or change their names. A few

successfully have challenged their inclusion on the list.

Proponents of the legislation say the expanded list would be a valuable law enforcement tool. "Drug trafficking

flourishes because it is anonymous," said Sen. Dianne Feinstein, D-Calif., who coauthored the legislation with

Coverdell. "This is an effort to take some of the anonymity away."

But the administration has worried all along that the legislation will offend Mexico.

"The political concern is that it would be bad for legitimate businesses in the country and that it would be yet another

contentious issue in the bilateral relationship between Mexico and the U.S.," a senior State Department official said.

"Anything where the U.S. is sitting in judgment is very problematic for any country, and for Mexico in particular."

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As a practical matter, Mexican drug traffickers are far harder to isolate than those operating in Colombia, because they

are deeply enmeshed in the larger, multilayered Mexican economy.

The holdings of Cali cartel members became easier to track about five years ago, when police teams backed by the

Drug Enforcement Administration and the CIA seized business records in a series of successful raids. The U.S.

intelligence community has not enjoyed similar success in penetrating Mexican drug trafficking organizations. Even if

it does, U.S. officials are not eager to produce a list that could hinder their ability to investigate further.

The Treasury Department has been vocal in expressing concerns that such sanctions could affect legitimate U.S.

businesses with ties to Mexico, the United States' second-largest trading partner after Canada.

Transportation Maritima Mexicana, a Mexican company that is one of Latin America's largest shipping concerns, has

been particularly incensed about the legislation. The company - which, along with U.S. and Canadian companies,

runs a railroad venture stretching from Mexico to Canada - has complained that American intelligence has unfairly

linked it to drug trafficking in the past. It has retained a major Washington lobbying group in its effort to defeat the

legislation or, failing that, to amend it.

Business groups, including the U.S. Chamber of Commerce and the American Bankers Association, also have

expressed concern about how the sanctions would be implemented.

If approved, the legislation would globalize the sanctions the administration has levied on Colombia. But it differs

from the existing law in one key respect: It would require that the president submit the list to Congress.

The measure would require the Treasury secretary to compile a list of major international drug traffickers and their

associates by Jan. 1, and by the same date in subsequent years. The list would be assembled after consultations with

the CIA and the departments of Defense, State and Justice.

The list then would be vetted by the White House drug policy director and sent to the president. By March 1, the

president would be required to produce a winnowed list of traffickers to be sanctioned, as well as a report to Congress

explaining any changes made.

The sanctions would be implemented by the Treasury Department's Office of Foreign Assets Control. The office has

only about half a dozen people assigned to implementing the sanctions against Colombia. The pending legislation

would not allocate any new funds to the effort.

With House and Senate conferees meeting this month to iron out details of legislation, Congress appears to be

succeeding in forcing the issue.

Elderly secret agent caught in Britain

The great-grandmother who passed nuclear weapons secrets to Moscow has been depicted as England's equivalent of Ethel and Julius Rosenberg, who were convicted of trying to pass U.S. military secrets to the Soviets in the 1940s and subsequently executed. She has been called Britain's most important female spy by hard-boiled reporters who confronted her with her deeds - and then left her house with jars of her homemade chutney.

Norwood is one of a handful of British agents whose names were revealed in a book published last week, "The Sword and the Shield: The Mitrokhin Archive and the Secret History of the KGB," by Cambridge University historian Christopher Andrew. Also exposed were a former Scotland Yard detective and two now-dead Labor Party members of Parliament, including the party's chairman from 1957-58.

The book is based on six trunkloads of material provided by former KGB archivist Vasili Mitrokhin, who spent a dozen years copying notes from the KGB's top-secret foreign intelligence files before retiring in 1985. He defected to Britain with the information in 1992.

Some of the more interesting revelations in the 700-page book are about the KGB's activities in the United States. Among them are that the KGB:

-Obtained highly classified secrets from major U.S. defense contractors by intercepting faxes from the likes of Boeing, General Dynamics, Lockheed and half a dozen other companies on the Trident, MX, Pershing-2 and cruise missile systems as well as on fighter jets. According to one KGB assessment, "Over half the projects of the Soviet defense industry in 1979 were based on scientific and technological intelligence from the West," Andrew writes. -Disseminated disinformation linking the CIA to the assassination of President Kennedy, including a forged letter from Lee Harvey Oswald to former CIA officer E. Howard Hunt, allegedly written two weeks before the shooting in Texas and suggesting that Oswald wanted to meet with Hunt before going ahead with the deed. The letter was mistakenly authenticated by Oswald's widow as well as by handwriting experts.

-Plotted to maim ballet dancer Rudolf Nureyev after he defected to the West.

-Used an unnamed California Democratic activist, recruited during a visit to Russia, to try to infiltrate the 1976 presidential campaign of Jimmy Carter.

The files have provided Western intelligence agencies with a broad look at more than 40 years of Soviet espionage operations in the United States, Europe and the Soviet republics. It offers details on U.S. sabotage operations gone awry, the existence of KGB arms caches throughout the West and the Soviet Cold War strategy of using national liberation movements - the Sandinistas in Nicaragua and the Irish Republican Army in Northern Ireland - to try to de stabilize Western governments.

In Britain, however, it is the Norwood case that has intrigued the public and shaken the establishment, although her activities occupy only about three pages and half a dozen mentions in the book. Today, Norwood hardly looks the part of a dangerous spy in her tweed skirt, tufted cardigans and support stockings. She walks with a cane and wears her gray hair pinned back.

But her politics are intact. Norwood is still a believer in the ideals of full employment and an end to the class system that she held when she was recruited to the Soviet cause. She is unrepentant about her past.

"I did what I did not to make money but to help prevent the defeat of a new system which had, at great cost, given ordinary people food and fares which they could afford, a good education and a health service," Norwood said.

"I thought perhaps what I had access to might be useful in helping Russia to keep abreast of Britain, America and Germany," Norwood said. "In general, I do not agree with spying against one's country."

Britain's most famous spies - double agent Kim Philby and his fellow "Magnificent Five" cohorts- were Cambridge University-educated members of the elite. Norwood's background, however, is closer to that of the working classes whose interests the Soviet regime sought to represent.

She was born Melita Sirnis in 1912, the daughter of a British mother and Latvian father who were both committed leftists. Norwood attended university for a year before taking a secretarial job in1932 in the British Non-Ferrous Metals Research Association - the base for Britain's project to develop an atomic bomb, known as Tube Alloys. She was already a member of the British Communist Party.

Norwood was recruited by the Soviets soon after she started her job, at the height of both Joseph Stalin's brutal rule and of the Spanish Civil War - a period of international struggle between communism and fascism. She became a full agent in 1937; her code name was Hola.

Just what secrets Norwood gave to her KGB handlers and how exactly they were used aren't specified in the book, which Andrew explains is based on her operational file - who she was, what she did and how well she was graded - and not on her product file.

But clearly she was a valued agent.

"She provided scientific and technological intelligence to the Soviets over 40 years. Very few people did that," Andrew said in an interview. Norwood married a mathematician and fellow Communist, who she says disapproved of her spying but didn't try to stop her. They bought the three-bedroom suburban house where she still lives today and had a daughter.

From 1945 onward, Norwood supplied what her file described as "many valuable materials" on the Tube Alloys project. According to Andrew, the result of Norwood's efforts was that Stalin was better briefed on the construction of the British atomic bomb than were many ministers in the British government of Labor Prime Minister Clement Attlee.

She retired from her job and from spying in 1972. Today, Norwood says she doesn't really think of herself as a spy. But to many Britons, Norwood is a Judas who should be put on trial. To others, however, she was only marginally useful to a Soviet weapons program that was well on its way to making an American-style bomb with the help of spies in the United States; she is irrelevant in the post-Cold War era, these people say.

Norwood has displayed what would seem to be a selective memory loss in her otherwise open conversations with the media. She says she can't recall who recruited her to the KGB or who her handlers were.

"These are very appropriate places for memory loss," Andrew noted.

Or perhaps it is the habit of keeping secrets. She never told her grown daughter of her espionage and only called her the night before the news broke to tell her simply to buy the next day's newspaper.

As to her own fate, Norwood seems resigned in interviews, saying, "I will accept the future as it comes."

09-20-99