REPORT ON SCRANTON OPERATION - 25 JUNUARY TO 3 FEBRUARY 1954. (W/ATTACHMENTS)

Created: 2/5/1954

OCR scan of the original document, errors are possible

pl?.ccthereunder by numbsred paragraphs. initiul ir. center3ine across the page aud forwaid. eachit tobove pr^cduretc.nij- for filing, this cov*sr ekoeat

import on ScrWltOn? Januaryi.

1. ?ollowlns paragraphs and atteehweivts Kit forth subject report as

Da

Detailed Narrative .deport

i Synopsis -of tavorabl' ani>effecting Scrantor, UoMMirdcations _

Jotrtact: m* J

Contactweendddle-jott and taul

Sierra and Lictwoen Lincoln ami Uftnl Surwiarj SorODton Finance

ound: iierton had arrived0 ;tours onanuary:ani Iron Headquarters iravelliiy;re out Irtaanuoft as be alreadyeturn trip ticket under that um. rrived later tlit oar*t about liijO hours, travelling under his alias. Joth men passed the tine untilanuary- at Lincoln Station ir. settling last nirmU affairs, sterili*-inj. their personal effects, and obtaining reservation? end ticketsripaacua.

Obtaining; reservations and t'.cketsaul to Onboth IJddlccotton obtained tneir reservations and tickets(ate .Memorandum for Scnnton File, ftb) for dep^rtnue or, C n<*Ianuary ci L ours. Although no ultimate

difficulty was experienced in'ne tickets, isoin delayct that said tickets were dj&tai;icdundayand apparently unskilled personnel on duty. About two hours wereby these employees in looking up the appropriate re.-ulaticns,etc.. Parte dtficulty vas caused by tile discovery that PAXconfirm reservations beyond hi Salvador to ilaru^ua for saw ii. . .andtherefore obtained confirmed reservations on connectins C of San Salvador, wiiich was schedij.ed to overnight at Tegucigalpa,

ISnnatarUi and continue early the next, nominenagua. Since rcservationacould be confirmed all the vray thro'igh to uonagua,as not necessary

fordlecott to obtain travel docurtents for either ifl Halvrdor or/ Honduras, trtcnddlacott requested Liiar. lliolr (alian) nawea be placodattor conflraed reservations cut oi San Salvador directlya^iia

on

sane iay, A* JJanuary, Un arrival at Dienl alivort,

iacrton eiu. Mddlecott learned thatul<Los given

confirmed reservations from San ^clvfdorna^us on 'ii*.e

latter choiceeferables taJ:cn in view oi" ihe cuntaet olnnsw:dch were to go into effect as of 2>

January, It is to ue noted that neitiver Idddlecottton were sz'.:c6 to display anr sort of doeunentation ln fUJUflg out too necessary InforsAticiiTor Ukl nicarti-iar tourist card, in spite of tiie fart thatertonekllecottoint of asking uhat documents were recuired, both forourist con- and Tor re-entry intoi-ed -tites.

U, Oc^i'.rturo and trip detail:.:

a. Irviedlately prior to departure, .erton boughtousand dollars worth of insurance eoverin; the round trip by air fron ;dajni to .'anagua under his alias, givinc his beneficiary as his Ewthor (since under his alias he was single)vinghis Bother's address the address of ids cover employer. This policy was sailed at the airportten per-sonally. It was iicrton's intention that his true beneficiarys wife, idddlecctt old not obtain any such insurance.

iJ* was anxing tiie passengersn tJie Ho sifcns of mutual recognitionven.Havana withoutWiij

nmshort layover of about JO rainutes ot .lavana,inciaenl.oted.

upon the arrival ofSan Salvador) itthat too connecting flightbeen delayed,^dudlecott andttr. would be forced to spend about two hours orthe airport, Ilopanso, San Salvador, is period was passed withouthut Immediately following the arrival of thf- conncctlnr, flight, C ed thai, one James Collins appearedniong

the incoming paoaenaers. .erton beLiovos that "ollins glanced.lerton,courso was under cover disguise, and actedittle perplexed ashadrton somewhere before. (Cui it'"jJanesan Arxrican business :ian withrton had becotie acquainted duringtour of duty in Guatemala. Collins was the boyfriend of .dssor Kobortson,he rooneate l

KUBArX secretary to the Station Chief, JuateMala,0 3ota Collins and Vobbie'1 are extrcnely quick-witted and very littln lnlontation of significance passes cer theirn view of thiserton decided to check the PAA manifestsiew to discovering whether Collins night be on the same flight with hinsclf Iron Santo .ana^ua. h. oUcfc of the Manifests revealed that Collins was enroute toose,tz rtica, and would be on the same flightton, which the lutter felt would be Host undesirable from lite .joint of view oferton'3 cover.

Decision Ml to "playhe plan* tteven i_ .ting, antth* -ripc :ferton instructed ,Jddlo:ott to continue onnuria and tothe LLdo falaeo Hotel ami Lucre avait rttrtou's arrival the next day. thereu'jor. went to the fonelf uleri; at th* 1'Aj. desk, inforuod her trialsick,ro into -ian Salvador. In ^an StuLvcdDTjat tha Astoria totel, rrridiatf ly obtainedaae adoctorf andtd doctor's oxaen beseriously ill to his Hier Ute doctor was 'X) oxamined iier ton'ssked whathad beenlately, and concludedrton vasron anombination ol' air sickness, beer, and easonedserved ct tlie air-iort restaurant. It. Joto prescribedano medicine. returned to the hotel, sent tiiei went to bed, .flit-re lie reuained otttU OuOOanuary,

rton uas visited in hisby the local San Salvador kha uanager and an assistantiewout iierton'sentryalvador. rjsreallyll becaue the local KJ. manager turned outa one

lcnaar, vithrtonalso well acquaintedesult of

i-olcnaar'srton's simultaneous service in rtoncnaar did net recojniae tola daring tlw visit0 hours,^January, ui-.ich was heldarkened rocn, heairly ccrtinust- have recognised idn thet OCOO hours, vhen BDTtOB had0 the paa office to settle the irro.ullr entry, .e'enaarrton to the Jjmigration authorities in -an Salvador end arranged inatteri* so smoothlyrtcn >ias able ton Salvador for Managua the follcvin- uay without incident.

foUowii^ bac^round is set forth on .iclando liclenaar: lenaar* aa the ri^htty Wilson, PAA Manager in

art .uich uovlti indicate that liolenaar rocorniaed ^icrton in

anyllMOVeTj it must be presumed that Molenanr Is in fact aware tbat Marten wasider alias, ianrbonticimm taighl] tnuttcd bylscn, C

lud in

stufiti

PBsuorcESij

iles for any derogatory -nfoniation.

nc official difficulty was experienced in liertcn'sfrom San Salvador, he was slightly embarrassed to find that aSullivan was registered at the Astoria iiotel, i':?rton, while notfriend of Sullivan's, was acquainted with him. sin- care ini-ieitcn ,ias able to avoid any direct contact withhe saw Sullivan twicexstar.ee; JJerton does not thinkwas in anyare of ricrtOD's presence at the iiotel Astoria.

is believed by llerton to bo therican representative and to spend much tisiehis hone office, Guatemala. .His wife is'Dean Sullivan, anrcciainaala while her husband travels his territory. not recall any derogatory information on either Mr. orullivan.

j. erton resumed traveloursX Jjanuary,Airport vii arriving rianagua without further

incident at about / J'lours. Upon arrivingnagua, llerton went by PAA. airport limousine to the Lido Palace Hotel, where he found iaddlecott laddlecoi- infomed Jierton that no contact had as yet been attewoted SO far asr..

5. Mrst Oontact: iddlecott passed the remainder of L untilours lounsing around the Lido Palace dressedby contact /lan. Asl) hours, since no contact hadton wsllwd up the main street of iranajrua withap?ra film, etc. Uoon their returnand aboMt one half block froa tiie hotel, I'-crton andaccosted >v- the driver'illys jeep station wagon bearingwhich pulled up alont; side them and stopped. The driver

struckonvocation with Kerton and filddlocott, aW asking ifahosci'j-rtcn docs not recall, connected within iiorfolk. In theonversation, the driverby renarking he was always 4ilad toellowerton replied "likewise", ddlecott returned to the hotelentered the jeep andsstirvavin- vehicle. ThehiascU as oneremarked

j,a> hiivself iiadriflar unset

over the failure toertonjanuary. It was learned fromthat no attempt !iad beento contact idddlecott. orlon passed the sur.ollarselt tofor deliveryMentioned he had vcrv little

tiae rei^ininu before another contact, r* crtonlans for a" teleohonc contact the .'cllc.ji.ni, day0anuary, and rot off "'e jeeolock fror. the Lido ?alace -totol. During the eveningrton and kiddlecott, in keeping with their cover role as tourists, visited the Copacabane and tiie Casino Oliapicoclubs,inr to the hotel0 hours.

Ml ol__. PBSIKZCESS

Contactsiocl-ord:

a. The followis-jsrv*iddclecott andaround the id'jocCne call Ira:

ch never uai-rialined. Late/ indtLLCCOtt

ton were'i on tiie frontf the hotel, dressed asby contact plan, toeyed jeepa^on pull upcurb in front ci' the hotel, chaufferesatin who sot out ofproceeded to the hotelnd en^sod the desk clerk in The driver then approachedand idddlecott,to"Chico me r;o which lierton replied, "Ha sido tieinpo The driver introduced hinsolx as one iioul Sierra, and statedwas to take iierton and idddlecctt to Seekford, hort descriptionSierra is herewith set forth: ife isounds, blackLatin appearance, snail nustache, quiet but apparentlypersonality). Sierra droveoint about two blocks away fromwhere Seekford was waiting, Seekford (jot into the careetingin the iiiovi.*y; car. After introductions and assignments of fieldiierton and Middlecott, he announced thai; he had arrangedertontooot reconnaissance of the Scranton site, shroutesite, Seekfordsrtor. and iliddlecott up to date on Scrsnton terton mentioned that he hadhone callutouthours that norningj to utiieh Seekford answered that he had cancelledsinco he was intending to> himself the sane Doming. el*.It was Merton's belief prior to this thatwas to be

iierton's and id.ddlecott's cotout with the

b. The party took the road fron llanagus to Tamarindc,personal finca aboutkilometers .noi'towcstna^ua on theTanarindo. At Tar.arindo, the party locatec

construction workalt flat project sone kilometers fron

tne central ranch. C

conversation lasted perhaps five

minutes. When Seekford returned, he brought withficaraguanuhosi he introduced bpwhom he described as

having just been selectedas liaison with Seekford at the Scranton

site.

he was ready to go ahead

with Scranton, to Jreplied, "Go a'tea'!". Seekford then asked for

a local liaisonbe appointed andthereupon designated

Seekford, this was the extent of the conversation}.

pBSu^CCESS

m ptCRET

PBSL/CCESS

led the reconnaissance party someiloneteroeo-vllcated raze oi back dirt roadslral buildiin;int or Liie .'aclfic Ocean at3 decreesst latitude and longitude. The Bite ues cxlv^fnly isolated,necessary toll stream and toet o' fincaonor 'o arrive,

Jri'Aiiton site is situatedilowatcre nest and south af *b* altitudeuet atuess. i,O*aaonry wall building subdivided into onaytwo twenty by fifteenuoative styleroofed dwellings; and Tour or five individualntathe east env south periphery of tiie bluff, led ilwa foot reconnaissance of the arta, pointing out wiw iwcauiuns of apurposes of the various dwell in<js, the presenceermanentand miscellaneous features of the site, (ft continued strongout to sea was particularly noticcai>leerton's andentire sojourn at the site}. The party tool: rout': neasurerxnta ary building which it was decided would houae utcquipment, tba student romancer, and nSddlaoott andTrie nearer to thedldinstin Cue lir^ea room deoned suitable for the storage of ;'ooi applies for the

..ji unit and cantninei, as well, adequate space to actitchen capable of handling the training univ'ti needs, i'iii.vilayoutia, hsg^miWHriu uaiiiln-e giwn en1 mW-.vMnti

OMrplseu ol about live ndi vidua!

personally introduced the party to Jnead of the guara detail pemaiwm'.ly detailed at the site, ihe guard

all, each of whom lived in one of

lily hutsii'e and farily.

site was pronounced satisyrton and Jefore departure, estimates were nade of thend asaount ofto net up tho training tables, the electric light system, quartanv traLneeo, niscellaneous tables, chairs, etc. These fir-ires were jivMSierra, and it was decided that be wottld pnrohaaa tin necessarythe following day.

the end of the reconnaissance, the part? andto the "aaarindo ranch house, where the party itself tharavpOOKana)piB| arriving late in tiie afternoon, pop, the party's return to rianagua

Saeiiiord and Sierra dropped i'<crton and addle *colt oTfrec blocks fro* thoir hotel after .nskiiu; arrangementsM ting later on that

StiflCl RYBAT - PB^JCCESS

sndesignated stn

i-eturnod to their hotel on Toot, ateup by Sierra ini>. - jknci.was held atpersonal ipart-

nont ana lasted i'or about one hour, until shortly0 hours. Tillswas terminated by the arrival of Seekford's landlord who dripped ln to pay Ills respects to Seekford. Seekford introduced iicrton and idddlccott as tourist friends.

i. or Lincoln's iru'ormation, Seekford's ppartaont consisted of tvo and one-half rooms situated at the rear of his landlord's blue (the only such color in the neighborhood)which stands directly across the street froa the opproxAnate center of the north side of the military airfield Fucraas Aereos Haclonales, FAN, on the east sido of Seekford'8 landlord is apparently engaged In the tractor business, since the entire rear yard ol the landlord's hou/se was filled with tractors.

j. Following the departure of Seekford'3 landlord atOneeting place was transferred to Seekford'- office about one-halfand ono-half block north of Seekford's apartnant. Seekford gave thothe office asa six roanory yellow

painted house set on the west central enaarge rectangular lot estimated to be about one hundred feet street frontomt. sixty feet deep. Tne street front of the lot is completely closed off from tho streetelloi: MnttM picket fence Thcro ore two gates, one for persons, and oneehicle driveway. Inside themall roon on theestern end has been set off as the "office" proper. There ia one entrance to thislch is securedey-type padlock when the office is not in use. Inside the office thereloset which is kept locked at oil timos and which Is used to store strong boxes and sensitive materials.

k. arge roon adjoining tho office, it was noted that cand receiver occupied one corner of the room. Thea Kallicraf tcrhile the receiver was one of the smallmodels. It is ijjrton's recollection that it was remarkedhart recently been installed for the purpose of providing connuniCalligerls in Tegucigalpa but that no such co.iBTTni-

cation hoa Mwta instituted. Xerton ond rdddlecott immediatelythe problem of communication security in the use of such equipmentassarod by Seekford that careful consideration would be given tobefore the equipnent would be used to provideTegucigalpaiagua, and further, that Seekfordroblem which could be solvod byand Kiddlecott. Itthat one of tha personnel atwas wing tho equipment to

corrTjnicatoa on an anateur band.

1. Personnel associated witha regular basis appeared

to number four, Haul Sierra, and three uniaentified Guatemalans, one o: wnor. acted as chauffeurtake body truck used by the office, one who operav the radio and was introduced as having electronic technician'she third whose only function appeared to be, thatermanent wstch.ia.-i.

pDq |

in. Vehicles apparently aoeociated wiTh"^ included onestake body track, one red Willys Jeepn, which ScekTordhis personal property,lack Chevrolet panel typeul Sierra said hadrrived fromalvador or Honduras onhe recalls Seekford stating thatwas

January.eli< rcnteo ayK

n. The remainder of the reeting begun at Seekford's apartmentin the office atuntilO hours the following morn-

January. Plans vurvforanuary. It was decided thatwould buy sufficient equipnent, lumber and supplies to take careand idddlejcott for about four days, the periodebruary, iierton was iiiforried that additional trainee candidatesin Managuaebruary,otal of five or six who wouldto Scranton site the .morning2 February, Tuesday. InMerton and Kiddlecott would proceed to the Scranton site Tiie equipmsnt and supplies purchased by Sierraanuarybe loaded on the trucks on the eveninganuary and be ready to goScranton site the following morning, probably departing around OfOOand Hiddlecott were to be flown to the site later in the morningto afford both of then an serial reconnaissance of the site. The planeusedessna registered in the name of Jorge Isaac Delgadc,Attache and one of Calligcris' men. Seekford said that hisstory was that he was takinglessons from(see

elcw) in this plane and was interested inmall air transport line. iierton and iliddlecott planned to utilise the delay of four days until the arrival of the trainee candidates at Scranton site in setting up the site, establishing radio communications with KUBAilKand Lincoln, and determining first hand4 items that would be needed to insure effective operation of the site.

o. The meeting concluded at0 hoursanuary, asa contact coming up atO hours. Merton gave Seekford asize envelope containing radio agent traininc material written inlanguage for passingru Merton also re-

quested Seekford to ask theto notify Headquarters and

Lincoln by cable of the receipt of the money previously passed to therLon and iliddlecott thereupon returned to their hoteloint several blocks fromotel, Seekford furnishing transportation in his jeep station wagon. Beforeontact plan was set up for the following day.

p. Tnev. .'anuary, herten and loddlecott wqlkddandaxi tc go meet Seekford as planned for0

hours. The arrivalanel bod-Ms. Chevrolet pickup bearing Honduran or Salvadoran license plates was noted wile awaiting Seekford, Iliddlecott end iierton were later told by oierra that this truck had just arrived fromor El Salvador and bore couriers, 'rfhen Seekford did not. show up,andton,ppropriate security precautions against surveill-anee. returned to tlieir hotel for lunch, iddlecott and iierton

C 0 hours,anuary, and^^eeo-iriiormad by -ioul Sierra that

Seekford wiis Piomcntarily

q. Upon Seekford's return shortly thereafter, he^passed Iiertona typewritten contact plan prepared by

Seekford recarhed at this tire that he had encounter-

aoie red tape in jetting the Scranton gear released fron storage. also brought with him frorr. the 1 the sum ofworth of Scranton funds whicn were deposited with Herton'sSeekford's strong box. Tho contact plan as prepared by the s set forth in Attachment 1. iscussion wasurning of the Scranton operation, and it was decided thatwouldet of .books on Scranton similar to tho set homaintaining on the Saranac operation. Merton advancedJ. S. dollars, for Sierra's use in making the initialof Scranton's supplies, and for the future purchase ofand equipment, ummary of the Scranton financial situationin Attachment 2. Sierra was to maintain these fundsecondwhich he was to use for both Saranac and Scranton funds.

r. After cohflrming the plans for the following day,and .Modlccott returned to their hotel, arriving atrrival, the Lido Palace desk clerk handedcaled envelopean invitation to meetillys" at the El Patio restaurant atAlthough it was0erton and KiddLccott wentto the El Patio but felled to make contact. The context of theit to be fronKerton mentioned this attempted con-

tact to Seekford but does not recall Seekford's concent. Atierra got ticrton out of bed and informed that there had been aplans which Seekford desired to discuss before the lattcr's departure 0DT0KE. Seekford now planned to take theiane toofanuary, and the Cessna pilot,j, would be en-

gaged in hauling supplies to the Saranac operations during tho entireofanuary. -j

s. as present at this meeting, lie is described as aman of about one hundred and eighty-five to two hundredhort-chinned fat faced apologeticiving the impressionan of weak character whoindiscreotly under the influence of alcohol and flattery. notnt at this late hour meeting and haa never boon directlyt c tJ However, aV as had at least two opportunitiest-fti Morton and Kiddlecott together, both times at the bar ofHotel. On both occasions, Iliddlecott and Iierton observed thai

appeared toopular person among the habituees present in the bar lounge of the Gran Motel. He flitted from table to tableutterfly. ii, one time he vas noted to engagealf-hour coversationouple,utch origin, whose expressions indicated that every word falling froe c 1 os was heavenly ambrosia. Merton does not entertain such high regard foi personality and conversational gifts. Merton does not

CRETCESS

mean to iasply thata Jis ln any way connected with responsibility for tbo flap,rton does wish to point out that in hisefinite personality type susceptible to making indiscreet remarks under the influence of liquor and flattery.

t. Regarding tiie change in the old plan and the necessity for theforanuary, Kerton did not fully understand all lhe isiiicaiionsfollowed Seokford's general direction. Soekford vas at all timesto give llerton and iiiddlecott all possible assistance intheir mission. The new plan involved llerton's and Jiiddlccott's ridingblack panel Chevrolet pickup truck and tho stake body truck todeparture to be qt0 hours the morning ofanuary. were to be unloaded at the Scranton site and returned tojeep and the stake body truck were toecond trip onwith additional supplies and naterial, including the necessaryconvert the masonry building into two officesraining room. Itthat the juep be left at the Scranton site to porform local andtransportation, while the truck would return to llanagua afterthe jeep at Scranton would serve the additional purpose of "coolingsince Seekford had used it extensively in his operations. 0 hours the Darning ofanuarylight by C Jto the Scranton site for the pivrposcs ofancing stripsite, giving Morton and hiddlecott an aerial reconnaissance of thefilling any omorgency requisitions that had developed between noon,and the plane's arrival the morning ofanuary- Upon theto Managua, lt was planned that L eliver it to Josta Rica(Kerton does not recalleriodic engine and plane 'ollowing tbe checkup,as scheduled to fly to the Scranton site

on the morningebruary, "hen the nev plan had been arranged and .Todiflod to the satisfaction of all present, Kerton returnedoint near his hotel, from where he returned by foot to his hotel and acquaintedwith the details of the nev plan.

7. anuary:

a. AtC hours,anuary, -icrton and idddlccoti settled their account at the Lidc ralacc, giving tho desk clerk the impression that they wore "visiting'1 in (iarfeua, left their baggagei ntar the front door of the hotel, and walked up town. Having checked forton and ttiddlecottab iron down town Kcna,-ca to a

point neat.nd procneded directly to the office, -pon arrival

at about OiOO hours, all appeared to be in order, haul Sierraat Seekford had departed as scheu-jlcd0 hoars that morning,anuary. lce bodyd ban sort on ahead tc the Scranton site shortly before >erton and Id.;dlecott's arrival, end all that reaainod was to take the black panel Chevrolet to dwotOHi feaaegoa,ew last minute purchases, and depart Tor the site. ompleting ton purchases,and idddlecott split up, Uddlocott reiiaining with tiie panel truck, and liertenab from downtown nana^ua to the hotel where

he picked up iierton's andaggage. LVionp the'rton directed liis driver to proceedoint which had beenlth 'iiddlecott. -iiddlecott and Sierra in the black panel Chevrolet convoyed iierton enroute to the predeslgnated point in an effort to detect possible At thisrtcn dis-rdssed his cab and awaited the arrival of i'iiddlecott and Sierra. Since no surveillance had been detected, Kiddlecott and Sierra picked up iierton muI the baggage and the porty proceeded to the Scranton site, arriving at about UOO hours. Upon arrival at the Scranton site, all materials and equipment were immediately unloaded, placed in the masonry building, and the trucks sent backagua.

b. Kerton and Kiddlecott immediately began to unpack the equipment, and passed the remainder of the day in setting up the power generators,temporary wiring, and assembling one agent radio set for use in, establishing communications witheadquarters the following day,anuary. The party had arrived at the site too late for schedules to be kept onanuary. The equipment was apparently secure after its storage with

0 January

morning ofanuary was spent in awaiting tho arrival cf

n the Cessna, which never matorialized^md inransmitting antenna, unpacking sensitive material necessary to establish cocminications with 5UBA.dC headquarters, and testing the radio equipment for workability. These activities consumed most of the nomine until6 hours, the time appointed for the first radio contact.

was made on schedule, and'JRT, ED9UBat Headquarters, reported Scranton signal strengthKcranton messageas passed after about onohours work. Oic contact and message were handled by Iliddlecott.

as the transposition ofas completedhours, tho truck and jeep arrivod from Managuaessagefor Merton and Kiddlecott to pack up their personal baggage andurgently to. .. None of the material scheduled to arrive on this

trip was actually delivered, with the exception of about fifteenor cots. Upon unloading these cots, Uie truck immediately departed for Managua, while the Jeep station wagon aval ted Merton and Hiddlecott. Neither chauffeur was able to give any details or explanations as to why it uas necessary to pack up and depart to precipitately. In view of the unusual circumstances, 'icrton and idddlocott delayed their departure for Managua untilould be passed, sensitive materials packed up, and remaining Scrantonlocked up in the masonry The delay visibly distressed the chauffeur of the Jeep. Middlccott andfinally made their departure

atours, 30

/

d. The return trip was made without incident except forig dark 5ftick about ten or fifteen kilometers outside of Managua. hls incident is noted because both liertan and kiddlecott are in agreement that they noticed the occupants of the Buick attempted to turn their faces away from the passing jeep as if to avoid identification or deny interest in the occupants of the jeep, iierton and 'dddlecott further agreed that one of the occupants of the Buickoung lady, possibly European, who apparentlyob at the Lido Palace Hotel, no surveillance was noted however.

o. Stopping tho jeep some distance away free, theher ton

oot reconnaissance of the office situation, Judged that it could be entered securely, and waved in Middlecptt and the jeop containing thematerials. J at tiie time of "ertoo's and .dddle-cott's arrival were the stakeuffeur and the permanent house guard. At this time the stake truck chauffeur explained to Kerton that the Scranton and Saranac operations had been exposed ln the newspapers. The chauffeur added that Sierra should htve returned to the office by now,5 hours, and that he die not know Sierra's whereabouts. Iierton sent the stake truck's chauffeur out to procurepy of ono ef the newspaperstho oxpose. The chauffeur returned about one hour lateropy of Las iJOvedades for JO January.

iiovedadee carried practically the entire copy story of f/ perations, headed bylack headlines, leaving nO dOUU)

major proportions had occurred. In view of lierton's personal

identity oituatioa, and of the sensitive material which Kerton andwere carrying, the latter two novod to dissassociate themselves and thefroin This was accomplished by moving Iierton and kiddle-

cott, their personal baggage, and tho sensitive materialmall hotel called El Sevilla. rtaul Sierra had not returned as of the tine of this move, perhaps at about lfiiS hours,anuary.

registering at the Sevilla, Iierton and Kiddlecottthe situation,decided to use tho emergency contact plan withto Lh>or the purposetne sensitive materials to theC station if it could be "ice's home was located by inquiry at suitable security precautions,ott and Kerton amiwB^erdal procecdei directly to ^wuse, taking thewith them and arrivinr ot.0 hours. ot at home. Since ouse was sone fiftoen or moreoutside of Xanagiia. proper, lt was necessary for .iorton ondreturn to tianagua ejytraxi. Upoh arrival in Managua, Iiertonwroteituation report, and the two split up,anotJier^atteriit to deliver the sensitive materials and thetcwhile Kerton made an emergency contact with Sierra, succeeoea in contacting the cutout, securely passed theond situation report, and returned to the Hotel Sevilla atHours,

T

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PBSU^CESS

h. Meanwhile, icrton succeeded in raking an emergency contactand spentne hour zt the" officeho

situation. SierratonpLiaLiuip atanuary, Scekford's liaison with

had approachedU simultaneously with the. ;iiein the newspapers and relayed Sonoza's orders lo evacuate. thetc Sierra if-ediately

evacuated Pivaii oy oaoy laun^-'ie the latter registeredGran Hotel under his cover. Sierraaunch, andthe evacuation as ordered. Sierra informed iierton that evacuationfirst lialf of Avail's operation was already under way and thatvould be completed0 hours,anuary. Sierra saidbeen informedthrough liaison'-hat

heouiu soon blow over andf^i^ew site; that C Jhau decided to leave the-as it was, for the time being, since the site was extremelyanduard permanently detailed to the site; that

felt that if the Guatemalan Government demanded an investigation, nesuch investigation until il was possible to move the Scrantonanother site and sterilize the old site. Sierra had also sterilizedas detailed. Sierra stated that the

trainee candidates scheduledrivena^ua would be stoppedthat the Oessna plane had been grounder andcould not be located, Kerton instructed Sierra to cooperate with

9. January:

a. The above information and recommendations pertainingpassed lo the cutout0 hours, 31

January and forwarded Tne contents ofere received

at this time and contents noted. In view of the information whichwas being passed to ileadquarters and Lincoln by Pivall, lierton and Kiddlecott, it was decided to setlan to execute the orders contained innd to ask Lincoln for approval and instructions to implement the plan upon receipt by Headquarters and Lincoln of the above information andand digestion thereof, FcLlowins the meeting wit! t- ierton and Hiddlecott returned to their hotel, using appropriate security precautions.

b. Sierra did not make contactthe morningesirous of maintaining contact with the current situation, atUiOO hours, lierton activated an emergency contact with Sierrahim at0 hours in the vicinity of the Sevillethis time Sierra informed lierton that the evacuation of Saranac had completely sterilised: that Saranac sen and equipment were safelyinstalled in^fw Pivall's reports for details);

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thathad sont additional liuards tu the .icronton Site and had

strengthened the locks on the building; that-ore tnan ever

was convinced that the stone would die out enu trtuiuiai resumedthathad inoj-lred ae to the disposition of the three in-

structors, meaning"tc:i, Mddlecott and Pivall, and had indicatedof the actions taken by them. In view of the contents ofKerton instructed Sierra to request that either( (l) Iiertonbe alloweu to pick up the radio ccpupmcnt from thewhichwas expensive, needed special attention, and would costa great deal of time and effort to replace, sixi keep itand/or Kiddlecott's personal control;erton andsaid radio equipment towith the Saranac person-

nel and equipment. Sierra sold thut he haa already discussed themoving the Scranton equipment withand that the great ob-

jection at the present momentesire to an as little movementof personnel and material along the roads in the

neighborhood. Morton agreed that thisegitimate objecijAmout that only one trip would be necessary to transfer theIn question and tnatrip could be made very lateor early in the morning so as to avoid possible observation by iierton instructed Sierra to press theit-

lerton also brought up the possibility that Sierra mj^'ht open abox for storage of the company funds no that theice

could be perfectly sterile. Sierra said he would look4 natter, rhia meoting was concluded at0 hours because Sierra had ocontact coming up with Plvall. The rerainder ofanuary was passedton and riiddlecott in living cover.

obruary:

a. The morningebruary was passed by iierton andliving cover. Tills was teneral Somose'c birthdaj and allcomealt. At noon hiddlecott andn made ancontact with their cutout and received contents ofhat nerton depart .ilcarar,ua soonest via Panama forand Uddlecott thereupon made an cswrgency contact vlthinformed him that the company doaired iicrton's presencethat iiiddlecott was to be left in charge. In view ofof knowledge of the Spanish language, it was necessary to set upcontact plan calling for frequent but secure meetingsand Kiddlecott for the letter's protection. Details of thisplan are set forth in Attachment 1. Sierra mentioned that dueof Sorota's birthaay, he had found it impossible to rvakcwit; snd therefore had gotten no reply os yet regard-

of actio;

ing the request concerning the radio equipment, cierra pron.iscd to do this soonest. Herton and .'dudlccott passed the remainderebruary discussini' Uie situation, forcasting .wssiblfl situations and fucure courses liddlecott requested iortori to inform Headquarters of the of his situation, particularly hia lack of knowledge of the.c. .To preserve the tourist cover of both 'kiddlecott and .ccott was to explain If necessary that i'erton bad gone to few weeks and expected to bo back. Kertonound

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trip ticket between Hanagua and I'anann awlananian tounst care to lend credence to this atcry. The tourist card requirvd two photo graphscrton obtained In the. qhotographji shop connected with tho Gran hotel, iierton eaoght bincotnagna for rananaebruary, arriving at about C Jnours and stopping at the fauan? liotel until he could make further reservations for the 4plane out of Panama .Cor Lincoln on ths nor cotapletinrttravcl without incident, abrivino at Lino reporting into Lincoln Station at0 hours,

rolu during tho flap has been reported by bisLincoln arxi Keado.uarter?. Should disposal problems arise in hi-ofthe following forwarding address for A frou* -lerra by -iertor, prior to the letter's returncoln:

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oaspunicatlons dia^rar showing corarunications in konasua as of Kerton'a departure and giving contact plans between various elements.

The followingynopsis of important unfavorable anc favorable factors presently affecting Scranton operation as result of flap:

a. Unfavorable factors in order of importance,

(1) Lack of overall disaster plan with centralizedSeveral points of contamination still exist,airplane, ana personnels

witnand before the timo of flap.

(3) i'ueber oi contacts by Middlccott and/or

Seokford's

(L) Potential disposeorge Isaar.

(=) Use of radio by_

(6) Kortcn'i' presumed recognition by( parigrap!

(7J Aront radio equipment exposed to Uicarasuans.

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Mole: Field cryptos have been assigned to ijcdlecott, ijsrton, i'ivall and Seek-ford for use in "cowpany" business. These are recordec in terno for the Scranton.

Original document.

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