Sipsey Street Exclusive: White House Fingerprints In the Issa-Grassley Report. "Newell had conducted similar operations 'all the time in Colombia.'" "Trust me, I'm with Government."

Long-time readers may recall this post from July 2011 when the name of Kevin O'Reilly first surfaced in the Gunwalker Scandal investigation. From an email I wrote to Issa committee staffers:

(S)ources told me this weekend that your joint investigation possesses e-mails between ATF Phoenix SAC William Newell and Dr. Kevin O'Reilly, Director of North American Affairs, National Security Council.

Dr. O'Reilly's professional background (attached, obtained on the Internet) states he has been a Foreign Service Officer for 22 years, whose most recent responsibilities include coordinating counter-terrorism issues in Latin America for the Department of State and the National Security Council. You will note there is a gap from 1989 to 1995 in his background, before he studied at the Naval War College in 1996-97, after which he embarked on a series of short-term assignments. One of these was as a Pearson Fellow in the office of one of your colleagues, Senator Richard Durbin of Illinois.

Different sources of my own within the U.S. intelligence community who have reviewed the foregoing, consider the e-mails between Mr. Newell and Dr. O'Reilly and their professional positions and duties to be reminiscent of the back-channel communications employed by then-Col. Oliver North, empowered by what was jokingly referred to as a "Fuhrer letter" from then-National Security Adviser John Poindexter. This authorized North to operate outside established channels to implement Iran-Contra mischief. In the opinion of my sources, the highly irregular direct communication between a senior advisor on the National Security Council and a lowly ATF Special Agent in Charge reeks of executive branch misconduct. It would be, if as true as my sources say it is, "felony stupid."

Since SAC Newell will be testifying under oath before the Committee on Tuesday, there is an opportunity for Mr. Newell to explain his own understanding of the communications between himself, Dr. O'Reilly, and the National Security Council; how they relate to Fast & Furious; and thus enable the Committee and the American people to better understand the genesis of Fast & Furious and the role of the White House. This opportunity also affords the Committee the chance to appropriately define the inquiry, and to illuminate the darker recesses of the Gunwalker Scandal debacle before the inevitable speculation that will arise in the press and on the Internet as this information becomes more fully understood.

After three staffers met with Larry Pratt of Gun Owners of America and me the day before the hearing, the committee did in fact ask Newell about those emails and his relationship with O'Reilly and received vague answers about O'Reilly being a long-time friend. Subsequently the committee sought to interview O'Reilly, only to discover that he had been shipped off to Iraq to put him out of convenient reach. One of the subjects of great curiosity was a meeting between Newell, O'Reilly and other White House personnel very early in the Obama administration -- March 2009. Ultimately, the White House exerted a dubious claim of executive privilege and denied the committee access to O'Reilly. They also stiffed the committee on any other information having to do with the March 2009 meeting -- its purpose, attendees, notes, emails, etc.

The report presents some few emails between Newell and O'Reilly without hitting at all on the unusual nature of this back channel communication between a senior NSC staffer and a relatively lowly ATF Special Agent in Charge.

From Page 109:

On July 28, 2010, Kevin O’Reilly, the Director of North American Affairs on the White House’s National Security Staff, e-mailed his colleagues asking, “Have we gotten any readout on ATF’s GRIT surge in Phoenix & in Arizona?”319 O’Reilly forwarded the correspondence to Newell, asking: “Just an informal ‘how’s it going?’” Newell promptly responded:

[W]e are on target to . . . eliminate our backlog of “leads.” A ‘lead” [sic] is where we have solid information regarding firearms trafficking activity but not enough manpower to work it. The best part about the GRIT for me has been the influx, albeit temporary (100 days), of Special Agents, Inspectors, Support Staff, etc. They have allowed us to catch up on the backlog of leads as well as follow up on newer information. They have been instrumental in supplying much needed ground-level support to several large-scale firearms trafficking investigations with direct links to Mexican DTOs. As an example I have had 10 Special Agents working exclusively in support of a very large OCDETF case involving firearms trafficking by the Sinaloa DTO. These agents have been so busy that they have expressed a desire to extend past the GRIT deadline due to the amount of work still needed on this case, a very good thing. One agent on detail from Miami . . . told me recently . . . [h]e’s never seen this level of illegal firearms trafficking activity before and wants to stay another 30 days just to help out with this case.

When O’Reilly asked for permission to share the documents with other White House staff, Newell responded: “Sure, just don’t want ATF HQ to find out, especially since this is what they should be doing (briefing you)!”

From Page 117:

Newell was also updating the White House on the timeline. On August 9, 2010, he wrote to Director O’Reilly: “Got another one last week, a .50 caliber semi-auto. Headed for Sinaloa DTO. Part of the same ‘large OCDETF case’ I mentioned previously. We should be indicting in early October.” A few days later, in response to O’Reilly’s offer to involve Newell in an arms trafficking conference in Mexico City in late September or early October, Newell responded: “Timing would be good because we should indict our Phoenix case in late Sept/early Oct.”

From Page 118:

On August 17, 2010, Group Supervisor Voth briefed Burke, Cunningham, Morrissey, and Hurley for two hours at ATF’s Phoenix offices. Apparently frustrated as a result of that meeting, the next day Newell e-mailed Director O’Reilly at the White House:

We have some “straw” purchasers who had purchased several hundred “weapons of choice” and made good money doing it but in reality may never get prosecuted. In trying to satisfy the Arizona USAO’s request to have the firearms inspected in Mexico in order to be able to introduce that in US Federal court we need Mexico’s help but as you can guess it’s a major pain to get access to these guns. . . . As an example and regarding the August 4th seizure in Nogales, Sonora [sic]. Several of the firearms in that seizure are directly linked to a case we are ready to indict here in the Federal system. We had these guns entered into our “Suspect Guns” system so when they were traced in eTrace they “pinged” off this “Suspect Guns” list and our case agent was immediately notified.

When these e-mails became public, the White House claimed the communications were “not in relation to Fast and Furious.” Yet this e-mail illustrates the methods ATF used to benefit from recoveries in Mexico. Because ATF entered the serial numbers of firearms into the Suspect Gun Database as soon as they received the 4473s from FFLs, frequently at the same time the firearms were being purchased, recoveries in Mexico provided ATF with instant intelligence about where the guns were going.

On September 3, 2010, Newell e-mailed Kevin O’Reilly at the White House again . .

But the blockbuster revelation is a mere mention in passing in this passage from Page 198:

Perhaps Hoover’s biggest failure as Deputy Director of ATF was his lack of close supervision of SAC Newell. Several years before Fast and Furious began, dating back to 2006, Hoover knew that Bill Newell was willing to employ risky tactics in his investigations. SAC Newell oversaw multiple cases during his early days as Phoenix SAC that utilized either gunwalking or controlled deliveries across the border as investigative techniques.

Hoover knew about Newell’s prior operations, and he did not condone them. Upon learning about the Hernandez case in 2007, Hoover, then Assistant Director of Field Operations, demanded answers from Newell about the operation. Newell first reassured Hoover by stating that Newell had conducted similar operations “all the time in Colombia.” (Emphasis supplied, MBV.) Newell finally recognized that Hoover had serious concerns about the Hernandez operation. He wrote to Hoover in an e-mail:

OK, I know you have reservations but please rest assured that this will go down as planned, as allowed per MLAT (Mutual Legal Assistance Treaty) with Mexico, with full approval of the USAO (confirmed again late this afternoon), and will have big payoffs for us and the Department in addressing Mexico’s concerns that we (US) aren’t doing enough to address their concerns. Trust me, I’m with Gov’t.

Billy Hoover had asked Newell for more information on the Hernandez case, obviously concerned about the "lost load" whose interdiction had been muffed by Mexican authorities. The exact wording of the emails is found in Appendix I, 3 of 3, Exhibit 225:

I would like to discuss the following: Have we discussed the strategy with the US Attorney's Office re letting the guns walk? Do we have his approval in writing? Have we discussed and thought through the consequences of same? Are we tracking south of the border? Same re US Attorney's Office. Did we find out why they missed the hand off of the vehicle? What are our expected outcomes? What is the timeline?

Later that day, Hoover added more questions:

Also, did the Mexico Country Office speak to anyone in Field Op's prior to briefing the Ambassador? What exactly did we tell him? Why was this necessary at this time in the inv(estigation)?

Newell fired back:

Standard protocol and they (Amb and DCM) are very used to it. Used to do it all the time in Colombia. Davy tell me he was going to do it and he told me the Amb was not surprised that the Mexicans missed the load.

My sources told me last year that Newell met O'Reilly several years ago during what one of the sources called "drug spook operations in Colombia" when O'Reilly worked for State and Newell was with the Immigration and Naturalization Service in Bogota.

It is evident that someone needs to pursue the investigation into the Newell-O'Reilly relationship, although whether the Issa Committee can accomplish that in the face of White House tactics of cover-up and stonewall is a matter of great doubt.

The Issa-Grassley report makes it plain that it considers Newell was the "man with the gunwalking plan" on the ground in Phoenix. Who gave him the green light to proceed? Perhaps Parts Two and Three will address the question of whether or not it was O'Reilly through a back door channel, similar to Oliver North in Iran-Contra. Perhaps, but my sources in DC say that, at the moment, it is not the way to bet.

Yet the fingerprints of White House involvement are certainly all over Part One of the report, the Committee has at least done us that favor. The only question is will they be pursued back to the fingers of the plotters?