As Prime Minister, Mr (now Lord) Callaghan had been critical of the Pinochet regime and had for a time banned arms sales. British relations with Chile improved after 1979 under Margaret Thatcher, blossoming into close collaboration during the Falklands War and a thriving arms trade.
Details of Gen Pinochet's black propaganda activities are contained in files compiled by the Federal Bureau of Investigation on Michael Townley, a US-Chilean citizen and key figure in Dina, the Chilean secret police. In 1979 he was jailed for the murder three years earlier of the former Chilean ambassador to the US, Orlando Letelier, by placing a bomb under his car in Dupont Circle in the heart of Washington's diplomatic quarter.
The hit man sent to Northern Ireland was Virgilio Paz, an anti-Castro Cuban also indicted in the Letelier case. He was on the run until 1991, when he was recaptured in Florida by the FBI and subsequently jailed. According to Townley's letters, Paz's mission was to take photographs of internment centres in Northern Ireland which, the FBI reports, "were to have been utilised by the Chilean government at the United Nations ... in order to discredit the British government for its alleged violation of human rights".
Paz carried out his orders, but the operation was bungled: the photographs arrived too late to be used by the president's representatives at the UN. Nevertheless, they subsequently appeared in the pro-Pinochet Santiago daily El Mercurio, a newspaper which is leading the fight in the Chilean media to have Gen Pinochet freed by Britain.
The FBI file, obtained by the National Security Archive, at George Washington University, chronicles internal intrigues of the Dina, as recounted by Townley in letters from prison to various people in Chile, including the general. They tell how a senior Dina figure allegedly "stole money from Dina accounts".
The FBI memo continues: "Townley also suggested that Valdivieso [Major Vianel Valdivieso, then number two in the Dina] and Contreras [Colonel Manuel Contreras, head of the Dina, now in prison in Chile] were involved in extorting money from ITT in Chile, as well as from the Racal Company in England." The allegation appears to refer to equipment sought by Chile for a rocket it was hoping to develop with British technology.
Racal spokesman Nigel Edwards said yesterday his company "was not doing business with Chile at the time in question because of the British government ban". But he added: "Racal equipment might possibly have got to Chile via a third party."
Pinochet, Menem, page 15;
Sheila Cassidy, CommentReuse content