Britain Attempts to Deport Metcalfs
More than three years after the embargo the British government were tired of embarrassing question about the carbon-carbon affair. The press clippings in my files were the scintilla of evidence they needed. It was time for them to act.
Vera Konstantinovna was eager to visit the immigration office in Glasgow, Scotland. She was sure they were going to stamp her Russian passport so she could live in the United Kingdom for the rest of her life. She was looking forward to living in an apartment in the center of London. Vera's hopes of a new homeland would not be realized. Her Majesty's government considered the content of the letter that would shatter her dream important enough to be hand delivered from London. The gentleman handed me a letter on the 5th of August 1988 that asked me to depart the country as a security risk.
Vera became aware, for the first time, that she had less human rights in Great Britain than she had in Russia. The immigrations officer sent from London to give us the order agreed that in this case she had no rights. She had been told America was much better, but she did not believe it. Tears streamed down her cheeks when she realized that she was going to be kicked out of her adopted homeland, for the common good of Great Britain, because of a risk to the security of the United Kingdom. Vera continued to sob as she told the immigration officers, "It is my fault because he married a Russian." They told her that in no way were they claiming she was a security risk. At the same time they wanted her to know that she could not remain in the United Kingdom. Her status was that of a Russian citizen who had been permitted to stay as a dependent of an American citizen. They had already checked that she had a right to live in the United States as a permanent resident and therefore would not be given political asylum. If she attempted to divorce and marry a British citizen they would consider that a marriage of convenience so her entry would not be allowed.
The Home Office is a fancy sounding name for the near equivalent of the US Department of Justice. British immigration policy has made a shambles of the Home Office. More than one hundred thousand letters remain unopened, at any point in time, mostly from black people of the former colonies seeking immigration to the English shores. When England ruled over its empire the English whites controlled many races of colored in the colonies. They allowed them access to England as cheap laborers. Historically the most racist people on earth, the English were caught in a human rights fiasco. They had to keep out their former black colonists while presenting a non-racist face to their colored citizens and the rest of the world.
Vera's immigration problems started in 1983. A quote from a Home Office letter indicates the problem to come.
"Vera Metcalf, a Soviet citizen who has been refused a multiple entry visa for the United Kingdom."
Whilst they do everything they can to assist bona fide visitors who need to travel here frequently at short notice, it is their policy not to issue multiple entry visas to the nationals of certain countries, including the USSR: hence the refusal of her application.
The government welcomed the project we brought to Scotland from the Soviet Union, so they found a way around the rules for this case with the assistance of James Hamilton, the local Minister of Parliament.
"Vera Metcalf's case has been reviewed in the light of your representations. I understand that she is presently in the United Kingdom and when she leaves, she will need to obtain a visa from her nearest British diplomatic post abroad before returning. Provided there is no material change in her circumstances, it has been decided, exceptionally, that she may be granted multiple entry facilities, valid for six months at a time."
The British government had a policy to encourage investment in Britain and actively seek businessmen like myself to open factories in their country. With the help of local political people we were able to establish a new method to allow her to remain in the UK
"I am pleased to inform you Vera Metcalf will be allowed to remain in line with her husband as his dependent."
My aim all along was to obtain a British passport for Vera. An American passport requires eight years, with fifty percent of that time in actual residence in the States. A British passport does not require the citizen to give up his old passport. In the politically changing world, Vera did not like the idea of renouncing her native citizenship. All the authorities were aware of this fact, and several organizations assisted us in the effort. We received an encouraging letter from the Home Secretary in July 1987.
Naturalization is at the discretion of the Secretary of State. You will see that applicants are required, amongst other things, to have completed a period of five years residence in the United Kingdom. Furthermore, an applicant's stay in the United Kingdom during the last 12 months of the five year period must not be subject to any time limit under the immigration laws."
We had followed all the immigration rules required to obtain an entry visa as a businessman to the United Kingdom. My firm had also followed every instruction of the Department of Trade with respect to the embargoed project in Russia. In any court of law Vera could have obtained her passport. Using their national security, they were getting rid of a Russian they did not want to become a citizen. By deporting me, they did not have to deport a Russian, which would have been embarrassing for the British Government.
British law is not based upon a written constitution, but rather upon a general understanding of common law and what the majority of the House of Commons pass as law. Precedent is a major factor in common law. If Vera were allowed, then others of the same class would be allowed. The Thatcher government did the only thing they could do to get her out of the country.
The gentleman who gave me the deportation letter explained that he was giving us a month to wind up our affairs. If I would sign the agreement he had on the table to leave voluntarily, then no order would be issued and the whole affair would be kept quiet. I would not be allowed to return to the United Kingdom, but Vera could return provided she fulfilled the visa requirements like any other Russian citizen.
I told the gentlemen that I had other problems, and that I had no desire whatsoever to live in their lousy country. My teeth had been pulled two days earlier and payment had already been made for a permanent bridge, which would require time. I had a contract in Brazil that required me to leave Scotland three days later. My position was that I was not guilty and would win the appeal hands down. I told him that high members of government would be exposed for their stupidity in the handling of the Soviet carbon-carbon matter.
To cement my request, he was told that all documents required for my appeal were in the USA. The immigration officer said that returning to the country when the Home Secretary had decided my case for national security reasons would be highly irregular and maybe unprecedented in law. He told me he came to Glasgow with pleasure to kick out a traitor to western security, but that after listening to the facts of my case, he would take every possible action to allow me to leave and return for an appeal. He told me it was a sad day for him. He gave me the fax number of the Home Office so I could put my position in writing. This number is not given even out to the Ministers of Parliament.
Vera wanted to fight to stay in the United Kingdom. It was a fight we could not win because we were not citizens and had no right to appeal their decision. Our only hope was to get the attention of the press. I told Vera she would have to tell her story to the press and be on television. She was confused when Thatcher embargoed my contract. She was more confused when I set up my own company to finish the embargoed job. She would not accept that Tom Dick, a British subject was allowed to work on the project, and James Metcalf, an American citizen, was not. The press confused her. Her question was repeated over and over. "Jimmy, who is doing this to us."
When we returned to our house the first task was to write a letter to the Home Office confirming what we had told the immigration officers. I was quite happy to leave Great Britain, but on my own terms. It was stupid of the British to label me as a security risk and allow me the right to fight the case, and they knew it.
A facsimile message, enclosing the Home Office letter, was sent to my former employer, and Hank Rowan, president and main shareholder of Consarc's parent company, asking for assistance.
A news release, along with the deportation notice letter, was sent to the British television networks, ABC News, major London newspapers, Royce of Newsday, and to my family in New Jersey. Royce called right away to get the facts. The Daily Telegraph of London called for a long interview but was not aware that they had run the carbon-carbon story before. They ran a short story in some edition the next day that claimed American sources told the British my company was continuing to do business on the embargoed project. That part of the news story was totally untrue.
Vera was hurt and confused by her favorite woman, Thatcher, and her favorite country, Great Britain, because they were giving her no rights whatsoever.
We were invited to have dinner the next evening with Vera's friend, a Russian émigré and naturalized British citizen. After a long talk with her friend she decided that it would be best if she returned to Moscow to live forever. Her only concern was who would look after me, because she knew I would never agree to move to Russia. She had bad feelings and was afraid to go to a country where the press could print her name and picture in a bad way without any real reason. The main reason she did not want to move to America was that the trip to Moscow would be three times longer.
I tried to explain to Vera that Reagan had to sell the American people his "evil empire" concept in order to get more money for the Defense Department. She agreed that the power of the big stick is one way to get a Russian to listen, and that just maybe if the United States had not installed the Cruise missiles in Europe there would have been no arms limitations treaty.
I explained to her that it appeared that Reagan had fired Richard Perle and Weinberger because they were against his new friendship with Gorbachev. Reagan wanted to be recorded in history as a man of peace, so he was embracing Gorbachev as his friend during these times.
My German customer called for some assistance. I told him the British office was closing down and would contact him from the States. He owned a small company in Atlanta and was very interested in setting up the carbon densification in the states with me as a minority owner. I was worried that he would squeeze me out if the operation was as successful as I knew it would be. He gave me the telephone in Atlanta and asked me to call him when I returned from Brazil.
Soderstrom arrived in Scotland two days earlier. His customer, Electometal needed some items for the used vacuum melting equipment he was installing in Brazil. By this time he was an enemy of the Rowan family of companies, and Dick's small company was growing and could supply Electometal's needs quicker and much cheaper than Consarc. The British gave Soderstrom a hard time upon his arrival at customs, even going through his documents in his pocket which included telephone bills. When he called me I told him about my deportation order. He decided not to make contact with me in Scotland. He agreed to return to Brazil a week earlier than scheduled to meet me there to plan future business there.
Royce must have considered me a nut, not Knut, since I called him so many times to help me get the real story in print. This had been a good story for him, and now he thinks he printed the truth. Such is the life of our modern journalists.
Royce was able to zip out the following story about me being deported from Britain, with probably less than five minutes reporting.
The Sunday Times of London faxed me a computer printout of a story in the Telegraph which they said ran on August 6, 1988. I have never been able to find the actual newspaper. Royce was in contact with their reporter in Washington, and at first they appeared interested. The reporter who called me later said that the reason they did not follow the story was because the Telegraph had already printed it. My information was that the British government had put a gag on this subject.
A fax arrived from the Home Office allowing me to leave on August 8, 1988 and return to the United Kingdom. However, it warned that my passport would be retained at the entry border point. I sent a long fax to them offering to leave the country in an orderly way in order to avoid the expense of the hearing, which would be a no-win situation for both of us. The letter also asked why more than three years had passed before they acted. The letter also asked a series of questions about my rights in the hearing.
At first immigrations officers at Prestwick airport ignored my statements during the departure check. It appears they called the Home Office, because they later came into the departure lobby to take all the details of my return plans. Customs agents in New York ignored my comment that I had sold rocket secrets to Russia as my reason for my trip.
Royce still refused to do any reporting or print any of my side of this story. I could not find another newspaper that would touch the deportation story. At first it appeared that the Miami Herald would interview me, but they later declined. The paper in New Jersey that ran the story as front-page headlines a few months earlier interviewed me and took the documents but the editor decided not to use it. He did not reply when I asked him if he was afraid of Rowan and Inductotherm.
My sister attempted to have my story told in the area where I was born. At first the editor appeared interested, since the story was ready-made. He refused to follow the story because he felt it was criticizing the press.
I was willing to let the press use the hook of my deportation for national security, and even embellish it as a spy story, if they would pick up the real story of Vera's plight as a Russian immigrant.
Throughout the Cold War the Voice of America, Radio Liberty, the BBC, and other freedom loving countries broadcast a common theme, along with rock music they played, on the airways. The theme was freedom for immigration from behind the iron curtain. Most western countries allowed a trickle of people to claim political refugee status. From time to time Castro opened the floodgates to allow his unwanted to flee to Miami. The economy of Eastern Europe and the Soviet Union was in decline due to the costs of the Cold War and a failed social experiment. Gorbachev addressed the UN and told the world that he was going to open the floodgates and there would be no more "refusenik's".
My story to the press was the reactions by America, Britain, and Germany to the new immigration situation. These countries did not need several million political refuge's ready to draw social security and welfare payments. Vera was the first victim of a policy that was not yet announced.
I flew to Brazil on the 21st of August 1988. Soderstrom arrived ahead of me. The customer was aware of my deportation order and the cover story in Time magazine. I told him I had to remain clear of any technology transfer until a license was obtained from the US government. Some experiments with reduction of oxides were planned but were canceled because an Inductotherm supplied coil had arced over and the vacuum melting operation was closed down. I asked Soderstrom to find some heavy walled copper and make a proper coil because this one had too many electrical turns. Soderstrom and Jimmy now were in direct competition with Rowan and the news would leak out.
Soderstrom took full advantage of my deported status. He took over my place as the main consultant for this customer. I did not fight him for this position. I wanted to go home to the land of the sky.
I called Rowan from Brazil and the line was bad. I suggested that Consarc Scotland could buy me out and make a profit. I also told him the reporter from the Mirror of London was digging and might find the problem with the British grants. I did not come close to blackmail but Rowan got uptight before we could finish the conversation. I was angry so I pretended that he could not be heard.
My expenses for this trip were being charged to my credit card issued by the Royal Bank of Scotland. I spent a large sum of money in Brazil buying jewelry and hotel bills using the credit card. The customer paid me cash to cover all the expenses including the airfares. Payment for the consulting fee was delayed for later payment.
I requested my daughter meet me in Miami on the 28th of August 1988 to help assemble the documents for the appeal in Britain. We drove north in my van to assemble all the documents at my sister's home in North Carolina so the work could be finished with maximum help from my family.
The first thing I did was to buy a Macintosh Plus for my sister's house and the most up to date Macintosh with all the goodies for my use in the USA. This purchase was in the $10,000 range. I had purchased a generator from my brother and could hook up to Easylink anywhere I could find a phone jack. I could also run my computer in the van.
The next small purchase on the credit card was refused so I called the Royal Bank of Scotland and they agreed to increase the credit line to about $25,000.
I called Cooke in Scotland with the suggestion he buy all my property at a very low price so I could get out of the UK. Cooke did not want to be seen as assisting a traitor.
I called Rowan's secretary but Rowan was not in. I gave her a contact point in North Carolina so she could send me a copy of a July 30 letter mailed to me in Scotland. It was a nasty letter because he had misunderstood. I asked my sister to type a long fax reply to explain the situation.
I drove north to Consarc to obtain supporting documents with a stop in Washington to obtain assistance of the government. I could not make a meaningful appointment with the State or Commerce Department. The American government was not interested in this affair. The visit Consarc was to pick up documents for my defense. Roberts suggested it was not a good time to visit Rowan.
I arrived in Scotland on September 15, and immigrations held my passport. They were told that I was going to leave before a deportation order was issued. I was blocked from further travel, but it appeared that they would not force me out.
Vera had an official letter from Immigrations dated 8 September extended her visa to the 26th of October 1988.
I invited the press to be in attendance when I delivered the large box that was my defense to Immigrations. The box was wrapped in red, white and blue ribbons and my native dress was old overalls and an old hat. The press did not show up, but the officials were amused at my act. The enclosed memo was part of the documents: http://www.ioa.com/~zero/553-LetterHomeOffice.html
The local Minister of Parliament sent me the letter he had received from the Home Secretary that had the fact of my sale to the Soviets as the reason for my deportation.
"I have considered most carefully Mr. Metcalf's involvement in Consarc Engineering of Bellshill, Glasgow, and in particular the part he played in setting up a contract with the Soviet Union to supply equipment for the manufacture of carbon-carbon, a material used in the building of heat shields for strategic nuclear missiles." "You will understand that I can not give details on matters of national security."
My defense was that I was an asset to the economy and national security of Great Britain. The Home Secretary was aware of that fact. The letter continued:
In making my decision I have taken into account the views of the Scottish Development Agency, and of Mr. Metcalf's previous residence in the United Kingdom. However, I do not believe that these factors are such as to outweigh the serious risk to our national security which I consider Mr. Metcalf presents. It follows from this that Mr. Metcalf's application for entry as a businessman, lodged at Moscow on 4 August 1987, will be refused. Similarly, any application by Mrs. Metcalf for further leave to remain will also be refused."
These would be the only facts given to the panel that would hear me. Great Britain has a law to guard their ministers, the Official Secrets Act. IT WAS GOING TO BE A KANGAROO COURT. I needed time to settle my affairs, so the game was played by their rules.
Vera could understand how the United States Congress had used the press to give Gorbachev a bad name during his visit to the States eight months earlier. She could not understand my explanation as to how the government could use newspaper, magazine, and TV articles as their evidence to convict me and then keep the facts secret so I could not use them to defend myself. Vera had decided she did not want to live in London, as Great Britain was throwing her JIMMY into the briar patch. Thank God for small favors.
The local freelance reporter who had a copy of the documents returned them with the news that this story was gagged and the matter was secret. Any reporting of details found in government documents was covered under the Official Secrets Act. I am sure that our President would enjoy gagging the press at times.
I finished my dental work in Glasgow five days later. Vera sold the car, house, rugs and other large pieces of furniture for about $20,000 more than I had asked from Consarc. This money was wire transferred by the real agent to my bank in Miami. I do not remember how we calculated the capital gains on this transaction because the value of the pound at the time of the original transaction was much higher.
I called my new accountant in Glasgow to ask about income taxes in the UK. He told me that the Inland Revenue Service was not interested in my case. I crossed the street to a branch of the Royal Bank of Scotland to close my account. The sum was small so I gave it to Vera as pocket money. The Royal Bank did not have a record of my credit card and could not receive a payment. I gave all parties my forwarding address in Miami.
The photographer that did all the work for Consarc brought me pictures of the TV screen that showed ABC News and many other photographs for the record. The company did not want to be paid for this service. Attached is a photograph of my little home in Motherwell. A picture just like this was in Newsday.
I called the Home Office with the news that I would leave without a hearing but with a request that they review the documents. The man handling my case told me the book draft was interesting reading. Immigrations returned my passport without a date certain when I would leave.
The Home office sent me a letter stating that since I was not deported then there was no reason to hold a hearing.
Using the credit card we rented a car to drive to London where we stayed with Vera's friends. The next morning I left Vera in London with adequate funds to buy a ticket to Moscow and live there a few months while I found a new home. I was able to book a standby seat using my Royal Bank credit card on Pan Am and passed through immigrations with a normal one-second look at my passport. I called the Home Office from a telephone near the departure gate to give them the flight number. The flight was held for about one hour while I waited for men to question me.
When I returned to New York on the 5th October 1988 a young FBI agent met at the baggage pickup inside Customs. He told me that he did not know the reason he was meeting me, and only had instructions to obtain my address in the USA. After a little reporting work, I found that the message was passed to him from Frank Rovella of Project Exodus (the same man we met in Consarc's offices after the embargo). The Home Office had cabled my last-minute travel plans because they were informed only after I was approved as a standby passenger.
I attempted to use my credit card to rent a car to drive to Rancocas to pick up my van. This time the light blinked and I handed the rental agent my American Express card. To make sure it was closed I checked a couple of times during my trip south to Florida.
I continued my efforts to have ABC News prosecuted for showing technology that would have required a technical data license. They showed it to Gorbachev on TV when he was in Washington. This was for fun but my letters and contacts with Customs appeared serious. The attached is a picture of the TV screen is hard to view but with modern techniques would show enough details to build the embargoed furnace.
Vera departed London about five days before her British visa expired. Before departing her friend visited the Soviet Embassy to prepare an invitation so Vera could visit her in 1989.
I rested a little before driving north to find a good place to set up my business.
Frank Rovella from US Customs asked me to attend a meeting on the 20th of October 1988. He gave me the address of a place he called "guest quarters" outside Washington. I thought it was a government house but it turned out to be a large motel. All expenses were paid so I got the best room, had a nice dinner and a few drinks at the bar. I also made quite a few long distance telephone calls. I called Knute Royce at Newsday to tell him that I had all the documents and some show and tell items that should interest the press. He asked me to be careful because the government could steal my documents and other items. He saw no reason to attend the meeting as my guest.
I wanted to use my new toy to film the meeting but Rovella refused. The large room filled with at least twenty people to ask questions about the embargoed project and other things about my experiences in the Soviet Union. They refused to give their names or where they worked. It appeared that they only wanted to confirm what was reported to congress the previous December. I showed them drawings, photographs and carbon-carbon materials. One man that I am sure worked for the Pentagon almost called me a liar when I showed the heater used on the isopress and elements of the high temperature furnace. He said, "we would not have made all the fuss to stop this simple project."
During lunch Rovella was more interested in new Consarc business in Iraq than the Soviet job. One gentleman said they had enough information to take me to court. I told him that Rovella had enough badges to arrest the president so arrest me. Rovalla closed down the meeting and told me the whole matter was history.
I gave Rovella the motel bill. It was for $218.16 so he took me to the cashier and had them change the bill to government rates before he signed the voucher. It cost me $94.17 to meet the government. I charged this to BEPA as a proper business expense.
I traveled to Washington in December 1988 to pick up a visa for Russia in order to stay with Vera during the holidays. I visited with Royce and he told me that he did not think my activities were connected with the KGB, but he found me guilty of not caring about the security of the United States. Royce has a small office near the rear of his newspaper's large office in Washington. A Cleveland Indian banner was flying above the right corner of his cubbyhole. His bookshelf included a volume on military aircraft. The main item that will never leave my memory was a large poster of General Patton with the words, "GUT THE COMMIE BASTARD" printed at the bottom.
Christmas in Moscow is a non event primarily because the Russian church did not change their calendar when the rest of the world did. The believers observed Christmas on January 7. December 25, 1988 was our ninth wedding anniversary so Vera had planned a big event.
We stayed at the Belgrade hotel near Smolinsk Square. The Square is home for the Minister of Foreign Trade and Foreign Affairs that are housed in one of the six ugly tall buildings built by the Stalin regime throughout Moscow. The most famous building of this type is the Moscow University. The Belgrade has a twin across the street and is near the Moscow River. On the other side of the river is the Kievsky Vakzal (railway station). The US-USSR Trade Council is just up the river from the train station. During the past few years the street that ends at Smolinsk (Arabat) has been converted into a pedestrian walking street with old shops and cafe's. During the past two years it had become the Hyde Park of Moscow. One night in the Moscow hotel for an American was almost one hundred dollars. Payment in dollars for the single night allowed me to obtain the proper stamp on my visa for the duration of the stay. With the proper stamp on my visa, the balance of the time was spent as Vera's husband at Soviet rates that were much cheaper.
Vera arranged a Christmas dinner at one of the new private operated restaurants in Moscow. She invited two of her new professor gentleman friends, an émigré gentleman she knew from London, her best friend, and a couple that had immigrated to London. The meal was normal but the service was excellent in comparison to state operated restaurants. The music was by a two man band that had a wide range of music to offer during the long evening. Vera was upset when she found the bill was three times normal and the music charge was one hundred rubles. Two weeks later this restaurant was wrecked by the Moscow Mafia, a new breed of characters in Russia that demand protection money from private business.
New Years eve was celebrated with a simple but very good meal at Vera's friends house with the only guest being her friends former husband. The conversation during the evening was mostly about the new economic order for the people of the Soviet Union. Just before midnight Gorbachev gave a little New Years speech in which he said that 1989 would be a difficult year for the people but the political and economic restructuring must be continued.
The Belgrade hotel closed for major repairs just after New Years so Vera had to find a new hotel that would accept us. Moscow hotels are always full and because they have no competition the management is very cold and will only take care of people they know. Vera had lost her influence in Moscow because she was away while the younger people took control. A payment under the table still worked.
The Rossia Hotel is claimed to be the largest in Europe. Many people consider that Moscow is in Asia. The border is the Ural Mountains so the majority of Soviet people live in Europe. The basic twelve floor structure is about one thousand foot square with two rows of rooms on each floor. The inner rows of rooms face a central garden that is about eight hundred feet square. The southern side faces the Moscow River that has been made into a canal for barges and pleasure boats. The river connects through a series of locks to the river Volga. It is possible to drive down the river from the Belgrade hotel but because of a wide turn in the river it is better to drive down Kalinen Prospect. This wide street is one of the most modern in Moscow, the tall office buildings are set well back from the street with shops on the lower floors. The street continues past TASS, the Soviet News Agency, to the north side of the Kremlin. The drive continues through Revolutionary Square where many famous buildings are located including the Metropole hotel and the Bolshoie Theater. Along the north side of the hotel are several old churches that have been under reconstruction over the years. The north side of the Hotel also has a tower block that has twenty one floors.
On the top floor of this massive Hotel building is a restaurant that has a spectacular view of Saint Basel Cathedral that is located on the southeast corner of the Kremlin on the south side of Red Square. To the south of the cathedral is a parking lot and a wide bridge across the river. This is the place where Russ, the young German pilot, landed his small airplane which the local taxi drivers call Sheremetevo 3. Vera still thinks that this was a planned event so that Gorbachev could fire his aging Minister of Defense.
During one of the many business meetings held in Moscow after the first of the year, the Soviet Graphite Industry offered carbon-carbon for sale to the West. I met with Dr. Kavrov of the graphite institute who offered to sell high strength carbon fibers to the West through our company. This was a strange twist of events. The Soviet Union was going to open up.
I returned to the States and wrote letters to Commerce requesting information on Bush's new administration's policy on trade and joint ventures in the USSR. I was cheeky with the question about the sale of carbon-carbon produced in the Soviet Union. Attached is a series of letters to and from Commerce:
I returned to Moscow in February 1989 after posting a letter to the Home Office. Vera was learning the limits of the new rules of business in the USSR. I told her it would take time, but there was business if we kept up the effort.
This letter is to inform you that the British embassy in Moscow issued an entry visa for my Russian wife, Vera Metcalf, to visit the United Kingdom on or before May 13, 1989. http://www.ioa.com/~zero/556-HomeOffice5Mar89.html
The new government in Washington did not answer my letters and Royce became annoyed with me for bugging him to write the story about the Soviet Union offering materials that we could not sell to them. My last free trip to Europe on Northwest Airlines could not be used after the end of February and the only open return date was on the 22nd of February 1989. Vera was able to check into the Rossia Hotel and buy us first class tickets to Munich, so it was time again to be off to Moscow to pick her up and to do some business.
We had a little hassle at the hotel because they wanted to be paid in dollars. The argument was settled when Vera agreed to pay forty five rubles for me and fifteen rubles for herself per day.
Several meetings were set up including joint venture discussion with a car rental company. The car rental company would be able to sell the cars after four years of use for more rubles than the original dollar costs to cover all operating expenses. Again they did not have dollars to invest. It would have been a great deal for somebody but this was not my business.
Additional meetings with the carbon people resulted in a plan to sell raw rayon and chopped rayon that had been cooked to carbon as seed money to set up a Ukrainian company as the largest producer of this insulating product in the world. The Soviet Union moves slowly but this appeared to be a good deal for both partners. The technology was already in the Soviet Union so it is not necessary to obtain a technical data license from the American government.
Another business opportunity had to be abandoned due to Soviet secrecy rules. The business was to sell heavy metal scrap that was to be recovered from several sources including light bulbs. It turned out that some of the scrap might have come from military lamps so the scrap could not be exported. Many outdated rules that prevent commercial applications of items developed for the military had to be eliminated by Gorbachev in order to improve the Soviet economy.
We departed Moscow for a two day shopping trip in Germany. Vera was able to find a nice fur lined leather coat that she had been trying to find for several years. The bombing of Pan Am airplane a few weeks earlier had caused the strict security of the Frankfurt airport to be even more strict. Police carried automatic weapons in the ready position throughout the airport. The first step at check in was to interview each passenger to determine if they know what was in their baggage and that it had not been outside their control since it was packed. The next step was the X-ray search of the hand baggage with a hand held metal detector used to scan the body. Just before boarding the airplane documents were again checked. Vera was singled out for a body and hand search because she had a Russian passport.
Vera had been out of America more than ten months and even with a green card (permanent alien) she was taken aside for special questioning. The rules for green cards changed when the law that allowed amnesty for illegal immigrants came into effect.
New immigration rules did not allow more than a few months out of the country without a special permission to re-enter document. The officer understood her situation and did not pull her green card but warned that it would be done in the future. We declared more than we purchased at customs in order to avoid any trouble with the law. Vera sold her fur coat in Russia and by trading and buying had accumulated three large suitcases of clothing and goodies. We did not consider that trading was buying new but customs could have decided differently.
The phone rang in my office in Miami just before we departed for a holiday in northern Florida. The gentleman on the line was from the Office of Foreign Availability in the Department of Commerce. He was fully aware of my situation and the letter to Commerce. He wanted me to send him a copy of the letter so he could act upon its contents. The simple insulation that had been put on the CoCom lists for controls had not passed through his office as required by law. This meant that the inclusion of this product was against American law.
The American supplier (FMI) of this product had been able to make a product for export that was outside the limits described by the law that they called export grade. The Pentagon wanted to change the law to include this new product.
He had some very harsh words for the Pentagon. He told me that Perle and Bryen might have been part of an unofficial group that was punishing the Soviet Union with their propaganda due to the fact that Russia would not release Jews. This operation was akin to Oliver North's operation, not official, but known and allowed. The most revealing discussion was a hint that Royce of Newsday might be in sympathy with Perle's objectives. It was suggested that INC Magazine would be a better forum to get my true story published. He wanted me to arrange a visit to Soviet production facilities of high strength carbon so he could have the information needed to remove these items from the control lists. He also wanted me to fax the letter to the Secretary of Commerce so he could use it officially to assist in the removal of the insulating product from the control list.
The insulating materials were not important enough to be on the control list. Getting credit for removing this material would prove my furnaces did not need to be embargoed in the first place. But, if the Soviets could freely import this material they probably would not agree to my terms for the joint venture to produce this material in the Soviet Union.
The man from Commerce asked me to allow him to show the letter to the chairman of FMI who produced this product in the States. I declined his request on the basis that FMI would be the competitor if the project went forward. In a later meeting with the president of FMI it was clear that they had been informed of my activities.
Most of my cash was deposited in the BEPA account and earning good interest. My accountant noted that I had not set up the company as a sub-chapter S and would be double taxed if BEPA paid a dividend. I moved the cash into my private account at a small bank in South Florida at excellent interest rates.
I wanted to reside in Florida because the state did not have an income tax, and it was a cheap place to fly in and out of to all points in the world. Vera did not want to live in Florida even though there was a large Russian group living in the Miami Beach area. Vera wanted to live in New York City but I was dead against it. Our compromise was Boston as an Office with residence in Florida. BEPA held an official board meeting and it was so resolved for state income tax purposes.
The eight weeks of time-share we bought in Mexico had cheap maintenance costs that allowed us to exchange for a resort in Daytona without spending a fortune. Vera's friend from Scotland joined her for a holiday in the sun. About a month later we arrived at my sister's house in North Carolina where we picked up the large cargo trailer that had been parked behind her garage for almost a year. I spent almost one day loading the files on the Macintosh Plus that was at my sisters house. We packed the Macintosh II in a safe place in the van before departing. On the way north we stopped to pick up items that were stored in a mini-storage near Consarc. We dropped off Ira at Newark airport and drove onward to Boston
The next chapter covers the year we spent in Boston.