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LAWYERS, GUNS AND MONEY

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The agents were undeterred. When Kapetanovic would mention the need for legal permits, Askins and McCaffrey--seemingly upset with his insistence on obeying the law--would often reply with a grunt, or an "uh-huh." They would then quickly change the subject to "alternate" options, such as moving arms illegally by a "fleet of boats" Askins claimed to own that could sneak up next to the Croatian coast.

When Kapetanovic failed to bite on such suggestions, agents took to pushing his emotional hot buttons, probing into sensitive areas that might provoke him to subvert the law.

On one occasion, McCaffrey persuaded Kapetanovic to talk about the massacre of 21 Croatian police officers by Serbian gunmen, mentioning he had seen "something" about it in that day's newspaper. The policemen, in one of the first documented atrocities of the war, had been tortured. A few had been drawn and quartered.

Kapetanovic, whose nephew is in the Croatian National Police, says he could feel the bile rising in his soul. He raved against the brutality of the "socialist Yugoslavian Army." Afterward, agents noticed, he seemed more receptive to their schemes to deliver weapons to Croatia immediately, with or without permits.

He also reacted vehemently when Serbia invaded parts of Croatia. On January 24, 1991, McCaffrey called Kapetanovic, who said he was "broken-hearted" after hearing news reports about fierce fighting and many Croatian dead. "[The Croatians] are just trying to defend themselves barehanded," Kapetanovic cried to McCaffrey.

The agent immediately mentioned that the fighting might further delay permits, and wondered how that might affect Kapetanovic's decision to wait for official okay before buying arms.

Kapetanovic, in a fit of emotion, replied that if things continued to worsen in Croatia, they might have to do something "around" to get weapons into the region.

During Kapetanovic's trial, prosecutors made much of the remark, saying it demonstrated his true intentions--even though in subsequent conversations, he would again mention the need for permits.

Goode mocks the weight given to the comment. "He said several things he now wishes he hadn't," Goode says. "There are certainly embarrassing moments there.

"But saying it is not the same as doing it. The Constitution protects our freedom of speech, so that we can say things in anger."
Kapetanovic explains. "I have closest relations in Croatia. Anybody brings that subject and remind me of that, touches my emotions."

@rule:
@body:Although agents had some evidence they believed showed Kapetanovic was intent on smuggling arms, by May 1991--four months into their sting operation--they had failed to stir their target to action. Kapetanovic simply refused to place an order for weapons.

At this point, logic might have dictated that the investigation was a dry hole. But agents decided to keep digging, driven on, Goode says, by simple economics. Not only did Askins have a financial interest in catching Kapetanovic in wrongdoing, so did Customs.

"After months of investigating, months of making tapes, Customs didn't have anything," Goode says. "They had sunk hundreds of man-hours and lots of money into the sting, and they needed to justify the expense by arresting someone."
Agents saw their chance to break the case when Kapetanovic told Askins and McCaffrey that his "Croatian contacts" would soon visit, bringing a substantial amount of cash with them. The agents leaped upon the information, asking Kapetanovic if the "contacts" would make a buy.

Kapetanovic couldn't truthfully say yes. But he didn't want to say no, either. His business sense told him not to lose contact with Askins or McCaffrey. There were signs that U.S. recognition of Croatia was closer than ever, and if recognition came, he thought the two arms dealers would give the Croats the best prices on badly needed weapons.

Perhaps, Kapetanovic said, his friends would be willing to make a buy.
The story wasn't a complete lie; there were elements of truth. Belinic, along with a Croatian National Police officer named Zeljko Vusir, were coming to visit Kapetanovic. And they were bringing nearly $500,000 of Croatian government money with them.

The purpose of the visit, however, was not to buy arms, but to meet with Scottsdale gun-shop owner Marty Mandall about the possibility of the legal purchase of a bullet-making machine. In addition, they had plans to journey to the Ruger gun plant in Connecticut for talks with the company's management about constructing a munitions factory in Zagreb, Croatia.

But the single-minded federal agents didn't know about Mandall, or about the Ruger meeting. All they saw was the opportunity they had been waiting for.

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Darrin Hostetler