Cebu Specials

Stephen Smith
12 min readJul 30, 2021

Fireworks centered on the transition of Presidential power had barely flamed out in Manilla. The New People’s Revolution had seated Aquino as the new President of the Philippines, and the former President, Ferdinand Marcos, was settling into his new home in Hawaii. Adjustment to my new duty station at Subic Bay, Philippines, was continuing and running as I had hoped. Operational demand on the N.I.S. Subic Office was high and as such was reflected in the attitudes of the primary Bosses. Dan McBride, the Agent in charge (S.A.C.), along with ASICs Wayne Cookie, Neil Robbins, and Bill Haumburg, ramrodded arguably the busiest office within N.I.S. Once the volatile political situation in the Philippines was factored in, professional survival demanded “high-speed, low drag” performance from Agent personnel.

Being assigned to the General Criminal Squad, my activity plate was full. Investigative referrals to the N.I.S. Office Subic were received from other N.I.S. entities as well as local base officials. Duty calls relating to U.S.M.C. and Navy personnel incidents on base, as well as adjacent Olongapo, were also the primary responsibility of the Criminal Squad. Independent of reported crimes or incidents, Agents were encouraged to conduct initiative efforts. These efforts incorporated several activities to include the identification and recruitment of cooperating witnesses (C.W.’s). A reliable and productive C.W. was, in a target-rich environment such as the Philippines, the “Gold Standard” for initiative operations and investigations.

Agent Dennis Gauze had been assigned to N.I.S. Subic Office for several years. A transplanted Texan, Dennis had earned a reputation not only as an excellent investigator but as a “Guru” in recruiting and handling C.W.s. Two C.W.s that Agent Gauze currently handled had already proven themselves as reliable. However, the value of both was not restricted to their reliability; it focused more on their access to the type of information essential for unilateral targeting.

Pending a change of duty station for Agent Gauze resulted in both C.W.s control and tasking being transferred to me. Unknown to me, it would truly evolve into both a blessing as well as a curse.

One source was a Philippine National who held a position within the Philippine Constabulary. “Danny O,” as he was known, had assisted N.I.S. in various capacities for well over a decade. He was, without a doubt, the go-to guy when failure was not an option. Exceptionally competent and skilled, Danny O was fiercely loyal to N.I.S. as an organization and designated N.I.S. “Handler.”

Experience, maturity, and a great deal of common sense were critical in successfully navigating “handling duties” relating to Danny O. One had to understand that N.I.S. Agents had to “run within” the ethical and legal guidelines set by the Navy as well as the United States Government, and that Danny O operated under different criteria set by the Constabulary, the Philippine Government, and at times Danny O himself.

Caution was mandated for certain issues, and circumstances could elicit responses from Danny O that were clearly outside of “authorized activity” for N.I.S. Agents. A fine line had to be run by Danny O’s Control Agent to maintain clarity on exactly what he was tasked to do and what he unilaterally did. Grey areas were going to occur; however, an Agent had to maintain “reasonable and plausible deniability” on all ventures that involved Danny O’s tasking and subsequent assistance.

It was not long before Danny O’s unique assistance was definitely needed and absolutely necessary. Two N.I.S. Agents, new to the Philippines, had been visiting several “establishments” located in Olongapo. Drinking the traditional “San Miguel” beer and chatting with the “ladies” had been the main activity for the evening when one of the “new guys” eyeballed what appeared to be a narcotics transaction. Inexperience and a lack of situational awareness resulted in both New Guy Agents following the culprits into an alley.

The scene has been replicated a thousand times by the same number of U.S. Servicemen since the creation of the concept of “Liberty” or, in civilian terms, “Party.” The uniqueness of this particular situation is that instead of young inexperienced Servicemen, it involved two “Special Agents of the Naval Investigative Service who “should have known better.”

Details: Special Agent New Guy comes to the Officer Quarters residence of Agent Smith at 0400. Wakes Smith up by aggressively banging on the door while pleading for help. Once in Smith’s room, Agent Newbie says he saw “a drug deal go down,” so he and his drinking companion (Agent Newbie #2) intervened. Agent Newbie 1 and 2 then follow the two “drug suspects” into a back alley. The two suspects, young Philippine National teenagers, subsequently produce sticks three feet in length and commence to beat the hell out of Newbie Agent 1 and 2. Adding insult to injury, both Newbie Agent 1 and 2 are then robbed and are additionally relieved of their “Special Agent Credentials.”

Disbelief left me temporarily speechless. Following question posed was, “did they take your weapons.” A degree of relief came when the reply “we left our guns in the car” blurted out. Advice provided to both Newbie Agents dictated that they notify their A.S.A.C. about the incident as soon as feasible.

The time was now 0500. I dressed and drove to Olongapo to Danny O.’s home. After relating the story of our Newbie Agents receiving a “stick lesson,” I carefully and fully explained that a reciprocated whipping might be appropriate, but a “Salvage” (assassination) definitely was not.

At 0730, Danny O called to inform me he had identified and rounded up the ‘stick beaters.’ Additionally provided was that both sets of Special Agent credentials had been recovered. Simple task for Danny O equaled major temporary relief for our soon-to-be “sanctioned” Newbie Agents.

The second C.W. inherited from Agent Gauze was M. Allen, a retired U.S. Navy Senior Chief and longtime resident of the Philippines. Allen was employed as a civilian employee at the Communications Center located aboard Cubi Point Air Station adjacent to Subic Bay Naval Base. Allen had provided Agent Gauze sensitive real-time information relating to U.S. Air Force personnel smuggling firearms to mainland Japan. Initial information developed disclosed that the guns were destined for the “Japanese Yakuza” and that they were being transported on Air Force planes flying out of Clark Air Force Base, Philippines.

The roller coaster ride at Subic continued when Agent Gauze announced that Allen had arranged for a U.S. Navy Chief to accept delivery of a shipment of guns to be delivered to members of the Yakuza in Atsugi, Japan. The coaster then went off the rails when it was explained that I would be the ‘Navy Chief” and that the delivery date had already been scheduled. A visit to the Navy Personnel office and to the Squadron Commander at Cubi Point resulted in the obtaining of a U.S. Navy Identification Card identifying me as a Navy Chief and a flight suit bearing my new name “Dennis Johnson” U.S. Navy.

Arrival of two large, specially packed packages at the N.I.S. Office in Subic resulted in immediate notification of E.O.D. personnel. Subsequent X-rays of the packages revealed fifty (50) small frame revolvers in one and two thousand five hundred rounds of pistol ammunition in the other. Kick-off time had arrived. Specific delivery instructions had been provided to Agent Gauze, and before I could count to three backward, I was aboard a C-130 Aircraft en route to Atsugi, Japan.

Flying as a Navy member, I was unknown to the aircrew assigned to my flight. As far as they knew, I was a Navy Chief hitching a ride to Atsugi. Arrangements had been made for N.I.S. personnel in Atsugi to “grease the skids” with Military customs once my flight arrived. My thoughts focused on maintaining my “cover” and affecting the delivery on schedule. Arrival in Atsugi was on schedule, and now the task was to exit the aircraft inconspicuously with my two oversize bags full of ammunition and pistols.

As I labored carrying the bags, I looked for my “contact” that was supposed to have liaised with Military Customs. I deliberately walked slowly because not only were the bags exceptionally heavy, I also did not want to attract attention. Not seeing my designated contact was concerning, so I casually walked past customs personnel and entered the terminal area. Within a short time, my contact Agent arrived, and I left the Atsugi Air Base.

Arrival at a local Motel was uneventful other than registering as a U.S. Navy Chief Petty Officer named Dennis Johnson. Quick operational visits with two N.I.S. Agents set the following day’s plan into motion. Last preparation involved discussing how the delivery of my contraband would occur and what actions I was to take after the exchange. Due to Japanese law restricting “undercover operations,” it was arranged for me to “effect a getaway” after the exchange. Concerns were immediately expressed involving “if I am captured,” what can I expect, and can they, or will they hold in abeyance the use of deadly force in my capture? “We have it covered” was the reply received. Unfortunately, since my contact did not show on time at Atsugi, the comment “we have it covered” left me a bit unsettled.

While I digested the idea of a “safe escape,” the clincher landed. “Your egress route out can not include the front or back entrance of the motel.” Explanation received was that all exits would be blocked so that the “bad guys” (Yakuza Members) could not escape. The kicker arrived when I was told, “you can’t stay in the room because they (Japanese Police) will be searching for Navy Chief Johnson.” Silently I said, “horse sh t,” and then the Senior Agent suggested, “you can go out the window,” and your Contact Agent will pick you up. Considering my room was on the first floor and seeing that the window opened easily, with just a screen to remove, I reluctantly agreed. It was late, so my visitors wished me luck and departed by saying we will telephone in the morning.

Sleep did not arrive easily. Thoughts of my previous visit to Japan came forward. It had been seventeen years since my last excursion on Japanese soil. May 1970, I was twenty years of age, and my real Military Identification card read Stephen R. Smith, Staff Sergeant, U.S. Army. My temporary I.D. disclosed, “Patient — Camp Zama — Gunshot wound r/shoulder & Malaria.” As my mind started to race, I consciously verbalized, “wake up, slow the f — -k down, and pay attention.” Once focused, my thoughts centered on “make the delivery — egress to Atsugi Air Base — return to the P.I.” Sleep finally arrived, but the new day’s light arrived abruptly.

A last name and a phone number were all I had identifying the person to who I was to deliver my special packages. Mr. Watanabe was the contact, and as I dialed his number, my bet was “Watanabe” wasn’t his real name. A man speaking Japanese answered. I asked to speak to Mr. Wannabe, saying also, this is Johnson. After a short pause, another man’s voice says “hello” in broken English. I repeat, “this is Johnson” I have some packages for you. Question posed “where are you?” I answer by identifying the Motel I was registered in. Immediate reply “I will call back” and click the phone goes dead.

Three minutes or so elapses before the phone rings. “Johnson, we need you to bring the packages” to our Motel. I immediately respond, saying, “no,” you have to pick them up here (my Motel). No, no, no is uttered, and I respond by saying, “I am not bringing the packages to you,” so if you “want them, you are going to have to come here.” Final discussion results in “Wannabe” suggesting that I come to meet him. Then we would return to my Motel to get the packages. I responded by saying I will call you back.

Once I called my contact Agent, I felt sure that the “Heavies” at N.I.S. would cancel the operation due to the dilemma involving actual delivery. As I informed the Agent of the details, I added, “if I meet them at their Motel without the “packages” and they believe I am U.S. Navy Chief Johnson, “all will be well.” To my surprise, the “Heavies” okayed the plan, and I placed a call back to Watanabe saying I was on my way. Taxi service was secured, and as I left the parking area of my Motel, I saw numerous Japanese police officers trying to be inconspicuous, hiding behind trees and bushes. “Holy S — T was all I could think of as the taxi continued to my destination.

Arrival was uneventful, and as I traversed through the lobby to the elevators, I scanned for potential surveillance. Knocking on Watannabe’s room door was interesting in that it immediately opened, but the one person seen was too far from the door to have opened it. As I stepped through the doorway, I immediately sensed the presence of a second person. It was only a second before the second person moved quickly up behind me. Not wanting to appear “spooked,” I slid a bit sideways so that both were clearly in sight. Watanabe was well-groomed and professionally dressed. However, his companion was clearly “a hired hand,” and my first impression was that the “hired hand” was the dangerous wild card in this introduction.

Small talk initiated with Watanabe wanting me to show “identification,” which I did displaying my wallet containing Chief Petty Officer Dennis Johnson’s Military identification card. A strange twist occurred when he said, “I am a movie producer.” Have you ever thought about being in the movies? Follow-up comment of “you’re a handsome man” pretty much told me that Mr. Watannabe’s nickname was probably “Twinkle Toes.” I immediately responded by saying I only have a day to visit my “girlfriend.” If possible, I would like to “hurry up getting the packages’ ‘to you.

Watanabe spoke Japanese to his companion, and the three of us proceeded to the Motel lobby. After a short time, Watannabe’s hired hand arrived in a white late-model Mercedes, and we proceeded back to the Motel I had stayed in. Visions of Police Officers' heads bobbing up and down, waiting for us to arrive, thankfully did not occur. A quick walk through the lobby and a short hall walk took us to my door. Once inside my room, I removed my packages from the closet area. Agent Gauze had been careful not to tamper with the wrappings for his C.W. Allen had alerted him that if the wrappings are tampered with, “they will know.” Once Watanabe saw the packages, his demeanor changed to almost giddy. I knew immediately that CW Allen had been on the money about “the packaging.”

As my guests secured the “packages” and started to leave, I asked, “what about my money?” Not being totally sure how much was owed, I did not disagree when Watanabe stated, “you will be paid in the Philippines.” As the door closed, I made a move to open the window. Once open, I pushed the screen loose and started climbing out. Immediately I realized that it was dark when I had inspected the window as my egress point. Now in the light of day, I realized, “yes, this room is on the first floor,” but it is close to a twenty-foot drop to the ground.

Sirens ringing, vehicle tires squealing, and screaming in Japanese was my “clue,” signaling it was “escape time.” I bailed out and, as I hit the ground, rolled to break my fall. As I recovered to my feet, I started running towards my designated pick-up point. No huge surprise to arrive and find that my Contact Agent wasn’t in sight. No time to waste, and being short of breath, cussing was not feasible, so I continued to run. Once the entry gate to Atsugi Air Base was in sight, I slowed to a fast walk, flashed my U.S. Navy Identification card and proceeded through the gate. Immediately finding a concrete bench, I sat down, caught my breath, and assessed my status.

Up drives my Contact Agent displaying a “sheepish smile” while apologetically saying, “the traffic was horrible.” Once night came, sleep was not difficult. Catching a military transport back to Subic was seamless for now, my displayed identification was N.I.S. Special Agent, Stephen Smith. However, one hurdle had not been anticipated. I now had to explain how I arrived in Japan without receiving any documentation for my entry from Military Customs. As I attempted to explain, I finally told the Navy Chief, questioning me, “you really do not want to know,” followed by “I Am not sure I can explain it,” which was met with a nod and an exit stamp on my passport.

Protracted investigative efforts by Japanese authorities resulted in the indictment & conviction of eight (8) Japanese Yakuza Members for smuggling of contraband, weapons violations, and possession of prohibited materials.

The firearms seized included fifty 38 cal pistols and 2 500 rounds of 38 cal ammunition. The firearms had been manufactured in Cebu, Philippines and were designed after S & W model 36 pistols (38 specials), now infamously known as “Cebu Specials.”

--

--

Stephen Smith

Veteran of Vietnam, P.I. during The Peoples Revolution, Desert Shield/Desert Storm, and the War on Terror. Retired NCIS Special Agent.