London security firm KMS linked to secret war in Nicaragua

The London Daily News, March 2 1987

The Prime Minister is to be challenged over her links with a powerful London security company which has been implicated in the Reagan Contra arms scandal.

Labour’s foreign affairs spokesman, George Foulkes, wants to know whether Mrs Thatcher has been secretly helping President Reagan by authorising the company, KMS Ltd, to support the US-backed Contras in their attempt to unseat the government of Nicaragua.

KMS, registered in Jersey with a discreet office in Kensington, is Britain’s most prestigious security company, run by former SAS men and described by SAS sources as “the unofficial arm of the British Government”. It is led by Major David Walker, who left the SAS in 1974.

The Foreign Office denies having any connection with KMS, but Major Walker’s company has been hired to provide bodyguards for British diplomats in trouble-spots like Beirut. Mjr Walker himself is said by colleagues to be on first name terms with the Prime Minister. “He knows her well enough to go round to Downing Street and have tea,” according to one.

The first clue that the scandal may lead to Number 10 is contained in an appendix to the Tower Commission’s report on the Iran Contra scandal, published last week. The appendix reproduces a flow-chart, in which the mastermind of the secret American operation, Lieutenant-Colonel Oliver North, outlined the role of dozens of companies in selling arms to Iran and pumping the proceeds into the Contra war effort.

Under the heading “Overseas Op Arms” he lists six companies, including KMS. Col North does not give the company’s exact role, but KMS’s own promotional literature boasts that it has raised, trained and equipped “full size Special Force Regiments”, lists counter-terrorism and counter-insurgency as its specialities and includes South America in its areas of activity.

According to unconfirmed reports, three men – a Briton and two South Africans – have been identified in central America as Contra mercenaries working for KMS. George Foulkes said yesterday he was tabling questions in Parliament asking Mrs Thatcher where and when she has had meetings with Mjr Walker, and whether any department of the Government had ever authorised KMS to provide support for Col North’s operation.

Mr Foulkes said: “For some time there has been suspicion that there has been a covert British government policy on Central America, that while their stated policy was to distance themselves from the US, they were in reality supporting the Americans and, through them, the Contras. The Tower Commission has now revealed connections which would seem to corroborate this.”

Security sources insist that KMS never takes a sensitive foreign contract without Whitehall clearance. But a Foreign Office spokesman said yesterday: “KMS is a commercial company and it does not operate with the blessing of the government.”