'ONE-TWO PUNCH' FOR CONTRA AID

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000504550003-3
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 7
• Document Creation Date: December 22, 2016
• Document Release Date: February 9, 2012
• Sequence Number: 3
• Publication Date: May 22, 1987
• Content Type: OPEN SOURCE

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STAT,
WASH ACTON POST
AwOCwltO NL"
Dan Morgan and Walter Pincus IT
I Three contra donors standing, from left, Joseph Coon, Elks Garw
four
`One-Two Punch'
1V rth ve Pitch; (hannell
C lest d, Contributors Testify
forn er Whil
er rl R. t:
in liciting
cunt as afte
A meetit
Offi . Build
tent 1 Bono
of S( Viet bol
rlev 'tatittg
U' yle told
Nor also c
"seclet plan
withlthe hell
Afterward
inedings at
pitch for nto
army or anu
tiou. O'Boyle
In:anothei
tifiel that Cl
a liti of c'ont
tall Lunge a
T o wen
SAY 22198'?
by contributors yesterday described how
House aide Oliver L. North and fund-mais-
itz) Channell worked as a "one-two punch"
veral million dollars for the Nicaraguan I
Congress cut off aid in October 1984
r in the White house and Old Executive
g, Marine Lt. Col. North painted for po-
Williarn B. O'Boyle a threatening picture
bers landing at a Nicaraguan air base after
he United States with nuclear we.iputts,
the inn-contra investigating ennintittees,
ufided, O'Boyle added, the existence of a
for the cot tray to oust the Sandinistas
of a U ,S, Navy blockade.
1, at intimate private dinners or ,rnall
tlegant hotels, Channell followed tip with a
ey to provide the contras with equipment,
monition through his "tax-exempt" fuunda?
said he eventually gave $160,000.
case, Texas heiress Ellen Garwood tes-
anuell, in the company of North, gave her
a needs in a side room adjoining the cock-
the Hay Adams Hotel. Listed were such
ntra Aid
TE8TI Y, P rem A I
contra needs as hand grenades, bul-
lets, cartridge belts and "possibly
surface-to-air.tnissilea."
Taking to heart North's warning
that the contras "night cease to
exist if something weren't done
about these various needs," Gar-
wood testified, she contributed $2.4
million to Channel's National En-
dowment for the Preservation' of
Liberty (NEPL) in the next two
months.
"Where I come from, we call that
the old one-two punch,'" corn-
mented Sen. Warren B. Rudman
(R-N,H.), the Senate committee
vice chairman.
A third witness, Colorado ind~~ts-
triatiat loleph Coors. described; af
different oft-two punch.
In June 1985, when he told its
longtime friend William 1. Casey.
who was then CIA director. that he
wanted to aid the contras Casey said
he couldn't do anything. But "to
int-blank Coors added Ca-
told hint llie North's the say to
see."
Casey, who was in his office at
the Executive Office Building, ar-
ranged for C oars to sites around the
liam O'Boylr, COMM Duncaa Osborn rentod.
yq
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corner and visit North who con.
vinced him to give $65,000 to ur-
chase an aircraft o t o laic t
contras needed for fight cargo and
short runways in Elnndurls,
North's direct dealings with
Coors contrasted to the accounts of
Garwood and O'Boyle, who testified
that Channelt usually solicited mon-
ey after North had left, North sub-
sequently provided Coors with the
name and nwnber of Lake Res
sources, the Swiss bank accounf
controlled by retired Air Force mar
jor general Richard V. Second, and
in August 1985, Coors trnnsferre
the money to that account.
The committee not only provided
details of how private money was
raised domestically for the con,
tras-using the prestige of ithe
but also raised quest" about ow
donated funds were ,
Coors, for example, t ld the m-
inittee that be believed the $65 00
would purchase a Maulgaircrat or
use by the contras. a even d
that North showed him a pictu of
it in the jungles of ttonderas, ca ng
Two weeks ago, however, Se rd
testified that the Maule lad bec e
part of the assets of his "en r.
Prize.' which was running a pri I.
airlift to resupply the dontras, I.
acknowledged the pLino had n
paid for with a donation that t
uments show came from Coors.
Coors said yesterday tjeat he es
this. And O'Boyle, who had spe#f-
tribution to Channell's foundat
for two Mauler, went further:
didn't give this money to Gen.
cord. I gave it to the free}om
era in ltonduras."
Channel) pleaded guilt a mo
ago to Conspiring to d raud t e
government by using f fro min
chase weapons. North uses Hain
as a coconspirator,
The committees also k e pur
ing what happened to larlie amt
butions such as the ones Garw
records, on April 15 and, May I
deposits to NEPL obtained by TI
Washington Post does non list co
tributiosss in tam anw~ni.nnt.,l e
Garwood's documents show
she transferred money or M it
t
taling just over $2 million o NEP
on April 15. The acco revie
May 8, 1986, and a su
transfer of that amount t
man islands shift company that pr
-
vided funds to the contras en
19
However, contra records made
available to the committees show
the Nicaraguan rebels receiving
less than $1 million from that
source during the entire year of
1986.
Garwood raised the question of
how much the Channell operation
deducted for costs and overhead ind
an anecdoto.
She said ' Channel! had solicited
$10,000 from her last December
for a fund to cover legal costs and
children's education for North. Af?
ter she contributed, however, she
was called by a North friend also
raising money for North's defense.
"Do you know Mr. Channell takes
35 percent for his own organisa-
tion's overhead?" the friend asked.
After confronting Channell and get-
ting no denial, she took the money
back and sett it to the "officials do.
Tense fund.
In other testimony that touched
on fund raising, the committees also
finished hearing testimony from
retired Army major general John K.
Singlaub. [to testified Wednesday
that in early 1986 he visited Assist-
ant Secretary of State Elliott Ab-
rams prior to traveling to two na-
tions---identified by sources as Tai-
wan and South Korea--with the
intention of soliciting aid for the
contras.
Singlaub said Wednesday that
Abrams had approved his plan and
would send a"signal" to those gov.
ernments that the administration
supported his private initiative.
Yesterday,'Singlaub said he was
surprised to learn that Abrams did
not tell the 'rower review board
that he offere4 to send a signal. The
former general however, stuck by
his story, pointing out that without
the signal of administration backing
he did not believe the countries
would agree to contribute.
Singlaub also repeated testimony
given Wednesday that Abram had
called him while he was in "Country
Three"-,Taiwan, according to oth-
er sources--nod told him to hold off
z,
on his *extract rricular activity" be.
cause the mat r would be handled
"at the highest level l,* which he took
to mean the W *it* House.
An aide to Abrams said yester-
day, "Elliott as probably not as
straight with Singtaub as be could
have been . . . . There was a lot of
doubt about whether we (Statel
could be involved." The department
ultimately decided it could not as-
sist Singlaub, and Abram. so ad-
vised him, the aide reported.
An added source of confusion, the
aide said, was Abrams' belief that
any signal would come from the
department rather than him.
During the questioning of Sin-
gisub, Rudman again raised the
natter of price differentials W
two" am and munitions add to
the contras by the two retired gen-
erals, Singlaub and Secord.
The contras would We re?
ceived two weapons for every aoe
that they received under Second's
prices, is that correctir' Rudman
asked.
That is correct," said Singisub,
who told the joint House and Senate
investigating committees that he
had provided training and military
advice, not only to the contras Ibut
to anticommunist resistance Sr ps
all over the world. However, he
pointed out that there were "o r
f.ctore" that might explain Nor 's
dtclsion to keep buying c tra
weapons from Secord.
Singlaub said he had worked herd
in! 1986 trying to raise money
the contras, not knowing that
card's "enterprise" was accumu
nn~ millions of dollars in sufifift
brinks through profits on the sal of
US. arms to Iran.
if I had any knowledge that that
money had been in the bank
woe available, I would be even
furious," said Singlaub.
The North-Channell fund-
operation unveiled yesterday
pohded heavily on North's vivid
tions of Soviet penetration it
hemisphere and the dire col
cusnstances of the Nicarugu~a
'f edom fighters."
t an April 1986 meeting Cis,
A110111111110
a
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3.
4i thin one of the unintended results for M Ir. Car: sad Mrs. Garwood and Mr. O'Seyle
... Is u'ro going to Met an Inarod bloc an gnat of mail from choritabl organizations
_.-. -.~.~--_~ - -- -? _~__~_u_ --~~~~ ~ `.w ~wr wry A
scribed by O'Boyle. North showed
photographs of the recently built
Nicaragua airport that would be
used not only t receive Soviet
bombers, but also to station Soviet
planes that have ''kind of large de-
vice on the outside to fly up and
wn the West coast" and eaves-
rop as the Unite4 States,
North described an intercepted
essage from the Soviet KGB to
Nicaraguan delegation to the
nited Nations-evidence that
ussians manage Nicaraguan dipio-
y--and showed a picture indi-
ting Nicaraguan government of-
Is were "involved in dope trans-
tions,' O'Boyle aid,
O'Boyle was later told by North
t the rebels needed Blowpipe mis-
des to down helicopters-but that
ey were "$20,000 apiece and had
be purchased in packs of 10."
O'Boyle also told of a subsequent
meeting in North'! office at which
National Security Council offi-
r told him of a "very, very secret
." After refusim at first to de-
it in public because of his
anise to North to "tell nobody,"
revealed its outlines after clear.
g it with Senate committee chair.
Daniel K. Inouye (D-Hawaii).
plan involved the contras seiz-
a piece of Nicaraguan territory,
bushing a provisional govern-
t and the U.S. Navy blockading
country, with the Sandinistas
uy giving up.
O'Boyle was recently charged
th a felony by New York City
utors for allegedly defraud-
i an insurance company out of
.8 million by ffun a false insur-
claim for pre olumbian state
he said were It
, according
t Michael McMan , an assistant
rict attorney . New York.
Manus said the statues were
a usily worth about $200,000.
I (Ye , who j old he r
n O'Boyle during
t imony, said the criminal charge
is t related to O'B4yle's work for
contras. O'Boyle has pleaded
n guilty and is awaiting trial. His
c inal case did not come OP at
y terday's hearing.
rrssarrher Mum Hell aed
st ! p-ribr Jos PiclYiralfe
c ribWtted to this report
SEN. WAR$t.N B. RUDMAN
Apparent North? Walsh Case
To Go on Public Record
The U.S. Court of Appeals
yesterday ordered that briefs be
riled publicly in a legal dispute
that sources say is between Lt.
CoL Oliver L. North and inde-
pendent counsel Lawrence E.
Walsh.
Yesterday's public order
seems to indicate that at least
part of the dispute involves an
unspecified challenge North is
making to Walsh's investigation.
In its order, the court said it is
calling for briefs "solely with
respect to the (North) challenge
to the legal authorities of
(Walsh) to proceed with his in-
vestigation before the grand ju-
ry."
" the court further orders .. .
that all aspects of this case, in-
eluding the remaining issues on
appeal and all proceedings that
have occurred in the case
date, remain under seal." u
the ruling, handed down by
three-judge panel.
The first brief I. due late t
day, and oral arguments in
matter were scheduled tar J
$.
I Two weeks ago. North ap.
peared at the federal courtL
florae in connection with a
dies of closed court proceeding
that culminated with a hearin
before a three-judge panel
the Court of Appeals. At t
usion, the panel announce
that it had issued orders on'
slealed matters."
~ Earlier this year, North
y sought to ?hal
into the fran.contra able.
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Joseph
Coors
Joseph Coors. a Colorado
beer executive and longtime
contributor to conservative
causes, said that his concern
about the "steady oppression"
of the Nicaraguan Sandinista
government caused him to ap-
proach William J. Casey, then
the director of the Central In-
telligence Agency, about help-
ing the contras.
"Bill Casey was a good friend
of mine," said Coors, the for-
mer chief operating officer of
the Adolph Coors Co. Coors is
also a friend and strong sup-
porter of President Reagan.
Coors told the con ressional
-contra panels that se
referred him to Lt. Col, Oliver
L. North who convinced him
to. contribute 65 000 to pw-
chase a sinall short-takeoff.
and-landing plane. called a
Maule, for the contras. Coors
said he wired his donation to a
Swiss bank account whose
number was provided by
North.
Coors has been a chief finan-
cial supporter of the Heritage
Foundation, a conservative
think tank, and also contrib.
uted to the Mountain States
Legal Foundation, which James
G. Watt headed before becom-
ing Interior Secretary.
"I had heard and talked with
a good number of people in re-
gard to the plight of the Ni-
cara uan freedom fighters ...
(and? I wanted to do something
about that," Coors said yester.
day.
Ellen
Garwood
Ellen St. John Garw an
outspoken anticommunist, has
been one of the Nicsra n
rebels' largest donors, con rib?
uting more than $2 mitt' for.
the contra cause.
She first received attention
when she contributed $65,000
through retired general An
K. Singlaub, a leading private
contra supporter, for a hd'
ter that was named the " Ellen" in her honor.
But Garwood told the
gressional Iran-contra pa yesterday that she gave
bulk of her contributhrough conservative fine.
raiser Carl R. (Spits) Chan who recently pleaded guilty to
conspiring to supply milititry
equipment to the rebels funded
by tax-deductible donations.#
A spry woman in her 81bs,
Garwood is the author of stv-
eral books, including a biogra-
phy of her father, William L.
Clayton, a lifelong anticommu-
nist who served as undersec.
retary of state for econo is
affairs under Truman. In tiffs
post, Clayton, who made a fpr-
tune in cotton trading, helped
devise the Marshal Plan 1to
rebuild Europe's econotny If-
ter World War 11.
Garwood, who is a wid ,
lives in Austin, Tex. -My -
ther wanted to stop the apr
of communism, she once said
in an interview. "I think we'Ive
got to keep freedom alive in
Central America, or we're 4o.
ing to lose our own freedom.!
FILES
A-1 l
William
o'Bdyle
William B. O'Boyle, an heir
to a Texas oil fortune, said he
agreed to donate $130,000 to
purchase two small planes for
the contras after It. Col. 01-
iver L. North Jr. explained that
Nicaragua was rapidly becom-
ing a Soviet "foothold" in Cen-
tral America.
O'Boyle, who . lives in New
York City, said -he was cot.
tacted by an aide to eonservs.
tive fund-raiser Carl R. (Spits)
Channell after a friend had giv-
en his name to the group,
He told the congressional.
Iran-contra panels that North
and Channell discussed with
him weapons the contras
needed, and he subsequently
agreed to provide $130,000 to
purchase two Maulea.
O'Boyle, who said he is a
private investor specialising in
oil and gas exploration. recent.
ly was charged in New York
City with a felons for allegedly
defrauding an insurance com-
pany out of $1.8 Mullion by (II-
ing a false insurance claim, Mi-
chael McManus, an assistant
New York district attorney,
said the criminal charge is un-
related to O'Boyle's contra
activities. O'Boyle, who is in
his mid-40s, has pleaded not
guilty and is awaiting trial.
McManus said' that O'Boyle
has a $40 million trust fund.
The criminal case did not
come up at yesterday's hear-
ing.
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THE IRAN-CON TRA HEARINGS ; A dg
Day 11 of ti 'e Testimony
"Cot Nort was concerned about Russian it itelligeltce services trying, to discredit him. I
reinembe wondering whether we were invc rived In the beginning of World War III here.
I And
said, 'No, Russia would never go up against us to save Nicaragua. "
Rxcerpts of ttatimoey by Ellen Garwood of Austin,
T. a tostributor to the contras, in response to Hoarse
st4Orcou rual Tors Fryman about her meeting in April
19186 with fund-r imr Carl R. (Spitz) Channel and
Natisnirl Security Council aide Lt Cot. Oliaer L.
No,*
What was said ... about weapons?
[They[ spoke in low tones to each other and,
after they had finished, Mr. Channel] produced a list
of weapons that they needed.
... AMd did Mr. Channell glue you his list?
Yes, he did.
.. ? What sort of information was on it?
The list had ... hand grenades, I remember, and
bullets, cartridge belts, possibly surface?to-air mis-
siles. And there were quantities opposite each cate-
gory and ... a sum of money that was needed, in or-
der to provide those weapons, that those weapons
would cost.
Whet was the approxlnate total amount?
Over $1 million. And I'm not sure just exactly
what it was, over probably $1.5 million, something
like that.
I Mr. Chanaeli ask you to make a eon.
Mr. Channell did, after Col. North left ....
... Did YOU make a Contribution to N[PL
[ChaauroM's National Cndownreat for the Pro.
sesvagM of Uhs ty( In response to Mr. Chan.
Men's rsgiast?
Yes, sir, [Garwood said she contributed nearly $2
million in April and May 1986.1
Excerpts from lestimmy by William B 0 Boyle, a
Nm York City oil and gas execuli$c?
And what Napwnsd after (O'Aoyle's Initial
nasting hire with Chann.lI and otheroi?
[In March 1986 , the group went over to the Old
Executive Office Building ... to ~a conference room
where we waited for Col. North td appear.
Approxln etely how large was the group ... t
About 10 people or so, 10, 12 people, something
like that.
... CM. North arrived of the cawfavonco
'cen't
WILLIAM B. O'BOYLE
Yet .... He described the sityation in Nicaragua,
He had photographs of an airport in Nicaragua that
had been recently built ... a din used military air.
Port- One of the uses for which jitj was intended was
to recover the Russian Backfire bombers after they
made a nuclear attack on the United States ... He
indicated how our security servioes had interce fed
the text of w ?,.,...-4
by the Nicara n re N
gun presenthtive to the U.N. , .. .
The point being that it's really the Russians who are
managing the diplomacy of the Nicaraguans before
the United Nations, He showed photographs which
indicated that the Nicaraguan government officials
were implicated in smuggling dope, showed pictures
of them involved in dope transactions ....
Did Col. North make any request for any con.
hlhutierr front the persons attending this meat.
iris ? ? . I
No.
r1low did
Mr.~Chown" drat vent have any discussion with
Yes. After dinner. he came over and indicated that
he heard that I was willing to make an especially large
contribution with the idea of possibly supplying weap-
ons or military equipment of some kind to the contras.
He said that there was a small group of people in the
United States that the president relied on to make
that kind of contribution, that: this was a cause that
was very dear to the president's heart. And he
thought that perhaps I might be interested in joining
[The next morning, Channell] said that, if one
were to give approximately $300,000 or more,
the president would.actually meet with the contribu-
tor and thank him personally, 18 or so minutes
with him on an off-the-recor kind of meeting and
thank him for the contribution he was making to the
national security.
Did he Indicate lhalj, between his first
CIav.reaa" with you and the Conversation
that run %brgr that thorn had been any Mad of
a
sftrto64 yew IrrNtls gi~wp your mil.
flol"Oka 41111
Yes. He indicated the next morning that he had
checked me out overnight . . .
... What did Mr. Chaell say after Col.
North arrived [for breakfast that rtes rg)?
5 (d
S &P
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2,
Well, he introduced me as someone who was willing
to provide money for weapons ..... Col. North made
the point that he could not ask fbr money himself as a
government employe but that he could provide infor-
mation .... He began to explain the type of weapons
which were needed.
Typos of weapons did he IndIC810
were He talked about Blowpipe missiles, which were
$20,000 apiece, but which had to be purchased in
paclik of 10 These were necessary to counteract the
Hin+ helloter gunahops, which the Russians had
t Sting missiles. He described the ammunition
What amount did yon dsctdo to contrib.
... a also described a certain kind of air-
.$130 00.
T of th (light supply Maule aircraft.
N dial nabs this contribution?
I nd ered the check to Mr. Channel! in
W ington few days later.
was was this to be for?
D you are a further meeting with Mr.
Ch rill . 1. with Col. North?
.4. And hat did Mr. Cbannoll say to Col.
. wed bun the check, and he indicated
Will, in
after a arrived?
that I'd made a contribution, and that's what he said.
And what was Col. North's reopensof
fie acknowledged that I'd nr.ide the contribution.
Was then may further discussion of weapons
on this occasion?
Yes. Col. North had essentially the same list that
we went over again, and ammunition ....
.. In your meetings with Col. North, did he
ev r Indicate that be was sharing classiftod in-
formetion with you?
Yea , It was the second meeting that I went to
down in Washington where ... he described the ad-
ministration's strategy in Nicaragua.
That was ... In his office
0: That's right ....
The following are Garwood's responses to hfoxss
chief minority counsel George Van Clew
.. 1 wondered M you could tell the commit-
tee the story concerning your contribution to
[the Oliver North legal defense fundl .... As I
M
had .
ing
Wotan
l
0psss
Chant
real
need
Mr.
educ ing hi;
send 10,00:
if he ill let
from 4y accu
did.
Nod, did
that ho
and I
percen
It, it starts east M early
0806"A- talked is Spits Chaaneq about
ttty of snaking mach a soaplbu.
i
II said over the phone that Col. North
or had been fired from the govern-
thewasinapositionwhereheweego-
perhaps, legal da(ense, and he also
hannell said, son f ... some funds for
children ... And he said, "Can you
And I said, "... 1 will ask my husband
send from his account $5,000 and
$5,000.... " And so that's what I
come a tlauo a alter
a phone call amb's
Messing abopt that some sash.
ms to give a donation for the (fund),
I've already given to Mr. Channell."
you know that Mr. Channell takes 35
!NJ
said, "0
for his
id, ?Nu
a organizations for his overhead?
should have inquired more but 1
. Ile told that Mr. Channsll was keep*
ing sa{, of the contributions to his or.
He t me 11at that's what he had heard, that
Channel was ng 35 percent of donations given to
his orgs for his own overhead and expenses
and that 's high amount .... I thought it was,
You didn't I$ew anything about that previ.
P
didn't
he said h
Channell
send, 1pa
hap. I
. 1 sa'
:ked Ie
was
)sends
out tc
You are raising an official
fund to defend Col. North." And
and I said, "Well' I shat ask Mr.
ck what I sent t; him, and I will
the North Legal Defense Fund, a
sac. I
call Mr. Channel) to obtetn a
Yes ;Hew disappointed. I toai him that I had
heard he wise kaki .. 35 percent f donations for
his overhea~ and I ought that was rather large and I
thought he should ave told me that'. And he said,
"Where did ou he
thisr' And I told him that Andy
e
Messing ha told . And he said, "Well, I think we
conservativ sh all cooperate with each other.
I'm very su the would tell you that .. , , "
Did he d the he was doing tb~s*T J~v
all
He didn't u y it, as I remdmber. But he
did consent $10,000 back to me, and I
o send
said I prefer it out to an official North Legal
Defense Fu andh
did.
77rsidlowi~ are dide s rr,~pomses to Senses adieu
committee Cl irmaa mid K. lnorye (f -Hawaii).
q
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3.
you, att~ fit, C1 ., d to roomy.
Col. North didn't characterize it exactly as "tbh
ss Iusified informatipn which I am now giving you.'
tte anybody about thi1,' And I took that to mean car.
aAV It
iuottag fros~s raw dopooltlan ... "lie
ndlwtod that our hst.Mlgaaoo aarrkaa
MtNwptod Inatrregoea tram the NOs Ise.
Naleao.^ pfd he we. the
't recall if he used that exact word.
did you wa the word " iatoraspbdv"
that's my beat recollection.
you sold Matt you had Naaranei saes
Yaw lied jaak~dJ Mr. North as to what
was plea for Nlaarags..... N. thou said
to _ sas!!tlMltg to, the other that he world
Y He sa ... there were two
plans .... One would implemented if Congress
a the money lash year (or the contra. One
ongress did not , .. They involved the con-
tras . . establishing a piovlsional capital, a provision-
al go at. and the U.S. Navy ... preventing the
supp coming is from Cubs . , . , If Congress did
appr the money, thi>~ would happen on a slower
time tale, giving the contras more time to consoli-
date r position. If they did not approve the money,
it ha it on a er time scale. which would
be . , kind of a last-ditc effort ... (by] the contras.
That 4s the plan.
Declassified in Part - Sanitized Copy Approved for Release 2012/02/09: CIA-RDP90-00965R000504550003-3