LAYING OUT THE BRUTAL FACTS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000706970007-9
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 22, 2016
• Document Release Date: December 20, 2011
• Sequence Number: 7
• Publication Date: March 9, 1987
• Content Type: OPEN SOURCE

Declassified in Part - Sanitized Copy Approved for Release 2011/12/20: CIA-RDP90-00965R000706970007-9
ARTICLE APPEAittD
ON PAGE 19&.
T IME
9 March 1987
Laying Out the
Brutal Facts
Tower's panel shows that the devil was in the details
It was bound in soothing blue
and bore the Presidential
Seal. Its language was re-
strained. dignified. some-
times even gentle. But its
? message was scalding. Rarely
has a presidential commis-
sion so sharply criticized its creator. The
288-page report of the President's Special
Review Board on the Iran-contra affair
describes an incredibly inattentive Ron-
ald Reagan. a hear-no-evil Secretary of
State George Shultz and Defense Secre-
tary Caspar Weinberger, a devious former
CIA Director William Casey. and a Chief
of Staff Don Regan whose proclaimed
mastery of spin control failed miserably
when faced with a matter of substance.
And while these officials floundered. Oli-
ver North. with the approval of his boss
on the National Security Council staff.
John Poindexter. showed a reckless dis-
dain for the laws of the land by creating a
covert network to fund the contras in Nic-
aragua while trading arms to the Iranians.
Appointed in early December to ex-
amine the structure of the ,,Sc. the panel
turned into an aggressive inquisition on
i the Iran-contra affair. Former Texas Sen-
ator John Tower. former National Securi-
ty Adviser Brent Scowcroft and former
Maine Senator and Secretary of State Ed-
mund Muskie reached their conclusions
with resounding unanimity after taking
testimony from some 80 witnesses and re-
,iewing thousands of documents. includ-
ing a treasure trove of \SC computer mes-
sages notable for. among other things.
eir frequent misspellings.
The report assails the \SC staff. head-
ed until December 1985 by Robert
McFarlane. and then by Poindexter, for
an "obsession" with secrecy that "provid-
ed an excuse for abandoning sound pro-
cess " It notes that the \SC staff. including
North. tried to keep much of the Iran ini-
tiative secret from foreign policy experts
in the U.S. Government even though it
was known to a "variety of persons with
diverse interests and ambitions-Israelis.
Iranians. various arms dealers and busi-
ness intermediaries and LtCol North's
network of private operatives." Beyond
risking exposure abroad. this meant that
the "unprofessional" operation was never
guided at home by people who understood
such essentials as the "situation in Iran:
the difficulties of dealing with terrorists:
the mechanics of conducting a diplomatic
opening." Charged the board: "The oper-
ation functioned largely outside the orbit
of the U.S. government land] was not sub-
ject to critical reviews of any kind."
While the impulsive North free-
wheeled the Iran venture, he kept only
Poindexter "fully informed" and made
Casey riv to ma .
Shortly be ore McFarlane's now notori-
ous trip to Tehran last May with a plane
bearing weapons and the expectation that
all American hostages would be released,
North uncharacteristically suggested to
Poindexter that a "quiet" meeting be held
with the President. Shultz, Weinberger
and Casey to review the plans. Responded
Poindexter in a computer memo to North:
"I don't want a meeting with RR, Shultz
and Weinberger." It was not held.
The NSC staff secrecy was even more
obsessive on North's pivotal role in sup-
plying the contras with arms at a time
when military aid was banned by Con-
gress. On May 15. Poindexter warned
North by computer. "From now on. I
don't want you to talk to anybody else. in-
cluding Casey. except me about any of
your operational roles. In fact. you need to
quietly generate a cover story that I have
insisted that you stop." The next day.
Poindexter sent a message that the now,
departed chief of staff must appreciate:
"Don Regan knows very little of your op-
eration and that is just as well." In June.
Poindexter indicated that Shultz too
should be kept out of contra details. telling
North. "To my knowledge Secretary
Shultz knows nothing about the prior fi-
nancing. I think it should stay that way...
Astonishingly. the Tower board found
that not even the President was aware
that his NsC staff. rather than the CIA. was
both directing and carrying out the Iran
deals. The report faults Casey for not
"the avarice of arms dealers." or was a re-
sult of an "American request for assis-
tance." But the board is certain that Israel
"had an incentive to keep the initiative
alive" and kept intervening with the \SC
staff. Poindexter and even the President
to do so. While Israel had great success in
repeatedly reviving U.S. interest when it
seemed to be waning, the report declares
flatly. "U.S. decision makers made their
own decisions and must bear responsibil-
ity for the consequences."
In the most detailed narrative yet
compiled on the scandal, the report sheds
new light on some of the sorry affairs
major questions:
Was the U.S. trading arms for hos-
tages? The Tower board concedes that
the U.S. officials aware of the Iran initia-
tive may have had different motives. But
despite such differences, the report con-
cludes. "Almost from the beginning the
initiative became in fact a series of arms-
for-hostages deals."
The blame for turning the Iranian ini-
tiative into an outright arms-for-hostages
scheme is placed squarely on one man
Ronald Reagan. The report reveals that
notes from the President's diary. as well as
his repeated questions about the fate of
the hostages to such aides as Regan and
Poindexter. show that Reagan's "intense
compassion for the hostages . appeared
to motivate his steadfast support of the
Iran initiative. even in the face of opposi-
tion from his Secretaries of State and De-
fense." Regan, for example, told the
board that in December 1985 the Presi-
dent had said "that we were going to
spend another Christmas with hostages
still there and that he was looking power-
less and inept because he was unable to do
anything to get the hostages out."
Even if skillfully executed, the arms-
for-hostages policy would still have been
wrong. Such trades "could not help but
create an incentive for further hostage-
taking ... They could only remove inhi-
bitions on other nations from selling arms
to Iran ... [The] trades rewarded a re-
gime that clearly supported terrorism and
hostage-taking."
Were the anus sales to Iran approved
in advance? It was not the panel's role to
make judicial verdicts, but the report
makes clear that the legality of the arms
deals depended on whether the President
warning Reagan of the risks involved in formally waived in advance the provi-
letting the inexperienced North run such sions of various arms-export laws forbid-
operations and for not insisting the CIA ding shipments to Iran.
take over the covert project. Declares the On that critical issue, the President
report. with deliberate understatement: gave three different versions of his recol-
"The President did not seem to be aware lection of what he had done about Israel's
of the way in which the operation was im- sale of 100 U.S.-made antitank missiles to
plemented and the full consequences of Iran in August 1985. This shipment start-
U.S. participation." He did not. it ap- ed America's involvement in Iran arms
pears. even bother to ask. sales, since it was conditioned on agree-
As to how the entire Iran initiative ment that the U.S. would resupply Israel.
started, the report says it is "unclear" Testifying to the Tower board this past
whether it was prompted by Israel. by Jan. 26, Reagan said he had approved the
shipment sometime in August 1985. He
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even underlined a portion of McFarlane's
testimony making the same point to the
Senate Foreign Relations Committee. On
Feb. 11, however, Reagan told the board
that after discussing the matter with Re-
gan, he realized he had been "surprised"
on learning that the Israelis had shipped
the weapons. and therefore must not have
approved it in advance. That squared
with Regan's testimony to Congress and
the board. Two weeks ago Reagan sent a
letter to the board saying "I'm afraid
that I let myself be influenced by others'
recollections" and "I don't remember-
period."
Interviewed three times by the board,
McFarlane stuck firmly to his story that
Reagan had personally given him approv-
al by telephone to tell Israel the President
supported the sale. McFarlane said he
even reminded Reagan that Shultz and
Weinberger opposed this move, but the
President assured him he would take "all
the heat for that." While the report says it
cannot "conclusively" resolve the dispute.
the board is "persuaded that [the Presi-
dent] most likely provided this approval
prior to the first shipment by Israel."
Israel also made a shipment of 18
U.S.-made Hawk antiaircraft missiles to
Iran in November 1985. The Iranians
were furious because the missiles carried
Israeli insignia. They demanded that the
weapons be sent back to Israel. Again. the
President's memory is cloudy on whether
he gave an O.K. to the sale. At first he told
the board he had objected. and that is why
the shipment was returned. Later he said
he and Regan had agreed that "they can-
not remember any meeting or conversa-
tion about a Hawk shipment."
By the time the U.S. decided to sell
arms directly to Iran, a formal presidential
finding was necessary. Reagan signed one
on Jan. 6, according to the report. but Re-
gan told the board that the President had
done so "in error." He signed another one
on Jan. 17. Although the President did not
read the covering memo explaining why
the finding was needed. he does remember
making the decision. He wrote in his diary.
"I agreed to sell TOws to Iran."
Did the NSC staff illegally help the
contras? In October 1984 Congress
passed the Boland Amendment, which
made it unlawful for the CIA or any agen-
cy of the U.S. Government that is -in-
volved in intelligence activities" to "di-
rectly or indirectly" support military
operations in Nicaragua. Defying the in-
tent of this law, North proceeded to over-
see the creation of a vast resupply
network involving secret Swiss bank ac-
counts, dummy corporations. nonprofit
tax-exempt foundations and covert solici-
tation of funds from foreign governments.
He called the operation "Project Democ-
racy." Charged the Tower commission:
"By fall 1985. North was actively engaged
in private efforts to resupply the Contras
with lethal equipment."
The board describes in damning detail
how North directed at least nine drops of
supplies in Nicaragua, and it discovered 36
messages between him and contra supply
i coordinators. Not even military operations
in the field were beyond North's personal
involvement. He met in Washington with
Contra Chieftain Adolfo Calero just one
month after the ban against U.S. military
aid became effective. According to the re-
port, they reviewed a contra plan to destroy
some Soviet helicopters acquired by the
Sandinistas. In February 1985 a North
computer memo asked McFarlane to help
Calero get information on a Nicaraguan
merchant ship delivering arms from North
Korea, with the objective of "seizing or
sinking the ship." Poindexter agreed in a
note on the memo: "We need to take action
to make sure ship does not arrive in Nicara-
gua." The plan was abandoned only when
an unnamed "friendly country" rejected an
NSC request to help with the operation.
North also kept close watch on the
fund-raising efforts of retired Air Force
Major General John Singlaub, who suc-
cessfully solicited money for contra mili-
tary supplies from two Asian countries
unidentified in the report but known to be
South Korea and Taiwan. McFarlane told
the board that an urinamed "foreign offi-
cial" (reportedly King Fahd of Saudi
Arabia) had donated $25 million to the
contras in 1985, putting the money into
accounts suggested by North.
About the time that McFarlane had
assured a congressional committee that
"there is no official or unofficial relation
with any member of the NSC staff regard-
ing fund raising for the Nicaraguan Dem-
ocratic opposition." North wrote a com-
puter memo to Poindexter reporting that
a plane controlled by retired Air Force
General Richard Secord had to be divert-
ed from carrying arms to the contras so
that it could deliver U.S.-made weapons
to Iran. "Too bad." said the memo. "this
was to be our first direct flight to the resis-
tance field at [deleted] inside Nicaragua.
The ammo was already palletized wi par-
achutes attached. Maybe we can do it on
Weds or Thurs."
When Congress appeared ready to re-
sume military funding in October 1986.
North proposed that the CIA purchase the
Project Democracy assets. which he listed
as including six aircraft. warehouses.
ships, boats, houses and a 6.520-ft. airstrip
in northern Costa Rica. The price tag:
$4.5 million. North even seems to have
engaged in near blackmail when officials
in Costa Rica threatened to close this
airstrip. After consulting with Elliott
Abrams, the top State Department offi-
cial on contra policy, and Lewis Tambs.
U.S. Ambassador to Costa Rica. North
reported that he called Costa Rican Presi-
dent Oscar Arias Sanchez to threaten that
the U.S. would cut off $80 million in aid if
this happened. Costa Rica closed the field
anyway: the aid continued.
Later North wrote Poindexter. admit-
ting that "I was well beyond my charter in
dealing w/a head of state this way and in
making threats/offers that may be impos-
sible to deliver ... it seemed like the only
thing we could do." Replied Poindexter:
"You did the right thing, but let's try to
keep it quiet."
The Tower commission finds the le-
gality of these NSC staff actions murky,
partly because in December 1985 Con-
gress altered the Boland Amendment to
permit some CIA intelligence exchanges
with the contras. A classified appendix
provided other loopholes. Scowcroft calls
the Boland Amendment a "masterpiece
of ambiguity."
Who knew of the diversion of Iran
arms proceeds to the contras? Scowcroft
conceded in an interview that the report
"only scratches the surface of the contra di-
version." The board was able to determine
that at least $23 million in profits from the
arms sales was available for diversion. This
includes $3 million from the first two Israe-
li shipments and $20 million from. the four
U.S. deliveries. In each case "the price
charged to Iran was far in excess of what
was paid to the Department of Defense."
The board reports that "nothing is known"
about the disposition of the Israeli profits
and that other excess monies "remain un-
accounted for."
Meese told the board North claimed
that such a diversion had first been sug-
gested by Israeli Counterterrorist Expert
Amiram Nir in January 1986. Manucher
Ghorbanifar. the Iranian middleman on
the arms deals, contends that in February
North asked him if the Iranians would
pay $10.000 per TOW missile. instead of
$6,500. When Ghorbanifar said yes.
North "was a changed man."
The panel cites evidence that the CIA
may have known about the existence of a
possible diversion far earlier than it has ad-
mitted: a memo from George Cave, a for-
mer CIA official working with North on the
Iran initiative, reported that Ghorbanifar.
at a meeting in Paris in early March. had
"proposed that we use profits from these
deals and others to fund support to the re-
bels in Afghanistan. We could do the same
with Nicaragua." But Cave told the board
that neither he nor Ghorbanifar had ever
mentioned a diversion.
In April of last year. North prepared a
memo seeking presidential approval for
McFarlane's trip to Tehran and stating
that S 12 million in "residual" funds from
the transaction would -be used to pur-
chase critically needed supplies for
the Nicaraguan Democratic Resistance
Forces. But the board could find no evi-
dence that North had even sent the memo
to Poindexter. By May. North had told
McFarlane that "the government is avail-
ing itself of part of the money for applica-
tion to Central America." North told As-
sistant Secretary of Defense Richard
Armitage in November that "it's going to
be just fine ... the Ayatollah is helping us
with the Contras."
As for the President. the board con-
cludes that "no evidence has come to light
to suggest" that Reagan knew before
Meese toTdhim in November.
C1111I1191MIe I
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Was there a cover-up? In perhaps its
weakest section. the report notes that
North. "either on his own or at the behest
of others. actively sought to conceal im-
portant information" after the scandal be-
came known. He produced a chronology
of Iranscam events that "had many inac-
curacies." McFarlane is faulted for help-
ing Poindexter. North and other NSC
staffers produce a dozen versions of this
chronology, which the former National
Security Adviser admitted "did not pre-
sent a full and completely accurate ac-
count." The board reported that it could
not confirm whether North had shredded
documents relevant to the investigations
under way.
On Nov. 21, just before the diver-
sion of funds became public. Ca-
sey and Poindexter briefed con-
gressional intelligence com-
mittees but "did not fully relate the nature
of events as they had occurred." This pro-
duced an "understandable perception."
said the board all too softly. "that they
were not forthcoming." More ominously.
the board also expressed its concern that
notes presumably made by Poindexter,
the official notetaker at key `SC meetings.
"appear to be missing."
But in perhaps its most comforting
finding for Ronald Reagan. the board
concluded that "he did not intend to mis-
lead the American public. or cover-up un-
lawful conduct." This was despite such
televised claims by the President as "we
did not trade arms for hostages" and all
the weapons sent to Iran were defensive
and "could fit in one plane." Unfortunate-
ly. the panel makes it relentlessly clear
that the President's appalling lack of un-
derstanding about what was really occur-
ring in no way vindicates him or his Ad-
ministration. Indeed, that is the most
damning indictment. -By EdMiSnuson
Reported by Barrett Seaman and Bruce van
Voorst/Washington
The former director of Central In-
telligence failed to question the
shaky assumptions behind the ap-
proach to Iran and apparently nev-
er explained to the President the
risks if the initiative became public
or the operation failed. Nor did he
make clear to Reagan that North,
rather than the CIA, was running
the operation. "The President does
not recall ever being informed of
this fact," said the commission. "In-
deed, Casey should have gone further and pressed for op-
erational responsibility to be transferred to the CIA. Be-
cause congressional restrictions on covert actions are both
largely directed at and familiar to the CIA, Casey should
have taken the lead in keeping the question of congressio-
nal notification active." Casey may also have had evidence
that funds were being diverted to the contras at least a
month before the diversion was uncovered, yet he failed in
,tis "clear" responsibility to raise the matter with Reagan.
Declassified in Part - Sanitized Copy Approved for Release 2011/12/20: CIA-RDP90-00965R000706970007-9