WHITE HOUSE ROLE IN CONTRA AID LARGER THAN DISCLOSED

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000807550027-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: January 17, 2012
• Sequence Number: 27
• Publication Date: January 30, 1987
• Content Type: OPEN SOURCE

Declassified in Part - Sanitized Copy Approved for Release 2012/01/17: CIA-RDP90-00965R000807550027-1 STAT
3 -
30 January 1987
White House Role in Contra Aid Larger Than Disclosed
President Agreed to Thank Peres
For Arms to Rebels, Panel Says
By Bob Woodward
Washington Past Staff Writer
President Reagan and his senior advisers were more
deeply involved in assisting the Nicaraguan rebels than
has been previously disclosed, and last fall the president
agreed to thank Israeli Prime Minister Shimon Peres
for providing captured Soviet bloc arms to the contras,
according to a Senate intelligence committee report
released last night.
The report by the Senate Select Committee on In-
telligence provides extensive new details on efforts to
help the contras, making it clear that Reagan adminis-
tration officials, including the president, knew much
more about clandestine efforts to ship arms and other
supplies to the rebels fighting the government of Nic-
aragua than they have publicly acknowledged.
Reagan's preparation for his White House meeting
east Sept. 15 with Peres is one new piece of evidence.
The report describes a memorandum written by Ma-
rine Lt. Col. Oliver L. North, then on Reagan's National
meeting with Reagan], the president should thank him
because the Israelis held considerable stores of [Soviet]
bloc ordnance compatible with arms used by the Ni-
caraguan resistance. Poindexter noted on the memo-
randum received by the [Senate intelligence] commit-
tee that he discussed it with the president."
White House chief of staff Donald T. Regan testified
to the Senate panel that he attended a briefing of the
president, an hour before the Peres meeting, where it
was decided that if Peres raised the subject of those
arms for the contras, "the president should 'just say
thanks.' " The report continues:
"Regan recalled no discussion as to
legality under American law."
At that time, by an act of Con-
gress, the administration was legal-
ly banned from providing or solic-
iting arms aid for the contras.
Israel has repeatedly denied pro-
viding money or arms to the con-
tras, though it has previously been
reported that the Israelis did indeed
provide such aid.
The intelligence committee re-
port quoted Regan as testifying that.
the subject of the arms shipment
was not raised in the portion of the
Reagan-Peres meeting he attended.
Andy it said, "Regan testified that
the president never told him what
came up in a 15-minute private
meeting between the president and
the prime minister."
Sources said last night that the
Committee established that Israel
'd id ship the arms but that the panel
was not able to determine whether
the president discussed the matter
with Peres.
The incident is also significant,
committee sources said, because of
a, Poindexter note two days before
in which Poindexter advised North
to "go ahead and make it happen" as
a "private deal ... that we bless."
The "private deal" Poindexter re-
ferred to was between retired Air
Force major general Richard V.
Secord, a key North associate in the
effort to aid the contras, and Rabin,
according to the Poindexter note
Security Council staff, to his boss, Vice Adm. John M. quoted in the report.
Poindexter, then NSC adviser, which Poindexter sub- I tor talke4 to CIA Direc-
sequently discussed with Reagan. 1'f for William J. Casey that morning
The memo recounted that three days earlier, Israeli about-Secoor ,, according to the re-
Defense Minister Yitzhak Rabin had offered "a signif- port, and "Poindexter instructed
icant quantity of captured Soviet bloc arms for use by North to keep the pressure on"
the Nicaraguan resistance." Casey to "make things right" for
The report continues: "The [North] memorandum Secord, who was running the contra
advised that if Peres raised this issue [in his Sept. 15 resupply operation.
The report's 22-page section en-
titled "Support to the Nicaraguan
Resistance" shows that:
,. As early as Nov. 22, 1985, ac-
cording to a White [louse document
.of that (late cited in the report,
:North and Secord were involved in
.transporting arms for the contras
using funds from what North called
"our Swiss Company," a reference
to a Swiss bank account called Lake
Resources. North kept Poindexter
informed of these activities and
used an operations code that had
not been compromised.
New information in the report
suggests that North skirted close to
the edge of the congressional ban
on administration involvement in
military aid to the contras. For ex-
ample, that same White House doc-
ument showed North telling Poin-
dexter he would meet with contra
leader Adolfo Calero "to advise him
of the delay in the arrival of the
arms," a reference to an arms ship-
ment to the contras that was held
up.
The report quotes North as tell-
ing Attorney General Edwin Meese
[I[ that he contacted Calero early
last year, apparently to discuss di-
verting profits from arms sales to
[ran to the contras, and that three
Swiss bank accounts were set up as
a result of that contact. North gave
the numbers of those bank accounts
"to the Israelis, and money was de-
posited in those accounts. North
guessed the money got to the con-
tras; they knew money came and
were appreciative," North told
Meese, according to the report.
^ Elliott Abrams, assistant secre-
tary of state for Latin American af-
fairs, apologized to the intelligence
committee for "witholding informa-
tion" about soliciting a $10 million
contribution for the contras from a
foreign government. Abrams, tes-
tifying under oath last Dec. 8, said
he did not realize until shown a
transcript of his Nov. 25 testimony
that it "clearly left a misleading im-
pression." The foreign country has
been identified elsewhere as
Brunei.
The committee report indicates
that Abrams made no real effort to
ensure that the money given by
Brunei was used for "humanitarian"
purposes by the contras. Abrams
and other administration officials
have said that it was legal to solicit
humanitarian aid from other na-
tions.
According to the report, Abrams
and Charles [fill, executive assist-
ant to Secretary of State George P.
Shultz, decided to use a Swiss bank
account opened by North for the
Brunei donation "without proce-
dures for monitoring expenditures
from the account."
The report connects that bank
account to the profits from clandes-
tine U.S. arms sales to Iran. The
committee said the account number
Abrams received from North for
the Brunei donation was that of an
account used by Secord and his
business partner, Albert Ilakim, to
receive profits from clandestine
U.S. arms shipments to Iran-in
which Secord and Hakim were also
deeply involved.
Declassified in Part - Sanitized Copy Approved for Release 2012/01/17: CIA-RDP90-00965R000807550027-1
 Declassified in Part - Sanitized Copy Approved for Release 2012/01/17: CIA-RDP90-00965R000807550027-1
? At least seven weeks before his
Nov. 21 testimony, Casey knew a
good deal about possible diversion
of money from Iran arms sales to
the contras, but he did not mention
it to the Senate committee. Under
the law, the Central Intelligence
Agency is supposed to inform the
committee of any possible illegality,
and weeks before Casey had sug-
gested to Poindexter that North
obtain legal counsel.
Casey also did not tell Meese
about possible diversion of money
to the contras during a meeting at
Casey's home on Saturday evening,
Nov. 22. The report said, "Meese
recalled no mention of the contras,
Nicaragua, anti-Sandinistas, Dem-
ocratic resistance, freedom fighters
or Central America. At one point he
said it was possible Casey may have
mentioned something similar, but
he subsequently said he was sure
Casey did not mention the possible
diversion of funds."
The morning of Tuesday, Nov.
25, before Meese went on national
television to disclose that his inqui-
ry had uncovered a contra fund di-
version, Casey called him at 6:30
a.m. The two met again at Casey's
home at 7 a.m.
"Meese could not recall the con-
versation [in testimony to the intel-
ligence panel, except that it was
generally about the situation and
what Meese had learned," the re-
port said. Later that day Casey
wrote a letter to Meese describing
when and how he had learned of the
possible diversion.
Two Republican sources inti-
mately involved in drafting and ap-
proving the report said last night it
describes a "cover-up" by senior
administration officials, particularly
Casey, to keep the Senate commit-
tee and its House counterpart from
learning of the diversion of funds to
the contras.
Two days before Meese's public
statement, according to the report,
former national security adviser
Robert C. McFarlane met with
North. "According to McFarlane,
North arrived at 12:30 p.m. and the
two had a private discussion for
about 15 minutes. North said he
would have to lay the facts out for
the Justice Department later that
day on the diversion of [ran money
to the contras. McFarlane testified
that North also stated it was a mat-
ter of record in a memorandum
North had done for Poindexter.
McFarlane asked if it was an ap-
proved matter and was told that it
was.
"According to McFarlane, North
stated that McFarlane knew North
wouldn't do anything that was not
approved," the report said.
It is not clear what that memo-
randum might be, but the report
refers to an undated, unaddresled
memo written on or after April-.4
;
1986, that was found in Nortl'p
safe. It said that $12 million of tbp
funds from the Iran arms "would,tg
used to purchase critically needgg?
supplies for" the contras. "At the
bottom of the page on which this
discussion appears was a recorrn
mendation that presidential approv-
al be obtained for certain parts,-of
the plan for the Iran program that
did not include the diversion -of
funds," the report said.
The report also said this memo
was found by a Justice Department
official (identified previously as As-
sistant Attorney General William
Bradford Reynolds) in an NSC file
with instructions for McFarland%
secret mission to Teheran in KAY
1986 that Regan had approved. Btlz
the intelligence committee found no
documents and heard no testimony
that the president saw the undated
memo on the diversion of funds.tp
the contras or knew its contents. -
The report contains no informa-
tion that the president did have.
knowledge of the diversion and says
he never met alone with North,
though North was in 17 meetings
with him during 1985-86.
According to notes taken during
a Meese interview with North, the
former NSC aide estimated that $3
million to $4 million went to the
contras, and Meese's public esti-
mate of $10 million to $30 million
was based on taking the North e--
timate plus the $12 million men-
tioned in the memo found in North's
safe and multiplying this by the
three arms shipments believed ip
have been made.
Eight days before Meese publicly
revealed the diversion of funds froip
Iran arms sales to the contras, a
White House chronology labeled
,.maximum version" contained a
handwritten addition to a list of
"[ran program accomplishments'
that said: "Nicargua (sic)," accord-
ing to the intelligence committee
report.
When Meese informed the pres-
ident of the diversion of funds On
Nov. 24. according to the repotr,
"Meese said the president looked
shocked and very surprised, as did
Regan, who uttered an expletive."
a,
Declassified in Part - Sanitized Copy Approved for Release 2012/01/17: CIA-RDP90-00965R000807550027-1